International Newcastle Airport flights announced: Bali here we come

WILLIAMTOWN is officially the Hunter's gateway to the world, with Newcastle Airport securing its first ongoing international service beyond Australasia.
Jetstar will fly from Newcastle to Denpasar in Bali from October 21, linking the region to one of the country's most popular holiday destinations and enabling direct connections from there to more than 40 countries.
The service will be formally announced on Tuesday morning.
Bali-bound flights are planned to leave Newcastle at 9.30am on Tuesday, Thursday, and Saturday from October 21 to land at 1.05pm Indonesian time.
Return voyages are slated to depart Denpasar at 11.10pm on Monday, Wednesday and Friday for the first week. From October 27 they are poised to leave at 10.20pm. They will arrive at 8.05am and 7.15am the next day, respectively.
Newcastle Airport chief executive Linc Horton said the route's arrival "shows what the Hunter is capable of when we aim high".
"We're proud to be delivering what our region has long asked for ... direct international flights from their local airport," he said.
"Jetstar has been part of Newcastle Airport's story from the very beginning, and it's only fitting that they're the airline to take us into our international future.
"Our long-term plan is to grow our international network, and we are working behind the scenes with several airlines about additional routes we may be able to provide."
Newcastle will be Jetstar's tenth route to Bali.
The new service will take slightly more than six hours and is scheduled to operate three times a week.
The A321LR aircraft will provide more than 70,000 seats annually on the route.
Jetstar Group chief executive Stephanie Tully described the route as an "exciting milestone".
"Jetstar is committed to making travel more accessible, and people living in and around Newcastle will no longer need to drive to other airports to fly overseas, which means more time and money can go toward their holiday," she said.
While the Port Stephens hub has previously flown to New Zealand directly, that service has been available only seasonally.
Port Stephens MP Kate Washington said it was "a historic moment" and paid tribute to the contributions of the two councils, Port Stephens and Newcastle, that co-own the airport.
"This means a lot to the people of Port Stephens and the Hunter," she said.
"Becoming an international airport isn't easy, there are a whole lot of people who have pushed for this for years."
Jude Munro, the Newcastle Airport chair, thanked Jetstar for its show of faith.
"Newcastle Airport will continue to secure new domestic and international routes for the region and grow as a significant gateway for international travel in NSW," she said.
"We look forward to working with all levels of government to be the airport our region deserves."
Newcastle Airport's $250 million international terminal expansion is slated for completion in August 2025.
NSW Minister for Jobs and Tourism Steve Kamper, whose government is backing the service through its Aviation Attraction Fund, said the route would boost the airport's capacity and "open the Hunter and the Mid-North Coast to a major South-East Asian transport hub and a wealth of opportunity".
Minister for the Hunter Yasmin Catley said the new link was "just the beginning".
"This is a game changer for the Hunter," Ms Catley said.
"We're not just opening the door to Bali - we're opening our region up to the world.
"With more direct international flights, we're positioning the Hunter as a tourism Mecca. It's about making it easier for the people who live here to explore the world and for the world to discover everything we have here."
News of the Bali flights comes just days after the airport revealed it would fly direct to Perth three times a week from September this year.
The flurry of announcements follows a period of expansion at the Williamtown site, including the construction of the new international terminal. A Newcastle Herald investigation previously revealed the airport had been in discussions with councils to access a financial injection of up to $40 million, and had been working to rein in spending and pay off escalating debt amid its expansion.
The airport has repeatedly denied any financial problems and says it has more than tripled its investment over the past decade.
It said revenue across passenger facilitation and property and commercial activities was $42 million this financial year.
Port Stephens mayor Leah Anderson acknowledged the federal government's $121 million investment in delivering international capability. She said she was excited that the council's ownership of the expanded airport could pay off handsomely for ratepayers.
"This asset is going to be so important for us as a council," she said.
"When shareholder dividends return, we've got lots of plans for that money."
Cr Anderson said she had been to Bali "on quite a few occasions" but was looking forward to avoiding the trip to Sydney to depart.
"Bags are packed, I'm ready to go," she said.
WILLIAMTOWN is officially the Hunter's gateway to the world, with Newcastle Airport securing its first ongoing international service beyond Australasia.
Jetstar will fly from Newcastle to Denpasar in Bali from October 21, linking the region to one of the country's most popular holiday destinations and enabling direct connections from there to more than 40 countries.
The service will be formally announced on Tuesday morning.
Bali-bound flights are planned to leave Newcastle at 9.30am on Tuesday, Thursday, and Saturday from October 21 to land at 1.05pm Indonesian time.
Return voyages are slated to depart Denpasar at 11.10pm on Monday, Wednesday and Friday for the first week. From October 27 they are poised to leave at 10.20pm. They will arrive at 8.05am and 7.15am the next day, respectively.
Newcastle Airport chief executive Linc Horton said the route's arrival "shows what the Hunter is capable of when we aim high".
"We're proud to be delivering what our region has long asked for ... direct international flights from their local airport," he said.
"Jetstar has been part of Newcastle Airport's story from the very beginning, and it's only fitting that they're the airline to take us into our international future.
"Our long-term plan is to grow our international network, and we are working behind the scenes with several airlines about additional routes we may be able to provide."
Newcastle will be Jetstar's tenth route to Bali.
The new service will take slightly more than six hours and is scheduled to operate three times a week.
The A321LR aircraft will provide more than 70,000 seats annually on the route.
Jetstar Group chief executive Stephanie Tully described the route as an "exciting milestone".
"Jetstar is committed to making travel more accessible, and people living in and around Newcastle will no longer need to drive to other airports to fly overseas, which means more time and money can go toward their holiday," she said.
While the Port Stephens hub has previously flown to New Zealand directly, that service has been available only seasonally.
Port Stephens MP Kate Washington said it was "a historic moment" and paid tribute to the contributions of the two councils, Port Stephens and Newcastle, that co-own the airport.
"This means a lot to the people of Port Stephens and the Hunter," she said.
"Becoming an international airport isn't easy, there are a whole lot of people who have pushed for this for years."
Jude Munro, the Newcastle Airport chair, thanked Jetstar for its show of faith.
"Newcastle Airport will continue to secure new domestic and international routes for the region and grow as a significant gateway for international travel in NSW," she said.
"We look forward to working with all levels of government to be the airport our region deserves."
Newcastle Airport's $250 million international terminal expansion is slated for completion in August 2025.
NSW Minister for Jobs and Tourism Steve Kamper, whose government is backing the service through its Aviation Attraction Fund, said the route would boost the airport's capacity and "open the Hunter and the Mid-North Coast to a major South-East Asian transport hub and a wealth of opportunity".
Minister for the Hunter Yasmin Catley said the new link was "just the beginning".
"This is a game changer for the Hunter," Ms Catley said.
"We're not just opening the door to Bali - we're opening our region up to the world.
"With more direct international flights, we're positioning the Hunter as a tourism Mecca. It's about making it easier for the people who live here to explore the world and for the world to discover everything we have here."
News of the Bali flights comes just days after the airport revealed it would fly direct to Perth three times a week from September this year.
The flurry of announcements follows a period of expansion at the Williamtown site, including the construction of the new international terminal. A Newcastle Herald investigation previously revealed the airport had been in discussions with councils to access a financial injection of up to $40 million, and had been working to rein in spending and pay off escalating debt amid its expansion.
The airport has repeatedly denied any financial problems and says it has more than tripled its investment over the past decade.
It said revenue across passenger facilitation and property and commercial activities was $42 million this financial year.
Port Stephens mayor Leah Anderson acknowledged the federal government's $121 million investment in delivering international capability. She said she was excited that the council's ownership of the expanded airport could pay off handsomely for ratepayers.
"This asset is going to be so important for us as a council," she said.
"When shareholder dividends return, we've got lots of plans for that money."
Cr Anderson said she had been to Bali "on quite a few occasions" but was looking forward to avoiding the trip to Sydney to depart.
"Bags are packed, I'm ready to go," she said.
WILLIAMTOWN is officially the Hunter's gateway to the world, with Newcastle Airport securing its first ongoing international service beyond Australasia.
Jetstar will fly from Newcastle to Denpasar in Bali from October 21, linking the region to one of the country's most popular holiday destinations and enabling direct connections from there to more than 40 countries.
The service will be formally announced on Tuesday morning.
Bali-bound flights are planned to leave Newcastle at 9.30am on Tuesday, Thursday, and Saturday from October 21 to land at 1.05pm Indonesian time.
Return voyages are slated to depart Denpasar at 11.10pm on Monday, Wednesday and Friday for the first week. From October 27 they are poised to leave at 10.20pm. They will arrive at 8.05am and 7.15am the next day, respectively.
Newcastle Airport chief executive Linc Horton said the route's arrival "shows what the Hunter is capable of when we aim high".
"We're proud to be delivering what our region has long asked for ... direct international flights from their local airport," he said.
"Jetstar has been part of Newcastle Airport's story from the very beginning, and it's only fitting that they're the airline to take us into our international future.
"Our long-term plan is to grow our international network, and we are working behind the scenes with several airlines about additional routes we may be able to provide."
Newcastle will be Jetstar's tenth route to Bali.
The new service will take slightly more than six hours and is scheduled to operate three times a week.
The A321LR aircraft will provide more than 70,000 seats annually on the route.
Jetstar Group chief executive Stephanie Tully described the route as an "exciting milestone".
"Jetstar is committed to making travel more accessible, and people living in and around Newcastle will no longer need to drive to other airports to fly overseas, which means more time and money can go toward their holiday," she said.
While the Port Stephens hub has previously flown to New Zealand directly, that service has been available only seasonally.
Port Stephens MP Kate Washington said it was "a historic moment" and paid tribute to the contributions of the two councils, Port Stephens and Newcastle, that co-own the airport.
"This means a lot to the people of Port Stephens and the Hunter," she said.
"Becoming an international airport isn't easy, there are a whole lot of people who have pushed for this for years."
Jude Munro, the Newcastle Airport chair, thanked Jetstar for its show of faith.
"Newcastle Airport will continue to secure new domestic and international routes for the region and grow as a significant gateway for international travel in NSW," she said.
"We look forward to working with all levels of government to be the airport our region deserves."
Newcastle Airport's $250 million international terminal expansion is slated for completion in August 2025.
NSW Minister for Jobs and Tourism Steve Kamper, whose government is backing the service through its Aviation Attraction Fund, said the route would boost the airport's capacity and "open the Hunter and the Mid-North Coast to a major South-East Asian transport hub and a wealth of opportunity".
Minister for the Hunter Yasmin Catley said the new link was "just the beginning".
"This is a game changer for the Hunter," Ms Catley said.
"We're not just opening the door to Bali - we're opening our region up to the world.
"With more direct international flights, we're positioning the Hunter as a tourism Mecca. It's about making it easier for the people who live here to explore the world and for the world to discover everything we have here."
News of the Bali flights comes just days after the airport revealed it would fly direct to Perth three times a week from September this year.
The flurry of announcements follows a period of expansion at the Williamtown site, including the construction of the new international terminal. A Newcastle Herald investigation previously revealed the airport had been in discussions with councils to access a financial injection of up to $40 million, and had been working to rein in spending and pay off escalating debt amid its expansion.
The airport has repeatedly denied any financial problems and says it has more than tripled its investment over the past decade.
It said revenue across passenger facilitation and property and commercial activities was $42 million this financial year.
Port Stephens mayor Leah Anderson acknowledged the federal government's $121 million investment in delivering international capability. She said she was excited that the council's ownership of the expanded airport could pay off handsomely for ratepayers.
"This asset is going to be so important for us as a council," she said.
"When shareholder dividends return, we've got lots of plans for that money."
Cr Anderson said she had been to Bali "on quite a few occasions" but was looking forward to avoiding the trip to Sydney to depart.
"Bags are packed, I'm ready to go," she said.
WILLIAMTOWN is officially the Hunter's gateway to the world, with Newcastle Airport securing its first ongoing international service beyond Australasia.
Jetstar will fly from Newcastle to Denpasar in Bali from October 21, linking the region to one of the country's most popular holiday destinations and enabling direct connections from there to more than 40 countries.
The service will be formally announced on Tuesday morning.
Bali-bound flights are planned to leave Newcastle at 9.30am on Tuesday, Thursday, and Saturday from October 21 to land at 1.05pm Indonesian time.
Return voyages are slated to depart Denpasar at 11.10pm on Monday, Wednesday and Friday for the first week. From October 27 they are poised to leave at 10.20pm. They will arrive at 8.05am and 7.15am the next day, respectively.
Newcastle Airport chief executive Linc Horton said the route's arrival "shows what the Hunter is capable of when we aim high".
"We're proud to be delivering what our region has long asked for ... direct international flights from their local airport," he said.
"Jetstar has been part of Newcastle Airport's story from the very beginning, and it's only fitting that they're the airline to take us into our international future.
"Our long-term plan is to grow our international network, and we are working behind the scenes with several airlines about additional routes we may be able to provide."
Newcastle will be Jetstar's tenth route to Bali.
The new service will take slightly more than six hours and is scheduled to operate three times a week.
The A321LR aircraft will provide more than 70,000 seats annually on the route.
Jetstar Group chief executive Stephanie Tully described the route as an "exciting milestone".
"Jetstar is committed to making travel more accessible, and people living in and around Newcastle will no longer need to drive to other airports to fly overseas, which means more time and money can go toward their holiday," she said.
While the Port Stephens hub has previously flown to New Zealand directly, that service has been available only seasonally.
Port Stephens MP Kate Washington said it was "a historic moment" and paid tribute to the contributions of the two councils, Port Stephens and Newcastle, that co-own the airport.
"This means a lot to the people of Port Stephens and the Hunter," she said.
"Becoming an international airport isn't easy, there are a whole lot of people who have pushed for this for years."
Jude Munro, the Newcastle Airport chair, thanked Jetstar for its show of faith.
"Newcastle Airport will continue to secure new domestic and international routes for the region and grow as a significant gateway for international travel in NSW," she said.
"We look forward to working with all levels of government to be the airport our region deserves."
Newcastle Airport's $250 million international terminal expansion is slated for completion in August 2025.
NSW Minister for Jobs and Tourism Steve Kamper, whose government is backing the service through its Aviation Attraction Fund, said the route would boost the airport's capacity and "open the Hunter and the Mid-North Coast to a major South-East Asian transport hub and a wealth of opportunity".
Minister for the Hunter Yasmin Catley said the new link was "just the beginning".
"This is a game changer for the Hunter," Ms Catley said.
"We're not just opening the door to Bali - we're opening our region up to the world.
"With more direct international flights, we're positioning the Hunter as a tourism Mecca. It's about making it easier for the people who live here to explore the world and for the world to discover everything we have here."
News of the Bali flights comes just days after the airport revealed it would fly direct to Perth three times a week from September this year.
The flurry of announcements follows a period of expansion at the Williamtown site, including the construction of the new international terminal. A Newcastle Herald investigation previously revealed the airport had been in discussions with councils to access a financial injection of up to $40 million, and had been working to rein in spending and pay off escalating debt amid its expansion.
The airport has repeatedly denied any financial problems and says it has more than tripled its investment over the past decade.
It said revenue across passenger facilitation and property and commercial activities was $42 million this financial year.
Port Stephens mayor Leah Anderson acknowledged the federal government's $121 million investment in delivering international capability. She said she was excited that the council's ownership of the expanded airport could pay off handsomely for ratepayers.
"This asset is going to be so important for us as a council," she said.
"When shareholder dividends return, we've got lots of plans for that money."
Cr Anderson said she had been to Bali "on quite a few occasions" but was looking forward to avoiding the trip to Sydney to depart.
"Bags are packed, I'm ready to go," she said.

