The last time I wrote an article for The Profit was about a month after we had got back into the office after ‘Alert Level 3’. As I wrote at the time“So ….. where to from here?If I had a dollar for each time I was asked what affect this will have on future property values I could probably retire.Possibly, the more important question should be: What is the impact going to be on volume?Answering this question will probably give a more informed prognosis because in time it will have a more material impact on property values. Certainly, residential sales have defied predictions andboth values and volume have increased.
Bindi Norwell, CEO of the Real Estate Institute of New Zealand (REINZ) reported thatthe number of residential properties sold in September across New Zealand increased by 37.1% from the same time last year (from 6,112 to 8,377). This is the highest number of properties sold in a month in New Zealand for 42 months (March 2017) and the highest number of properties sold in a September month for 14 years.
At the risk of boring you I have rounded up some statistics of the property market since we came out of lockdown when no one was quite sure how the residential property market would respond. The stats quoted are up to September 2020 as there is approximately a month’s lag with receiving data.
September 2020 saw a record national Median Sale Price (MSP) achieved at $885,000 with nine out of the 16 regions also posting record MSP’s.Not only that, the volume of sales was also the highest it’s been in New Zealand since March 2017.Regionally, Hawke’s Bay also recorded a 3.1% increase in volume over last month and 21.2% increase over September 2019 with 263 properties sold – the highest number of properties sold in a September month since 2006.
Values do not seem to be hindered by this increase in sales volume.In Hastings City, the suburbs of Camberley, Mahora/Tomoana, St Leonards and Hastings Central all recorded their highest MSP’s since records began. Mahora/Tomoana recorded an MSP of $749,250 off 12 sales with the suburb’s first million-dollar sale also recorded. Furthermore, Frimley and Clive recorded their second highest MSP and Mayfair recorded the suburb’s highest volume of sales since May 2016.In Napier City the suburbs of Pirimai, Westshore, Taradale and Napier South also all recorded their highest MSPs since records began. Also, of note is that the median days to sell a property regionally is now 29 days, which is down from 32 days at the same time last year.
However, inventory is down by 17% from September last year. In Hawke’s Bay listings decreased -8.0%, bringing the region to the lowest level of inventory that it has seen since July 2019.
We have seen first time buyers become more active in the market probably due to the low interest rates and lack of ‘loan to value ratios (LVRs). Investors are also taking advantage of low interest rates and have been showing interest at all levels across the market. The increasing levels of demand has created tough competition, resulting in multi-offers on many properties. Furthermore, the Reserve Bank has relaxed the market for property investors since Covid. By scrapping LVR restrictions, the Central Bank has given the green light for banks to lend more money to landlords, further fanning the flames of the market. Investors borrowed $1.45 billion in August, the highest figure since May 2018.
Journalist Daniel Dunkley describes the market as ‘tearaway’ and it’s hard to see this fervour being maintained. Opinion also appears divided as to whether this is a negative or positive aspect to our economic recovery. The housing market has defied expectations post Covid lockdown with values and volumes increasing nationwide. Yet there are fears New Zealand’s housing-led economy is highly vulnerable to a correction.
As we start to get a better understanding of the new ‘Business as usual’ operating landscape and the initial urgency around business disruption dissipates, at BDO our focus has now shifted to ensure local business have the ongoing support and strategies in place for the medium to long term time periods.By building resilience and taking full advantage of the options available to them, businesses now have the opportunity to finesse, pivot and diversify to best position themselves for the future.
One of the strategies we are encouraging businesses to adopt is to ensure that they are across the tax changes implemented during the initial Covid-19 lockdown.These changes can affect how much provisional tax you should pay, as well as how different costs might be treated in your reporting to the IRD.
Paying provisional tax based on standard uplift may not be the most cost effective option for you moving forward.Below I will look to provide an overview of the key tax changes that all SME owners need to ensure that they are across so that they are prepared for any future opportunities.
