Statements of Service Provision

3 Economic Development
​Whanaketanga ōhanga

Promoting the city’s competitive advantages in order to enhance the quality of life

BY THE NUMBERS

2.1%

Wellington City average annual GDP growth
which compares to 1.9% nationwide. 13

7

Major event venues that are just 5 minutes’ walk apart. 14

$36.5m

Contribution to Wellington’s economy during 2015/16 from major events supported by Council. This compares to $29.9 m in 2014/15. 15

Economic development – at a glance

Outcomes Connected-city People-centred city Eco-city Dynamic-city
Relevant LTP objectives

“Investing to grow” through establishing a programme of major projects that grow the economy and deliver returns on investment;

Investing to maintain and improve existing services, including making infrastructure more resilient and the city’s transport system more efficient;

Increasing the use of existing assets rather than spending on new infrastructure; and

Improving asset management practices to better manage risk and the timing of asset replacement.

LTP key activities City promotions and business support.
 
Relevant LTP projects Investing for growth; Longer airport runway; Central city tech hub; Film and screen productions; and Joined-up regional approach.
Operational expenditure Operational expenditure (as per financial summary).

We attract and support business activity, market Wellington to tourists from New Zealand and overseas, and own and operate performance venues and conference facilities either through WREDA or in partnership with WREDA. Working with others we also promote business, education and cultural links through sister city relationships, and provide free weekend parking in the CBD.

We fund these activities to attract and retain talent, grow the tourism spend and economic returns from events, and increase inward investment and exports.

These activities make Wellington a more vibrant place to live and improve residents’ quality of life, prosperity, identity and the opportunities available to them.

Case study

Collider

A technology hub for Wellington was one of our “8 Big Ideas”, and the business case was endorsed by our Economic Growth and Arts Committee in April 2015. Collider was officially launched by Prime Minister John Key in November 2015.

Collider is a partnership between Wellington City Council and BizDojo. It consists of BizDojo’s co-working space at 115 Tory Street, and Collider’s programme of activities. The Council’s contribution towards the tech hub will be up to $3.2 million over 3 years, and will be used to fund the non-commercial elements of the tech hub.

The tech hub was established to connect high-tech, rapid-growth ventures, investors, social enterprises, international visitors, tertiary institutions, government and established businesses working on new ideas. It is a place for Wellington's innovative businesses in the tech sector to call home – whether through locating or showcasing their business there, attending or hosting events, or seeking resources and support to help their businesses be more successful.

Partnerships in relation to the hub have now been formalised between BizDojo and CreativeHQ, Xero, Deloitte and various other service providers. For example, the StepUp Mentorship Programme was launched in March as a collaborative venture between BizDojo and Xero to provide guidance around growth to a number of small businesses in Wellington.

Events and programmes held have included international speakers such as Adriana Gascoigne (CEO, Girls in Tech), Tristan Pollock (named in the 2015 Forbes 30-under-30 list and a Silicon Valley based co-founder and entrepreneur), Anthony McGuire (Head of Global Partnerships at Facebook), and Savannah Peterson (named in this year’s Forbes 30-under-30 list).

3.1
City promotions and business support
Ngā whakatairanga tāone me ngā āwhina pakihi

By supporting city promotions and major events, we underscore Wellington’s reputation as a great place to live and visit

What we do and why

Wellington’s economic prosperity is closely linked to residents’ quality of life. Prosperity provides the resources for businesses, the Council, and individuals, to contribute to the vibrancy of the city and invest in its future development.

Our promotions and business support activities are closely linked to WREDA’s work. Working with other institutions in the region ensures that we use our resources effectively.

