Regional mayors call on Government to pay off ski field debt

Saturday, 10 February 2024

At the moment, whoever decides to take over Whakapapa ski field would also be taking on around $15 million worth of debt.

The mayors of Taupō and Ruapehu are calling on the Government to step in and pay off Whakapapa ski field’s debt, giving whoever takes it over a clean slate to work with.

Their call comes after a second possible buyer of Mt Ruapehu’s Whakapapa ski field pulled out of negotiations leaving a mountain to climb for anyone looking to take over the operation before winter.

Earlier this week, Whakapapa Holdings Ltd, a company set up by businessmen Tom Elworthy and Dave Mazey pulled out of negotiations, and in September last year local iwi Ngāti Tūwharetoa also decided it would not go ahead with a bid to take over operations on the mountain.

Ruapehu district mayor Weston Kirton is calling on the Government to wipe Whakapapa ski field’s slate clean to allow any potential owners to start fresh.

At the time, Te Kotahitanga o Ngāti Tūwharetoa Trust chief executive Nigel Chee said the business case did not stack up.

Elworthy told RNZ on Thursday the deal was not worth pursuing and no-one would be willing to take on a business with more than $15 million of debt.

Mazey said the new owners of the ski field needed to have a fresh operating concession from the Department of Conservation, and that a 10-year concession, with the right of review after five years, was not long enough.

Taupō mayor David Trewavas said Crown intervention was key to keeping the country’s largest ski field open.

“Only being offered a 10-year licence to operate was also untenable against the uncertain backdrop of Crown treaty settlements with local iwi and what that could mean for the use of the ski slopes.

'And probably the last thing that's always been there, and what some people forget, is you're taking on a $14m debt with the Sky Waka bonds associated with the investment made in 2018 and within four years that’s, effectively, got to be repaid,' Mazey told RNZ.

Ruapehu Alpine Lifts (RAL) is still running operations on the mountain after its board put the company into voluntary administration in October 2022, and into liquidation on June 21 last year.

Conservation Minister Tama Potaka said he has close links to Mt Ruapehu and National Park and was working with officials to help keep the ski fields open.

Ruapehu district mayor Weston Kirton and Taupō mayor David Trewavas said Whakapapa Holdings’ decision to pull out was a big blow for the regional economy.

The Ruapehu District Council has a $500,000 bond invested in Whakapapa’s Sky Waka gondola, and the Taupō District Council has a $1m bond on the Sky Waka.

“We have a new broom in terms of a Government stepping in and they (the National Party) were keen to put the boot in when Labour were saying no,” Kirton told the Waikato Times.

“But I do think they have a strong commitment to regional development and that may help our cause.

Taupō MP Louise Upston said the situation on the mountain was complex and the Government were looking for a long-term solution.

“But, a clean slate is needed allowing a private business model to be sustainable … and if they can’t make money out of that, then it would be time to say everyone has had enough,” Kirton said.

Trewavas said Crown investment was key.

“I know they have poured a lot of money in so far, and that’s appreciated, but when you are talking about the largest ski field in New Zealand and the economic base of the central North Island, it just has to keep going.

“I am making a plea to the Government to set this right for the future, because plain and simple, it’s needed here,” Trewavas said.

“Getting the message across to the new government that this is a very serious issue needs to happen soon,” Kirton said.

“Anyone in a private capacity would not want to take on so much debt, especially in a business that has more uncertainties, such as whether conditions,” he said.

Conservation Minister Tama Potaka said he’d like to speak directly to both mayors but the matter was being handled by Government officials and “there’s no doubt they will keep me briefed”.

“I’ll wait for them to update me, they have been working very hard on this matter.

“But that place is very important to me, as I was brought up down that way and I have close connections to the maunga and National Park.”

Taupō MP Louise Upston said it was not a straightforward issue but it was promising there had been progress on a sale for the Tūroa ski field.

“It’s not as simple as just saying taxpayer money should be poured into it … we need a long-term solution, and that will take time.”

Upston said she wanted to take Potaka to the mountain to help him understand the issues “and to make sure that on behalf of our communities there’s adequate consideration given to a solution that will fit those longer term needs”.

“I’m very confident there will be skiing again this season.”