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Proposal To Wind Up Destination Marlborough Goes To Council

The commissioners appointed to steer Destination Marlborough after its entire board resigned over an employment dispute with a former manager has recommended the regional tourism agency be disestablished.

The move would see the Destination Marlborough Trust enter into voluntary liquidation, with all assets, permanent staff and financial shortfall absorbed by the Marlborough District Council.

Destination Marlborough has a forecast deficit of about $200,000.

A report on Destination Marlborough will go to a full council meeting on Monday. Councillors will vote on the recommendations.

If approved, the council’s economic, community and support services department would be responsible for all activities currently undertaken by Destination Marlborough.

The trust would enter voluntary liquidation on July 1. No redundancies were proposed.

The trust’s board resigned en masse in September last year over an employment dispute, brought by former general manager Bruce Moffatt, who had been in the role for less than a year.

The council funded a settlement between the two on the basis that the money be recovered from Destination Marlborough.
Rather than replace the board, the council decided to appoint four commissioners for a fixed term until the end of June this year.

They were deputy mayor David Croad, Marlborough Sounds councillor Barbara Faulls, former councillor Trevor Hook and former Destination Marlborough general manager Tracy Johnston.

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Tourism consultant and Marlborough Chamber of Commerce Board chairperson Tracey Green stepped in as interim general manager.

The report to council, prepared by the council’s strategic finance manager, said the former trustees had agreed to reconvene and pass the necessary resolutions to wind up the trust.

The report recommended the council establish an internal loan of approximately $200,000 to be repaid by a targeted tourism rate starting in 2025-26, by which time a new “destination marketing service” might be known.

The 2024-25 operating budget would be covered by council.

The other option was to fund the loan from a reserve, however the targeted rate was preferred as the beneficiaries of Destination Marlborough services would pay for it.

“Assuming a $200,000 shortfall and a 20-year loan, this equates to interest and principle repayments of $16,600 per annum,” the report said.

The report also recommended appointing the commissioners to a Destination Marketing and Management advisory committee within the council.

Croad told Local Democracy Reporting on Friday the winding up of the trust was an interim measure until they worked through a “future pathway” for Destination Marlborough.

“We all just want the best outcome for Destination Marlborough and the industry that it supports.”

The future of regional tourism promotion was to go through an Investment Logic Mapping process.

The process was introduced to New Zealand by the State Services Commission in 2008, and was used by government agencies to test and confirm the rationale behind investment decisions.

“We don’t want to assume anything with this, [but] bringing [Destination Marlborough] into council at the moment is what I personally believe is the right thing to do to more formally steady the ship,” Croad said.

“But I wouldn’t like people to perceive that that’s the pre-determination of what the future could look like.

“Because really the future could be back in some sort of trust model, or it could be a council-controlled organisation or it could be a department of council.

“That’s what the Investment Logic Mapping process is all about ... to help inform what is the right vehicle to deliver the services that Destination Marlborough delivers.”

Destination Marlborough staff would not be covered by the council’s contract agreements until July 1, 2025, when the “future means of delivering DM activities should have been resolved”, the report said.

The council allocated $1.15m in funding to Destination Marlborough in 2022-23. It also received other financial contributions, including sales through its i-Site booking business.

LDR is local body journalism co-funded by RNZ and NZ on Air.

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