The Crown will provide a loan to Hawke’s Bay Airport to ensure it can trade through COVID-19 economic impacts, support the region’s recovery and protect up to 200 jobs.
The Crown has a 50 percent shareholding in Hawke’s Bay Airport Limited (HBAL), with Napier City Council holding 26 percent and Hastings District Council 24 percent.
The airport requires financial support of up to $9 million due to reduced passenger numbers and revenue due to COVID-19. The Crown will loan up to $4.5 million on commercial terms, with the councils providing up to a further $4.5 million.
“It’s important that we retain an important regional asset which will enable the Hawke’s Bay to stay connected and support the recovery of the domestic tourism and aviation sectors,” Winston Peters said.
“Hawke’s Bay Airport experienced a significant drop in revenue due to COVID-19. The request was made to shareholders to provide financial support to ensure the airport remained viable and to allow completion of the terminal redevelopment, an important part of the airport expansion project, which was started before the onset of COVID-19.”
“As the major shareholder in Hawke’s Bay Airport it’s appropriate for the Crown to provide a loan to support cashflow,” Grant Robertson said.
“This ensures the terminal redevelopment can proceed, protecting up to 200 jobs including those of contractors already working on the project. As a Government we support investments that will help our regions and local economies to continue their recovery and to rebuild.”
The loan is expected to be repaid within two years and is considered fiscally neutral. There will be no impact on net core Crown debt over the period of the loan, and the capital expenditure associated with the appropriation will not impact the COVID-19 Response and Recovery Fund.