Local, Politics

Does the Airport Deed of Gift make the proposed privatisation problematic?

On 2 October 1991 the Federal Government and the Coffs Harbour City Council (CHCC) signed a deed of gift wherein airport management and control was ceded to council subject to the terms and conditions in the deed.

By The Editor,

The deed was signed by R.S. Elder on behalf of the Commonwealth of Australia and then Mayor, John Smith, on behalf of the CHCC.

The Deed spells out what the Council needed to do in this regards along with details of monies the federal government would give the council so as to improve the airport within two years of the date the deed was signed.

according to a deed Agreement with the Commonwealth Government, profits made by the Airport are collected under the proviso that they are used on the airport.

Clause 2 (k) of the Deed spells out that the Council may lease or license the whole or any part of the aerodrome so long as the lessee complies with all terms as set out within clause 2.

Separately Clause 6 states;

“The local authority on and from 1 October 1991 shall have the right to determine and collect charges for aerodrome operations, other than those imposed under the Civil aviation Act and Regulations made thereunder, as are necessary to cover the cost of developing, operating and maintaining the areodrome.”

The Deed of Gift appears to be silent as to how this clause would apply to a lessee as is currently being proposed.

Inquiries made by CCO would suggest that this deed has not been varied by the parties to it.

The 1995-96 debate

Clause 6 later became the centre of a contentious council debate in 1995-96 when a proposal was put forward to divert monies from the airport to be used to advertise a job creation scheme called Jobs North.

An article from the Coffs Coast Advocate of Tuesday July 25 1995 by Michael Secomb covered this debate wherein then Cr John Essex-Clark stated he would oppose the motion stating; “I want to ensure money is spent on the airport to create real long term jobs…..”.

The issue continued to simmer and came to the fore again a year later on July 12 1996 when a report on page 3 of The Independent ran a report wherein it was stated; “according to a deed Agreement with the Commonwealth Government, profits made by the Airport are collected under the proviso that they are used on the airport.

Remembering a former Mayor with long list of achievements | Coffs Coast  Advocate
The late John Smith was CHCC Mayor in 1991 and also over the 1995-96 period too. Photo; Coffs Coast Advocate

The 1991 agreement states that any money raised by the facility is to be used for maintenance and improvement”.

What does this mean today?

It would seem the debate in Council over 1995-96 was found in favour of airport profits not being able to be used for general Council expenditure other than for reasonable administration expenses related to airport governance.

We say this as we have seen internal National Party correspondence written just prior to last year’s federal election in May 2019 wherein branch officials drew the attention of then National Party Cowper candidate and current member, Pat Conaghan, to this issue.

In this letter it is stated;

“It is common knowledge among ratepayers that Coffs Harbour City Council has, for at least the last two decades, regarded the Airport as a huge source of revenue (Cash Cow) for its own activities when, ethically, the Airport should only be called upon to remunerate Council for its administration function. All profits for the airport should flow back directly into Airport facilities, improvements and maintenance.”

The letter then also goes to state among numerous other issues we will cover in coming weeks that;

“There is a very wide and very strong suspicion among thinking Coffs Harbour Citizens that Coffs Harbour City Council wants to either lease or sell the airport to some large business organisation such as Macquarie Bank which already owns Sydney Airport. Our citizens are doubtless well aware of how they would be ruthlessly exploited by such a lease or sale given the enourmous increases in user costs to the public which followed the sale of Sydney Airport.” (Emphasis in above two quotes as per original letter).

What if this scenario is ‘horrendously correct’?

If the Deed of Gift has in fact not been varied by the parties to it then does this mean that the CHCC may have to perversely return any profits from the airport lease/privatisation straight back to the lessee so as to ensure ongoing airport maintenance and improvement?

And, if this is the case, does this not mean any profits would not return to the ratepayers?

Has Council obtained legal advice in regards to this? If so might not it be a good idea to release it so as to clarify this issue?

And if the above scenario is in fact ‘horrendously correct’ then what is the current point of the whole privatisation/lease exercise?

————

Here is a story published yesterday by CCO relevant to this; https://coffscoastoutlook.com.au/?p=37266

4 Comments

  1. Ahhh

    And the plot continues to thicken

    Need to see all of Clause 2 please

    Well done with the research, investigative journalism and presentation.

    And a big thank you … CCO’s editor.

  2. 40cmPedestalFan

    I wonder if this lease arrangement could be the remarkable work of the CHCC Fiscal Brains Trust headed by Coffs Harbour’s Prime Minister-in-waiting, which dovetails wholly with Council’s Re-Provisioning Strategy: take money from a lessee then give it back.

  3. It looks like the deed between the Coffs Council & the Commonwealth was intended for all profit to go back into the Airport.
    Once again our councilors and council management appear to have been using the profit with no regard to a legal document from what I can see.
    So does that mean when they lease off the Airport all the rent goes back to the lessee and what they pay for the lease would also have to go back to the lessee?
    Does not sound like a good deal for the Coffs rate payers!
    One other comment the GM will not disclose the term of the lease to the rate payer. This is a critical part of the lease and every ratepayer has a right to no what all critical details are in this debate.
    But the GM’s past performance with our waste management facility, selling of of the pools contracts, selling of water from Woopi Dam it seems to be a matter of “who cares if it’s legal” and unfortunately most of the Councilors seem to have the same view in my opinion.
    This means the Coffs Harbor rate payers will be picking up the bill to fix up their blunders. What will be the cost to the rate payer for this one?

  4. The airport “cash cow” must remain as a Council enterprise, dedicated to airport service development. The trust relationship of a ‘Deed of Gift’ establishes that old fashioned principle of trust on behalf of a community. Would a government deliberately hand over such an asset as a gift for the purpose of corporate greed and misappropriation? Never! And how does this benefit our future generations if we lose control of this asset?
    Our community is caught in a vortex of public servant manipulation. Council is totally dysfunctional in the current voting deadlock crisis, with one citizen holding sway on all matters of our LG administrative decisions.
    Our airport sell-off, penalising individual development applicants, diverting funds from their approved purpose, selling off our Council Chambers and a Civic and Cultural “glass house” which is in fact a castle for our bureaucrats – by no means the cultural centre we were promised! Citizens, its time we woke up !

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