Emirates: doing business in NSW

March 21, 2009

The ingredients of big-business operations in NSW were all there: a multinational tourism operator; environmental groups with varying interests; a donation to the NSW Labor Party; the apparent channelling of another donation; a local council decision overturned by the Land and Environment Court; and development approved by the then-Labor Party planning minister, Frank Sartor.

The result was a win for business and a loss for the environment. The lesson to be learned is that business aims to make money and environmental groups should keep business at arms length.

It all began in 2003 when Emirates chairperson Sheikh Ahmed announced a new resort-conservation tourism project. In June 2005, Emirates announced that it would build the resort in the Wolgan Valley, about 190 kilometres north-west of Sydney.

The resort site sits nestled between national parks in the Greater Blue Mountains World Heritage Area. When completed in October 2009, the resort will have 40 villas with pools, lounges, a library and a restaurant bar.

Accommodation rates will range from $1490 per night for a single person in the Heritage Suite to $5500 for the Wolgan Suite.

Emirates's original concept included a conservation program that featured the planting of thousands of native trees in the Wolgan Valley.

Emirates's plan had the approval of the Blue Mountains Conservation Society (BMCS). With a membership of around 1000 it is one of the more influential conservation groups in Australia. More critical was Keith Muir, executive director of the respected Colong Foundation for Wilderness (CFW), the longest-serving community wilderness advocacy group in Australia.

The June 29, 2005, Blue Mountains Gazette quoted Muir saying, "the resort should restrict its operations to the farmlands of the Wolgan Valley", and said that "he would oppose any proposal for a heliport on the site or in nearby Capertee".

However, Emirates saw a helicopter business opportunity. The Public Environment Report, produced for Emirates by Cumberland Ecology in December 2006, says Emirates initially considered providing scenic helicopter flights for its clientele, but ultimately agreed to a resort helipad limit of four flights a week.

In February 2005, Mark Lilley, a local businessperson with interests in helicopters and machinery hire, also saw a business opportunity and applied to the Lithgow City Council to operate a helipad. His chosen location was the small town of Capertee, near the Emirates resort site.

Following opposition from Emirates and the Capertee Valley Environment Group (CVEG), among others, the helipad proposal was rejected in December 2005. Lilley submitted a revised application in early 2007, with flight paths that avoided the Emirates resort and included Sydney flights.

Emirates did submit an opposing submission to this application but took it no further. After all, it could provide convenient access to scenic flights and to Sydney Airport for a rich clientele. In June 2007, Lithgow council rejected the revised helipad application — but that was not the end of the matter.

Emirates was also continually active in the "community" and the planning process. The records of the NSW Electoral Funding Authority show that on June 8, 2006, Emirates Australia (Emirates Airline) gave a donation of $15,000 to the Australian Labor Party (NSW Branch), a donation that was only declared to the EFA in May 2008, after Emirates had been referred to the Crown Solicitor for having failed to lodge a declaration.

The original resort concept plan was finally approved by Labor's acting minister for planning in May 2006. In November that year, Emirates lodged a concept plan modification that would enable a repositioning of the resort's complex by swapping 114 hectares of bushland outside but adjoining the national park for 39 hectares of national park land.

Initially, CFW strongly opposed the notion of a land swap. However, after some months of negotiations, a joint media release by CFW and the NSW National Parks Association displayed less discomfort: "While we opposed the Emirates resort, we believe that we have safeguarded Wollemi and Gardens of Stone National Parks".

BMCS supported the plan modification contingent upon the legalities being worked out. The legalities were sorted and on April 13, 2007, planning minister Frank Sartor signed the approval for the modified concept plan.

The major planning approval phase came to an end with the September 2007 Land and Environment Court "helipad" hearing of Lilley vs Lithgow City Council. Once again, like many cases in NSW, the developer was successful in overturning a council decision, with the court handing down a decision in favour of the Capertee helipad on September 25, 2007.

BMCS helped CVEG with incurred costs in fighting the lost helipad case. A literal reading of the BMCS management committee's February 2008 minutes shows that Emirates donated $7500 to the BMCS Gardens of Stone Campaign and BMCS then paid $5500 to CVEG for its court case costs.

This set of transactions was not reported in the BMCS official annual accounts, president's annual report or newsletter.

In an open forum in October 2008, the BMCS treasurer explained that the omission from the accounts was due to the Emirates donation to BMCS being specifically for CVEG's incurred costs. The donation was immediately passed on and hence not reported under an accounting convention.

Does the treasurer's explanation not suggest BMCS acted as a channel for Emirates to fund CVEG? Why didn't Emirates pay CVEG directly and in any case should BMCS have had any financial dealings with a tourism developer?

What was the upshot of this process? Emirates got its resort, is currently advertising helicopter arrivals and is portrayed as a good environmental citizen.

Mark Lilley got approval for his helipad operation; Capertee residents got helicopter residential noise-limiting conditions. As usual, everyone wins except the environment as there will be more helicopters buzzing in the World Heritage Area.

Also the success of Emirates quite conceivably sets a precedent causing the looming legislation amendments to allow environmentally threatening tourist developments in national parks. As for the BMCS? It needs to ask itself if the planning process integrity was compromised by it being too close and comfortable with Emirates.

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