Don't let private sector gets its hands on library building
OPINION: Whatever option councillors choose to restore our beloved central library, the citys living room as some call it, there is one thing they should not do: privatise the building. This isnt a question of ideology. Its simply the wrong way to harness the citys commercial energy, and would work out badly for ratepayers. In their latest report to councillors, city council staff say a developer may be willing to purchase the existing library building, remediate it and lease council the space. As someone who spent several years covering such deals as a reporter in Britain, I would strongly advise against this. It would be a kind of permanent public-private partnership (PPP). Wellington is already having to watch one PPP go horribly wrong, in the form of Transmission Gully. More generally, such deals always run up against one core problem: a lack of control when faced with an unpredictable future. In the UK, I reported on PPP schools, where private firms built and ran school buildings on 30-year leases. Often the schools principal would, some years down the track, decide that they wanted to open up the building after hours for adult education night classes. At which point the private operator would say, No, you cant thats not in the contract. Or they would say, Yes, you can for a very large fee. READ MORE: * Ratepayers set to foot the bill for proposed $200 million Wellington central library upgrade * New Wellington mayor Andy Foster resolute the Central Library should be repaired Once you have given a firm a decades-long (or permanent) contract to control a building, you have that worst of all possible situations: a private monopoly. If you havent anticipated a particular change you want to make, they have you over a barrel. This is especially relevant for a library, a complex, multifaceted building that is likely to change what it does and how it does it many times in the coming decades. Just look at Christchurchs extraordinary new library, with its music studios and childrens play areas alongside traditional bookshelves. How different it is from a city library in the 1980s! It is simply impossible to predict all such changes in a contract signed today and if the council tried to write in a vague option to make unspecified changes, the resulting cost would be exorbitant. Council staff suggest privatisation would be more flexible, but it would in fact be the precise opposite. One counter-argument is that public bodies frequently rent office space. But offices are generic, easily changed, tangential to the actual business done within. A library is a centrepiece of a city, a building and purpose intimately entwined. It cant be easily shifted. So the council needs complete control over it. Council staff also hope that privatisation would free up funding, but if you sell a building and lease it back, all you are doing is shifting the moment you pay for something, not reducing the amount. And because, as above, you pay over the odds for unanticipated changes, it ends up costing you more anyway. Borrowing which the council can generally do more cheaply than a developer is a better route to financial flexibility. None of this is a criticism of private enterprise. In the case of the British PPP schools, the contractors were simply doing what the contract allowed. And we want vibrant commercial energy in many corners of our city: in shops, housing developments, film studios. But the public sector often finds it hard to harness that energy well, and can only do so from a position of control. Mayor Andy Foster seems to understand this: he said last week that he wants the private sectors skill and knowledge ... in terms of their thoughts about how we do this job, not in their ownership of the building. Thats exactly the right approach, and I hope he sticks to it. The library has always had a commercial element, in the form of Clarks Cafe but on a lease from the council, not as the owner. Nikau is a similarly vibrant commercial addition to Te Ngakau/Civic Square. As the Norwegian politician Jens Stoltenberg once said, The market is a good servant, but a bad master. The city council needs to restore our wonderful library, a beautiful piece of civic life, from a position of strength and bring in the private sector where needed. Max Rashbrooke is the author of Government for the Public Good: The Surprising Science of Large-Scale Collective Action. He is a senior associate at the Institute for Governance and Policy Studies, Victoria University of Wellington.