Nash Stuart: Appropriation (2010/11 Supplementary Estimates) Bill — In Committee Third Reading 
Nash Stuart: Appropriation (2010/11 Supplementary Estimates) Bill — In Committee Third Reading 
[Volume:673;Page:19562] 
STUART NASH (Labour) 
: 
 Again I have just a few questions. As the Minister in the chair the Minister of Finance alluded to we are all acting in good faith with regard to the Canterbury earthquakes and there is no query around the process. I want to take a few seconds to say that it is very good to see the Minister in the chair standing up and taking a call when there are genuine questions. I mentioned this earlier. I was talking to an older since retired MP about the process in the Chamber. He said he was a little dismayed that Ministers did not take the call during the Committee stage when genuine questions were put up by the Opposition. Old hands like Peter Dunne often stand up and it was good to see the Minister Bill English who has been in this House for a long time and obviously respects tradition stand up and answer some of the questions that the Opposition put his way. I thank the Minister for that. 
I have a couple of questions. As I said I am not passing judgment at all but I would like to talk about the non-departmental capital expenditure of $3 million for Canterbury earthquake demolition-related property purchases. Where does this come from? In terms of property purchases what is the process for—I assume it relates to the Canterbury Earthquake Recovery Authority or the Government— purchasing a property? Is this perhaps the process if the property is not insured or cannot ever be built on again? How will these properties be identified? As we well know a significant portion of the central business district—and again we are not even necessarily talking about the central business district here—and residential properties have been demolished and can never be built ever again. 
Amy Adams 
: We’re talking about the central business district. 
STUART NASH 
: OK we are talking about the central business district here and $3 million is not a lot of money at all. In fact it barely buys a decent piece of commercial real estate now. So I wonder what that $3 million is about and why it is there. How will the property be identified? Will they be identified by Gerry— 
The CHAIRPERSON (H V Ross Robertson) 
: The member referred to an honourable member by his first name. 
STUART NASH 
: I apologise. Will the properties be identified by the Hon Gerry Brownlee or by the insurance companies? Again it is a question of process but $3 million is not a lot of money at all.  
I could be wrong here but I understand that about 95 percent of buildings in the central business district are covered by insurance anyway. I am assuming—and again correct me if I am wrong here—that insurance companies will pay out whether a building is demolished it is rebuilt or the land can never be built on again or whatever the circumstances. I could be wrong. Maybe this $3 million is to just top up insurance costs or maybe it is to buy buildings that are owned by the Government. Maybe the Government owns a building in Christchurch and this is part of that. Again I have absolutely no idea so it would be great if the Minister could clarify that. 
In terms of page 929 we are talking about $27 million worth of Canterbury earthquake property demolitions related costs and compensation. I think the Minister alluded to this. I do not think anyone really knows what the cost of demolishing a significant part of the Christchurch central business district will be. It would take a very brave person to stand up and say that it will cost X million dollars. It could be $37 million or it may be $17 million. Again I am just curious to know how this figure was arrived at. The Minister outlined the process for bringing this to the House which was hugely appreciated. But I know that when one is estimating work even for a refurbishment of a standard commercial building one has to bring in a quantity surveyor and one goes through that whole process let alone assessing the cost of demolishing the central business district of one of New Zealand’s largest cities. So I just wonder whether for example Fletcher Challenge came up with this or a firm of quantity surveyors—maybe Quotable Value which is online—or experts came to the Minister and said: “Look Minister we have absolutely no idea whatsoever. We think it could be $30 million. We don’t know but we know you have to put a figure in here so it is recognised.” 
The classic case is Rolls-Royce which never valued its brand but put a dollar on the books just to show that it did have a value because it had absolutely no idea. But a sign of value meant it was worth something. Is this the case where the Minister has said that we need to have something in the estimates because we have no idea how much it will cost so we put in $27 million? As the Minister said we all agree. We are not going to quibble about this. Hell if it ends up being $37 million that is tough but I do not think there will be any New Zealand demolition company that will rip off the Government or the taxpayers of Canterbury. So this will be done—I am assuming and I know—in a good sound commercial way but I ask whether there was a process around that $27 million. Thank you very much.