53 tourism businesses share $25 million in Government grants

Tuesday, 15 September 2020

New Zealand had about 20,000 tourism businesses pre-Covid and about 126 key ones received more than $270m in grants and loans to save them from possible closure.

Museums, spas, cruises, scenic flights and an adventure park feature will get up to $500,000 from a Government fund to save key tourism businesses.

A further 53 attractions deemed “strategic assets” have been named by the Ministry of Business, Innovation and Employment (MBIE), and they will share about $25 million.

Shantytown, Otago Museum, the Polynesian Spa, and Dunedin’s Penguin Place are on the list released by MBIE after signing funding agreements, most of which were for the maximum amount of $500,000.

Fourteen aviation companies, ranging from scenic helicopter flights and seaplane services, to skydive operators received grants, as did Ngāti Awa Tourism – owner of White Island Tours, which is at the centre of a WorkSafe investigation into the volcanic eruption that last year killed 21 people.

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Christchurch Adventure park, which endured a lengthy closure as a result of the pandemic, is among the latest bunch of tourism operators to score a $500,000 Government grant.

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Dunedin’s Penguin Place is among wildlife attractions to be recognised as key tourism businesses worth saving. Others include the Oamaru Penguin Colony, Monarch Wildlife Cruises and Black Cat Cruises.

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Howick Historical Village got a $500k Government grant as a strategic tourism asset, on top of $330k from Auckland Council. Manager Krissy Perret said the funds would let them reopen on September 19. “We were overjoyed, it has been a lifeline.”

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The financially troubled Christchurch Adventure Park, majority owned by the Christchurch City Council, will benefit from a $500,000 injection from the fund.

The park was closed for 10 months after the Port Hills fire severely damaged the facility, and last year it was on the brink of calling in administrators when it received $5m from the city council, $3.2m from existing shareholders, and an ANZ bank loan of $2m.

There were more than 300 applications for the strategic assets money, the centrepiece of the Government’s $400m Covid-19 tourism rescue package, and 130 were successful.

But the naming of recipients has occurred piecemeal as funding agreements setting conditions for payments of grants were signed off, leading to a lot of speculation within the tourism industry.

The scheme has also attracted criticism for providing just $67m in grants versus $202m in loans, and for capping grants at $500,000 after giving millions to three larger operators (AJ Hackett Bungy, Discover Waitomo and Kaikōura Whale Watch).

The threat of legal action is still looming as failed applicants seek clarity over the selection process which saw 116 judged as ineligible under MBIE criteria for identifying strategic assets.

Lawyer Andy Glenie is acting for a couple of dozen businesses, and he said they had asked for copies of the advice given to the tourism ministers’ recovery group that made the final decisions.

“If we don't get some clarity around the process, then we will reluctantly resort to a judicial review to shed some light on this.”

Tourism Minister Kelvin Davis has already made it clear that there will be no review of decisions already made, and he has dismissed complaints about lack of transparency.