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News.com.au

2 hours ago

• News.com.au

We handpick all the best travel deals for EOFY 2025

The End of Financial Year Sales have kicked off bringing thousands of dollars in savings and discounts of up to 90 per cent. As a professional deal hunter, I'm pretty adept at weeding the good deals from the great ones - and because no one likes to waste their time or their money, I'm only bringing you the best ones here. Top of my list - particularly for travellers - is Flight Centre with up to 60 per cent off travel. If you're headed to across the pond for the snows, there's New Zealand flights from $456 return on Air New Zealand. However, if you'd prefer not to lift a finger, they've also rustled up to 60 per cent off beach holidays. Think eight nights at Phuket's Kamala Beach Resort from $350 per person and seven nights at Double Six in Seminyak Bali from $943 per person. I'm a sucker for points earning opportunities and if you are too, you'll be stoked to hear that Luxury Escapes is running a triple points deal on select packages. These points are for their Sociéte program and can earn you future discounts and exclusive benefits. Popular stays you can rack up points with include five nights at the Meru Sanur Bali from $2059 per room and seven nights at the all-inclusive Katathani Phuket Beach Resort from $1999 per room. Banking up Qantas Frequent Flyer Points instead? Lotte Duty Free is currently offering two Qantas Points per $1 spent in their online store. This makes life so much easier as you can click and collect at the airport. For your wardrobe, Boody has slashed its prices by at LEAST 30 per cent. Bras start at $12 and undies at $8, with our favourite Full Briefs down to $13.97 per pair (down from $19.99) and "the perfect travel pants" the Downtime Lounge Pants now $55.97 (originally $79.99). The Iconic has also joined in the fun with the fun (I'd expect nothing less), slinging up to 60 per cent off end of season stock, plus a bonus 20 per cent off selected items. 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How long do the End of Financial Year sales last? The End of Financial Year sales run until June 30, which is the end of the tax year. What are the most sought out products in the End of Financial Year sales? This year ARA Chief Industry Affairs Officer Fleur Brown has noticed that "many savvy shoppers are on the lookout for work-related products to claim on their tax return. This is making computers, phones, and other technology highly sought after." Other popular categories of note are fashion, household appliances, whitegoods and tech. - - Best luggage brands

The Advertiser

3 hours ago

• The Advertiser

What airport mortgage document says about Newcastle, Port Stephens council ties to $235m loan

