No financial interests in Hood Aerodrome decision

24 February 2022: We were asked to look into potential issues with a mayor and councillor voting on a plan for Hood Aerodrome. After considering the information we needed, we do not consider they had a financial interest in the decision.

A member of the public raised concerns with us that Mayor Lyn Patterson and Councillor Tina Nixon of Masterton District Council each had a financial interest in a decision to adopt a plan (called the Masterplan) for Hood Aerodrome and should not have participated in the discussions and voting. Adopting the Masterplan effectively gave the “green light” to a major infrastructure project at Hood Aerodrome.

Mayor Patterson and Councillor Nixon provided us with all the information we asked for to consider this matter. We concluded that neither had a financial interest in the decision and so did not breach the Act that applies in these situations (the Local Authorities (Members’ Interests) Act 1968).

We have written to Mayor Patterson and Councillor Nixon about our findings. Our letters to them included personal information about their partners, neither of whom are public figures. To respect their privacy, we are publishing just this summary of our conclusions.

Other concerns were raised with us, but the Act that applies here covers only financial interests. We are unable to consider non-financial interests as part of an investigation under that Act.

We understand how the appearance of a financial interest could arise. Councillor Nixon’s partner is the part-time manager of the Council-owned Hood Aerodrome. Mayor Patterson’s husband and Councillor Nixon’s partner each leases a hangar site at Hood Aerodrome. Each owns the buildings on their leased sites, and uses the buildings to store recreational aircraft. Councillor Nixon’s partner’s hangar has an apartment attached, which he sometimes rents out for short-term stays.

A councillor is deemed by the Act to have a financial interest in a decision if their spouse or partner has a direct or indirect financial interest in the decision as an owner of an interest in real or personal property, as an owner of a business, or as a party to a contract with the local authority. A potential financial interest is not enough for the purposes of the Act. Based on previous case law, the test under the Act is whether the councillor, or their spouse or partner, has a reasonable expectation of financial gain or loss as a result of the particular decision. A reasonable expectation of financial gain or loss requires a reasonable degree of certainty about whether, how, and when the councillor (or their spouse or partner) will be affected financially.

We are satisfied that Councillor Nixon’s partner has no financial interest through his employment because his pay is not linked to the Masterplan or any potential increase in activity at the aerodrome. An employment relationship, where a person receives a fixed level of remuneration, does not, on its own, give rise to a financial interest under the Act.

We were told that neither hangar site will be directly improved by the project – they are not in the area to be developed. We thought about how the development might affect:

  • rent charged by the Council to those leasing hangar sites;
  • rent charged by hangar site lessees to other people who use some of the hangar space for their own recreational aircraft;
  • the value of the hangar buildings; and
  • apartment bookings.

In our view, these potential financial effects might be positive or negative, or might not happen at all. We consider them too remote, uncertain, or speculative to constitute a financial interest that would trigger the application of the non-participation rule in the Act. We concluded that neither Mayor Patterson’s husband nor Councillor Nixon’s partner had a reasonable expectation of financial gain or loss as a result of the Council’s decision to approve the Hood Aerodrome Masterplan.