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No waiver or discounts on landing fee, says PM

Monday 28 June 2021 | Written by Caleb Fotheringham | Published in Economy, National


No waiver or discounts on landing fee, says PM
Rarotonga International Airport. (PHOTO: CI News)

Cook Islands does not offer waivers or discounts on landing fee for travel out of New Zealand, says Prime Minister Mark Brown, after businessman Mike Pero pulled the plug on Pasifika Air due to ‘lack of government support’.

Prime Minister Mark Brown took a swing at the Cook Islands News in Parliament last week, saying he was “surprised and very disappointed” at the paper’s coverage of Mike Pero’s failure to get an airline off the ground.

“To put it mildly, I was surprised and very disappointed to read the Cook Islands News story suggesting that Mike Pero pulled the plug on Pasifika Air because he couldn’t get a waiver or discount on landing fees at our international airport,” Brown said.

“Especially as he told me himself that there were eight factors which prevented him from moving ahead with the proposed airline at this time.

“Pero has thanked me for the support I gave the proposal… and apologised for the spin CI News took highlighting one factor without mentioning the other seven.”

Pero told the Cook Islands News that he would not comment further on the matter.

Earlier this month Pero told the newspaper he pulled the plug on the proposed airline for eight reasons, one of them being a lack of enthusiasm from the Cook Islands government. He did not reveal the other seven reasons.

Pero said New Zealand airports were willing to provide the airline with free landing fees for an average of two years but the Cook Islands government offered only one month.

Pero said the lack of government support was “quite hurtful” and “the most disappointing” reason why Pasifika Air didn’t get off the ground.

He emphasised “the Cook Islands Government was not the primary reason for us not proceeding – it was one of eight factors but it was the last straw.”

“In New Zealand, there was a huge willingness for the airline to succeed, to the extent New Zealand airports were prepared to invest millions of dollars in the way of credits to help get this venture off the ground,” Pero said.

“Yet in the Cook Islands, I felt there was not the same willingness. Not the same willingness to work with us and it was a huge blow.”

During Parliament, PM Brown said Pero had been in discussion with numerous government agencies including the Airport Authority and Ministry of Finance and Economic Management (MFEM) on commercial matters relating to Pasifika Air.

“Mr Pero asked the Airport Authority for a landing fee exemption of one to two years.

“The authority agreed to a one-month exemption, 50 per cent discount on the second month, 25 per cent off the third, with full landing fees applying from the fourth month onwards,” Brown said.

“The current landing fee for flights ex New Zealand is $1800 per flight, less than $10 per passenger.”

Brown said: “Our policy to date has been that we don’t offer waivers or discounts on landing fee for travel out of New Zealand. And if we did it for one air carrier, to be fair and even-handed, we would have to do the same for all carriers coming in.”

Speaking to the New Zealand Herald last week, Pero said the “reference to only $10 per passenger may not sound much but that is a million dollars a year just to land in Rarotonga”.

Pero told The Herald, Air New Zealand paid little in the way of fees when they started flying to the Cook Islands, while Virgin (and Pacific Blue, prior) got start-up concessions.

PM Brown said: “Mr Pero met with MFEM on only one occasion and to date he has not provided them with a business case or any actual proposal.”

“Mr Pero never clearly articulated to MFEM exactly what support he was hoping to get from the Cook Islands government.

“This government does not invest in any initiatives be they start-ups or existing, without proper analysis and well-developed financials.”

Pero aimed to fly Pasifika Air later this year as part of a Cook Islands travel bubble with New Zealand.