EXPERTS who reviewed a mortgage document for Newcastle Airport's $235 million loan say both Newcastle and Port Stephens ratepayers could be on the hook for the borrowings, but the councils say the document can not be "relied upon in isolation". The potential risk to ratepayer funds is outlined in a 57-page mortgage document, signed by City of Newcastle chief executive officer Jeremy Bath and Port Stephens Council senior executive Greg Kable in March 2023 and obtained as part of a Newcastle Herald investigation into Newcastle Airport's financial situation. Legal and business law experts consulted by the Herald have identified nine clauses in the publicly available mortgage document that indicate the councils, joint owners of the airport, could be held legally liable for the airport's $235 million Commonwealth Bank loan. In response, airport owners Port Stephens Council and City of Newcastle said in a joint statement earlier this year that the mortgage document could not be "relied upon in isolation to understand the financing arrangements", but declined to elaborate when asked for other relevant documents. In the weeks since the release of the Davidson Review, an independent inquiry into the City of Newcastle's policies, processes and procedures, simmering tensions within the council over the airport have overflowed into a public spat. Labor councillor Declan Clausen has made reference to past comments made by lord mayor Ross Kerridge regarding the financial situation of the airport, accusing the lord mayor of "rewriting history" by deleting past Facebook posts and saying the review showed: "every major decision about the airport was made lawfully, responsibly, and with proper controls and oversight". While not examining the airport's financial situation, the Davidson Review said it was "considered unlikely" that any significant financial risks from the airport would be transferred to the City of Newcastle, without detailing how it came to this conclusion. In the months prior to the review, the Herald had been working to clarify whether ratepayers were exposed to the record $235 million CBA loan facility. When questioned about the possible liability to ratepayers as outlined in the mortgage document, councillors from Newcastle issued what they called an "unprecedented" joint statement. "Councillors were informed in February 2023 that there were a series of legally binding agreements that sat alongside the mortgage of head lease that govern the financial arrangements, including securing the loans against airport assets only, thereby limiting the financier's recourse," the joint statement reads. The councils declined to answer specific questions about clauses in the mortgage that would allow CBA to access council funds if anything goes wrong, and if they are enforceable. They also declined to identify documents that overrule the mortgage to establish that ratepayer funds are off-limits. The airport secured the loan in April 2023 to construct a new international terminal and fund its property development business. While the councils are not parties to the loan or guarantors, they are linked to the deal because they hold the head lease with the Commonwealth for the 28 hectares of land where the airport operates south of Williamtown RAAF Base. The airport can't operate without the lease, so the bank wanted it as security. To ensure the airport could get its $235 million loan, the councils voted unanimously in separate confidential sessions in February 2023 to offer up the head lease as security for the loan. The head lease mortgage document establishes a legal agreement between City of Newcastle, Port Stephens Council, and the CBA. According to the councils, "CBA has confirmed in writing to the airport that the commercial intent of the mortgage of the head leases is limited recourse third party securities". Despite the intent, three experts who reviewed the mortgage said it had the potential to cause heartache for ratepayers if anything goes wrong. When considered in isolation, they said the mortgage gives CBA legal recourse to council funds. Associate Professor Keturah Whitford, dean of staff at the Australian National University's College of Business and Economics, said, "critically, there is nothing in the mortgage which limits the liability of the councils to the realised value of their interests in the airport lease". Professor Whitford, who specialises in business law, reviewed only the mortgage document. She said under the mortgage, the councils agreed to "ensure that no event of default occurs" and to "procure the punctual payment" of the secured money. "While the councils may not be borrowers, guarantors or obligors under the loan facility, the mortgage secures, amongst other things, 'all money which any obligor is or may become actually or contingently liable to pay under or in connection with the finance documents'...," she said. "Further, the council indemnifies the CBA for losses in connection with, among other things, any default." According to the mortgage document, if the airport defaults on a loan payment or interest, the councils could have to pay the money. If CBA cannot recoup money owed from the airport, under the mortgage, the councils have agreed to compensate the bank for any losses, liabilities, costs, expenses and taxes it incurs. Under the mortgage terms, the bank can also enforce its right against the councils before it seeks funds from the airport. If this were to happen, the councils could claim against the airport. It is unknown how much money, if any, the councils could be held responsible for, as the agreement does not put a ceiling on the possible costs. According to the agreement, the councils cannot ask for the mortgage to be discharged until CBA is satisfied that all the secured money has been paid. There is nothing in the mortgage, like a limited recourse provision, to restrict Port Stephens or Newcastle councils' legal liability to the value of the head lease. This means that if the airport could not foot the bill, under the mortgage terms, the councils could have to pay more than the value of the head lease they have mortgaged to settle the airport's debt to CBA. The Herald asked the councils if they were required to ensure there was no default by the airport on its $235 million loan, if the councils were legally liable for the loan or if they had agreed to compensate CBA for any losses, liabilities, costs, expenses and taxes associated with the airport loan. They did not answer the questions. The joint response said the airport entities were independent of the councils regarding legal liability. "As previously explained to the Herald, there are a number of interrelated legal agreements and deeds that reflect the corporate structure of the airport separate to the councils that dictate the operation of the previous loan agreement with ANZ and now with the Commonwealth Bank," it reads. When the Herald asked individual councillors if they knew of any possible risk to ratepayer funds, Newcastle's Labor, Green, Independent, and Liberal councillors joined forces to dispel concerns, minus lord mayor Ross Kerridge and his Independent running mate Peter Gittins. The 11 councillors said they had "independently sought clarity" and "received multiple briefings" about the airport's financial situation. They said the council unanimously endorsed a proposal for the airport to refinance from ANZ to CBA, to increase its loan from $100 million to $235 million at its meeting on 28 February 2023. "The loan is secured solely against the airport's head lease with the Commonwealth Government," the joint statement reads. "This lease is the only security at risk in the unlikely event of a default. This ensures that there is no legal exposure to the councils or to ratepayer funds ... As councillors, we are committed to ensuring governance processes are followed, financial risk is properly understood, and the community is accurately informed." Questions about the mortgage arrangements come after Herald scrutiny of the airport's financial situation revealed the airport was looking to cut staff, had asked Defence to waive its rent, had been in discussions with councils to access a financial injection of up to $40 million, had been diverting millions in cash reserves to prop up its burgeoning property-development arm and was looking to borrow more money. The airport last month announced flights to Perth, and earlier this month said it had secured its first ongoing international service beyond Australasia, with flights direct to Bali. According to an airport spokeswoman, a valuation from last year based on "increases in land value, business growth" and Ernst & Young modelling that was done in 2019 valued the airport at $430 million. The $235 million loan is secured by the head lease and the airport's assets. Newcastle council's Newcastle Airport Partnership Company 1 and Port Stephens Council's Newcastle Airport Partnership Company 3 are the guarantors for the loan. The joint Newcastle councillor statement said Newcastle Airport's company structure was unanimously endorsed by council in November 2012 and approved by the then local government minister. "It was specifically designed to allow the airport to raise debt independently of the councils and to protect ratepayers of its two shareholder councils." First-time Port Stephens councillor Mark Watson urged people to focus on the "positives" about the airport. "We are expecting dividends in the near future, providing well-needed funds to inject into our roads and community projects," he said. "The airport loans have zero impact on councils operations and ratepayers funds." Fellow councillor Paul Le Motte was not on council when the refinancing deal was approved. However, he said he was "comfortable with all I have seen and heard" about the airport's finances and any potential impact on council funds. A leading industry expert's legal review of the mortgage document conducted for the Herald identified nine clauses where the councils could potentially be held legally liable for the airport's loan. He said CBA might have agreed in a separate document to limit its recourse not to make the councils legally liable for the airport's loan. The councils must be a party to the agreement for this to occur. City of Newcastle's Mr Bath and Port Stephens Council's Mr Kable signed the mortgage on behalf of the councils in March 2023. At the time when councillors voted to approve the loan deal, they were told the councils would "not be a borrower, guarantor or obligor under the facility agreement" and that each new agreement the councils had to enter into, including the mortgage, consent deed and financier side deed, was due to the councils holding the head lease. When asked if there was anything in the mortgage, consent deed or financier side deed that would prevent the bank from accessing council funds if anything goes wrong at the airport, the councils said the Herald's "questions referred to only some of the documents in the suite of transaction documents". The councils declined when asked to name the document that limited the bank's ability to access ratepayer funds. "The mortgage of the head leases is just one of a suite of commercial in confidence documents that govern the financial arrangements of the airport's loan facility," they said. "Together, these documents limit the financier's recourse in the highly unlikely event of a default. These documents have existed since 2013 and remain in place under the current loan facility, which was supported by both councils in 2023." It's understood Newcastle Airport's legal counsel prepared the mortgage. Several past and present councillors who spoke to the Herald said they were not informed about any potential risk to council funds. They understood that only the airport was on the hook if the debt was called in. Reaction from the airport and councils, including many elected councillors, to the Herald's reporting about the airport's finances