Claiming depreciation on buildings
One tax support measure following covid, is the reintroduction of tax depreciation on (non-residential) commercial and industrial buildings and the allowance for tax depreciation on newly acquired buildings and capital improvements made to existing buildings from the 2020/21 tax year. The tax depreciation rate will be 1.5% straight line or 2% diminishing value.
For entities that had previously been claiming depreciation on their non-residential buildings, this change will see reduced taxable income levels following from recommencing a claim for depreciation from the beginning of the 2021 tax year.You may want to consider the impact of this claim when you are considering the amounts you need to pay for provisional tax.
For entities accounting for deferred tax, this reintroduction of a claim for depreciation will also result in a significant change to the deferred tax balances in the 2020 year results.
Increased minor asset write-off thresholds
In March, the government also lifted the threshold for writing off the purchase cost of minor assets. Previously set at $500, SMEs can now claim in full at the time of purchase for assets with a cost of up to $5,000 in the year they were purchased. This threshold increase is only temporary, and expires on 17 March 2021. However, the threshold will only drop to $1,000, remaining double what it had been in 2019.
Loss carry back provisions
The Government’s new “carry back” rule has been implemented to help SMEs recover some past tax losses and put that recovered cash flow toward future recovery efforts. This rule is more complicated than the previous two, and you should consult with your tax accountant to help calculate how this change may be applied in your business.
Tax losses in 2020 and 2021 can be offset against profits earned the previous year (2020 and 2019, respectively). These losses can be based upon a filed tax return or by provisional tax estimates. Estimates need to be based upon extensive analysis and reasonable forecasts and SME’s may be charged interest if payments are underestimated.
Research & development claims & refunds
R&D is often among the first functions to be discontinued or scaled back when cash flow is limited. To keep the New Zealand economy at the forefront of global innovation, the Government has brought forward the refund date for the R&D tax credit by one year. Businesses with research and development departments can claim up to 15% of their eligible annual R&D spend, up to $120 million.
The R&D tax incentive was passed last year but some of the broader refundability rules weren’t set to go into effect until the 2020-21 income year. These are the rules the government has moved forward. If your SME has R&D costs speak to your business advisor about whether your projects meet the eligibility criteria for a refund.
Recovery is about seizing opportunities
Businesses can’t leave money on the table when funds are tight. Thanks to these changes, there is now a range of tax benefits available to help small to medium-sized businesses move into the 2021 year as positively as possible.Given that payment dates for tax are often staggered throughout the year, it is important that you take stock of the changes that were implemented and consider how these may influence your tax responsibilities.
Security has become a more in-depth executive discussion because of the many ways through which businesses can and are being attacked. Mobility, BYOD (bring your own device), virtualisation, the cloud, and social media have all opened new doors and security loopholes into all our businesses. At the same time, all organisations need IT Security protection to allow their business to function, grow and flourish. And of course, the regulatory environment calls for an increasing number of types and levels of proven compliance, with regular and timely updates and maintenance. Sound Hard? Complicated? You are correct – it is.
Adding pressure to organisations is the fact that technologies, business models, regulatory environments, and the threat landscape are continuously evolving. So, security has become a broad IT discipline that affects the entire organisation and calls for a range of highly specialised and dynamic skills and technologies that most businesses don’t currently have. The boardroom question is: how cost-effectively can these be acquired and implemented?
What is the solution to this serious business issue?
With a specifically structured suite of Managed IT Security products, your IT partner can protect your business from the increasing security breach landscape. Some organisations have firewalls, antivirus, and network intrusion prevention systems in place. However, research shows that they are often not fit for purpose in today’s IT environment, are out of date, and businesses don’t always have the workforce capacity or technology to maintain them efficiently. In particular, systems are often not patched regularly. Consequently, organisations don’t always know whether or not they’ve been attacked and aren’t taking proactive steps. Much more importantly, these very limited systems cannot predict attacks.
