Gareth MOrgan Beach offer

Before you reject my beach offer, read this…

Gareth MorganEnvironment

Some people have been upset by the conditions in my offer to help buy the beach in the Abel Tasman. Of course the obvious answer to any deal if you don’t like it is to say ‘no deal’. That’s fine, it is how business works.

But before you make up your mind, take a moment to consider the three most popular complaints about the offer. The fact is that we all want the same outcome – I don’t want to see Kiwis excluded from this beach any more than the rest of us. I also don’t want to see taxpayers’ money being used to curry favour and buy votes. Okay, so here are the objections and my responses.

When you donate there should be no strings attached

There are always strings attached.

Every philanthropist has a limited amount of money to give and they want to see the best return for that money. How they might define that return differs – for me I invest in social development overseas where the needs are greatest, conservation projects in New Zealand, and research that stimulates public policy debate. There is no open cheque book for allcomers however, one always picks projects that you believe will deliver the most good per dollar.

Let’s be honest here – the conservation gains on this strip of beach are miniscule. As TV One News pointed out, the assumed price tag of $2m is 190 times the cost of other similar additions to the DOC estate. You would be nuts to be paying that if conservation is your purpose. Given sea level rise as a result of climate change, I even wonder how long this sand spit will stick around. We can’t justify this investment on conservation grounds – we can, and do make far better investments elsewhere.

So if I wouldn’t invest in this beach from a conservation perspective, why would I invest at all, what’s in it for me?

The idea was that the land would be for everyone so why do you expect the public to subsidise your bach?

To be honest I don’t really want this piece of land at all. I’ve already got quite a nice bach. But like most New Zealanders I am not enamoured by the thought of Kiwis being excluded from this beach. It just doesn’t seem to be our way and feels wrong. So let’s be clear – this is not about conservation then, it’s about public access.

Most people, including me – seem concerned that access to the beach be maintained in the same way it is now, thanks to the goodwill of the current owners. There’s a big risk that the winning tender will come from one of the “helicopter set” who will lock the public out from the beach. So I thought I’d be happy to buy the land and make use of the existing buildings, while the public (even though they’re predominantly foreign tourists) can retain access to the beach. In addition I’d contract to gift the whole lot over to DOC at an agreed date. And just as what would happen at that time if the crowd managed to buy it, DOC would demolish the building. Think about it – the public can’t use the buildings anyway, so in reality they’d be going without nothing under this deal. Seems fair and reasonable to me – see the map above for the proportions.

Why don’t you let the little guy win?

Which brings us to the ultimate question – why don’t I let the little guy win? I hope the crowd-funding campaign does amass enough to buy the whole thing. But I don’t think they will. Firstly they have to raise $2m. Even if they achieve that, will it be enough? It sold for this amount 8 years ago, and without the profiling it’s been given now thanks to the frenzy of the crowd.

This sale is an open tender process. There has been significant interest from other buyers (over 100 enquiries), and you aren’t competing with average Kiwis here. They’re not even competing with the “middle class”. There is an airstrip nearby – you are competing with people that can fly in by plane or helicopter, the financial elite. Also bear in mind that your competitors in this tender know how much you are about to bid – so all they have to do is bid $1 more to beat you – easy peasy. With the amount of interest in this beach I think the price could go as high as $3m.

All of which raises a question about the naivety of this particular crowd and its leaders. Remember this is not the public, fewer than 0.5% of the public have givenalittle. The public clearly isn’t that concerned, even the Red Peak campaign got 5 times more support in a couple of weeks than this effort. Words are cheap, there’s a lot of noise but actually very few have put their hand in their pocket for this.

As I have said from the outset, if we really want to secure this beach for Kiwis, we need to either “givealot”, get a lot more people involved – or more intelligently get this out of the tender process and negotiate with the vendors directly. I’m willing to underwrite that negotiation process to make sure all Kiwis can keep accessing that beach. All I want in return is to use the buildings already on site. The alternative is that there is significant risk that this particular givealittle crowd will be well short and public access is lost forever.

Nonetheless this crowd has decided to take the punt that they can do it themselves. Unless the vendor takes pity on the public and does a deal they are likely to come away empty-handed, but they haven’t yet shown the collective intelligence to remove that risk. Are they mad or just innocently, naively frenzied?


Before you reject my beach offer, read this… was last modified: February 10th, 2016 by Gareth Morgan
About the Author

Gareth Morgan

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Gareth Morgan is a New Zealand economist and commentator on public policy who in previous lives has been in business as an economic consultant, funds manager, and professional company director. He is also a motorcycle adventurer and philanthropist. Gareth and his wife Joanne have a charitable foundation, the Morgan Foundation, which has three main stands of philanthropic endeavour – public interest research, conservation and social investment.