24 Jun 2020

Tourism Minister answers Strategic Tourism Asset funding questions

From Checkpoint, 6:10 pm on 24 June 2020

The government has taken a leap of faith on Wednesday approving more than $10 million in funding for AJ Hackett bungy after declaring it a strategic tourism assets.

The company's getting a $5.1 million grant and access to a loan facility of the same amount, from the $400 million tourism recovery fund.

It's the third handout to a business under the scheme aiming to keep afloat tourist operators that provide significant financial benefit to the wider community.

Discover Waitomo is getting $4 million. Part of that is a loan and WhaleWatch Kaikōura is getting $1.5 million.

Tourism Minister Kelvin Davis told Checkpoint he was not sure what the interest rate is for the $5.1 million loan part of the funding. 

"The finer details, officials are on top of that," he said. 

"We make sure that we do support them and if they're unable to continue, that's part of the quarterly declaration and they won't receive money." 

He could not answer the question of whether the government has any claim to assets of businesses that receive the public funding, but still fail. 

How are Strategic Tourism Assets chosen? 

"Myself and the other tourism recovery ministers, we look at the information put in front of us and we make the decisions then. 

"Officials go through all the applications, the ones they believe are viable they put to us. We will say yes or no to any application. At this stage we've got 300 that will be gone through." 

One of the big issues considered is the amount of "spillover" effects that a tourism asset will bring to its local economy, Davis said. 

But he did not give an exact amount of how much estimated spending in a local area would make a tourism asset viable. 

"It's a criteria that will support the community, the town, the region. It's difficult to put a dollar value on how important Whale Watch Kaikōura is to the town and district of Kaikōura. It's difficult to put a specific dollar value on how much Discover Waitomo contributes to the King Country area."