Airport CEO salary released to Crux under Official Information Act
It has taken an official information request under LGOIMA (Local Government Official Information and Meetings Act) but the Queenstown Airport Corporation has agreed to release full details of CEO Glen Sowry's salary and remuneration package.
Crux is interested in comparing the salary of the new CEO with that of former CEO Colin Keel, who was paid $550,000 a year in a role clearly focussed on unpopular airport expansion and development of Wanaka airport. Those goals were obstructed by widespread community opposition and a High Court Judicial review.
Mr Sowry is on a package that is comparable, if not a little higher with the top of his range at $570,000 a year plus a bonus $100,000 if he stays in the job for more than three years.
It's not clear at this stage whether the significant package reflects anxiety over the upcoming fight over competitive development at Tarras by Christchurch Airport or renewed attempts at local expansion.
Mr Keel had been charged by his Board to develop a Two Airports policy with up to $400 million to be invested in bringing Wanaka airport up to narrow body jet capability.
A High Court judge earlier this year ruled the 100 year lease granted to QAC by QLDC unlawful due to a lack of community consultation and it has been cancelled at a cost of $14 million - money that now needs to be returned to QAC by QLDC.
Here's the full details of Mr Sowry's package released to Crux under LGOIMA.
Base salary - $490,000 per annum
At-risk annual incentive payment potential – capped at $80,000 per annum
Total potential remuneration package – in the range of $490,000 to $570,000 for FY22. This will
be subject to an annual remuneration review, along with all other QAC employees, by the
Board each year beyond FY22
At-risk one off retention incentive payment of up to $100,000 in FY25 additional to the base
package set out above
Crux had made the request not just because it is in the public interest with QAC being 75% ratepayer owned via QLDC but because the information was due to be released next year anyway in QAC annual report. We also felt that the salary level would be an indication as to whether the airport was assigning more of a "care and maintenance" role to the CEO or one of competition and expansion.
QAC is currently paying no dividend at all to QLDC as 75% shareholder due to Covid related revenue losses.
This is how QAC outlined Mr Sowry's goals in their letter to Crux today.
"The at-risk component of the package will be formally assessed by the Board at the conclusion of each financial year and paid in full; in part; or not at all. The first review by the Board will be in early FY23. The at-risk incentive component of the remuneration package will be linked to:
Achieving the Statement of Intent objectives and targets including completing a strategic business plan with a ten year outlook
People and business leadership of QAC
Ensuring the continued stable financial performance of the company through the uncertain
COVID-19 pandemic, safeguarding its core capacity to operate vital and lifeline airport
infrastructure for the district and to support the recovery of the district
Maintaining world class operational performance and health and safety standards
Open engagement with the communities we serve, our shareholders and with our customer
and supplier base
Crux will continue to cover the CEO's progress as he takes on the new role. One interesting dynamic will be Mr Sowry's relationship with his Board of Directors. Media interviews so far have indicated that Mr Sowry does fully understand community concerns regarding airport expansion and the need for full and open transparency from the community owned airport.
The battle of the airports - Tarras vs Queenstown - may be influenced or even determined by the two minority shareholders. In Queenstown's case the minority 25% is owned by Auckland Airport, but 25% of Christchurch Airport is owned by the Government. Under certain circumstances the Government could step in to make a strategic decision over airport development - regardless of the two councils' - Christchurch and Queenstown - point of view.
Auckland Airport's CEO is on a package that hovers over the $2 million mark while the boss of Christchurch airport is just under $1 million. Queenstown airport is constrained not just by community opposition to expansion but by the lake and river that restrict the runway length to 1.8 kilometres. Christchurch airport is proposing a runway length for Tarras of between 2.2 kilometres and 3 kilometres - enough for international, long range wide body jets.
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