Rafting rule changes could add costs for small firms
Rafting companies will be have to diversify their business or cough up as the Government looks to change the way the industry’s health and safety is regulated, writes Thomas Coughlan.
Planned changes to the regulation of white water rafting have caught the industry by surprise — they were only alerted to the Government's decision after an inquiry from Newsroom.
The changes mean many companies could be forced to pay $135,000 in extra health and safety costs over the next ten years. Other companies, however, will be able to make a saving of nearly $300,000 in compliance costs over the next ten years.
The Government is changing the way rafting companies are regulated to correct an historical anomaly that allows some companies to save money, whilst others are double-billed.
Until 1999, commercial white water rafting and jet boat operators were not subject to any form of national regulation. Only the Queenstown Lakes District, using local bylaws, offered any regulation of the industry.
In 1999, a series of rafting deaths on the Shotover River prompted the Government to regulate the industry, placing it under the Maritime Safety Authority, which later became Maritime NZ. The current rules mean Maritime NZ must approve safe operational plans, carry out inspections and audits of operators and issue certificates of compliance.
But Maritime NZ regulates just a small part of the adventure tourism industry. Since 2014, WorkSafe NZ has administered a similar regulatory scheme under the Adventure Activities Regulations or AARs. This applies to all commercial outdoor adventure activities other than activities for which a maritime safety document is required.
This scheme is similar to the Maritime NZ scheme, but more detailed and therefore expensive. This places an increased compliance burden on companies that operate rafting alongside other adventure sports: it means they have to audit themselves twice, under two different schemes.
In fact, the compliance burden was so high, it led some organisations to streamline their activities to avoid paying double compliance costs.
But from 2020, rafting will be removed from Maritime NZ’s responsibility and placed under the AAR regime.
Tim Marshall, Chairman of New Zealand Rivers Association, a group representing the industry said that he was forced to streamline his business after the dual regime was introduced in 2014. He used to offer inflatable kayak tours, which in spite of their manifest similarity to rafting, were regulated under the AAR regime.
As the kayaking operation brought in just 5 percent of the company’s revenue, Marshall wound it up rather than subject it to the costly AAR scheme.
Marshall and the NZRA supported retaining the existing scheme, and had raised his concerns with the Associate Transport Minister Julie Anne Genter, who is overseeing the changes.
“Finance was a concern from our members, but it was not the only concern,” he said.
He said he wanted to remain under the existing scheme because Maritime NZ held the industry to a higher safety standard than WorkSafe NZ. He said the added cost of the AAR scheme was not due to a higher standard of auditing, but because auditors were drawn from a private marketplace, accredited by WorkSafe NZ rather than a Government agency, as is the case under the Maritime NZ system.
“Under the AAR audit system so you have four commercial companies that are allowed to play the game for an audit which can have a varying standard,” Marshall said.
“Under the current system we have the maritime auditor - they understand every company. It’s a very solid watchdog, whereas under this huge commercial system it will have a lot more variance,” he said.
Marshall wants the Government to ensure that any changes do not result in standards slipping.
James Shaw, who approved the changes as acting associate Transport Minister, noted in a report released to Newsroom under the OIA that his approval was conditional on the concerns raised by the NZRA being addressed.
Genter’s office has confirmed to Newsroom that a transitional period will allow time for operators to prepare for the change and the Association will be able to consult with WorkSafe on developing the Activity Safety Guide for rafting, which will be used by auditors.
However, Marshall said that as of yesterday, his organisation had yet to hear about the consultation. He only became aware the rules were changing after being contacted by Newsroom.