A controversial tourism grants scheme - described by the auditor-general as having some unclear criteria - caused division in the sector, an Otago tourism operator says.
"It’s created a really, really big divide in the tourism industry - massive," Pure Glenorchy Scenic Film Location Tours co-owner Joel Lamason said.
"It’s almost a tale of two towns. It is grossly unfair."
The $290 million Strategic Tourism Assets Protection Programme (Stapp) was set up to get some businesses through fallout from Covid-19, but its implementation drew mixed reviews from the sector.
In a report released yesterday, auditor-general John Ryan raised concerns about the programme’s criteria, assessment process and transparency.
Uncertainty about key criteria, combined with Government ministers making decisions that diverged from officials’ advice, with limited explanation, made it hard to determine if funding was applied fairly, Mr Ryan said.
"Trust and confidence in government depends on transparency and accountability when spending public money," he said.
Minister of Tourism Stuart Nash said the scheme’s objective was to protect tourism jobs and businesses and support regional economies through the pandemic.
"I’m not surprised the auditor-general found areas where improvements could be made," Mr Nash said.
"With the beauty of hindsight there will always be lessons to learn.
"It was important to get money out the door, fast, to support jobs and businesses.
"We estimate Stapp funding helped to retain around 3000 jobs in the tourism industry and the early design encouraged these businesses to keep trading."
Totally Tourism owner Mark Quickfall said aspects of the process were hard to understand and lacked consistency.
He was grateful for a $500,000 grant and $2.6 million loan.
The setting up of the scheme had seemed to be a "scramble" and "a more equitable process would have been welcomed".
Three tourism businesses sought and received funding before Stapp opened.
One key criterion of the Stapp process was tourism businesses applying for funding had to have "exhausted all other avenues of support".
What this meant in practice was unclear, the auditor-general commented.
The Ministry of Business, Innovation and Employment did not seek information to support each tourism business's representation about this criterion, Mr Ryan said.
"No inquiries were made about tourism businesses' equity position or parent company resources."
NZSki chief executive Paul Anderson declined a $500,000 grant, because a larger grant would have been needed for what the company had planned to offer in the Remarkables.
He felt the process had been reasonably clear.
The Government had been in an unenviable position and it was difficult to try to "pick winners" fairly.
Mr Ryan was concerned there was limited documentation about why ministers decided on the number of businesses to fund and why they did not accept officials’ advice to stop Stapp or to only fund a small number of businesses.
All decisions to spend public money came with an obligation to ensure decision-making was consistent and transparent, he said.
The ministry should formally review the effectiveness of Stapp against its goals, he said.
Mr Nash said this was already occurring.
