Wellington airport hits back at NZIER analysis

14 February 2016 (Last Updated February 14th, 2016 18:30)

Wellington International Airport has come down heavily on the New Zealand Institute of Economic Research's (NZIER) analysis of its $300m runway extension project.

Wellington International Airport (WIA) has come down heavily on the New Zealand Institute of Economic Research's (NZIER) analysis of its $300m runway extension project.

According to the WIA, the NZIER while making its analysis not only underestimated the low economic benefit that each tourist would provide to the country but also had overblown the airport's proposed number of routes.

The analysis had stated that the 350m extension is "speculative" and therefore not to be proceeded.

"The draft CBA implied a conservative value of $246 for each visitor, a figure which the MBIE analysis and other commentators have suggested is too low."

The Board of Airline Representatives had issued the NZIER analysis.

NZIER had drawn its conclusions after analysing seven potential routes to the US, Middle East and Asia, reported Nbr.co.nz.

However, WIA spokesman Greg Thomas told BusinessDesk that its own consultants had recommended the extension's feasibility based on far fewer routes than reported by NZIER analysis.

Thomas was quoted by Nbr.co.nz as saying: "World route development experts InterVISTAS have confirmed viable long haul routes from Wellington starting with a daily service [not seven as BARNZ have suggested], growing to four services by 2035 - similar to Christchurch today."

According to Thomas, NZIER's "estimate that each additional tourist would add just $160 of economic benefit is massively disproportionate to the Ministry of Business guidelines for determining the net benefits that New Zealand derives from international visitors to New Zealand."

"The draft CBA implied a conservative value of $246 for each visitor, a figure which the MBIE analysis and other commentators have suggested is too low."

WIA is owned in the ratio of 66:33 by Infratil, an infrastructure investor, and the Wellington City Council.

The airport has sought funds from central and local governments for the the proposed extension.

Public consultation on the proposal is yet to begin.

Currently, the Wellington City Council is providing funds to conduct studies as well as for the resource consent process.