Our activities include:

Over the year these activities contribute to the following outcomes:

Outcome Outcome statement
People-centred city
  • Promotion of the city as an attractive place to live and do business, works to attract talent to the city and attract tens of thousands of visitors to the city every year (WREDA)
  • The City Growth Fund and economic grants support the attraction and retention of talented people, and support the creative business sector in Wellington
  • Major projects (funding for possible implementation) will promote the city as an attractive place to do business and attract visitors to the city
  • International relations improve access to international markets and provide local businesses with new opportunities
  • Business Improvement Districts (BIDs) – vibrant suburban centres make Wellington an attractive place to live and help form a sense of community
Connected-city
  • Ensuring the city has a presence internationally will be vital to attracting investment, talent, visitors and jobs (WREDA )
  • Major projects - improving direct access internationally will provide local businesses with new opportunities to access large markets
Dynamic-city
  • Attracting talent, investment, visitors and jobs will be critical to growing the economy and ensuring Wellington remains vibrant and retains its competitive advantage (WREDA)

Our key achievements

Our partnership with WREDA - a CCO - strengthened over the year. With WREDA’s new senior management team finalised prior to Christmas, our Major Events team transferred to WREDA in 2016.

Wellington Regional Economic Development Agency Ltd (WREDA)

WREDA is the new regional economic development agency for the lower North Island, combining the economic development activities of Wellington City Council and Greater Wellington Regional Council to advance the prosperity and liveability of the Wellington region. WREDA brings together the functions and activities of the following agencies: Grow Wellington; Positively Wellington Tourism; Positively Wellington Venues and Wellington City Council major events.

Relevant Council outcomes:

People-centred city Promotion of the city as an attractive place to live and do business, works to attract talent to the city and attract tens of thousands of visitors to the city every year
Connected-city Ensuring the city has a presence internationally will be vital to attracting investment, talent, visitors and jobs
Dynamic-city Attracting talent, investment, visitors and jobs will be critical to growing the economy and ensuring Wellington remains vibrant and retains its competitive advantage

Key activities

  • WREDA attracts and supports business activity, markets Wellington to tourists from New Zealand and overseas, and owns and operates performance venues and conference facilities. Working with others WREDA promotes business, education and cultural links through sister city relationships, and provides free weekend parking in the CBD

Key achievements

We promoted the city as an attractive place to live and do business, that works to attract talent to the city and to attract tens of thousands of visitors to the city every year

  • We celebrated our 150th anniversary of being New Zealand’s capital with over 85,000 people visiting 40 institutions in our very successful open house weekend. Approximately 15,000 people attended a concert and spectacular projection mapping show at Parliament. During the year, WREDA undertook a number of marketing campaigns including supporting DreamWorks Animation, The Exhibition, the Royal Edinburgh Military Tattoo, New Zealand Festival, Wellington Sevens, and CubaDupa. A record number of conventions and events were held during October to December, including the Helloworld conference which attracted over 500 overseas delegates from the tourism industry. WREDA’s venues also successfully hosted 64 events over a 24-day period for the New Zealand Festival (source). Visitor numbers were strong again this year and commercial guest nights grew by 6.4% and had their highest 12 months on record (surpassing Auckland, Waikato, Hawkes Bay, Canterbury and the national growth rates). International and domestic guest nights grew by 12%. This is up from five years ago and is now surpassed nationally only by Queenstown/Central Otago and summer holiday destinations

We ensured the city has a presence internationally which will be vital to attracting investment, talent, visitors and jobs

  • A significant highlight during the year was the Royal Edinburgh Military Tattoo, at Westpac Stadium from 18-21 February. The Tattoo attracted an audience of approximately 85,000 over the four shows, with over 60% of the audience coming from outside the Wellington region. The direct out of region spend in Wellington was estimated at $31.7 million, filling hotel beds across the region. We hosted major sporting events, including our first Super Rugby final and the All Blacks versus Wales test. Following on from the success of the ICC Cricket World Cup last year, we hosted a blockbuster summer of international cricket with the Black Caps taking on Pakistan in international T20 and One Day International (ODI) matches, and Australia in an ODI and a test match. The sold out match against Pakistan marked the return of ODI cricket to the Basin Reserve
  • To retain our international presence we won the right to host future events, including a number of international rugby matches next year. New Zealand Rugby also confirmed that the Sevens will remain in Wellington for another 3 years. Other major events announced include Keith Urban and Carrie Underwood performing at Westpac Stadium in December 2016

