18 July 2019

Further $1.7m Provincial Growth Fund injection ‘vote of confidence’ for Southland

Regional Economic Development Minister Shane Jones says if the Government continues its tourism push for places like Stewart Island it will need to help out.

Jones was in Invercargill on Thursday where he announced a further $1.7 million funding package for Southland from the Provincial Growth Fund.

He confirmed the PGF will invest in air connectivity, water storage, business growth and economic development in Southland.

The four projects announced were:

  • Invercargill Airport air cargo and terminal development (Invercargill Airport Limited) – $500,000
  • Establishment of a business start-up investment network (COIN South) – $550,000
  • Oreti managed aquifer recharge pilot (Oreti MAR Limited) – $593,481
  • Stewart Island/Rakiura economic development plan (Southland District Council) – $100,000

The Southland District Council has a dilemma as to how to fund the required infrastructure on Stewart Island given it has such a small ratepayer base.

While Stewart Island only has around 400 residents, visitor numbers are close to 40,000 per year.

SDC proposed to increase its Stewart Island visitor levy from $5 to $15 to help with the shortfall, however, that was delayed following backlash from tourist operators and others.

SDC opted to carry out a review and develop a strategic plan for Stewart Island to work out a way forward.

The $100,000 from the PGF will be used to help formulate that strategy.

Jones indicated the end result of a feasibility study could lead to more Government input for Stewart Island.

“If we are going to boost international tourism to go to places like Stewart Island then the crown has got a role to ensure its durability. I’ll certainly be an advocate for that outcome,” Jones said.

The $500,000 to the Invercargill Airport from the PGF was granted for necessary upgrades to prepare it for the first direct jet connection between Auckland and Invercargill since 1995.

Jones said connectivity was key in fostering growth in places like the “far north” and “deep south”.

“I came from the fishing industry as chairman of the Maori Fisheries Commission, and Sealords back in the day, I know if you can not move, for international purposes, both people and goods around efficiently then you are handicapping your provincial economy.”

Invercargill Airport general manager Nigel Finnerty said the funding injection was a huge boost for the Invercargill Airport.

“This is a wonderful vote of confidence in the future of this airport and in the region’s growing economy,” Finnerty said.

Young businesses in Southland have also been provided a leg up PGF funding helping establish the COIN South business start-up investment network.

“Enabling Southland to retain and grow young businesses is a no-brainer. These businesses could otherwise leave the region in search of capital,” Jones said.

The Oreti Managed Aquifer Recharge (MAR) testing project will explore options to improve the management of groundwater storage.

“Water storage is a major issue in Southland, with water shortages being a key barrier to growth. This investment has the potential to bring environmental, social and economic benefits to the region and help to grow a sustainable primary sector.”

The latest announced takes PGF’s approved contribution to Southland to $16.7m for 13 different projects.

In February last year, the Government announced an allocated $3 billion to the fund, over three years, to enhance economic development and employment opportunities in regional New Zealand.


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