Our story of recent time – Growing up in New Plymouth, our local economy, our local achievements, business & politics, turning the ship around, ideas for growth and appetite for change.
Like many of you, I have witnessed the changes in New Plymouth, spanning from childhood memories at Moturoa, to Fitzroy, and now Vogeltown. Watching the chimney sprout from below ground level to a towering landmark. From being a small agricultural-based town building a power station at the port – to becoming a critical New Zealand energy source, and now losing that relevance.
Right up to now; being a small city on the cusp of becoming self-sustaining at the magical 100,000 population mark. We risk not reaching that if we cannot rapidly replace our high value energy sector based economy.
Chimney construction. Source: Puke Ariki.
T&G Building construction. Source: Puke Ariki.
Centre Court construction. Source: Puke Ariki.
In Taranaki terms, I am just beyond a newbie – a third generation local from a farming and construction family, Brough Construction. A forgotten company now, but one that started off building budget homes in the 1960s, alongside bridges around Taranaki’s rural roads, then progressing to larger projects, including:
Our family have been tied to the development and building of our city for some years, which instils a sense of pride and belonging, with a duty of care.
During this time, New Plymouth has experienced a period of enormous growth, with the energy sector bringing wealth to town. It has also seen a gradual shift from dairy farming to smaller holdings, with suburban sprawl of city fringe subdivisions for upmarket homes, and the subsequent loss of reliance on agricultural incomes.
We are now faced with a similar plight with our reliance on energy-based income.
Source: ABC Group.
Filming at Pukekura Park. Source: Venture Taranaki.
Collectively, we have had our ups and downs. From the sale of Powerco (justified by claiming to give us “zero rates by 2020” by some proponents), to the Samurai summer when Tom Cruise was in town and the whole province was awash with flying rumours, endless sunshine and parochial enthusiasm.
The future was sparkling and no end was envisaged. Since this era, we have predicated our plans on continual growth and borrowed and spent to maintain our small city’s services and future growth.
We have always prided ourselves on punching above our weight, at both a national and international level. We stood alone with strong leadership by Daisy Lean, among others, to retain our now crown jewel – TSB Bank.
Ironically, now we have gone on to be the envy of other regions that gave in to demands from governments of the day to eradicate local banks. What foresight that was. Now TSB is a leading example for the country and one we are proud to rightly claim as our own.
Construction of TSB Centre. Source: Puke Ariki.
Source: Powerco.
Despite some early mis-steps, we have watched our proceeds from the sale of Powerco start to mature into an enduring benefit to the district’s ratepayers, with it locked into a well-structured and managed investment vehicle.
Now, if we could just grow this with some more capital, our city’s future would be better secured and truly be paying it forward to future generations. Instead, we use it as a buffer to say it negates our borrowings, and indicate we can borrow more if we so choose.
We have over the decades been able to produce many fine sporting achievements, and many a tipple has been poured after a successful Shield challenge.
1996 Shield win. Source: Taranaki Bulls.
We have a number of businesses that provide the fabric of a successful society who trade locally and across both New Zealand and the world.
Some have attracted international investors, and the benefits this brings should not be underestimated.
I instinctively understand this, and find immense pride in calling New Plymouth my home. A home that has given me 40 years experience in creating and building a business. One that employs local people to successfully compete on the New Zealand stage as an importer, manufacturer and distributor of a specialist niche construction product
Digital billboard installation at my workshop on Devon Street.
Tour video of “The Mayor’s Office”
This achievement does not come from being negative or avoiding risk. It comes from being able to create something simply from ideas, discern correct pathways from wrong, assessing and weighing risk and reward, while seeing pitfalls to work around or through.
Any struggling or successful business owner understands this, and is used to juggling multiple responsibilities simultaneously. Firstly to themselves and family, their staff, the business, and society norms of law and regulations.
This fact alone is why a good leader does not feel the need to shout their accomplishments to the world. First, it is not the Kiwi way, and they simply don’t see it as worthy. It merely is routines they perform everyday to stay in business and provide for the people who depend upon the commitment they apply to achieving success. By nature Kiwis are, and respect, understated achievers.
This is part of what I believe is why we have lost our way in society. Political life is not something that appears attractive to high achievers and doers. The thought that a political leader cannot achieve meaningful change in less than two or three terms does not appeal to those used to creating and improving how things work in real time. Simply put, if a business owner took three plus years to adapt to a need for change, they would not survive.
Witness to this is the Covid era. Businesses adapted literally overnight. The good ones survived, the marginal ones, through no fault of their own and a crappy set of rules and circumstances, did not.
We are now approaching the darkest cloud on New Plymouth’s economic future for a generation. Most people in business nowadays, covid bump aside, have not experienced a period of stagnation or low growth.
We are now seeing a second year of low growth and a decline in regional GDP. This is being partially hidden by the farming payout. Unfortunately for us in New Plymouth, most of this is in South and Central Taranaki now, with our lack of intensive primary production switch.
Since we saw a “captain’s call” on oil & gas, we have been on a downwards economic slide, almost imperceptible when you are living it daily – but you can witness it in the vibe of town.
Throwing ratepayer money and window-dressing over it won’t change it. We live on the fringe of tourism dollars and this should be supplementary to primary production dollars in our economy, not foremost.