has been swift and dismissive. The reporting has faced a chorus of vocal opposition to publicly discredit the information and distance the councils from the airport's business operations, repeatedly pointing to the airport's independent 10-member board as being responsible for decision-making. As previously reported, the council-controlled partnership boards are the ultimate authority at the airport. Any decision worth more than $1 million must be referred to the partnership boards for approval. Newcastle's representatives on the two partnership boards are Mr Bath and deputy lord mayor Callum Pull, who replaced former lord mayor Nuatali Nelmes this year. General manager Tim Crosdale and Labor mayor Leah Anderson represent Port Stephens. At a Newcastle council meeting in March, after councillors were earlier briefed by Newcastle Airport management, Labor's Deahnna Richardson described concerns about the airport's finances as "deliberate misinformation". Cr Richardson was one of many councillors who took aim at Cr Kerridge during the meeting because, days before, he called for an independent inquiry into the matter and refused to hand over a letter he wrote to Local Government Minister Ron Hoenig. Cr Kerridge, who has declared a conflict of interest in relation to the airport and does not attend briefings, said he was concerned about the discrepancies between the Herald's reporting and the official responses from the councils and the airport. Mr Hoenig dismissed the request, citing concern that Cr Kerridge was "unable to assess what the council's financial arrangements are with a company half owned by his council". Cr Liz Adamczyk described having to clarify what she claimed as "misinformation" about the airport's finances as "tedious" and a "waste of our time". She detailed an "incredible amount of work" that had gone into trying to "course correct", responding to what she called untruthful claims "out in the media". "And what we are doing now, I think, is just ridiculous in having to ask questions to again be clarified for the benefit of correcting that misinformation that is coming from the lord mayor and the Herald," she said. Cr Declan Clausen also criticised media reporting on the airport and Cr Kerridge for requesting the investigation. "I'm deeply concerned that the lord mayor expects that NSW taxpayers, or even worse our own ratepayers, should fund an inquiry into an asset that we own based on nothing more than innuendo that has been published in the media that has been fact checked and responded to by the airport, by the audit office, by our own ARIC [Audit, Risk and Improvement] committee, and proven to be untrue," he said. Cr Clausen was asked to identify who did the fact-checking of the reporting and what was proven to be untrue. In response, he said he was "directly responding to the misinformed claims made by the lord mayor regarding the airport". The Herald stands by its reporting, much of which is based on the airport's own internal reports. EXPERTS who reviewed a mortgage document for Newcastle Airport's $235 million loan say both Newcastle and Port Stephens ratepayers could be on the hook for the borrowings, but the councils say the document can not be "relied upon in isolation". The potential risk to ratepayer funds is outlined in a 57-page mortgage document, signed by City of Newcastle chief executive officer Jeremy Bath and Port Stephens Council senior executive Greg Kable in March 2023 and obtained as part of a Newcastle Herald investigation into Newcastle Airport's financial situation. Legal and business law experts consulted by the Herald have identified nine clauses in the publicly available mortgage document that indicate the councils, joint owners of the airport, could be held legally liable for the airport's $235 million Commonwealth Bank loan. In response, airport owners Port Stephens Council and City of Newcastle said in a joint statement earlier this year that the mortgage document could not be "relied upon in isolation to understand the financing arrangements", but declined to elaborate when asked for other relevant documents. In the weeks since the release of the Davidson Review, an independent inquiry into the City of Newcastle's policies, processes and procedures, simmering tensions within the council over the airport have overflowed into a public spat. Labor councillor Declan Clausen has made reference to past comments made by lord mayor Ross Kerridge regarding the financial situation of the airport, accusing the lord mayor of "rewriting history" by deleting past Facebook posts and saying the review showed: "every major decision about the airport was made lawfully, responsibly, and with proper controls and oversight". While not examining the airport's financial situation, the Davidson Review said it was "considered unlikely" that any significant financial risks from the airport would be transferred to the City of Newcastle, without detailing how it came to this conclusion. In the months prior to the review, the Herald had been working to clarify whether ratepayers were exposed to the record $235 million CBA loan facility. When questioned about the possible liability to ratepayers as outlined in the mortgage document, councillors from Newcastle issued what they called an "unprecedented" joint statement. "Councillors were informed in February 2023 that there were a series of legally binding agreements that sat alongside the mortgage of head lease that govern the financial arrangements, including securing the loans against airport assets only, thereby limiting the financier's recourse," the joint statement reads. The councils declined to answer specific questions about clauses in the mortgage that would allow CBA to access council funds if anything goes wrong, and if they are enforceable. They also declined to identify documents that overrule the mortgage to establish that ratepayer funds are off-limits. The airport secured the loan in April 2023 to construct a new international terminal and fund its property development business. While the councils are not parties to the loan or guarantors, they are linked to the deal because they hold the head lease with the Commonwealth for the 28 hectares of land where the airport operates south of Williamtown RAAF Base. The airport can't operate without the lease, so the bank wanted it as security. To ensure the airport could get its $235 million loan, the councils voted unanimously in separate confidential sessions in February 2023 to offer up the head lease as security for the loan. The head lease mortgage document establishes a legal agreement between City of Newcastle, Port Stephens Council, and the CBA. According to the councils, "CBA has confirmed in writing to the airport that the commercial intent of the mortgage of the head leases is limited recourse third party securities". Despite the intent, three experts who reviewed the mortgage said it had the potential to cause heartache for ratepayers if anything goes wrong. When considered in isolation, they said the mortgage gives CBA legal recourse to council funds. Associate Professor Keturah Whitford, dean of staff at the Australian National University's College of Business and Economics, said, "critically, there is nothing in the mortgage which limits the liability of the councils to the realised value of their interests in the airport lease". Professor Whitford, who specialises in business law, reviewed only the mortgage document. She said under the mortgage, the councils agreed to "ensure that no event of default occurs" and to "procure the punctual payment" of the secured money. "While the councils may not be borrowers, guarantors or obligors under the loan facility, the mortgage secures, amongst other things, 'all money which any obligor is or may become actually or contingently liable to pay under or in connection with the finance documents'...," she said. "Further, the council indemnifies the CBA for losses in connection with, among other things, any default." According to the mortgage document, if the airport defaults on a loan payment or interest, the councils could have to pay the money. If CBA cannot recoup money owed from the airport, under the mortgage, the councils have agreed to compensate the bank for any losses, liabilities, costs, expenses and taxes it incurs. Under the mortgage terms, the bank can also enforce its right against the councils before it seeks funds from the airport. If this were to happen, the councils could claim against the airport. It is unknown how much money, if any, the councils could be held responsible for, as the agreement does not put a ceiling on the possible costs. According to the agreement, the councils cannot ask for the mortgage to be discharged until CBA is satisfied that all the secured money has been paid. There is nothing in the mortgage, like a limited recourse provision, to restrict Port Stephens or Newcastle councils' legal liability to the value of the head lease. This means that if the airport could not foot the bill, under the mortgage terms, the councils could have to pay more than the value of the head lease they have mortgaged to settle the airport's debt to CBA. The Herald asked the councils if they were required to ensure there was no default by the airport on its $235 million loan, if the councils were legally liable for the loan or if they had agreed to compensate CBA for any losses, liabilities, costs, expenses and taxes associated with the airport loan. They did not answer the questions. The joint response said the airport entities were independent of the councils regarding legal liability. "As previously explained to the Herald, there are a number of interrelated legal agreements and deeds that reflect the corporate structure of the airport separate to the councils that dictate the operation of the previous loan agreement with ANZ and now with the Commonwealth Bank," it reads. When the Herald asked individual councillors if they knew of any possible risk to ratepayer funds, Newcastle's Labor, Green, Independent, and Liberal councillors joined forces to dispel concerns, minus lord mayor Ross Kerridge and his Independent running mate Peter Gittins. The 11 councillors said they had "independently sought clarity" and "received multiple briefings" about the airport's financial situation. They said the council unanimously endorsed a proposal for the airport to refinance from ANZ to CBA, to increase its loan from $100 million to $235 million at its meeting on 28 February 2023. "The loan is secured solely against the airport's head lease with the Commonwealth Government," the joint statement reads. "This lease is the only security at risk in the unlikely event of a default. This ensures that there is no legal exposure to the councils or to ratepayer funds ... As councillors, we are committed to ensuring governance processes are followed, financial risk is properly understood, and the community is accurately informed." Questions about the mortgage arrangements come after Herald scrutiny of the airport's financial situation revealed the airport was looking to cut staff, had asked Defence to waive its rent, had been in discussions with councils to access a financial injection of up to $40 million, had been diverting millions in cash reserves to prop up its burgeoning property-development arm and was looking to borrow more money. The airport last month announced flights to Perth, and earlier this month said it had secured its first ongoing international service beyond Australasia, with flights direct to Bali. According to an airport spokeswoman, a valuation from last year based on "increases in land value, business growth" and Ernst & Young modelling that was done in 2019 valued the airport at $430 million. The $235 million loan is secured by the head lease and the airport's assets. Newcastle council's Newcastle Airport Partnership Company 1 and Port Stephens Council's Newcastle Airport Partnership Company 3 are the guarantors for the loan. The