Point or Order first heard of the Ardern Government’s helping to fire up an “exciting multi-pronged aerospace project” on the Kaitōrete Spit on 1 June 2021.
The Crown at that time had contributed $16 million to secure the land. The Crown and a Rūnanga will would each own 50 percent shares in the land and project.
Research, Science and Innovation Minister Megan Woods eagerly told as all about it. Well, perhaps not all – but she told us about it:
1 June 2021
- Exemplar Māori-Crown partnership
- Protecting cultural and environmental interests
- Up to $300m in annual benefits (by year 10)
- Plans to develop aerospace R&D facilities, including space launch
An exciting multi-pronged aerospace project is coming to Kaitōrete Spit – a 25km stretch of land on the Canterbury coast.
It’s thanks to a special commercial joint venture between Kaitōrete Limited (Te Taumutu Rūnanga and Wairewa Rūnanga) and the Crown, which will unlock jobs – including aerospace, develop a space launch and R&D facilities, protect cultural interests and the unique bio-diversity of the area.
“Project Tāwhaki is a special partnership with both Rūnanga that will rejuvenate a nationally unique environment, honour deep cultural relationships, and provide amazing opportunities to tap into the multi-billion dollar aerospace economy. This is a very exciting day,” Research, Science and Innovation Minister Megan Woods said.
More government funding was called for – what a surprise, eh! – and two years later Woods (this time as Minister of Infrastructure) was announcing the Government’s contribution of a $5.4 million grant:
3 October 2023
The Government is helping Canterbury’s aerospace industry take off with further infrastructure support for the Tāwhaki Aerospace Centre at Kaitorete, Infrastructure Minister Dr Megan Woods has announced.
“Today I can confirm we will provide a $5.4 million grant to the Tāwhaki Joint Venture to fund a sealed runway and hangar facilities to encourage investment, growth and continued research and development in New Zealand’s aerospace industry,” Megan Woods said.
“Tāwhaki predicts that over the next 10 years this development will contribute to over 1,300 highly skilled, high-paying jobs and up to $2.4bn in economic benefits.
No more news on development since then has been posted on the Government’s Official Website, even though we now have a Minister for Space .
But RNZ yesterday reported …
Work on setting up an international spaceport at New Zealand’s best site for launching rockets is in strife.
The government is pulling back at Kaitorete Spit, south of Christchurch, without signing up a single international customer and despite its high aerospace ambitions.
Facing east in largely empty skies, Kaitorete is the jewel in the crown of launch sites, even by world standards.
But the fledgling national aerospace centre Tāwhaki has failed in early efforts to attract international investors, has underspent its $4 million a year budget and is not making enough return on investment.
Space Minister Judith Collins has now rejected its request for more funding, newly released documents show.
That was despite Tāwhaki warning her that “lower funding options would undermine industry and investor confidence and weaken the message that New Zealand is open for aerospace business”.
This news was welcomed by the Taxpayers Union
Friday, 23 August 2024
The Taxpayers’ Union is congratulating Judith Collins for rejecting further corporate welfare for the space industry via the Tāwhaki National Aerospace Centre that, despite promises of 1300 high-paying jobs and $2.4 billion in economic benefits, has seriously underperformed.
Taxpayers’ Union Campaigns Manager, Connor Molloy, said:
“The failure of the aerospace site to attract international investors, despite $30 million in taxpayer funding demonstrates that it’s never a good idea to let politicians and bureaucrats gamble taxpayer money on private ventures.”
The Taxpayers’ Union media release pointed out that
Rocket Lab originally considered building a launch site in Kaitorete but it found getting a consent to be too challenging, made worse by the Green Party at the time raising concerns about the impact it would have on ‘threatened lizards, rare invertebrates and threatened plants’.
But the Labour Government went on to subsidise that very same site to the tune of tens of millions of dollars.
Let’s go back to Megan Woods first enthusing about the “exciting multi-pronged aerospace project” that her Government opted to finance on Kaitōrete Spit.
She ballyhooed about the project being an exemplar of “the Māori-Crown partnership”.
It would protect cultural and environmental interests; it would generate up to $300 million in annual benefits (by year 10); and it was imbued with a powerful dose of Maori mythology.
As Woods explained:
The name Project Tāwhaki, chosen by the partners, draws on the Ngāi Tahu ancestral connection to Tāwhaki, a demi-god from Ngāi Tahu pūrākau (stories) who sought celestial knowledge from his gods. Tāwhaki was able to navigate his journey by seeking and building strong relationships, by being adaptive and innovative and using his sheer tenacity to keep going until he reached his goal.
The tenacious Tāwhaki was back for more money two years later and Woods announced the Government had obliged by providing a $5.4 million grant to the Joint Venture to fund a sealed runway and hangar facilities “to encourage investment, growth and continued research and development in New Zealand’s aerospace industry”.
“Tāwhaki predicts that over the next 10 years this development will contribute to over 1,300 highly skilled, high-paying jobs and up to $2.4bn in economic benefits.”
The $5.4 million funding would help build $6.1 million sealed runway and hangar infrastructure at Kaitorete. The $700,000 co-funding would be provided by Tāwhaki.
