Councillor Ray Chung Statement On Reading Cinema Deal

Published: Wed 24 Apr 2024 01:52 PM
Councillor Ray Chung said the Reading Cinema deal was bad for the city and cancelling it potentially saved Wellington Ratepayers many millions of dollars more than the proposed $32 million.
“The Mayor and the Chief Executive did a secret deal with the owners of Reading Cinema during a $1400 dinner and then did everything they could to push it through while ignoring expert advice. I’m extremely pleased on behalf of Wellington Ratepayers that this flawed deal has been finally cancelled.”
Ray Chung said cancelling the deal was the face-saving option for Mayor Whanau and the Chief Executive. It became clear very quickly when the deal was announced that Wellington Ratepayers were going to lose millions of dollars from giving Reading a nominal price, 10-15-year option to buy back the land at face value. The council would have further locked in capital gains losses from having to sell other appreciating assets to fund the deal.
“Wellington’s Mayor will only cost the city money, not build it up. The Reading Cinema deal can’t be great when she announced it, and great when she cancelled it, as Mayor Whanau stated to media yesterday.”
Ray Chung said that what was also extremely concerning was that it took the council executive and the Mayor a week to inform elected councillors that the deal was no longer on the table, when they told Reading on 16 April.
“The Chief Executive had delegated authority from the Mayor to push this deal, but when it finally collapsed due to widespread ratepayer opposition, it took a week to tell councillors – that’s just not good enough.
“The council executives serve the elected representatives, not the other way around. When the deal was cancelled, it should have immediately been brought to council, not a week later.”
Ray Chung said he will be writing to the Auditor-General’s office and the Ombudsman’s office seeking an investigation into the processes around the deal.

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