joint Newcastle councillor statement said Newcastle Airport's company structure was unanimously endorsed by council in November 2012 and approved by the then local government minister. "It was specifically designed to allow the airport to raise debt independently of the councils and to protect ratepayers of its two shareholder councils." First-time Port Stephens councillor Mark Watson urged people to focus on the "positives" about the airport. "We are expecting dividends in the near future, providing well-needed funds to inject into our roads and community projects," he said. "The airport loans have zero impact on councils operations and ratepayers funds." Fellow councillor Paul Le Motte was not on council when the refinancing deal was approved. However, he said he was "comfortable with all I have seen and heard" about the airport's finances and any potential impact on council funds. A leading industry expert's legal review of the mortgage document conducted for the Herald identified nine clauses where the councils could potentially be held legally liable for the airport's loan. He said CBA might have agreed in a separate document to limit its recourse not to make the councils legally liable for the airport's loan. The councils must be a party to the agreement for this to occur. City of Newcastle's Mr Bath and Port Stephens Council's Mr Kable signed the mortgage on behalf of the councils in March 2023. At the time when councillors voted to approve the loan deal, they were told the councils would "not be a borrower, guarantor or obligor under the facility agreement" and that each new agreement the councils had to enter into, including the mortgage, consent deed and financier side deed, was due to the councils holding the head lease. When asked if there was anything in the mortgage, consent deed or financier side deed that would prevent the bank from accessing council funds if anything goes wrong at the airport, the councils said the Herald's "questions referred to only some of the documents in the suite of transaction documents". The councils declined when asked to name the document that limited the bank's ability to access ratepayer funds. "The mortgage of the head leases is just one of a suite of commercial in confidence documents that govern the financial arrangements of the airport's loan facility," they said. "Together, these documents limit the financier's recourse in the highly unlikely event of a default. These documents have existed since 2013 and remain in place under the current loan facility, which was supported by both councils in 2023." It's understood Newcastle Airport's legal counsel prepared the mortgage. Several past and present councillors who spoke to the Herald said they were not informed about any potential risk to council funds. They understood that only the airport was on the hook if the debt was called in. Reaction from the airport and councils, including many elected councillors, to the Herald's reporting about the airport's finances has been swift and dismissive. The reporting has faced a chorus of vocal opposition to publicly discredit the information and distance the councils from the airport's business operations, repeatedly pointing to the airport's independent 10-member board as being responsible for decision-making. As previously reported, the council-controlled partnership boards are the ultimate authority at the airport. Any decision worth more than $1 million must be referred to the partnership boards for approval. Newcastle's representatives on the two partnership boards are Mr Bath and deputy lord mayor Callum Pull, who replaced former lord mayor Nuatali Nelmes this year. General manager Tim Crosdale and Labor mayor Leah Anderson represent Port Stephens. At a Newcastle council meeting in March, after councillors were earlier briefed by Newcastle Airport management, Labor's Deahnna Richardson described concerns about the airport's finances as "deliberate misinformation". Cr Richardson was one of many councillors who took aim at Cr Kerridge during the meeting because, days before, he called for an independent inquiry into the matter and refused to hand over a letter he wrote to Local Government Minister Ron Hoenig. Cr Kerridge, who has declared a conflict of interest in relation to the airport and does not attend briefings, said he was concerned about the discrepancies between the Herald's reporting and the official responses from the councils and the airport. Mr Hoenig dismissed the request, citing concern that Cr Kerridge was "unable to assess what the council's financial arrangements are with a company half owned by his council". Cr Liz Adamczyk described having to clarify what she claimed as "misinformation" about the airport's finances as "tedious" and a "waste of our time". She detailed an "incredible amount of work" that had gone into trying to "course correct", responding to what she called untruthful claims "out in the media". "And what we are doing now, I think, is just ridiculous in having to ask questions to again be clarified for the benefit of correcting that misinformation that is coming from the lord mayor and the Herald," she said. Cr Declan Clausen also criticised media reporting on the airport and Cr Kerridge for requesting the investigation. "I'm deeply concerned that the lord mayor expects that NSW taxpayers, or even worse our own ratepayers, should fund an inquiry into an asset that we own based on nothing more than innuendo that has been published in the media that has been fact checked and responded to by the airport, by the audit office, by our own ARIC [Audit, Risk and Improvement] committee, and proven to be untrue," he said. Cr Clausen was asked to identify who did the fact-checking of the reporting and what was proven to be untrue. In response, he said he was "directly responding to the misinformed claims made by the lord mayor regarding the airport". The Herald stands by its reporting, much of which is based on the airport's own internal reports. EXPERTS who reviewed a mortgage document for Newcastle Airport's $235 million loan say both Newcastle and Port Stephens ratepayers could be on the hook for the borrowings, but the councils say the document can not be "relied upon in isolation". The potential risk to ratepayer funds is outlined in a 57-page mortgage document, signed by City of Newcastle chief executive officer Jeremy Bath and Port Stephens Council senior executive Greg Kable in March 2023 and obtained as part of a Newcastle Herald investigation into Newcastle Airport's financial situation. Legal and business law experts consulted by the Herald have identified nine clauses in the publicly available mortgage document that indicate the councils, joint owners of the airport, could be held legally liable for the airport's $235 million Commonwealth Bank loan. In response, airport owners Port Stephens Council and City of Newcastle said in a joint statement earlier this year that the mortgage document could not be "relied upon in isolation to understand the financing arrangements", but declined to elaborate when asked for other relevant documents. In the weeks since the release of the Davidson Review, an independent inquiry into the City of Newcastle's policies, processes and procedures, simmering tensions within the council over the airport have overflowed into a public spat. Labor councillor Declan Clausen has made reference to past comments made by lord mayor Ross Kerridge regarding the financial situation of the airport, accusing the lord mayor of "rewriting history" by deleting past Facebook posts and saying the review showed: "every major decision about the airport was made lawfully, responsibly, and with proper controls and oversight". While not examining the airport's financial situation, the Davidson Review said it was "considered unlikely" that any significant financial risks from the airport would be transferred to the City of Newcastle, without detailing how it came to this conclusion. In the months prior to the review, the Herald had been working to clarify whether ratepayers were exposed to the record $235 million CBA loan facility. When questioned about the possible liability to ratepayers as outlined in the mortgage document, councillors from Newcastle issued what they called an "unprecedented" joint statement. "Councillors were informed in February 2023 that there were a series of legally binding agreements that sat alongside the mortgage of head lease that govern the financial arrangements, including securing the loans against airport assets only, thereby limiting the financier's recourse," the joint statement reads. The councils declined to answer specific questions about clauses in the mortgage that would allow CBA to access council funds if anything goes wrong, and if they are enforceable. They also declined to identify documents that overrule the mortgage to establish that ratepayer funds are off-limits. The airport secured the loan in April 2023 to construct a new international terminal and fund its property development business. While the councils are not parties to the loan or guarantors, they are linked to the deal because they hold the head lease with the Commonwealth for the 28 hectares of land where the airport operates south of Williamtown RAAF Base. The airport can't operate without the lease, so the bank wanted it as security. To ensure the airport could get its $235 million loan, the councils voted unanimously in separate confidential sessions in February 2023 to offer up the head lease as security for the loan. The head lease mortgage document establishes a legal agreement between City of Newcastle, Port Stephens Council, and the CBA. According to the councils, "CBA has confirmed in writing to the airport that the commercial intent of the mortgage of the head leases is limited recourse third party securities". Despite the intent, three experts who reviewed the mortgage said it had the potential to cause heartache for ratepayers if anything goes wrong. When considered in isolation, they said the mortgage gives CBA legal recourse to council funds. Associate Professor Keturah Whitford, dean of staff at the Australian National University's College of Business and Economics, said, "critically, there is nothing in the mortgage which limits the liability of the councils to the realised value of their interests in the airport lease". Professor Whitford, who specialises in business law, reviewed only the mortgage document. She said under the mortgage, the councils agreed to "ensure that no event of default occurs" and to "procure the punctual payment" of the secured money. "While the councils may not be borrowers, guarantors or obligors under the loan facility, the mortgage secures, amongst other things, 'all money which any obligor is or may become actually or contingently liable to pay under or in connection with the finance documents'...," she said. "Further, the council indemnifies the CBA for losses in connection with, among other things, any default." According to the mortgage document, if the airport defaults on a loan payment or interest, the councils could have to pay the money. If CBA cannot recoup money owed from the airport, under the mortgage, the councils have agreed to compensate the bank for any losses, liabilities, costs, expenses and taxes it incurs. Under the mortgage terms, the bank can also enforce its right against the councils before it seeks funds from the airport. If this were to happen, the councils could claim against the airport. It is unknown how much money, if any, the councils could be held responsible for, as the agreement does not put a ceiling on the possible costs. According to the agreement, the councils cannot ask for the mortgage to be discharged until CBA is satisfied that all the secured money has been paid. There is nothing in the mortgage, like a limited recourse provision, to restrict Port Stephens or Newcastle councils' legal liability to the value of the head lease. This means that if the