Air N.Z. facing big changes?

Press, 26 November 1981, Page 17

Air N.Z. facing big changes?

By

LES BLOXHAM

senger loadings that will result from a restoration of economic activity throughout New Zealand.” .

However, the party has not rejected outright the need for third-level services, i.e. smaller airlines flying smaller aircraft .than Air New Zealand’s 48-seat Friendships on some regional routes.

The party favours the formation of a holding company in which Air New Zealand would have 51 per cent of the shares with the balance being held by all the third-level carriers. Such a plan, the party believes, would cut costs and avoid the duplication of maintenance and repair facilities. “With Air New Zealand the principal shareholder, a major measure of Ministerial influence over the retention of services would be guaranteed,” the policy states.

National has undertaken to stand by Air New Zealand in its present form. “Over a time of crisis for international airlines around the world, the National Government has consistently stood by Air New Zealand,” says a

brief policy on aviation. National’s confidence in the airline and its ability to succeed is reflected in the purchase of five new Boeing 747 s with fuel-efficient Rolls Rovce engines, and in continuing negotiations for new international landing rights.

“National has tackled the difficult arid controversial task of merging the airlines, with proven savings of $l3 million a year,” the policy claims. The Government’s domestic air services policy review, which was released earlier this year but which is still to be put into effect, will — according to the party — ensure the continued growth of commuter and provincial air services.

A revised licensing framework would encourage more frequent and efficient provincial services, and reduce the costs of main trunk services.

Social Credit’s policy is the briefest of the three parties. While reiterating its original support for the merger, the League doubts that the promised benefits have in fact occurred. It has undertaken urgently to investigate

the airline’s present structure.

Ownership of the prime air services would remain with the public through a corporation, but assistance and encouragement would be given by Social Credit to the development of additional feeder services and to the continuation of commercial services such as agricultural and freight operations. Tourism

The three parties have painted a broad picture of growth in the tourism industry. Labour proposes the establishment of an air tour company within Air New Zealand to promote in-bound tourism at lower costs than now available. The party’s priorities would be to make it easier for New Zealanders to travel and enjoy their own country, to create jobs, and earn and conserve foreign exchange. The latter would in part be achieved by Labour’s foreign exchange “surcharge” — a

tax which the party concedes in its financial policy would “encourage New Zealanders to see New Zealand first.”

The surcharge would be based on the present annual devaluation rate of the New Zealand dollar. At the suggested 6 per cent, for instance, the surcharge would cost intending travellers an extra $6O for every $lOOO drawn in foreign funds. However, as the foreign exchange surcharge would apply to all imports, including fuel, it is likely that air fares would also cost more. So would accommodation and other ground charges for an overseas trip, even if paid to a local travel agent before departure.

Labour has undertaken to stimulate the development of hotel accommodation and to develop a national tourist plan based on 10-year projections. It would also require the Tourist and Publicity Department to expand and accelerate publicity of New Zealand abroad.

National’s policy reflects the Government’s record since 1975 during which time overseas exchange earnings have more than doubled to $4OO million. Its aim for the future is to maintain growth in the industry from its present level of 450,000 visitors a year to one million visitors in 1990.

The party has undertaken to retain until at least 1985 its export performance tax incentives and export promotion grants which led to a positive and co-ordinated growth in marketing of New Zealand overseas by the private sector. National would continue to encourage hotel development which, over the last four years, had produced 1000 new first-class hotel rooms. It sees an increasing future for New Zealand’s ski-fields, an industry which already was earning $lO million a year in overseas earnings. National’s policy specifically mentions the proposed runway extensions at Christchurch Airport. “The decision to extend the runway ... is part of an ongoing policy to ensure that airport

development keeps pace with tourist demands. The South Island in particular will benefit from the extension which ensures Christchurch’s role as the gateway city of the south,” the policy states. Social Credit proposes legislation that would define the role of the Tourist and Publicity Department solely as a promotional one. It would remove its present ability to sell domestic and international travel.

The League would encourage investment in the industry. “Because tourism is a real growth industry with excellent potential as a foreign exchange earner, development finance will be made available at concessional interest rates to encourage private development of hotels, resorts, and other tourist complexes. This investment will flow at a rate sufficient to ensure that a 15 per cent growth rate is possible.”

Social Credit would also guarantee support for the Tourist Hotel Corporation, and protection for the environment and national parks.