Home LATEST-NEWS Whakaari Outburst: Government Funding for Business Shocks Victims’ Lawyer

Whakaari Outburst: Government Funding for Business Shocks Victims’ Lawyer

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Aerial view of Whakaari/White Island after the volcanic eruption in 2019. Photo / File

Tourism companies in Whakaari/White Island accused of violating health and safety laws have received hundreds of thousands of dollars in government funding since the tragedy.

Twenty-two people died and at least a dozen others were seriously injured after the explosion on December 9, 2019.

A week after the eruption, Prime Minister Jacinda Ardern announced a bailout package to help businesses recover from the economic shock.

Figures obtained by RNZ show that White Island Tours, Volcanic Air and Kāhu NZ received nearly 90 percent of the $1.67 million distributed by the fund.

They were investigated at the time and are now among 13 parties prosecuted by WorkSafe for alleged health and safety violations that led to the devastating explosion.

A lawyer representing some Australian families called the payments “absolutely unfair”.

White Island Tours, which had brought 21 of the 22 who died to the island, got the most out of the support package — more than $870,000.

The operator also received $244,000 in payroll subsidies for Covid-19, bringing total government funding to $1.1 million last year.

Helicopter company Volcanic Air, with whom one of the deceased flew to the island, also received more than $1 million – including more than $390,000 from the eruption recovery fund, $500,000 from the government’s Strategic Assets Protection Program and $121,000 from Covid-19 wage subsidies.

Kāhu NZ, another helicopter company facing prosecution by WorkSafe, received more than $220,000 from Whakaari’s recovery package.

The Whakatane District Council had so far refused to disclose recipients and amounts, citing commercial sensitivities.

It helped approve grants and assured recipients that the information would remain confidential.

RNZ filed a complaint and after an investigation, Chief Ombudsman Peter Boshier ruled that “the municipality was not entitled to withhold a malfunction”.

Aerial view of White Island after the volcanic eruption on December 9, 2019. Photo / File
Aerial view of White Island after the volcanic eruption on December 9, 2019. Photo / File

Attorney Rita Yousef represents some Australian families who are taking legal action against the Royal Caribbean cruise company that sold passenger tickets to Whakaari/White Island.

She told RNZ that it is “absolutely unfair” that the companies have received the payments when her customers have just had ACC payments.

“I am amazed that the alleged violators would have received such large sums of money.”

Yousef said to her clients that the consequences of the tragedy were as real today as when it first happened.

“It is not something that anyone could easily or quickly recover from or move on from. Especially for those who have lost loved ones and also especially for those who [survivors] who, for example, have lost body parts and had to learn to live without.”

Nash defends payouts

Small Business Secretary Stuart Nash would not be interviewed about the grants.

But in a written statement, he said: “Central and local government decisions on measures to support business were made in accordance with the eligibility criteria.”

When asked whether the public funding could eventually be used to pay WorkSafe fines and reparations — if defendants are found guilty or plead guilty — Nash said “it would be inappropriate to speculate.”

White Island Tours declined to be interviewed but also made a written statement to RNZ.

Stuart Nash.  Photo / File
Stuart Nash. Photo / File

“The allocated funding was mainly used to support continued employment of staff and the coverage of fixed operating costs during the summer period when tourist numbers declined and the company had very limited revenues,” it said.

Volcanic Air chief executive Phil Barclay also declined to be interviewed, but in writing said all reporting requirements were “strictly adhered to” after funding was received.

He said the eruption and Covid-19 had created “an incredibly tough few years”.

“Financing has enabled the company to retain our workforce, pay for aircraft maintenance, product development, marketing and meet our regulatory requirements.”

Kahu NZ declined to comment.

Gives ‘a lifeline’ – congregation

Whakatane Mayor Judy Turner rejected RNZ’s request for an interview, but the district council issued a statement defending his actions.

“The grants have been a much-needed lifeline for a number of businesses, allowing them to retain staff and continue contributing locally. A robust process was prescribed for the Whakatāne District Council to facilitate the establishment of an independent panel to review applications for support.”

A representative of Ngāti Awa sat on this panel.

Conflicts of interest had to be managed carefully as the iwi owns White Island Tours.

Te Rūnanga o Ngāti Awa bought the Whakatāne business in May 2017.

Ngāti Awa lost 245,000 acres of land to Crown confiscations, so rūnanga leaders weighed up White Island Tours’ deal for months, cautiously accounting for more than 16,000 iwi members of 22 hapū, to whom Whakaari is sacred.

Pilots from Kāhu NZ and Volcanic Air flew to Whakaari to rescue survivors after the December 2019 blast.

With these two companies in court, 140,000 people have signed a petition to have their charges dropped.

But WorkSafe’s prosecutions only cover alleged actions before the eruption, not after.

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