airport could not foot the bill, under the mortgage terms, the councils could have to pay more than the value of the head lease they have mortgaged to settle the airport's debt to CBA. The Herald asked the councils if they were required to ensure there was no default by the airport on its $235 million loan, if the councils were legally liable for the loan or if they had agreed to compensate CBA for any losses, liabilities, costs, expenses and taxes associated with the airport loan. They did not answer the questions. The joint response said the airport entities were independent of the councils regarding legal liability. "As previously explained to the Herald, there are a number of interrelated legal agreements and deeds that reflect the corporate structure of the airport separate to the councils that dictate the operation of the previous loan agreement with ANZ and now with the Commonwealth Bank," it reads. When the Herald asked individual councillors if they knew of any possible risk to ratepayer funds, Newcastle's Labor, Green, Independent, and Liberal councillors joined forces to dispel concerns, minus lord mayor Ross Kerridge and his Independent running mate Peter Gittins. The 11 councillors said they had "independently sought clarity" and "received multiple briefings" about the airport's financial situation. They said the council unanimously endorsed a proposal for the airport to refinance from ANZ to CBA, to increase its loan from $100 million to $235 million at its meeting on 28 February 2023. "The loan is secured solely against the airport's head lease with the Commonwealth Government," the joint statement reads. "This lease is the only security at risk in the unlikely event of a default. This ensures that there is no legal exposure to the councils or to ratepayer funds ... As councillors, we are committed to ensuring governance processes are followed, financial risk is properly understood, and the community is accurately informed." Questions about the mortgage arrangements come after Herald scrutiny of the airport's financial situation revealed the airport was looking to cut staff, had asked Defence to waive its rent, had been in discussions with councils to access a financial injection of up to $40 million, had been diverting millions in cash reserves to prop up its burgeoning property-development arm and was looking to borrow more money. The airport last month announced flights to Perth, and earlier this month said it had secured its first ongoing international service beyond Australasia, with flights direct to Bali. According to an airport spokeswoman, a valuation from last year based on "increases in land value, business growth" and Ernst & Young modelling that was done in 2019 valued the airport at $430 million. The $235 million loan is secured by the head lease and the airport's assets. Newcastle council's Newcastle Airport Partnership Company 1 and Port Stephens Council's Newcastle Airport Partnership Company 3 are the guarantors for the loan. The joint Newcastle councillor statement said Newcastle Airport's company structure was unanimously endorsed by council in November 2012 and approved by the then local government minister. "It was specifically designed to allow the airport to raise debt independently of the councils and to protect ratepayers of its two shareholder councils." First-time Port Stephens councillor Mark Watson urged people to focus on the "positives" about the airport. "We are expecting dividends in the near future, providing well-needed funds to inject into our roads and community projects," he said. "The airport loans have zero impact on councils operations and ratepayers funds." Fellow councillor Paul Le Motte was not on council when the refinancing deal was approved. However, he said he was "comfortable with all I have seen and heard" about the airport's finances and any potential impact on council funds. A leading industry expert's legal review of the mortgage document conducted for the Herald identified nine clauses where the councils could potentially be held legally liable for the airport's loan. He said CBA might have agreed in a separate document to limit its recourse not to make the councils legally liable for the airport's loan. The councils must be a party to the agreement for this to occur. City of Newcastle's Mr Bath and Port Stephens Council's Mr Kable signed the mortgage on behalf of the councils in March 2023. At the time when councillors voted to approve the loan deal, they were told the councils would "not be a borrower, guarantor or obligor under the facility agreement" and that each new agreement the councils had to enter into, including the mortgage, consent deed and financier side deed, was due to the councils holding the head lease. When asked if there was anything in the mortgage, consent deed or financier side deed that would prevent the bank from accessing council funds if anything goes wrong at the airport, the councils said the Herald's "questions referred to only some of the documents in the suite of transaction documents". The councils declined when asked to name the document that limited the bank's ability to access ratepayer funds. "The mortgage of the head leases is just one of a suite of commercial in confidence documents that govern the financial arrangements of the airport's loan facility," they said. "Together, these documents limit the financier's recourse in the highly unlikely event of a default. These documents have existed since 2013 and remain in place under the current loan facility, which was supported by both councils in 2023." It's understood Newcastle Airport's legal counsel prepared the mortgage. Several past and present councillors who spoke to the Herald said they were not informed about any potential risk to council funds. They understood that only the airport was on the hook if the debt was called in. Reaction from the airport and councils, including many elected councillors, to the Herald's reporting about the airport's finances has been swift and dismissive. The reporting has faced a chorus of vocal opposition to publicly discredit the information and distance the councils from the airport's business operations, repeatedly pointing to the airport's independent 10-member board as being responsible for decision-making. As previously reported, the council-controlled partnership boards are the ultimate authority at the airport. Any decision worth more than $1 million must be referred to the partnership boards for approval. Newcastle's representatives on the two partnership boards are Mr Bath and deputy lord mayor Callum Pull, who replaced former lord mayor Nuatali Nelmes this year. General manager Tim Crosdale and Labor mayor Leah Anderson represent Port Stephens. At a Newcastle council meeting in March, after councillors were earlier briefed by Newcastle Airport management, Labor's Deahnna Richardson described concerns about the airport's finances as "deliberate misinformation". Cr Richardson was one of many councillors who took aim at Cr Kerridge during the meeting because, days before, he called for an independent inquiry into the matter and refused to hand over a letter he wrote to Local Government Minister Ron Hoenig. Cr Kerridge, who has declared a conflict of interest in relation to the airport and does not attend briefings, said he was concerned about the discrepancies between the Herald's reporting and the official responses from the councils and the airport. Mr Hoenig dismissed the request, citing concern that Cr Kerridge was "unable to assess what the council's financial arrangements are with a company half owned by his council". Cr Liz Adamczyk described having to clarify what she claimed as "misinformation" about the airport's finances as "tedious" and a "waste of our time". She detailed an "incredible amount of work" that had gone into trying to "course correct", responding to what she called untruthful claims "out in the media". "And what we are doing now, I think, is just ridiculous in having to ask questions to again be clarified for the benefit of correcting that misinformation that is coming from the lord mayor and the Herald," she said. Cr Declan Clausen also criticised media reporting on the airport and Cr Kerridge for requesting the investigation. "I'm deeply concerned that the lord mayor expects that NSW taxpayers, or even worse our own ratepayers, should fund an inquiry into an asset that we own based on nothing more than innuendo that has been published in the media that has been fact checked and responded to by the airport, by the audit office, by our own ARIC [Audit, Risk and Improvement] committee, and proven to be untrue," he said. Cr Clausen was asked to identify who did the fact-checking of the reporting and what was proven to be untrue. In response, he said he was "directly responding to the misinformed claims made by the lord mayor regarding the airport". The Herald stands by its reporting, much of which is based on the airport's own internal reports. EXPERTS who reviewed a mortgage document for Newcastle Airport's $235 million loan say both Newcastle and Port Stephens ratepayers could be on the hook for the borrowings, but the councils say the document can not be "relied upon in isolation". The potential risk to ratepayer funds is outlined in a 57-page mortgage document, signed by City of Newcastle chief executive officer Jeremy Bath and Port Stephens Council senior executive Greg Kable in March 2023 and obtained as part of a Newcastle Herald investigation into Newcastle Airport's financial situation. Legal and business law experts consulted by the Herald have identified nine clauses in the publicly available mortgage document that indicate the councils, joint owners of the airport, could be held legally liable for the airport's $235 million Commonwealth Bank loan. In response, airport owners Port Stephens Council and City of Newcastle said in a joint statement earlier this year that the mortgage document could not be "relied upon in isolation to understand the financing arrangements", but declined to elaborate when asked for other relevant documents. In the weeks since the release of the Davidson Review, an independent inquiry into the City of Newcastle's policies, processes and procedures, simmering tensions within the council over the airport have overflowed into a public spat. Labor councillor Declan Clausen has made reference to past comments made by lord mayor Ross Kerridge regarding the financial situation of the airport, accusing the lord mayor of "rewriting history" by deleting past Facebook posts and saying the review showed: "every major decision about the airport was made lawfully, responsibly, and with proper controls and oversight". While not examining the airport's financial situation, the Davidson Review said it was "considered unlikely" that any significant financial risks from the airport would be transferred to the City of Newcastle, without detailing how it came to this conclusion. In the months prior to the review, the Herald had been working to clarify whether ratepayers were exposed to the record $235 million CBA loan facility. When questioned about the possible liability to ratepayers as outlined in the mortgage document, councillors from Newcastle issued what they called an "unprecedented" joint statement. "Councillors were informed in February 2023 that there were a series of legally binding agreements that sat alongside the mortgage of head lease that govern the financial arrangements, including securing the loans against airport assets only, thereby limiting the financier's recourse," the joint statement reads. The councils declined to answer specific questions about clauses in the mortgage that would allow CBA to access council funds if anything goes wrong, and if they are enforceable. They also declined to identify documents that overrule the mortgage to establish that ratepayer funds are off-limits. The airport secured the loan in April 2023 to construct a new international