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RSSA letter to the incoming Prime Minister Christopher Luxon





Current RAL Receivership.


Tēnā koe Chris


I write in relation to Ruapehu Alpine Lifts (RAL) recently being moved into receivership. We

understand that MBIE has now taken control of Ruapehu Alpine Lifts by purchasing the ANZ debt for $1 and appointing Calibre Partners as receivers to seize the assets. According to reports, staff have been given their final notice, and the asset seizure process has commenced.


We are calling on the incoming Government to immediately stop this bureaucrat led fiasco. The exact terms of the transaction have not been fully disclosed, but based on the information we have received from credible sources it appears:


  • MBIE will provide Pure Turoa (private bidder) with $3m+ of funding available immediately for off-mountain setup expenses. According to reports, if the concession transfer is not obtained within a certain timeframe, then this funding will be forgiven with no further obligations.

  • If the concession transfer is not obtained by early next year, MBIE will reimburse the


These timeline-based penalties put the onus on the Department of Conservation to try and push through the concession transfers and put undue time pressure on local Iwi with legitimate concerns, objections or needs for internal consultation.


All this new support above is apparently in addition to the original deal that was offered to MBIE's preferred bidder which apparently included:


  • $50M+ in clean-up, remediation and lift removal works that the taxpayer will fund. Noting that this is not just a hypothetical government underwrite for future removal, but a shovel-ready capital works programme to clean up existing unused but not yet removed lift foundations.

  • $5M+ of lift maintenance and upgrades that have been completed in the last twelve


We request the incoming government should stop the process.


MBIE pushing through the deal in the post-election period is very concerning as the transaction binds the incoming government to tens of millions of dollars in future expenditure as well as further damaging Iwi Tongariro National Park (TNP) treaty settlement relationships. We are therefore calling on the incoming Government to stop this MBIE failure. Specifically:


  • Stop MBIE progressing the asset sale and handing out millions of taxpayers’ dollars to a few private individuals.

  • Let PwC the legally appointed liquidators get on with their job and look at a creditor's


This fiasco has been entirely driven by MBIE over the last twelve months and we are essentially no further ahead. In fact, we are now in a worse situation. MBIE has managed to disrespect multiple Iwi, ignore key stakeholders, divide the community and waste millions of taxpayers’ dollars on something which could have been resolved many months ago.

Our view on this is heavily informed by Iwi correspondence and letters that have been sent to MBIE, DOC, and Cabinet Ministers by collective Iwi including Ngāti Tūwharetoa, Ngāti Hāua, Ngāti Rangi and Te Korowai o Te Wainuiārua.


These various Iwi letters state that the sale and purchase of RAL assets breaches the current Iwi partnership agreement clauses and is prejudicial to the upcoming TNP treaty settlement process.


Furthermore, they advise that there are likely to be legal challenges if the process proceeds. In short, it is highly unlikely that concession transfers will be granted in the near future.

In addition, a unilateral asset sale by the receivers is likely to be challenged by other creditors (LPH) if the assets are sold for only $1.


At present, there is no reconciling the below two aims and so the process is effectively

stalemated.


  1. Various Iwi have directly opposed the sale of RAL assets and new concessions being

  2. MBIE aggressively pursuing a private commercial solution over the past 12 months


The Solution - Iwi collective with Ski Community and Government support.


There is a concept in economics of 'the natural owner' and we believe an Iwi collective with the backing of the Government and Ski Community are the 'natural owners' at present because of the following key reasons.


  1. The Government now owns most of the secured RAL debt.

  2. The Government now owns most of the RAL assets.

  3. Iwi via the Tūwharetoa Gondola Limited Partnership own the Whakapapa Gondola via secured asset.

  4. Various Iwi control transfer of concessions.

  5. life pass holders (LPH) are $32m unsecured creditors and the majority of the current RAL lift assets were financed via life pass holders (LPH) capital rase since 2000 (Approx. $45m).


In addition, the following key points highlight why it makes more sense for an Iwi, ski community, Government collective should own and run the ski fields rather than continue to drip-feed millions of taxpayers’ dollars to private individuals and consultants while the TNP treaty claims are being negotiated, which is likely to take years.


  1. The previous $15m Government PGF loans that were provided to develop the gondola should have been provided as grants to foster provincial growth which would have produced a better outcome. Arguably this debt significantly contributed to the collapse of the RAL.

  2. The Government and Iwi can provide stability.

  3. It makes more sense for the Government to write off its own debt rather than forgive that debt for the benefit of a few private individuals.

  4. RAL is a not-for-profit public benefit entity, on public land and has been funded by multi generations of kiwis for 70 years.

  5. It provides a safe working relationship while the TNP treaty claims are being negotiated between the Government and various Iwi interests over coming years.

  6. The ski fields are of vital importance to the local economy and contribute approximately $100m per annum, of which the Government collects approximately $25+m in GST, PAYE and income tax each year. It therefore makes sense to continue to support the ski fields.


RSSA Support


The RSSA support the Iwi collective plans to take over management of ski fields.


The RSSA was started by a mix of volunteers from the ski community, life pass holders, season pass holders, former mountain staff and local businesses. The RSSA now represents tens of thousands of life pass holders and mountain users.


Furthermore, the members that the RSSA represent are able to raise over $7m dollars towards this purpose and do not want any financial return other than the ability to continue to use the mountain.


Not selling to private individuals now allows for the possibility of a new Iwi collective, ski

community, Government partnership which will benefit the local Iwi, community and ensure the next 70 years of successful ski fields operations.


The recent successful ski season generated millions of dollars in sustainable revenue. This

combined with debt forgiveness and a restructured RAL, would make RAL solvent, and most

importantly retain the existing concessions while the TNP treaty claims are being negotiated.

This would also provide immediate relief to the gnawing uncertainty that has been so toxic to the staff and local community over the last 3 years.


If this does not happen, we believe we will end up in March next year with no concessions, no sale and much more Government money required for the second time in 12 months, resulting in continued uncertainty and long-suffering for staff, local businesses, and community.


We would like to request a meeting as soon possible to discuss this matter.



Ngā mihi

 

Jason Platt

Chairman

Ruapehu Skifields Stakeholders Association




RSSA letter to incoming Prime Minister 21.11.2023
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