The cost of fixing Auckland now
Likely it be the biggest non-earthquake disaster in New Zealand, a picture is beginning to form about the long term implications of the flooding that will impact the entire country
In today’s edition: changes on the way for 501 deportation scheme; home loan interest rate cuts following yesterday’s employment data; Citizens Advice Bureau faces closure; but first, the estimates begin as Auckland mops up
Flooding in Wynyard Quarter, Auckland. (Photo by Lynn Grieveson/Getty Images)
“Likely New Zealand’s most expensive non-earthquake disaster”
I visited New Orleans in 2018. Almost everyone we spoke to used “pre and post Katrina” phrasing when talking about their city. The scale of devastation wrought by Hurricane Katrina, the loss of life, cost of recovery and toll on the people of that city are in no way comparable to what’s happened in Auckland and other areas in the North Island, but that observed division of past and future has been rattling round my head since Saturday, and a picture is beginning to emerge of what the longer term impacts of the floods here will be. As it stands, finance minister Grant Robertson says the floods are likely New Zealand’s most expensive non-earthquake disaster.
Some parts of Auckland may become too expensive to insure by mainstream insurance companies
Infometrics principal economist Brad Olsen’s early “best estimate” of the recovery cost is around $466m and is important to note it is early days. Insurance claims could hit nearly $1b. Massey University’s Michael Naylor writes that in the worst case scenario, the weekend’s floods might mean some sections of Auckland become too expensive to insure by mainstream insurance companies.
Fund to fix roads will soon be exhausted
Olsen has also noted (paywalled) that there’s likely to be considerable infrastructure costs to repair transport networks “which will put further pressure on Waka Kotahi’s emergency repairs budget”. As the Herald’s Thomas Coughlan writes, the fund the government uses to fix storm-ravaged roads will soon be exhausted thanks to the number of costly storms trebling in the last five years. In the Coromandel, we don’t have any timeframe for when SH25A might be fixed as we’re not even sure we have the expertise in the country to do it. That’s a main route into that area, now cut off.
The downstream effects
Writing for BusinessDesk, economist Cameron Bagrie has a good piece this morning (paywalled) on the cost of “mother nature’s wrath”. Where once central banks had to contend with the odd supply shock, “we're now facing what appears to be a rolling series of supply shocks.” interest.co.nz’s Rebecca Stevenson writes that construction projects may be delayed for several months as civil contractors prioritise emergency flood repair and construction costs may remain high. There are about 600,000 consented dwellings in Auckland. With 2,300 property assessments completed, Auckland council expects there are between 4000 to 6000 properties still to be assessed. That’s 1.3% of the city’s housing stock. Landlords are already warning that rents in the city will go up as remedial work to flood-damaged properties affects supply and demand.
The Spinoff's independent, homegrown journalism is only possible because of the support of our members. Their generous donations power all our work and help keep it freely available to all. Tautoko The Spinoff this year by becoming a member, making a new donation or encouraging your organisation to donate.
Changes on the way for 501 deportation scheme
I missed this yesterday morning because I spent the night constantly looking out the window but it’s pretty significant news. Revealed on Tuesday night by Newshub, the length of time someone has spent in Australia will soon be a “primary consideration” when determining whether a visa should be cancelled. It’s a pretty big softening of the controversial 501 deportation scheme that has caused tensions between Australia and New Zealand. Australia's shadow minister for immigration is now calling for greater clarity on the changes. Prime minister Chris Hipkins will meet with Australian prime minister, Anthony Albanese in Canberra next week.
Home loan interest rate cuts made
ANZ has said it will drop home loan interest rates by up to 55 basis points. It comes after yesterday’s employment data was released which showed that unemployment rose to 3.4% in the December, and pay did not rise as much as some economists had expected. Bank economists now expect the official cash rate to increase by 50 basis points, rather than the 75 basis points previously forecast. BusinessDesk’s Rebecca Howard notes (paywalled) that’s still a hefty lift and “hardly a respite”. More than 400,000 New Zealanders are now behind on credit repayments.
After a fallout with National that threatened to bring the entire party down with it, Jami-Lee Ross sought a return to politics as co-leader of Advance NZ in 2020. As Ross led a campaign that seemed doomed from the start, director Tony Sutorius (Campaign) was with him every step of the way – from public meetings, to the Newshub Nation studio, and inside his own home. Streaming on The Spinoff from February 21, and as we head into our next election cycle, Elements of Truth provides exclusive insight into the former senior MP turned political outcast as he attempted to stage a dramatic political comeback.
Citizens Advice Bureau faces closure in Auckland Council budget cuts
Auckland mayor Wayne Brown’s draft Auckland budget proposes stopping or reducing funding to the city’s 32 Citizens Advice Bureaus (CABs). I have a real soft spot for CABs - as a once poor student dealing with a stressful and quite costly situation, they were extremely helpful. As Newsroom’s Nikki Mandow writes, the nearly 1000 volunteers who give their time at Auckland’s CABs, helping 163,000 people last year, are preparing for a fight.
Click and collect
Schools in Auckland were able to open from midday yesterday
Fresh heavy rain warnings issued as storm does U-turn
The Sikh volunteers quietly cooking thousands of meals for flooded Aucklanders
Government's fuel subsidy extension 'extremely dumb economic policy'
Pak’nSave’s 67c beers are ‘simply irresponsible’
Got some feedback about The Bulletin, or anything in the news? Get in touch with me at thebulletin@thespinoff.co.nz.
If you liked what you read today, share The Bulletin with friends, family and colleagues.
As Auckland mayor Wayne Brown continues to pull focus in a room he seems incapable of reading, I’ve written about empathy as a necesary skill in leadership and not a magical super power. New Zealand, according to the UN committee, is "just not getting children’s rights right". Don Rowe explains what specifically they're talking about. The Ockham New Zealand book awards longlist is out this morning and it's longer than ever – books editor Claire Mabey and poet Louise Wallace share their thoughts. Jade Winterburn celebrates the rebirth of Auckland Pride. Tara Ward power ranks the 14 remaining castaways after week one of Treasure Island: Fans v Faves. And Alex Casey gets the ick from the new season of Love Island.
We’ve lost the plot
“Each invitation to be entertained reinforces an impulse: to seek diversion whenever possible, to avoid tedium at all costs.”
I loved this long read by Megan Garber at The Atlantic on the incessant need for everything to be entertainment. I know I’m in “old man yells at clouds” territory here, but I bang on about this to the unfortunate souls in my life at least once a week. The boiling down of things into tropey, entertaining shorthand flatirons important detail, nuance and fact out of them. And then there is fast churn cycle of real world events being parlayed into entertainment products. The line between fact and fiction is blurry. As Garber notes, we often express concern about a post-truth world in the context of politics but really, “the encroachments of a post-truth world are matters of culture as well.”