terminal and fund its property development business. While the councils are not parties to the loan or guarantors, they are linked to the deal because they hold the head lease with the Commonwealth for the 28 hectares of land where the airport operates south of Williamtown RAAF Base. The airport can't operate without the lease, so the bank wanted it as security. To ensure the airport could get its $235 million loan, the councils voted unanimously in separate confidential sessions in February 2023 to offer up the head lease as security for the loan. The head lease mortgage document establishes a legal agreement between City of Newcastle, Port Stephens Council, and the CBA. According to the councils, "CBA has confirmed in writing to the airport that the commercial intent of the mortgage of the head leases is limited recourse third party securities". Despite the intent, three experts who reviewed the mortgage said it had the potential to cause heartache for ratepayers if anything goes wrong. When considered in isolation, they said the mortgage gives CBA legal recourse to council funds. Associate Professor Keturah Whitford, dean of staff at the Australian National University's College of Business and Economics, said, "critically, there is nothing in the mortgage which limits the liability of the councils to the realised value of their interests in the airport lease". Professor Whitford, who specialises in business law, reviewed only the mortgage document. She said under the mortgage, the councils agreed to "ensure that no event of default occurs" and to "procure the punctual payment" of the secured money. "While the councils may not be borrowers, guarantors or obligors under the loan facility, the mortgage secures, amongst other things, 'all money which any obligor is or may become actually or contingently liable to pay under or in connection with the finance documents'...," she said. "Further, the council indemnifies the CBA for losses in connection with, among other things, any default." According to the mortgage document, if the airport defaults on a loan payment or interest, the councils could have to pay the money. If CBA cannot recoup money owed from the airport, under the mortgage, the councils have agreed to compensate the bank for any losses, liabilities, costs, expenses and taxes it incurs. Under the mortgage terms, the bank can also enforce its right against the councils before it seeks funds from the airport. If this were to happen, the councils could claim against the airport. It is unknown how much money, if any, the councils could be held responsible for, as the agreement does not put a ceiling on the possible costs. According to the agreement, the councils cannot ask for the mortgage to be discharged until CBA is satisfied that all the secured money has been paid. There is nothing in the mortgage, like a limited recourse provision, to restrict Port Stephens or Newcastle councils' legal liability to the value of the head lease. This means that if the airport could not foot the bill, under the mortgage terms, the councils could have to pay more than the value of the head lease they have mortgaged to settle the airport's debt to CBA. The Herald asked the councils if they were required to ensure there was no default by the airport on its $235 million loan, if the councils were legally liable for the loan or if they had agreed to compensate CBA for any losses, liabilities, costs, expenses and taxes associated with the airport loan. They did not answer the questions. The joint response said the airport entities were independent of the councils regarding legal liability. "As previously explained to the Herald, there are a number of interrelated legal agreements and deeds that reflect the corporate structure of the airport separate to the councils that dictate the operation of the previous loan agreement with ANZ and now with the Commonwealth Bank," it reads. When the Herald asked individual councillors if they knew of any possible risk to ratepayer funds, Newcastle's Labor, Green, Independent, and Liberal councillors joined forces to dispel concerns, minus lord mayor Ross Kerridge and his Independent running mate Peter Gittins. The 11 councillors said they had "independently sought clarity" and "received multiple briefings" about the airport's financial situation. They said the council unanimously endorsed a proposal for the airport to refinance from ANZ to CBA, to increase its loan from $100 million to $235 million at its meeting on 28 February 2023. "The loan is secured solely against the airport's head lease with the Commonwealth Government," the joint statement reads. "This lease is the only security at risk in the unlikely event of a default. This ensures that there is no legal exposure to the councils or to ratepayer funds ... As councillors, we are committed to ensuring governance processes are followed, financial risk is properly understood, and the community is accurately informed." Questions about the mortgage arrangements come after Herald scrutiny of the airport's financial situation revealed the airport was looking to cut staff, had asked Defence to waive its rent, had been in discussions with councils to access a financial injection of up to $40 million, had been diverting millions in cash reserves to prop up its burgeoning property-development arm and was looking to borrow more money. The airport last month announced flights to Perth, and earlier this month said it had secured its first ongoing international service beyond Australasia, with flights direct to Bali. According to an airport spokeswoman, a valuation from last year based on "increases in land value, business growth" and Ernst & Young modelling that was done in 2019 valued the airport at $430 million. The $235 million loan is secured by the head lease and the airport's assets. Newcastle council's Newcastle Airport Partnership Company 1 and Port Stephens Council's Newcastle Airport Partnership Company 3 are the guarantors for the loan. The joint Newcastle councillor statement said Newcastle Airport's company structure was unanimously endorsed by council in November 2012 and approved by the then local government minister. "It was specifically designed to allow the airport to raise debt independently of the councils and to protect ratepayers of its two shareholder councils." First-time Port Stephens councillor Mark Watson urged people to focus on the "positives" about the airport. "We are expecting dividends in the near future, providing well-needed funds to inject into our roads and community projects," he said. "The airport loans have zero impact on councils operations and ratepayers funds." Fellow councillor Paul Le Motte was not on council when the refinancing deal was approved. However, he said he was "comfortable with all I have seen and heard" about the airport's finances and any potential impact on council funds. A leading industry expert's legal review of the mortgage document conducted for the Herald identified nine clauses where the councils could potentially be held legally liable for the airport's loan. He said CBA might have agreed in a separate document to limit its recourse not to make the councils legally liable for the airport's loan. The councils must be a party to the agreement for this to occur. City of Newcastle's Mr Bath and Port Stephens Council's Mr Kable signed the mortgage on behalf of the councils in March 2023. At the time when councillors voted to approve the loan deal, they were told the councils would "not be a borrower, guarantor or obligor under the facility agreement" and that each new agreement the councils had to enter into, including the mortgage, consent deed and financier side deed, was due to the councils holding the head lease. When asked if there was anything in the mortgage, consent deed or financier side deed that would prevent the bank from accessing council funds if anything goes wrong at the airport, the councils said the Herald's "questions referred to only some of the documents in the suite of transaction documents". The councils declined when asked to name the document that limited the bank's ability to access ratepayer funds. "The mortgage of the head leases is just one of a suite of commercial in confidence documents that govern the financial arrangements of the airport's loan facility," they said. "Together, these documents limit the financier's recourse in the highly unlikely event of a default. These documents have existed since 2013 and remain in place under the current loan facility, which was supported by both councils in 2023." It's understood Newcastle Airport's legal counsel prepared the mortgage. Several past and present councillors who spoke to the Herald said they were not informed about any potential risk to council funds. They understood that only the airport was on the hook if the debt was called in. Reaction from the airport and councils, including many elected councillors, to the Herald's reporting about the airport's finances has been swift and dismissive. The reporting has faced a chorus of vocal opposition to publicly discredit the information and distance the councils from the airport's business operations, repeatedly pointing to the airport's independent 10-member board as being responsible for decision-making. As previously reported, the council-controlled partnership boards are the ultimate authority at the airport. Any decision worth more than $1 million must be referred to the partnership boards for approval. Newcastle's representatives on the two partnership boards are Mr Bath and deputy lord mayor Callum Pull, who replaced former lord mayor Nuatali Nelmes this year. General manager Tim Crosdale and Labor mayor Leah Anderson represent Port Stephens. At a Newcastle council meeting in March, after councillors were earlier briefed by Newcastle Airport management, Labor's Deahnna Richardson described concerns about the airport's finances as "deliberate misinformation". Cr Richardson was one of many councillors who took aim at Cr Kerridge during the meeting because, days before, he called for an independent inquiry into the matter and refused to hand over a letter he wrote to Local Government Minister Ron Hoenig. Cr Kerridge, who has declared a conflict of interest in relation to the airport and does not attend briefings, said he was concerned about the discrepancies between the Herald's reporting and the official responses from the councils and the airport. Mr Hoenig dismissed the request, citing concern that Cr Kerridge was "unable to assess what the council's financial arrangements are with a company half owned by his council". Cr Liz Adamczyk described having to clarify what she claimed as "misinformation" about the airport's finances as "tedious" and a "waste of our time". She detailed an "incredible amount of work" that had gone into trying to "course correct", responding to what she called untruthful claims "out in the media". "And what we are doing now, I think, is just ridiculous in having to ask questions to again be clarified for the benefit of correcting that misinformation that is coming from the lord mayor and the Herald," she said. Cr Declan Clausen also criticised media reporting on the airport and Cr Kerridge for requesting the investigation. "I'm deeply concerned that the lord mayor expects that NSW taxpayers, or even worse our own ratepayers, should fund an inquiry into an asset that we own based on nothing more than innuendo that has been published in the media that has been fact checked and responded to by the airport, by the audit office, by our own ARIC [Audit, Risk and Improvement] committee, and proven to be untrue," he said. Cr Clausen was asked to identify who did the fact-checking of the reporting and what was proven to be untrue. In response, he said he was "directly responding to the misinformed claims made by the lord mayor regarding the airport". The Herald stands by its reporting, much of which is based on the airport's own internal reports.