We need jobs and hope for the future. Reality of world appetite to reduce emissions hit us with the call to end offshore exploration, and a blow was struck, from which we have not yet recovered.
There has been some hype and money thrown at studying the so called “transition,” but nothing has come at a scale to replace what was lost. A number of high paying jobs were created to shuffle paper and create reports – a good number of these actually located out of the district, which was a double slap in the face.
I can recall a period similar to now in the 1990’s, when you could hardly give away a section in parts of the district. There were tough times in our recent past. Subdivisions sat unsold. Land was not considered a good return on investment with banks refusing to lend on subdivisions.
It was however due to some relentlessly positive leadership from the mayor of the day that the ship got turned around. We came out of the funk and started to prosper again. We are getting to the same point now in the economic cycle.
The genesis of recovery will come from business confidence. This is why it is a lead indicator, and gauged by economists and banks. When businesses are confident to take risks to borrow and invest to grow, people are employed, the fabric of worth grows at a personal level, and people feel empowered to make good choices for their future with job security and stability.
We have now turned to become a province where Council are the biggest employer and dispenser of funds in the district. A province that relies on inwards facing taxation revenue in the form of property taxes to sustain itself cannot survive. We must look beyond natural population growth, to grow revenues that businesses bring in from outside the district – for our prosperity and lifestyle.
The genesis of recovery will come from business confidence. This is why it is a lead indicator, and gauged by economists and banks. When businesses are confident to take risks to borrow and invest to grow, people are employed, the fabric of worth grows at a personal level, and people feel empowered to make good choices for their future with job security and stability.
Next year, Methanex, our biggest export dollar earner sitting on the largest industrial assets in Taranaki, will be making a decision to either stay and invest or pack up and leave. We must not let the latter occur, but for this we rely on government and legislation to take affect. In the meantime, we must look to our ability of self reliance as well.
This could come in several ways. Supporting existing businesses, assisting start-ups, or head-hunting businesses from other areas to relocate here. If we don’t, we live in an ever-diminishing circle of economic life. It is all very well to add to the social and private housing stock, but without good jobs and career prospects, there is no incentive to relocate to or remain here.
Councils are one of three organisation groups that need to lead this charge locally. Then you have local businesses and investors, and then the final group are institutional investors, including Iwi.
Locally, we have our bank, TSB, and Fisher funds as a great starting base that feeds profits into TOI Foundation to then dispense these dollars with social license, as is their current remit.
What if we were able to have a conversation as to how the millions of dollars that are given away each year could have a multiplier effect for the economic betterment of the district through growing jobs and supporting our economy to generate external dollars?
A good starting point would be to look at the example of Kiwisaver fund Simplicity. They are branching out with a small percentage of their Kiwisaver funds into the realms of building investments with sound, well-run private businesses around New Zealand – which earns real dollars from the private marketplace.
They also run a model that builds self-funded social housing, which is possibly something Fisher Funds could also investigate.
What if the TOI Foundation could consider how to balance social license and economic prosperity in its funding model?
I submit that without economic prosperity there will be a diminishing pool of funds for the social largesse.
Perhaps as a province we could look to repurpose the mothballed Waitara Valley plant into an export-based income earner – with a public private partnership. There are enough proven technologies around biogas, waste processing and alternative energy production that could be investigated and set in motion sooner rather than later.
We just need to harness the private sector knowledge and institutional funding sectors so it does not fall on ratepayers.
We currently run a basic set of services to keep the city functioning and rely on overseas-owned companies to provide these. While they are employing local people here, what if we had a model that supported locally owned businesses to carry out these same services and used some capital from our own pools of money, both private and public, to establish a long term benefit for our region.
For instance, we could harness Kiwisaver funding to establish a large-scale plant, in conjunction with private enterprise, to handle and process all our waste. We have the engineering base locally, we have the construction skillsets, we have the funding pool, we just have not been looking at all these in their entirety and putting the bigger picture together fast enough.
We could build a power generation plant at the port again, as crazy as it may seem. We have sites and infrastructure already consented for use, at both Waitara Valley and the port, that can handle energy based growth.
We have an opportunity to bring in Liquefied Natural Gas to replace the diminishing gas reserves, and the pipeline to distribute it to Auckland. We have a pipeline north, we have fractionation towers at Motunui, we have no fuel distillery in New Zealand now since Marsden Point closed – as a country we are now fully reliant on overseas supply chains for fuel to power our fleet.
We have forgotten what the 1970’s oil shock was. Interruption to fuel was the reason why the Think Big plants were built. Energy security. We just need to recognise our opportunities and repurpose our existing assets and grasp them before they are gone for all time.
Then at a political level locally, we are hearing about the need for change. The clamour for change is fairly constant through electoral terms, and one that belies what people really want, which is often referred to as the “good old days.”
I counter that an effective “change agent” is not one that takes 6-9 years to affect anything meaningful. That is simply “business as usual” incrementally evolving.
Right now, New Plymouth is in need of a massive boost. It does not appear to be very forthcoming from any stripe of government anytime soon – so guess what folks? Its all on us!
As a local business owner with an inside track to like-minded achievers, I want to lead a new Council to work with local business and entrepreneurs to add further ideas, developing the district’s economy and growth.
We must kick off our dancing shoes and get to work.
