Rescue organisations hit by funding uncertainty under lottery reforms

Friday, 3 July 2026

Frontline rescue organisations have no guarantee their lottery grants funding will continue under a sweeping Government overhaul, despite officials warning ministers the changes could disrupt support for critical community services.

Department of Internal Affairs (DIA) documents flagged the risk of “disruption of funding” to four regular recipients of Lottery Outdoor Safety funding – Coastguard New Zealand, Surf Life Saving New Zealand, Land Search and Rescue (LandSAR) and the Mountain Safety Council.

A warning was raised in advice to Internal Affairs Minister Brooke van Velden in November on proposed changes to the lottery grants system.

But she pushed ahead with the biggest distribution restructuring in 35 years, scrapping specialist committees and replacing them with six regional and one national committee. That came into force on Wednesday.

The affected organisations collectively receive between $10-$15 million a year in funding, which The Post understands the Government is now scrambling to protect during the changeover.

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Under the new structure, organisations that previously applied through the specialist Lottery Outdoor Safety committee will instead compete for funding through broader regional pools alongside a wide range of community groups.

Officials had warned funding previously channelled the specialist committees “may not be guaranteed to the same extent”, and that new committee members “may lack the subject matter expertise required to make robust decisions” on complex applications.

There were also concerns about the tight timeline to introduce the new system.

The rescue organisations, and Water Safety NZ, wrote to Ministers and the Lottery Grants Board in May.

The board includes presiding member van Velden, Prime Minister Christopher Luxon and leader of the Opposition Chris Hipkins, who sent MPs Louise Upston and Lemauga Lydia Sosene as representatives.

It was given a high-level briefing by van Velden in January, but not told of the details until a briefing - described by officials as a ‘late paper’ - on April 29.

Relevant ministers were told in a letter on the same day, and the following day termination notices were sent to 77 committee members.

The restructuring notice was formally gazetted in May.

Rescue orgs “optimistic, but uncertain”

LandSAR chief executive Wendy Wright said delays to the 2026/27 funding round - due to begin next month - meant the organisation was already facing constraints in planning programmes that underpin life-saving services.

Granted $2.1m in the last financial year, it remained broadly supportive of the intent behind the reforms. But Wright said a lack of clarity around implementation was creating uncertainty.

“We’re optimistic the funding will continue. It has been well supported by the Lottery Grants Board over many years,” she said.

“But at this stage, we do not have certainty, and we have not received any explicit, ring-fenced financial guarantees or transitional safety nets from the Government to protect our operational baseline.”

Mike Daisley, chief executive of the Mountain Safety Council, said he accepted there was no intention to reduce overall community funding, but there were risks in the timing of the transition.

“We take as read that there’s no intent to remove funding from community organisations,” he said.

“However, the uncertainty around what the process looks like into the future makes us very nervous.”

Also “optimistic”, he said prevention work relied on long-term funding certainty and warned that, in an extreme case, interruptions in funding could have immediate operational consequences. The safety council got $2m in the last funding round.

“The harsh reality is… if funding is cut or there is a significant gap in timing, organisations could come to a fairly abrupt halt very quickly,” he said.

Coastguard New Zealand chief executive Carl McOnie said the lottery outdoor safety funding underpins both frontline response capability and the wider volunteer infrastructure that supports it. In 2025/26 it was awarded close to $3m.

Crews, supported by a network of 62 volunteer units, respond to more than 2700 incidents each year and rescue around 7000 people annually.

McOnie said the funding makes up about 16% of Coastguard’s budget and covers volunteer training, rescue equipment, vessel maintenance and safety gear.

“It is an important source of funding for services people rely on every day,” he said.

He said the organisation was still working through what the Government’s proposed changes would mean, but echoed warnings that uncertainty was already affecting planning cycles.

“We’re optimistic the funding will continue - it has been well supported over many years - but what we need most right now is certainty.”

Any significant delay, reduction or loss of funding during the transition would force organisations to reassess programmes and spending, he said.

“The worst-case scenario would be losing funding that supports life-saving services used by hundreds of thousands of New Zealanders every year,” he said.

Associate Transport Minister James Meager, who has delegated responsibility for recreational safety and search and rescue, said concerns about the transition were “understandable”.

“I want to assure the sector that those views have been heard and are being taken seriously,” he said.

“I have instructed officials to work closely with the Department of Internal Affairs and the sector to support organisations as they transition to the new arrangements and ensure it works well for those that provide critical outdoor safety and search and rescue services,” he said.

“Ministers are aligned on the need for this process to run smoothly.”

Van Velden said the reforms were intended to simplify what had become a 'fragmented' grants system. She said all existing recipients remained eligible for funding under the new system and the new committees would be staffed by existing members.

“This is an administrative change to help with efficiency and clarity. I do not intend for it to change the types of groups who receive funding or the amount that goes out,” she said.

She added: “The total amount of funding is set to increase. The Lottery Grants Board has allocated $511.644m to its operations and distributions for 2026/27, an increase of $93.615m from 2025/26.”

However, she did not say whether the four outdoor safety organisations would receive the same level of funding under the new system.

She also didn’t answer questions about whether she had approved transitional protections, including ring-fenced funding, or what assessment she had made of the impact of the longer gap between funding rounds on frontline rescue organisations.

Lottery Outdoor Safety grants 2025/26

Royal New Zealand Coastguard $2,999,814

Mountain Safety Council $2,000,000

Surf Life Saving New Zealand $2,900,000

Land Search And Rescue $2,143,041

Water Safety New Zealand $2,477,314