A Managed IT Security Solution together with reputable IT tools can and does. Recent highly publicised security breaches at many Australasian businesses have proved just how disastrous security breaches and reputational damage can be. However, achieving this necessitates a fundamental change in security focus as well as significant investment. You need industrial-strength levels of documentation, processes, and procedures. Ideally you need qualified engineers and security specialists to continuously monitor your security systems, analyse the alerts and be able to respond immediately. You need to continuously update your technology with the cumulative experience, insight, and knowledge of many independent security experts working towards the same goal of pre-empting attacks. The best way to achieve this successfully and affordably is through an IT Managed Security Service.
Layered Security Options
Below are some security options that need to be considered by businesses: –
Managed Firewall: protects your key information assets across networks, hosts, applications, and databases.
Managed Advanced Intrusion Prevention: can provide a fully managed, 24/7 service that uses network-based intrusion detection and prevention systems to protect networks from attack.
Managed Email Filtering Services ensures that emails are monitored and managed effectively to provide continued protection from information leakage and from viruses, trojans, spyware, and malicious code distributed via email.
Web Managed DNS: provides secure DNS management (filters the internet address book for bad addresses) to remove the threat of any related security threats, with the added functionality of web filtering by location and/or employee.
Managed Password and Account Access Policies: Changing passwords at least every 90 days and/or implementing multi-factor authentication ensures that imposters cannot log into your account from elsewhere, even if they steal your username and password.
If some or all of these descriptions and/or technology terms are not familiar to you, and you are worried about how secure your IT environment is, you need to talk to your IT provider as soon as you can, and before it’s too late.
It is important to note that recent changes to the New Zealand Privacy Act means businesses will be required to notify the Privacy Commissioner and affected individuals after suffering a privacy breach where personal and business information is criminally accessed, and where serious harm is likely. The new Act takes effect on 1st December 2020.
New Zealand, it seems, is leading the world in its handling of the Covid-19 crisis. Although none of us have a crystal ball, we are in a much better position than most nations, many of whom are suffering under the pressure of vast numbers of new cases and struggling economies.
Over the last few months I have observed economists, investors and market commentators sway between downright pessimism and euphoria. The happy medium is that there has been good growth in many asset classes during 2020, not least of which has been in the mortgage trust arena.
What now?
The Reserve Bank recently announced a funding for lending programme will be ready for the end of 2020. This will involve the Reserve Bank directly funding bank lending at a set low interest rate, which may add to the downward trend in bank lending and term deposit rates.
As house prices continue to rise it appears the Reserve Bank believes that it is better to over stimulate the economy than not. Ultimately more money is likely to flow into assets like residential property, shares and mortgage funds.
Although the global economy is slowing down, some economists believe that this does not necessarily mean that a financial crisis at home is looming and the Government, which is about to start its second term in office, has indicated that it will take extra steps to support the economy.
I firmly believe that we should not be talking ourselves into a recession. Let’s be honest here, people are spending their hard-earned cash; they are not travelling overseas because they can’t, but they are travelling domestically and do want to support local businesses and invest as asset prices continue to rise.
Pessimism in New Zealand seems to be easing. Kiwis are refocusing on their nest eggs and looking to the future, just as they should be. Many people have recognised that although our economy may take a few years to regain its full momentum there are still many opportunities to be had. Midland’s continues to fund various property orientated growth activities throughout the country.There is good demand in the marketplace for lending products and as banks continue to reward their savers with meagre returns, we are seeing increasing interest in our fund.
In summary, I think we should all be looking firmly to the future, whilst understanding that there may be some challenges ahead. There is a continued trend of investors looking for reliable returns over and above bank deposit rates. The recent closure of Bonus Bonds has also fuelled interest in cash-type investments. Should you wish to discuss any of my thoughts detailed above, then please do not hesitate to get in touch.
The COVID-19 pandemic has created a great deal of economic uncertainty both globally and in New Zealand.During the lockdown in April and May 2020 we were all questioning how the housing market would be impacted.
