Future of joint venture airports decided
The Government has reached a decision on the future governance structure of remaining airports in which it is a joint venture partner.
Transport Minister Annette King says the Cabinet has decided that two airports – Hawke's Bay and New Plymouth - will be given the option to corporatise, while the five airports, Whangarei, Whakatane, Taupo, Wanganui and Westport, will continue to be operated as joint venture airports.
Before Hawke's Bay or New Plymouth can be corporatised, agreement has to be reached between the partners in the joint venture --- the Crown and the local authority(s) currently involved in the management of the airport. Corporatisation will also be contingent on protecting the rights of Treaty of Waitangi claimants.
Under corporatisation a new legal entity, an airport company, would be created to own and manage the airport, Ms King said. The council(s) and the Crown will both be shareholders of that new company but the directors would be responsible for governance of the airport.
The structure of any board would be subject to an agreement between the local authority and the Crown. The Crown's interest would be managed through the Company Monitoring and Advisory Unit, with arrangements similar to Dunedin, Christchurch and Invercargill where the Crown has retained shareholdings.
"This decision paves the way for more active decision-making about important community assets. Of course, we can only proceed with agreement of our joint venture partners, and officials will be speaking with them soon," says Ms King.
The airports will remain in public hands, and the company structure will provide clearer governance and enable the airports to borrow for investment if necessary.
Whangarei, Whakatane, Taupo, Wanganui and Westport will remain joint venture airports, where the Crown and the local authority operate in partnership to manage an airport, Ms King says. The Crown shares the cost of any capital expenditure such as jointly acquired buildings and facilities (including runways and taxiways) and future improvements. Any deficits or surpluses are shared equally between the parties.
The Crown owns half the venture but has no role in the day to day running of a JVA, she says. The local authority partner is responsible for the day to day operational running of the airport and the airport is treated as a council controlled entity for purposes of accountability to ratepayers.
Ms King says the Government is "committed to increased engagement with the councils to ensure the joint venture relationship works more effectively for both parties for the benefit of the communities."