We attracted talent, investment, visitors and jobs critical to growing the economy and ensuring Wellington remains vibrant and retains its competitive advantage

  • The New Zealand Festival also celebrated its 30th anniversary between 26 February and 20 March, with 395 performances and seven world premieres. 95,000 tickets were sold for the Festival, with over 200,000 enjoying free non-ticketed events, including the Festival Playground
  • International highlights included the sold out seasons of Café Muller / Rite of Spring and the Jazz at Lincoln Centre Orchestra. An estimated 19% of attendees were from outside the Wellington region and the direct out of region spend was estimated at $32.1 million. We supported arts and cultural events that contributed to Wellington’s economy and created jobs. Beervana, Wellington on a Plate and LUX combined to attract record audiences to bring the city to life in August. The World of Wearable Art Season was again highly successful. Westpac Stadium hosted the Elton John and AC/DC concerts, attracting a combined audience of almost 60,000, with approximately 50% of the audience coming from outside of the region. CubaDupa returned over the weekend of 19-20 March, attracting tens of thousands to enjoy the immersive festival experience
  • During the year WREDA won funding to run the R9 Accelerator Programme (a programme of work to improve central government and business working more effectively) and has funding approved for the Regional Business Partner programme

Performance Information

Attendance at WCC supported events exceeded our target and last year’s performance because of Capital 150 celebrations, Royal Edinburgh Military Tattoo, Elton John’s concert and New Zealand Festival. The improved ratio of direct spend to economic impact is a result of high profile and unbudgeted events that resulted in high levels of regional visitation and economic impact. These measures can be found in the section ‘Measuring our Performance’.

Source: WREDA

To ensure our residents and visitors are connected we continued our city’s CBDfree Wi-fi network. There has been a 161% increase in CBD logins.

Measure 2015/16 Actual
Performance
2015/16 Target
Free Wi-Fi usage (logons/day)waterfront and central city CBD 17, 990,606
Waterfront 299,844
Improved performance
N/A
2014/15 Performance
6,816,785
142,366

Source: Citylink and Trademe

Through the City Growth Fund and economic grants we supported the attraction and retention of talented people, and supported the creative business sector in Wellington

The City Growth Fund completed its third year of funding events, partnerships, and initiatives to foster economic growth.

We supported a wide range of projects through the fund, including LUX, Wellington on a Plate, Venture Up, the Wellington Capital City 150th anniversary, the World War 1 Commemorations, Young Enterprise Trust (Wellington), Gillies McIndoe Research Institute research, Miramar Film Event Trust, the ICT Grad School, the Enspiral Open Source/Open Society event, the Helloworld conference, and the Collider tech hub programme.

The City Growth Fund fund also supported the second business accelerator for Youth Enterprise alumni (Venture Up), the Open Source/Open Society international conference, the establishment of the ICT Grad School in Wellington, and sponsored the Young Enterprise Trust’s Wellington presence.

Other beneficiaries to the fund include TEDxWellington, TEDxWellingtonWomen, Web Developers Conference of New Zealand, Multicore World, Webstock, and Summer of Tech. The first New Zealand based game developer’s conference Play by Play was held in Wellington this year and will be returning in 2017 on a larger scale.

We made progress on our major projects - improving direct access internationally will provide local businesses with new opportunities to access large markets

The consent application for a runway extension at Wellington Airport was lodged in April 2016. The resource consent was informed by work undertaken by Wellington International Airport Ltd (WIAL), including a cost-benefit analysis by Sapere Research Group. The numbers for domestic and international passengers entering Wellington Airport continues to grow.

Measure 2015/16 Actual Performance 2015/16 Target
Number of domestic airline passengers entering Wellington Airport 4,899,000
Improved performance
N/A
2014/15 Performance
4,682,000

Source: Wellington International Airport Limited

Measure 2015/16 Actual Performance 2015/16 Target
Number of international airline passengers entering Wellington Airport 897,000
Improved performance
N/A
2014/15 Performance
775,000

Source: Wellington International Airport Limited

We also continued to work with WIAL to develop international air connections. During the year, Singapore Airlines announced a new route, the ‘Capital Express’, connecting Wellington-Canberra-Singapore. Flights will start in September 2016, operating four times a week, providing Wellingtonians and visitors with the most efficient connection to Singapore.