Contrary to the expectations of some commentators, the NZ housing market has been booming since the end of lockdown.Whether this is from an increase in Kiwis returning home, new home buyers taking advantage of lower interest rates or people just needing a change, the fact is competition for houses has increased and prices are still rising. According to data REINZ released in September 2020, median house prices across NZ increased by 16.4% in August 2020.In Hawke’s Bay the increase in annual sales volumes during August was 32.5%, the highest number of house sales for the month of August in 14 years.
Bramwell Bate is finding that clients are often involved in a multi-buyer situation where now, more than ever, they are needing to put their best foot forward in order to have a chance at their offer being accepted.
It is still important, however, that you do your homework first.A house purchase is one of the biggest investments you will likely make in your lifetime.
When you put forward an offer to purchase a property, you can make the offer subject to several conditions that need to be satisfied before your purchase proceeds.
One of the most common conditions is finance.Even if you have pre-approval from a bank, most banks will need to see the signed Agreement for Sale and Purchase and approve the property you are looking to purchase before they will give you final approval. This makes the finance condition crucial.
If it is your first home, then you may be eligible for a Homestart Grant or to withdraw funds from your Kiwisaver.In these situations you should speak with your lawyer about what timeframe your finance condition should have to ensure you have sufficient time to get approval and withdrawal of funds, especially if you need those funds to pay a deposit to the vendor.
A solicitor’s approval condition is also often included in an Agreement for Sale and Purchase.This can provide your solicitor with a chance to look at the Agreement and the title to the property.For example, there may be an easement on the property which gives someone a right of way, or a right to run power or pipelines through your property. You may also have plans to develop your property and before you proceed with the purchase it is important to consider whether any easements might restrict your ability to do so.
Another common condition is a builder’s report. This report generally allows you to obtain a report on the condition of the home and other improvements on the property.
We recommend you speak with your lawyer prior to making an offer so that you can consider the number of conditions to include and ensure that you are sufficiently protected.There may also be instances where you can make enquiries before putting forward your offer, such as obtaining the builder’s report or asking your lawyer to take a look at the title to the property before you proceed.
Whatever you decide, it is important to get the proper advice and support.A signed Agreement for Sale and Purchase is a legally binding document. Your lawyer will talk you through it, answer any questions, and ensure it is correct before you sign.
The last Alert Level 3 Lockdown in Auckland has once again shown that businesses need to be prepared, at short notice, to make to significant changes to the way they work if required to move to Alert Level 3, or 4. As a result, it’s important to have a plan that you can put into action should this next occur.
An important part of this plan should focus on how you will, if necessary, seek agreement with staff on temporary changes to their employment terms and conditions.
During the lockdown in March, it became obvious that numerous employers were making decisions without first getting agreement with staff. The common situations included:
Automatically reducing salaries to 80% or lower, or to the $585 subsidy level – without employee agreement, and
Directing employees to take annual leave, leave in advance or leave without pay – without their agreement and without the 14 days’ notice required under the Holidays Act.
It was noted at the time, that irrespective of the disruption and confusion caused by COVID-19, many of these practices were illegal and it was widely expected that we would see these claims filter through to the Employment Relations Authority. We are starting to see the first of these cases appear [note: both of the below cases are being appealed].
Raggett & Ors v Eastern Bays Hospice Trust t/a Dove Hospice [2020] NZERA 266
In addition to providing hospice services, Dove Hospice also operates a number of retail shops that were closed due to the COVID-19 Lockdown. Dove proposed restructuring the retail shop employees’ positions and invited feedback, which the employees gave. Dove subsequently sent letters advising the employees’ positions would be disestablished with an eight week notice period. The first four weeks would be paid at 80% of their wages and the second four weeks would be paid at the wage subsidy rate of $585.80.
The employees’ maintained they did not agree to be paid anything short of their normal wages and therefore Dove had breached the Wages Protection Act (WPA). Dove stated that due to COVID-19, the employees were not ready, willing and able to work, and therefore the WPA did not apply.
