$200 million settlement for Canterbury schools

A $200 million insurance settlement for earthquake damage to Canterbury schools is an important confidence boost to the education sector in the region says Canterbury Earthquake Recovery Minister Gerry Brownlee, Education Minister Hekia Parata and Associate Education Minister Nikki Kaye.

Mr Brownlee says today’s settlement between the Ministry of Education and Vero Insurance is one of the largest insurance pay outs in New Zealand’s history.

“The National-led Government has big plans for investing in greater Christchurch’s education infrastructure, so this is a timely and welcome boost to the rebuild,” Mr Brownlee says.

Ms Parata says the settlement is great news for Canterbury schools, the community and the Government.

“With a $1.1 billion investment in education renewal in greater Christchurch over the next decade already underway, this settlement gives impetus to the largest ever investment in a region’s educational facilities,” Ms Parata says.

“This year alone, 15 schools will enter the capital works programme.  The new Pegasus School is scheduled to open in term 2 and the rebuild of Halswell School is due to open in term 4. Approximately $30 million is being spent in the Greater Christchurch Renewal Programme over the 2013-14 financial year, and approximately $100 million will be spent in 2014-15.”

Ms Kaye says the Ministry of Education’s insurance claim was one of the most complex arising from the Canterbury earthquakes.

“More than 1000 buildings at over 200 schools were involved.  The wide-ranging building types and damage, the spread of school sites across Canterbury, and ensuring schools remained open and functional were all part of the challenge,” Ms Kaye says.

Mr Brownlee says today’s settlement represents the result of several major programmes and complex negotiations with insurers over three years.

“Immediately after the earthquakes, emergency and temporary works were undertaken across affected schools and extensive building and land damage assessments were carried out.

“Staff, students and parents have shown great resilience over that time, and we know they’re excited about this process of renewal.”

Ms Parata says the remediation of 91 schools in the outer Canterbury area was completed in late 2012.

“However, more complex remediation of many buildings has been on hold while the Ministry of Education and Vero assessed damage and negotiated the claim,” Ms Parata says.

“Now with the claim settled and cash in hand, we can get on with repairing or demolishing damaged buildings without the constraint of the insurance claim process.

“Our Government wants to thank all school communities for their patience.”

For more information on the Greater Christchurch Education Renewal Programme visit www.shapingeducation.govt.nz/2-0-future-direction-of-education/property-programme

Notes:

Q&A

What is the total amount the Ministry receives from insurers?
The Ministry will receive $200,675,000 from insurers.  This amount is after the deduction of excess.

What will the money be used for?
The money will be a direct contribution to the repair and renewal of schools’ infrastructure across greater Christchurch.

How many schools were involved in the claim?
A total of 214 schools in Canterbury were involved in the claim, including:
123 schools in greater Christchurch; and
91 schools in the outer Canterbury area.

Was it one big claim, or were there several claims?
The Ministry’s claim was one big claim that involves 214 schools in Canterbury.  The claim was against the 2010/2011 insurance policy year.

What were the components or detail of the claim?
The claim covered four earthquake events: September and December 2010, and February and June 2011. It also covered a number of non-earthquake events (such as fire) that occurred during the 2010/11 policy year.

What was the break-down of the settlement for each individual school?
The Ministry’s claim settlement is a negotiated settlement for damage to all 214 schools. Although engineering assessments were undertaken for individual schools, the negotiated settlement did not involve a breakdown for individual schools.

Was EQC involved with the Ministry’s claim?
The Earthquake Commission (EQC) provides natural disaster insurance for residential properties only. It was not involved with the Ministry’s claim.

When will the damaged buildings at my school be repaired?
Earthquake damage will be repaired as part of the Greater Christchurch Education Renewal Programme. Refer to the following link for further details:
http://shapingeducation.govt.nz/

What about the school buildings with shared ownership?
A number of school buildings involved in the Ministry’s claim are co-owned by the Ministry and schools’ boards of trustees (or community trusts). The Ministry’s claim only covers the portion of buildings owned by the Ministry. The boards of trustees (or community trusts) are responsible for the negotiation and settlement of their own insurance claims. The Ministry will provide assistance where possible.