We agreed in principle to support the building of a movie museum and a new purpose-built convention centre on Cable Street, opposite Te Papa. We also purchased the land for this development on Cable Street. We will partner with private interests to deliver this project. We consulted on the proposal in February/March 2016 and feedback was overwhelmingly positive. A report will go to the Council, with the final business case, requesting final approval for the convention centre and movie museum early in 2016/17. This proposal, if approved, will deliver two of our economic catalyst projects and provide significant economic benefit to the city.

We continued to strengthen international relations improving access to international markets and providing local businesses with new opportunities

We continued networking at an international level by hosting delegations and forums and cementing relationships. The first New Zealand–China Mayoral Forum, held in September 2015, was a significant milestone for our relationship with China. It resulted in strengthened civic and trade ties as well as promising deeper cultural understanding through programmes and exchanges. Led by Local Government New Zealand and hosted by the Chinese People’s Association for Friendship with Foreign Countries, the forum focussed on trade and investment opportunities, in particular development prospects for tourism, education and the primary industries of both countries. Mayor Wade-Brown led a delegation to Wellington’s sister city, Xiamen (Fujian province) which included 12 New Zealand Mayors as well as over 50 business and education leaders. Joining them were 200 Chinese representatives including 13 of the country’s mayors. Described as an immense success by all those involved, the forum is set to become a regular event with the second of its kind being held in Wellington in 2017.

During the forum, Mayor Wade-Brown officially opened a New Zealand section at the Seashine import Supermarket in Xiamen. The trade initiative was born from the Wellington – Xiamen sister city relationship and resulted in dozens of local New Zealand products including dairy, honey, fruit and meat on the shelves of one of Fujian’s most popular supermarkets. This exposure has proven to be a great opportunity for local business owners to break the Chinese market and showcase quality New Zealand goods to foreign investors and consumers. Since opening, the company’s demand for Kiwi goods has grown exponentially and Seashine executives make regular visits to the Wellington region and beyond to scout out new products to stock their shelves.

During the lead up to Anzac Day this year, the city leaders of Wellington and Çanakkale signed a Memorandum of Understanding (MOU) and became historical sister cities. It was the coast of Gallipoli and the wider region of Çanakkale where some of the fiercest fighting in New Zealand military history took place. Founded on a historic bond formed during the World War 1, the new MoU promises to promote peace by developing a relationship that focusses on commemoration and appreciation.

We agreed a sister-city relationship with Canberra, building on the forthcoming flights from Wellington to Singapore via Canberra.

Measure 2015/16 Actual Performance 2015/16 Target
Number of events/activities held with international cities 75
Improved performance
N/A
2014/15 Performance
72

Source: WCC International Relations

Using our Business Improvement Districts (BIDs) – we improved the vibrancy of our suburban centres making Wellington an attractive place to live and help form a sense of community

We continued to establish BIDs, which involves a local business community within a geographic area developing projects and services that support local economic development. Over the year, we helped to get the BID in Kilbirnie up and running. We have also started work around expanding the boundary of the Miramar BID.

Our performance

Our performance against the measures on the quality of our investments in promoting the city are discussed in the previous table for WREDA.

Finances

How it was funded

The majority of the economic development activities are paid for by commercial ratepayers, as it covers the cost of tourism promotion, economic grants, and other activities that directly benefit the sector.