In this case the Authority found that:
If employees could not work due to a Lockdown, the employer must pay 100% of wages unless otherwise ‘agreed’.
There was no ability to only pay 80% of wages unilaterally.
The employer must fulfill its Employment Agreement obligations.
Sandhu vs Gate Gourmet NZ Ltd [2020] NZERA 259
Gate Gourmet provides inflight catering services and was therefore deemed an ‘essential service’. Business had fallen sharply and the company proposed a partial shutdown of its operations. The employees in question were all paid the minimum wage which was due to increase on 1 April. The company decided that only those employees at work would be paid the new minimum wage, and believed that those who were not rostered should be paid 80% of the old minimum wage. After some objection, the company agreed to apply the new minimum wage, but only at 80%.
The employees challenged this on the basis that 1) reducing wages required consent, and 2) the company failed to pay the minimum wage.
The Authority found that:
The minimum wage increase on 1 April 2020 must be paid even if the employee was not required to work, and
The company could not agree to pay 80% of wage rate if the employee was on the minimum wage.
While this might seem obvious now, during the confusion of the first few days of the March lockdown this was far from clear to many employers. While there is no doubt that employers were facing a unique situation, compliance with employment law should not be ignored.
To avoid this these issues arising it is important to note that all of your pre-COVID-19 employment obligations still exist – nothing has changed in this regard. Importantly:
You cannot unilaterally make decisions regarding employees terms and conditions, including wages and hours of work.
Any agreed changes should be recorded in writing confirming that agreement.
If you cannot get agreement and need to reduce costs, you have the ability to restructure the positions in your business.
August and September saw several new pieces of legislation come into force. Two of these include:
1. The National Policy Statement on Urban Development 2020
2. The National Policy Statement for Freshwater Management 2020
The National Policy Statement on Urban Development 2020 came into effect on 20 August 2020. It replaced the National Policy Statement on Urban Development Capacity 2016.
The NPS-UD 2020 recognises the national significance of having well-functioning urban environments now and into the future and providing sufficient development capacity to meet the different needs of people and communities.
It requires Councils to plan for growth and ensure a well-functioning urban environment for all people, communities and future generations by:
Ensuring urban development occurs in a way that takes into account the principles of the Treaty of Waitangi (te Tiriti o Waitangi)
Ensuring that Plans make room for growth both ‘up’ and ‘out’, and that rules are not unnecessarily constraining growth
Developing, monitoring and maintaining an evidence base about demand, supply and prices for housing and land to inform planning decisions
Aligning and coordinating planning across urban areas.
Key points include:
Policies pertaining to intensification seek to improve land-use flexibility in the areas of highest demand – areas with good access to the things people want and need, such as jobs and community services, and good public transport services.
Minimum parking rates in District Plans are to be removed as a means to improve landuse flexibility in urban environments.
Removing minimum parking rates in District Plans is anticipated to allow more housing and commercial developments, particularly in higher density areas where people do not necessarily need a car to access jobs, services or amenities. Urban space can then be used for higher value purposes than car parking. Some degree of car parking will still be required however – certainly for accessible car parking, but the intent is for the number of car parks to be driven by market demand.
Although minimum rates may be removed from District Plans, car parking is still likely to be a major consideration for any resource consent process, and it may be that losing this sort of guidance (or ‘acceptable solution’) from District Plans will have unintended consequences on streamlining the process. Have we just leapt to the other end of the spectrum?
The National Policy Statement for Freshwater Management 2020 came into force on 3 September. It succeeds the 2014 and 2017 versions and provides local authorities updated direction on how they should manage freshwater under the Resource Management Act 1991.
Managing freshwater in a way that ‘gives effect’ to Te Mana o te Wai is the central principle. This is all about:
Involving tangata whenua
Working with tangata whenua and communities to set out long-term visions
Prioritising the health and wellbeing of water bodies, then the essential needs of people, followed by other uses.
