Nick Hill: Auckland Unlimited CEO on the first round of funding in the $70 million major events package

There's a view that Government funding for major events is a smart investment. 

The first round of events in its $70 million package has been unveiled, including the first ever concert at Christchurch's One NZ Stadium at Te Kaha next May. 

Other events include Linkin Park in Auckland and the Ultra Music Festival in Wellington. 

Auckland Unlimited Chief Executive Nick Hill told Mike Hosking this funding is designed to make existing events bigger. 

For example, he says, the Readers and Writers Festival in Auckland is a fantastic event, but could they use the funding to make it more international? 

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Episode Transcript

Speaker 1 (00:00):
We're starting to see what the seventy million dollars major

(00:02):
Events funding package buyers. First trunch has been it out.
So we're going to get Lincoln Park at Auckland, six
sixty and Symphony open at the Christian Stadium. The Ultra
Music Festival out of Miami comes to Wellington. Now. Nick
Hill is the chief executive of Auckland Unlimited. And as
whether's Nick morning to you.

Speaker 2 (00:20):
Good morning, Mike.

Speaker 1 (00:21):
Convince me now because I'm sort of on the side
of getting more people here and I understand the methodology
around it in the mathematics. But here's my thing. Because
they had David Higgins on earlier on this morning, the promoter,
and he was trying to explain I looked at the
six sixty thing yesterday, right, So six sixty and Symphony. Now,
would you sell out christ Church Stadium if you put

(00:41):
that on? I think yes you would. And you don't
need the government. Why is the government so important?

Speaker 2 (00:48):
Well, it depends quite often you do need public money.
I can't talk about the stadium in christ Church and
whether that would sell up without the government. There's certainly
an element of risk it. So you know, someone like
David who is a bit of a genius has taken
awful lot of risk in his life, and the question is,
if you want things to happen, how do you underwrite

(01:11):
some of that risk? And that's where public funding comes in.

Speaker 1 (01:15):
So am I being too free market about this? I mean,
you know, so David takes a risk that's on him.
That's his business. And when he when the risk pays off,
he makes a lot of money. That's business.

Speaker 2 (01:25):
No, No, you can be free market. There's a problem
of free riders around promoting and bringing big things in
because there's a lot of benefits that flow to a
whole lot of people beyond those that will actually necessarily pay.
So how do you how do you get enough investment
to get the kind of the level of the event
you want to have the impact that not everybody will

(01:46):
actually pay to get the benefit of it. It's a
tricky economic situation. It's free riding, okay.

Speaker 1 (01:53):
So when I look at the Ultra Music Festival in Wellington,
I mean, I mean, would that have come here anyway?
Or we just simply don't know?

Speaker 2 (02:03):
I like gain, that's not one I know a lot about.
But I can talk in the context of Auckland and
part of What they are doing with this, which I
think is the smart thing, is saying how can you
actually make existing events bigger and how would you use
additional funding to do that? So things like the Readers
and Writers Festival in Auckland is a fantastic event, but

(02:24):
can you make it more international? And so the funding
that's coming in for that is to try and achieve that.
So how do we get Australians to come to Auckland
for that? That's our focus on.

Speaker 1 (02:33):
Something could you present to me in a select committee
or at scrutiny week in Parliament numbers that, without shadow
of it out go right? The government put an x
million and you as a result of that, got y
million in and you are materially better off minus the
money the government paid for.

Speaker 2 (02:54):
I could, but you'd have to be patient and you'd
have to be prepared to get into some deep economics
and then always be gray areas. So for example, what
is it worth for the reputation of Auckland to be
in someone's mind as a place to visit? So sale
GP seems incredible images around the world which sales GP

(03:17):
use actually well beyond our event, and that people look
at that and go awkward. That looks an amazing place.
I'm into sailing and yachting. That's worth that's worth something,
but very hard. You can quantify it, you can and bounds,
but you know, at the end of the day people
will be skeptical and say, well, it's leaved to the market,
but it wouldn't happen if you just left it to

(03:37):
the market.

Speaker 1 (03:37):
How many events do you reckon then become events or
happen because and they're really not that good, but it
gets that whole community spirit vibe going because the government
are involved. In other words, you do stuff because you've
got the money.

Speaker 2 (03:52):
There's always a risk of that, but that happens in
the private sector as well. You're always taking risks around
things where you can't always be sure, and with public
money there's always going to be a degree of sloppiness
and bureaucracy that creeps into it. I think it's a
question of overall, how does your portfolio of things perform,

(04:13):
and you know what's your overall benefit, And we're pretty
rigorous in measuring that. Some people use really big numbers
around events, we actually use very conservative numbers. We use
a highly regarded film called fresh Infolk, who use a
very quantitative method and we kind of assume some of
the other benefits on top, but don't quantify them. So

(04:34):
we try to be as rigorous as we can because
we think at the end of the day, we've got
to be credible and we've got to have integrity and
be consistent. And yeah, I suppose that's as far as
I can do.

Speaker 1 (04:45):
How much? How much are we doing this simply because
everyone else does, because that's the standard line they use
as well, are you look at Australia Melbourne does this
all the time as though that's a thing.

Speaker 2 (04:54):
Well it's true.

Speaker 1 (04:55):
Well, I know it doesn't make it right.

Speaker 2 (04:59):
Well, I think if you were to going look at
Melbourne and what Jeff Kennett did, sold all those assets
and reinvested things like power stations and reinvested into facilities
and transport and importantly major events. So major events are
just we think of it as how you drive demand
and shape demand and the kind of people you want

(05:20):
when you want them where you want them. So you know,
if you were running a business, you do have you
do spend money on marketing to drive your top line results,
and a lot of this is about doing that for
cities and Doc Wayne Brown is a real skipt because
you'd know he's a piscal conservative and he's been persuaded.
His issue is how do you where does the funding

(05:41):
come from? And he argues for a bad levy, which
is a sound economic argument, which you know I'd completely support.

Speaker 1 (05:47):
Yeah, that's the weird thing about that. I don't understand
why the government doesn't support it.

Speaker 2 (05:51):
Given that, I don't understand either.

Speaker 1 (05:52):
So on one hand they're handing out money, but on
the other hand they're not bringing it in an area
they could. Well.

Speaker 2 (05:58):
The other thing is the government more than ninety percent
of public money is raised by the government spent out
at Wellington. Well, we're interested in is mechanisms at a
lay to raise money locally, to invest locally through an
industry that helps to grow the industry, and that's what
a levy would do.

Speaker 1 (06:13):
Interesting. Good on you and appreciate it very much, Nick Hill,
that was better than I thought. Actually I was. I
know he was. He's excellent. They gave me a very
good insight Because I'm on the fence on this. I
fully get that we need events. Events are greats and
that whole thing about you know, someone in the world
looks at Auckland or Wellington or Queenstown and goes wow,
I might go there fantastic, fully get it. But I

(06:36):
also see just yet another government slash fund here well
the whole sea, I mean, some of the events they're
talking about, iron Man, New Zealand and Taupo. It's already on.
It's it's been on for years. The fact that suddenly
government money turns up does make any difference unless you
argue nix line, which is you make it a better
event or a bigger event, Golden she is. It's already on,
it's been gone for decades. A Tiger rally in Dunedin,

(06:58):
as in the motor cars that's been on as well.
You see what I'm saying. So, I mean it's just
all these events that have already been on are suddenly
on again, but with government money. So what have we
gained out of there?

Speaker 2 (07:09):
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