What it Cost 2015/16

Operating
Expenditure
($000)
Actual
2016
Budget
2016
Variance
2016
Actual
2015
3.1.1 WREDA 1        
Expenditure 18,574 31,560 12,986 23,385
Revenue (738) (14,365) (13,627) (915)
Net Expenditure 17,836 17,195 (641) 22,470
3.1.2 Wellington convention centre        
Expenditure 14,269 - (14,269) 14,031
Revenue (14,371) - 14,371 (14,483)
Net Revenue (102) - 102 (452)
3.1.3 Retail support (free weekend parking)        
Expenditure 1,356 1,356 - 1,355
Revenue - - - -
Net Expenditure 1,356 1,356 - 1,355
3.1.4 City growth, economic growth and economic grants2        
Expenditure 3,798 3,599 (199) 2,409
Revenue - - - -
Net Expenditure 3,798 3,599 (199) 2,409
3.1.6 Regional and external relations 3        
Expenditure 677 572 (105) 583
Revenue (24) - 24 (8)
Net Expenditure 653 572 (81) 575
3.1.7 Business improvement districts        
Expenditure 114 114 - 97
Revenue - - - -
Net Expenditure 114 114 - 97

Capital
Expenditure
($000)
Actual
2016
Budget*
2016
Variance
2016
Actual
2015
3.1.2 Wellington convention centre 4        
Expenditure 1,669 1,669 - 2,268
Unspent portion of budget to be carried forward N/A 749   N/A

* The capital expenditure budget consists of the LTP amount plus the carry forward from 2014/15.
1 Over budget due to over-commitment in major events offset by underspend in Destination Wellington fund.
2 Over budget due to professional fees incurred on the Convention Centre/Movie Museum project.
3 Over budget due to an additional staff member and more overseas travel.
4 Under budget due to delays in the renewals programme for the St James Theatre, to align work with the earthquake strengthening works, and renewal works at the TSB Arena.

The Basin Reserve Trust

Established in 2004, the Trust manages assets and operations at the Basin Reserve.

Relevant Council outcomes:

People-centred city Promotion of the city as an attractive place to live and do business, works to attract talent to the city and attract tens of thousands of visitors to the city every year

Key activities

The Basin Reserve Trust

  • Contributes to the Wellington City Council’s vision of Creative Wellington - Innovative Capital
  • Manages, administers, plans, develops, maintains, promotes and operates the Basin Reserve for recreation and leisure activities and for the playing of cricket for the benefit of Wellingtonians
  • Establishes a long-term policy for the further development of the Basin Reserve as a recreational facility and as a facility for the playing of cricket, other sports and as a venue for other community based activities
  • Preserves and enhances the significant and recognised heritage value of the Basin Reserve

Key achievements

Promotion of the city as an attractive place to live and do business, works to attract talent to the city and attract tens of thousands of visitors to the city every year
  • The return of One Day International Cricket to the Basin for the first time in 11 years with the Blackcaps playing Pakistan (6,500)
  • Blackcaps vs Australia Test Match (20,000 over 3 days)
  • Two international T20 women’s (Whiteferns) matches (2000)
  • The opening of the refurbished Wes Armstrong Ground Keepers Cottage
  • The Robbie Williams concert marking the return of public concerts to the Basin for the first time in 6 years (10,000)
  • The installation of two large information boards covering the sporting history of the Basin on the front of the northern and southern toilet blocks

Performance Information:

  • We have significantly exceeded our targets for sport and community events held at the Basin Reserve

Interesting Fact 2015/16 Actual Performance 2015/16 Target
Number of Events - Cricket 35
Improved performance
11
2014/15 Performance
N/A (Not Established)
Interesting Fact 2015/16 Actual Performance 2015/16 Target
Number of Events - Other Sports 25
Improved performance
 
12
2014/15 Performance
N/A (Not Established)
Interesting Fact 2015/16 Actual Performance 2015/16 Target
Number of Events - Community 15
Improved performance
4
2014/15 Performance
N/A (Not Established)

Source: Basin Reserve Trust

Economic – overall summary

We made progress towards most of the activities in this activity area in year one of the LTP. There were delays in our only capital project, the movie museum and convention centre, which reflects the complexity of acquiring land, and designing and building a national asset of this kind. On balance, our economic development investments were successful and we are continuing to support a more vibrant, diversified and resilient economy, which provides a strong return to our community.

13WCC – Wellington City Profile – Key facts about the city
14WCC – Wellington City Profile – Key facts about the city
15WCC City Events - WREDA