Core objectives are to improve degraded water bodies and maintain or improve all others using bottom lines defined in the NPS. Key points include:
Threatened species and mahinga kai join ecosystem health and human health for recreation, as compulsory values
Councils must develop plan objectives that describe the environmental outcome sought for all values
Councils will have to develop action plans and/or set limits on resource use to achieve specific attributes.
There are tougher national bottom lines for the ammonia and nitrate toxicity attributes
With the Plan Change 9 (TANK) being notified just prior to this new version of the NPS, it is unclear as to how and when the new NPS will be implemented, or how it may affect the TANK process. Whatever the case, it is sure to have a significant influence on future planning processes and the way everyone manages land and freshwater.
It seems change in this sector is coming at a rate where policy approaches are almost immediately redundant upon development, and that initiatives are continuously needing to change before substantial progress is even made.
Despite some uncertainty and short-term disruption to market conditions from COVID-19, low interest rates are fueling investment activity, especially for prime properties with strong covenants. The flight to quality and limited stock available to purchase is likely to elevate the level of competition amongst experienced investors driving values higher.
Overall Investor Market Conditions
The economic downturn created by the COVID-19 lockdowns and the introduction of border restrictions has created economic disruption that has reduced the current level of commercial market activity.
However, investors are conscious that a rebound and resumption in more normal market conditions could eventuate due to the forced short-term nature of the situation. As a result, investors are turning their focus towards the solid market conditions leading up to COVID-19 and reviewing the fundamentals. Although not as strong, investors are postulating that the current uncertainty created by COVID-19 could be accommodated in many circumstances, especially if incorporating longer-term projections.
While vacancy rates are expected to lift from 20-year record lows, the secondary sector is facing more challenging market conditions than in the prime sector, as occupiers and investors pursue quality premises.
Despite some uncertainty and understandable cautiousness, investors are spurred on by low interest rates, which will continue to remain low (and may reduce further) for an extended period under current forecasts.
The RBNZ continues to keep monetary policy settings accommodative and financial markets liquid, but there is an overall reluctance from major banks to write new business. This uncertainty has increased the demand for debt advisory services, which are proving beneficial. We are also noticing a greater number of non-bank lenders, high net worth privates, domestic and institutional funds entering the market, albeit at a higher cost of capital.
A recent Colliers International APAC research report noted that the yield spread over ten-year government bonds in New Zealand was amongst the highest in the APAC region. In addition, New Zealand’s approach to dealing with the virus has enhanced its international reputation as a safe haven which is likely to spur greater overseas interest in local assets. In the short-term, the ability of overseas investors to transact will be tempered by border restrictions in place, and likely for the remainder of 2020. A sharp lift in international activity is anticipated once restrictions are lifted, prior to this however, domestic players look likely to take the opportunity to fill the gap.
A lack of alternative options to generate returns will keep investment activity high, however, competition for a short supply of prime assets available to purchase will remain a challenge. This could lead to a return of fear of missing out for investors. If this eventuates, it is likely to push yields lower and capital values higher for quality stock with positive attributes.
Hawke’s Bay has the potential to supersede the likes of Auckland, Hamilton, Tauranga, Wellington and Christchurch as the premier sport facility region of New Zealand.
In fact Hawke’s Bay can probably already lay claim to the title, but with over $60 million of new sport facilities at the Regional Sports Park (Mitre10 Park), Pettigrew.Green Arena (PGH) and a high performance training facility for Hawke’s Bay Rugby, the region is punching well above its weight.
At Mitre10 Park, sports already present include athletics, hockey, rugby, football, league, canoe polo, fitness centre, Crossfit, basketball and netball and they will be joined by swimming, water polo, cricket and boxing as well as a 40 room hostel.
Just several kilometres down the road at Taradale’s Pettigrew.Green Arena (PGA), indoor sport codes such as basketball, netball, badminton, volleyball and futsal will enjoy the increase in court space to 11 courts.
