Source: Radio New Zealand
Whanganui District Council has lost $11 million from its investment in the New Zealand International Commercial Pilot Academy. RNZ/Robin Martin
An independent review is to take a warts-and-all look at Whanganui District Council’s commercial pilot school, which is closing facing an $11 million loss.
Councillors approved the review of the New Zealand International Commercial Pilot Academy (NZICPA) 9-2 at a full council meeting today
Ahead of the vote, Mayor Andrew Tripe told councillors it was important the organisation learned from its mistakes and not “waste a crisis” and find out exactly what happened, so it could be more disciplined with future investments.
“Today we receive a very honest report about the NZICPA,” he said. “We are looking at a total loss of $11 million over the 11-year life of the investment and the effect on rates this coming year is 0.8 percent.
“This is a difficult number to digest, but we will not hide from it and we are choosing a controlled responsible divestment to ensure aviation training here continues without the financial risk to this council.”
Tripe said the academy was born from a desire to see Whanganui Airport thrive and to bring a new industry to the city.
“At it’s peak it was a success contributing $9.8 million to our annual GDP and supporting about 100 jobs.”
But the world changed after Covid-19 lockdowns, the withdrawal of Provincial Growth Fund support for an Advanced Aviation Hub and other factors meant the operation was no longer sustainable for ratepayers, Tripe said.
Council bought the academy – then called Flight Training Manawatū – in 2015 for $800,000 via its commercial arm Whanganui Holdings.
Later rebranded as the NZICPA it would close in June.
The $11 million loss was based on an estimated loss on assets sales – including aircraft – and other costs of $2.5 million, and operating losses of $8.5 million.
An independent review was estimated to cost between $50,000 to $150,000.
A internal council report prepared by chief financial officer Mike Fermor, which laid bare issues faced by the flight academy, recommended the review “to support transparency and capture lessons from the experience for future council investments”.
Councillor Charlotte Mesler spoke in favour of the review.
“We do still owe our community some clear answers about what we did know, what risks were identified or missed and how did we respond when things started to go wrong?”
She said that could only be achieved through a truly independent review process.
“Without that level of scrutiny we risk marking our own homework.”
Councillor Rob Vinsen baulked at the cost of the review.
“I cannot see the point of spending up to $100,000 for information we already know. This report on our agenda is extensive.
“It’s a very very good report which explains exactly what has gone on since the first entry on 6 of December 2017 … purchasing three Cessna.
“I don’t believe you need to hire a consultant to tell us that. The new chief executive could lead and internal review with their team and come up with any of that information. It’s all there..”
Fermor’s report found the flight school was set up with the best of intentions to boost the local economy, create jobs, attract international students, and increase activity at Whanganui Airport, but was hit by a series of setbacks.
These included border closures during Covid-19, which it survived due to $300,000 in council loans, the withdrawal of Provincial Growth Fund support for a proposed Advanced Aviation Hub and the closure of key building due to earthquake risk
In 2025, the NZICPA’s accreditation was also temporarily suspended during a Civil Aviation Authority safety investigation “materially changing its risk profile” prompting council to pump in another $2.3 million to prop up the pilot school.
At this stage the focus turned to managing risk and looking for a new operator for the struggling flight school.
It wasn’t all bad, while it operated the flight academy returned tangible benefits contributing approximately $9.8 million per year to local GDP and supporting about 96 full-time equivalent jobs at its peak, the report said.
Although a buyer was not found for NZICPA, Oamaru-based New Zealand Airline Academy – which looked at a purchase – was now operating a pilot school at Whanganui Airport and paying an $829,000 annual leases.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