But Woods didn’t mention something that made its way into the headline of a Newsroom article headed in June this year, after the election and a change of government:
A Cabinet workaround saw Tāwhaki Aerospace centre approved for $5.4 million from a regional fund under the previous government despite officials advising it shouldn’t.
The article explained:
Advice from officials outlined that a consistent line had been held since the 2018 Provincial Growth Fund that projects in metropolitan centres were excluded from ring-fenced regional development funds.
In addition, Tāwhaki was not able to contribute much of its own money.
“RSPF eligibility criteria includes that other funding must be available for RSPF projects in addition to the RSPF funding sought. Although the amount of co-funding required was not specified by Cabinet, for commercial projects, the requirement is generally at least 50 percent additional funding. For non-commercial projects and Māori-enabling projects, a contribution of 20 percent is a guideline,” officials explained.
Tāwhaki contributed $700,000 – 11 percent towards the total cost.
Officials recommended the proposal be declined.
“There are significant reasons why it should not be funded through the RSPF … The benefits are to metropolitan Christchurch, not regional New Zealand. Over the past five years many potential proposals presented to Kānoa that did not meet the location-based eligibility criteria were not considered for funding.
“Moreover, other proposals in Kaitorete have been declined for regional development funding previously given its location.”
Oh – and officials (unlike Megan Woods) were unconvinced about the long-term economic benefits of Tāwhaki.
“The Ministry of Business, Innovation and Employment is unclear at this stage if funding the Tāwhaki proposal will be a good investment for the Crown long term.”
The briefing paper to minsters also outlined officials’ concerns that other funding avenues had not been explored.
“Tāwhaki has not fully explored other funding mechanisms (e.g. co-fund, sell assets, raise capital, partner with other commercial entities, other government funds, Budget bid). Tāwhaki claims that a grant is the only workable option, however our view is that there are further funding options to explore.”
There were concerns, too, that the project itself was not fit-for-purpose.
And now we learn that Space Minister Judith Collins has rejected a request for more funding.
Collins has made no announcements on the Government’s official website. RNZ learned of what’s doing through “newly released documents”.
According to the RNZ report, Judith Collins has been signalling to the United States that New Zealand wants in on its burgeoning commercial and military space launches.
Moreover, she reportedly told RNZ that the government still supported Tāwhaki – but…
… the briefings showed the tide had been going out on the centre since February.
“Tāwhaki has worked extensively to attract firms to New Zealand but none of these opportunities has yet come to fruition,” officials at the National Space Agency within the Ministry of Business, Innovation and Employment told Collins in May.
“Tāwhaki should focus on maximising the value from existing infrastructure given the low likelihood of international launchers entering New Zealand in the near-term.”
The officials advised Collins to tell Tāwhaki about “your preference for a scaled-back operation”.
“Their income is less than it should be given the opportunities available and the Crown investment already made” of $30m, half of that for the 1000ha of land.”
The government overhauled the Tāwhaki board in June and called for another “commercially focused” business case, though the agency lacks the resources to do it, RNZ reported.
Its most concrete achievement is a runway opened in February, built using $5.4m the previous government gave Tāwhaki.
It is now surviving on what it underspent from last year.
Then we heard from the Minister:
Collins told RNZ on Wednesday that funding talks were ongoing, though RNZ understands Tāwhaki is not in on those talks.
Asked if the government was at risk of wasting the country’s best launch site, Collins said it remained “an important site to support commercial drone, uncrewed aerial vehicle and advanced aviation activity”.
“A significant investment has already been made … and we look forward to realising the outcomes from that,” she said.
Her statement did not mention rocket launches.
Asked by RNZ what she was doing about National’s policy to set up two new aerospace testing sites aside from Kaitorete, she did not respond.
According to the documents which RNZ cited in its report:
“MBIE is unclear at this stage if funding the Tāwhaki proposal will be a good investment for the Crown long term.”
If Kaitorete won customers, “we can increase Crown assistance if necessary” but for now, drones were in but rockets were out, the documents indicated.
As for other options for vertical space launches, the Space Agency said no advice on that had gone to Collins this year.
Nor did the agency provide any record of briefing Collins about the options for the future Crown role in Tāwhaki, instead saying that had all yet to be worked out.
Bob Edlin is a veteran journalist and editor for the Point of Order blog - where this article was sourced.
5 comments:
A shameless waste of taxpayer monies approved by a hapless Megan Woods who was blinded by the " smoke and mirrors " , mythical arguments of local maori.
What we are left with is a amateur airstrip which no doubt the local maori will now attempt to monetise for private/commercial users " approved " solely by them.
A disgrace from the get-go.
Steve Ellis
A private venture, use private money.
Go talk to Ngai Tahu, they must have the same view on Maori and space.
Is Megan Woods at embarrassed by this debacle ?
What a total waste of tax payer dollars for zip, nothing, nada.
The Maori elite who pocketed most of those millions will be grinning from ear to ear, and ordering another flash car.
So, Tāwhaki is whucked eh?
Next we'll hear that Kaitorete have lodged a claim with the waitangi tribunal for $150 million, their share of the projected income, compensation for loss of Mana because the project was canceled.
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