The region will now be able to host multi-day major regional, national and possibly international sports events at each facility separately or together with the ability to bid for events like National and International Masters.
This will bring in athletes, supporters and increase visitor spending which will boost the region’s hospitality and retail sectors.
Sir Graeme Avery, chairman of the Hawke’s Bay Community Fitness Centre Trust which has led the development of over $50 million in sport facilities at Mitre 10 Park in Hastings the infrastructure investment in international class facilities, along with existing ones, will not only place Hawke’s Bay as a first choice for major domestic and in the future, international sports events, but also in leading the country in programmes delivered at the facilities for sport development and for the health and mental wellbeing of the community.
“Development of new indoor facilities for cricket, boxing, Olympic climbing, gymnastics and beach volleyball, along with synthetic tennis courts at Mitre 10 Park as well as a yachting and water sports development hub in Ahuriri.
“All these proposed new facilities will complement the current investments and cement Hawke’s Bay as unrivalled in New Zealand for the scope of its sport and recreation facilities for the community and for hosting major sports events,” Sir Graeme says.
He says the trust aims to achieve a major sports event in the region every month and is developing a strategic plan to work with HB Tourism and Councils across the region to bid for major multi-day and multi-sport events.
Mitre10 Sports Park chief executive Jock Mackintosh says the facility has the best athletics venue in New Zealand consistently rated a 9 out of 10 when surveys are undertaken during major events.
“Increasingly we are getting the attention of Athletics NZ that regularly send their athletes here for training camps and in 2021 and 2022 we will host the New Zealand Athletic champs.”
For Pettigrew-Green Arena Regional Indoor Sports and Events Centre Trust chairman Craig Waterhouse the focus of redeveloping the indoor sports centre from 3 courts to 11 is well over due with increased community participation in sports such as basketball and Futsal driving the need.
He says 76 percent of the regular sports users of PGA are under the age of 19 years with the facility at maximum use for the regular sports from 4 pm to 9.30 pm five days a week.
“Over the last ten years, there has being a massive shift in youth sports participation from grass-based sports to indoor sports.
“Basketball is now the number one secondary school sport ahead of rugby and soccer. Indoor soccer (Futsal), which did not exist in New Zealand, as a sport when they built the original arena, cannot grow as they have no facilities, volleyball has increased by 100 percent in five years and netball is requiring more indoor court space.”
He says if facilities don’t meet the demand, there’s a risk to the health and well-being of youth.
“Users are demanding more and more courts space; the lack of space affects the health of our children – they are not moving back to grass-sports they are simply not participating in sport.
Craig says sport and recreation is not just about winning, it’s about helping build stronger, healthier, happier, and safer communities.
“The increase in the scale of the Pettigrew Green Arena will have a massive impact on the future health of our society, probably the single most significant opportunity we have ever had to impact on our children’s future.
Graeme fully agrees with the sentiment that the investment “There will be undoubted social and economic benefits for the Hawke’s Bay community. The new and enhanced facilities will provide jobs to the local construction sector in an important post-covid recovery phase. Sport is the ‘glue’ for creating social cohesion in a community – as very well evidenced when community sport resumed in level 1 of covid-19.”
Sport Hawke’s Bay chief executive Mark Aspden is also on the same page that the investment in new sport facilities will overcome availability issues due to increased community participation in some sports.
“The investment is enhancing the opportunity for our local community to be able participate in the activities that they want to engage in. For example there has been a shortage of indoor court space for several years and the PGA expansion will go a long way to addressing that.
“With the EIT Institute (and particularly with the addition of the Indoor Aquatic Facility) we are able to ensure that young people in the region will have similar, and in some cases better
opportunities to develop their talents as those in the major centres.
From a Sport Hawke’s Bay perspective getting more local people active more often is its primary focus but the new facilities will attract major regional and national events.
