Rescue plan for New Zealand skiing crisis

The NZ government has forked out $5 million in a bid to save the country’s ski season after a major skiing operator collapsed.

The New Zealand government has forked out $5 million in a last-minute bid to save the country’s North Island ski season after a major skiing operator collapsed.

The 11th hour loan of NZ$5 million (A$4.6 million), confirmed just days ahead of the season opening on July 1, was announced to ensure the ski season on Mt Ruapehu, home to two major ski resorts, will go ahead.

It comes after Ruapehu Alpine Lifts, the company that operates the two resorts, revealed it was going into liquidation last week.

The New Zealand government has forked out $5 million after a major skiing operator collapsed. Picture: Visit Ruapehu

The cash boost is the latest of a series of attempts to save the ski season, after a meeting with major creditors — including the New Zealand government, ski pass owners and ANZ bank — failed to reach a solution last week.

Ruapehu Alpine Lifts was placed into liquidation the following morning. David Friar, a lawyer representing the company, described the ski fields as “hopelessly insolvent and unable to pay its debts.”

Most of New Zealand’s ski resorts are located on the South Island, while the North Island’s two major resorts, Whakapapa and Tūroa, are both located on Mt Ruapehu. The mountain brings in $100 million for the central North Island each year — about 10 per cent of its total regional GDP, according to the New Zealand government.

New Zealand’s regional development minister Kiri Allan said the funding would save hundreds of jobs and help to prevent economic loss to the region. Ruapehu Apline Lifts typically employs about 700 people each winter.

“This will allow time for liquidators to decide on the purchaser or purchasers of the business and its assets,” Ms Allan said in a statement.

“We’ve always been committed to finding a way to ensure the ski season on Mt Ruapehu goes ahead this year. Cabinet’s decision today has solidified that.”

Ruapehu Alpine Lifts was placed into liquidation after suffering a warm winter and years of pandemic closures. Picture: Alamy.

New Zealand prime minister Chris Hipkins hinted at the rescue plan last week when he said the Mt Ruapehu ski season represented a “very significant part of the economy in the central North Island.”

“If there is a way forward that allows the ski fields to continue to operate, then, yes, the government should be involved in those discussions — bearing in mind the Government stands potentially to end up being the party picking up the tab in the event the ski fields fall over,” Mr Hipkins said.

Ruapehu Alpine Lifts went into voluntary administration last year, owing about NZ$45 million (A$42 million), after suffering a warm winter and years of pandemic closures.

A report earlier this month revealed its debt had ballooned to NZ$81.6 million (A$75 million), more than half of which was owed to 15,000 people who hold ski passes.

The company’s debt nearly doubled in the past year. Picture: Getty Images.

Ruapehu Mayor Weston Kirton said the funding will help to ease concern in the central North Island community while an appropriate buyer for the ski fields is found.

“This decision marks a significant milestone in the ongoing efforts to secure the future of skiing on Mt Ruapehu and its contribution to the regional economy,” he said.

“I want to express my gratitude to the resilient and supportive Mt Ruapehu communities. I understand the stress and uncertainty this process has brought upon you.

“Moving forward, I call upon all stakeholders to support the liquidator to choose the best operator or operators who can ensure the long-term success of the Mt Ruapehu ski industry.”