Financial performance

IVL performance

In its second year of operation (2020/21) the IVL continued to face major funding challenges. This was due to the ongoing impact of COVID‑19 on revenue collected. New Zealand’s borders remained heavily restricted, meaning the number of people who paid into the IVL was far fewer than pre-pandemic predictions.

Revenue

Actual revenue collected in the second year of operation to 30 June 2021 was $2.69m.

Initially, the IVL was predicted to raise approximately $450m in its first 5 years. However, revenue raised in the first two years was significantly lower than estimated due to the ongoing impact of the pandemic and the New Zealand border remaining heavily restricted because of it. Despite this, revenue collected to 30 June 2020 has ensured the first round of investments will meet commitments, with some project deliverables amended.

From 19 April 2021 to 31 July 2021, quarantine-free travel was available between New Zealand and Australia. Despite Australian citizens not paying the IVL, non-Australian citizens travelling from Australia during this time had a marginal impact on revenue collected through the IVL. Our data shows that approximately $25,000 in revenue was collected from people travelling from Australia for the 2020/21 year. Inbound travellers pay the IVL alongside visa fees, meaning it is paid prior to travel. Therefore, IVL fees were not collected during the Australia-New Zealand quarantine-free travel period, but when their temporary visas were processed by Immigration New Zealand.

Due to the New Zealand border only recently being reopened to international visitors, an accurate revenue estimate for future years cannot be provided at this time. As the IVL is revenue funded, current and future investments need to be considered against actual revenue received, rather than forecasted revenue.

Expenditure

Actual expenditure in the second year of operation to 30 June 2021 was $11.34m.

In August 2019, the joint IVL Ministers announced the initial round of IVL investments. The 10 investments totalled $18m in funding allocated to the 2019/20 year, with a further $23.7m committed in principle across 2020/21 through to 2023/24 for multiple-year projects.

Investments in conservation projects were recalibrated at the end of 2019/20, reducing the total investment to $38.9m. Forecast underspend of $0.22m for the conservation project Visitor Safety System Trial and Pilot has further reduced the total investment. Total funding has been revised downwards, returning the underspent variance to unallocated funding. The total investment for the initial round of projects is now $38.69m.

Summary of Round 1 IVL 5-year commitments ($m)

* Year 1 spend on fund management and bank fees differs from the IVL Annual Performance Report 2019/20 due to the timing of data collection.

** The figures in MBIE’s Annual Report 2019/20 differ to these figures as they are inclusive of administration fees. The above tables outline the breakdown of total figures. 

MBIE annual report 2019/20 [PDF, 3.5 MB]

*** Due to rounding, these figures total $12.41m.

2020/21 funding by project

Project performance

The initial round of IVL investments was announced in August 2019. The 10 investments totalled $10.15m funding in the 2020/21 year, with a total of $38.69m across the life of the investments.

In the second year, the conservation and tourism projects have advanced all IVL investment priorities: to target areas of cultural and historic significance, the restoration and protection of New Zealand’s unique biodiversity, upgrades to existing tourism destinations, and transformational technologies. All projects progressed well against their milestones despite delays caused by the COVID-19 pandemic.

The following tables provide an overview of the budgeted and actual funding of each IVL project.

Updated Round 1 conservation funding commitments by project

Conservation portfolio for the period ended 30 June 2021 ($m)

* Due to rounding, these figures total $1.51m.

** Since the 2019/20 IVL Annual Performance Report was published, the Department of Conservation has undertaken a reconciliation exercise to ensure all IVL funded project-related expenditure is captured in actual funding. Because of this, there are slight variations between some 2019/20 figures in this report and those in the previous report.

*** Forecast underspend of $0.22m will be returned to uncommitted funds.

Updated Round 1 tourism funding commitments by project

Tourism portfolio for the period ended 30 June 2021 ($m)

* Due to rounding, these figures total $5.21m.

** Due to rounding, the project totals add to $12.41m.

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