“Community participation has to be the main focus, but hosting events can be the icing on the cake. It isn’t as simple as ‘build it and they will come’ but by having these facilities we have a much greater opportunity to host bigger events.”
Craig says PGA will be in the top 10 percent of indoor facilities in New Zealand and will be able to host national events, especially at secondary school and age group levels boosting accommodation providers and tourism businesses.
“With five additional futsal courts, 8 new basketball courts, over 40 new volleyball and badminton courts and 8 new indoor netball courts we will be able to host National Secondary and age-group tournaments.
“This will be a significant boost over winter when tourism in the Bay has fewer visitors. We estimated 10,000 additional visitors, an increase in regional GDP of $3M.
Mark says the portfolio of sport facilities in Hawke’s Bay coupled with our climate will be unparallel in New Zealand.
“Alongside our climate which is well suited to year round outdoor activities and tracks which create opportunities for walkers, runners, cyclists and mountain bikers to be active, there are obviously plenty of options for residents and those from other regions to engage in physical activity.
As the region continues to grow its sport facility assets Mark is keen to see the regions councils review and update a regional sport facility plan that was last signed in 2015. Only one mayor – Wairoa District Council’s Craig Little remains as a signatory.
There is strong evidence that Napier and Hastings council’s are more focussed on collaboration as well as ensuring there’s less duplication, but it’s time for an updated regional facility plan involving all five local authorities.
“They’re working together in an extremely co-operative manner in relation to sports facilities. In light of that we have a great opportunity now to ensure that a regional plan is put in place and actioned, which provides the basis for the future development of facilities in a way which best meets the needs of the region.
To counteract concerns the job market would get harder for its rangatahi (young people) following the Covid-19 outbreak, they fast-tracked plans to create jobs themselves and LIFT Business on Emerson Street, Napier, was born.
This retail hub, supported by council and charitable funding, opened its doors in August selling products made by LIFT’s rangatahi ‘clients’ or their broader whānau. Part of the shop is set aside for running a screen-printing business, while out the back rangatahi with business ideas work through business modelling and skills courses with staff.
“This is literally the only initiative like this in New Zealand,” says LIFT founder and director Jody Hamilton. Fledgling businesses are already hatching. One 22-year-old participant has launched a domestic cleaning business with help from LIFT Business. “She came back in to us on Thursday because she needs to hire someone now. It’s brilliant,” she says.
“Even within our retail hub we’ve hired seven people to fill retail associate and screen-printing jobs, who were all unemployed before. Five of them had never worked before in their lives,”
says Jody.
This proactive attitude is what got LIFT started in the first place. The statistics on job prospects for Māori boys in Hawkes Bay, did not impress Jody. With a young son herself she wanted to do something about it and in 2017, LIFT Youth Employment began.
A key part of its success is its Bounce Programme, which teaches rangatahi about how their brains work, communication style and integrity. They learn their pepeha (self-introduction) and about their turangawaewae (where they come from), as well as employer and employee expectations.
“This culminates in the graduation at the end of the two weeks, where they present a plan of where they want to be. It includes personal and professional goals and that’s what we use as the basis of working with them. Then we do whatever it takes to deliver that. It’s transformational,” Jody says.
Many will have been involved with the criminal justice system, so LIFT spends time working with various services to help their clients get on track towards their goals. Others may need help with getting their driver license. “We tend to be receiving through our doors what other people think are the most disadvantaged and unruly kids in the area. But everyone has dreams and aspirations, even these rangatahi deserve the right to chase them,” says Graeme Ewart, in charge of LIFT’s business development.
LIFT uses a reverse marketing approach – establishing what the rangatahi want and then finding an employer that fits, rather than the other way around. It’s getting results. LIFT exceeded the employment target on a recent government contract by eight times. They aim to move 95 individuals a year towards employment and have already worked with about 700 people since LIFT began.
“Even if [the rangatahi] wants to be a rocket scientist, we start them on that journey. Over time they realise that they might need to do some other jobs or training along the way,” Graeme says.
