The Trough Monitor is triggered as $140m of PGF deals are announced on the West Coast

The PM was down on the West Coast this morning, along with Regional Economic Development Minister Shane Jones and Agriculture Minister Damien O’Connor, keeping the Point of Order Trough Monitor busy while they announced $140 million of deals from the Provincial Growth Fund.

Loans for the Ruatapu Garnet Project, Westland Milk Products, and the Punakaiki Rest Wellness Centre were among the beneficiaries.

Taxpayers’ Union spokesman Louis Houlbrooke wasn’t impressed.

Upgrading digital infrastructure and public trails is one thing, he said,

” … but ploughing millions into luxury spa facilities, mining ventures, and dairy businesses is not the role of government. In fact, these handouts give unnatural competitive advantages to recipients, with no dividends returned to the taxpayer.”

He argued that a well-established company, Westland Milk Products, with 430 employees in Hokitika alone, was capable of securing investment privately.

“Clearly, Shane Jones has too much taxpayer cash in his pockets.
 
“This type of largesse typifies why Shane Jones received our inaugural Lifetime Achievement Jonesie Award for wasteful spending.”

ACT Leader David Seymour similarly was unimpressed, saying the Provincial Growth Fund’s lending to struggling New Zealand firms “should scare the daylights out of taxpayers”.  

If banks weren’t willing to lend to these companies, they had judged them to be too risky – so why should taxpayers be on the hook?

At time of writing National had yet to comment.

Here’s what the Beehive press statements said:

29 NOVEMBER 2018

$140m investment in West Coast economy

The Government is investing significantly in the West Coast through the Provincial Growth Fund (PGF) to strengthen the region’s economy and create new jobs with a $140 million investment package announced by Prime Minister Jacinda Ardern today.

Projects announced today include:

  • $87.46 million for tourism, ensuring the region’s popular sites and unique environments are protected and offer high-quality experiences for visitors
  • $32.8 million for extending ultra-fast broadband and mobile coverage
  • $10 million for a garnet mining project at Ruatapu
  • $9.9 million for a milk segregation project with Westland Milk Products

Regional Economic Develoment Minister Shane Jones said the projects announced today also reflect the priorities of the Tai Poutini Economic Development Strategy and focus on the key sectors already driving the region’s economy, which increases the chances of success.

The full list of projects included in today’s announcement is provided here.  

Investent in West Coast hi-tech dairy

Regional Economic Development Minister Shane Jones announced the Government is helping future-proof a critical West Coast industry with a loan of $9.9 million from the Provincial Growth Fund (PGF) to enable a milk segregation project at Westland Milk Products.

The interest-bearing, repayable loan from the PGF will support the development of segregation facilities at the co-operative’s Hokitika site, which will enable Westland Milk Products to collect and process different types of milk products and milk, such as A2 milk and colostrum.

The objective is to encourage farmers to produce milk that can be turned into much higher value products, delivering higher returns without requiring an increase in herd numbers.

This would pave the way for Westland Milk to grow its business by processing to higher value products, a great example how technology can help drive growth that is both meaningful and sustainable.

Westland Milk Products has indicated it may explore using the facility to produce non-bovine milk, such as sheep and goat milk or plant-based protein.

West Coast tourism gets big PGF boost  

Regional Economic Development Minister Shane Jones announced today West Coast tourism will benefit from an $87.46 million investment from the Provincial Growth Fund (PGF).

With funding for five tourism initiatives within the Buller district and a new premium service and extra capacity on KiwiRail’s world-renowned TranzAlpine Great Journey of New Zealand, this investment will strengthen the entire region’s appeal to visitors from New Zealand and overseas.

The projects receiving funding are:

  • $40m for a new premium service additional capacity for the TranzAlpine service
  • $25.6m redevelopment at Dolomite Point in Punakaiki, focusing on improved visitor facilities and visitor experience
  • $9.36m to build the family-friendly Kawatiri Coastal Trail between Westport and Charleston
  • $5.7m to improve visitor facilities and environmental protection at Oparara Arches in Karamea
  • $3.3m loan to build hot pools and spa facilities above Punakaiki Resort
  • $3.5m to upgrade Croesus Road at the Blackball end of the new Paparoa Great Walkand Pike29 Memorial Trail

The investment in KiwiRail will be used to add two more carriages to the TranzAlpine during peak periods and to introduce a premium carriage, offering for more luxurious experience and to upgrade platforms and booking systems. The funding follows PGF’s $40m investment to boost the Coastal Pacific service that was announced last week.

$45m boost for South Island connectivity

Regional Economic Development Minister Shane Jones announced today the Government is investing $44.8 million from the Provincial Growth Fund (PGF) to improve digital connectivity in the West Coast and Southland.

The investment will extend and improve internet access and mobile coverage across the entire area, including developing broadband infrastructure in and around Haast and Milford Sound.

Projects announced today include investments of:

  • $22m for Haast Fibre Loop between Fox Glacier and Lake Hawea
  • $12m for Milford Highway Fibre Connection into Milford Sound in west Southland
  • $5m to extend and improve mobile coverage on the West Coast
  • $1m to extend and accelerate Ultrafast Broadband (UFB) in UFB towns on the West Coast

Today’s announcement also includes an additional approximately $4.8m to expand the Rural Broadband Initiative Phase 2 (RBI2) and Mobile Black Spots Fund (MBSF) in the West Coast, funded from the PGF’s national connectivity investment announced earlier this month.

The PGF funding will be transferred to Crown Infrastructure Partners (CIP) which will contract providers for the project work.

New mining venture a reality for West Coast

Regional Economic Development Minister Shane Jones announced the Government is backing a new venture to mine garnet on the West Coast with a $10 million loan from the Provincial Growth Fund (PGF).

Up to 50 permanent, high-paying jobs will be established through the Ruatapu Garnet Project, as well as boosting support industries like transport and trades in the region.

The Barton New Zealand Limited (BNZL) mine has support throughout the region, including councils and iwi, and is backed by American firm Barton Mines, which has 140 years’ experience in garnet mining.

After several years exploring the site, BNZL says the garnet resource here is world class and this mine represents the beginnings of a new industry for the West Coast.

Alluvial garnet is mainly used as an industrial abrasive – such as water jet cutting or in products like sandpaper. The mineral-bearing sand will be collected using a front-loader digging operation and the garnet will be separated with machinery based at the Ruatapu site.

The project will be developed on privately owned land in Ruatapu, near Hokitika.

The repayable, interest-bearing loan from the PGF is contingent on Barton NZ Limited successfully completing the Resource Consent and Overseas Investment Office processes.

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