Sydney Morning Herald

8 hours ago

• Sydney Morning Herald

Indonesia's answer to the Maldives is one of the best-kept island secrets

Belitung is located on the east coast of Sumatra in the Gaspar Strait where the South China and Java seas meet. Its north-west corner, where I'm staying, has been dubbed the 'Seychelles of Indonesia' and 'Indonesia's Maldives'. I liken this heavenly beach paradise to a mini-Raja Ampat, a white sandy wonderland of gentle translucent waters with tropical fish darting in the shallows, and blooms of staghorn and brain coral sitting quietly in the cooler depths. The coastline's scattering of tiny islands – rocky outcrops sprouting picture-perfect coconut trees – are part of a UNESCO Global Geopark. It is scenery worthy of a fairytale, or a pirate movie. That a shipwreck and its treasure were discovered out on the horizon, just 1.6 kilometres away, is entirely in keeping. Known for its lucrative deposits of tin, Belitung has a mining history and was once a base for BHP Billiton, Billiton being another name for Belitung. Its population of about 320,000 has traditionally worked in mining, but the depletion of tin in the 1990s has since seen the emphasis on fishing, agriculture and, incrementally, tourism. My invitation to the island has come from Tanjung Kelayang Reserve, a 350-hectare privately owned nature reserve that fronts Belitung's stunner north-west coastline. Of this land, 200 hectares have been dedicated to rewilding and conservation, with a promise of protecting the island's endemic fauna and flora while supporting local communities. I arrived earlier this morning on the 45-minute flight (400 kilometres) north of Jakarta. At the one-shed International airport, my host Yuni Kusama points out that I am the only bule, or foreigner, at the airport. She explains that the reserve's Perth-based Indonesian owner (who requests anonymity) wants Australians and Europeans to visit Belitung 'because they're eco-travellers. They'll understand that we are trying to create a truly sustainable destination'. From what I'm seeing, the assessment is bang-on. Aussies keen on a low-impact intrepid island adventure will fall for this place. So will those seeking a laid-back beach holiday or an eco-luxury escape. For the first two nights, I stay at Sheraton Belitung, at the centre of the reserve. It's a lovely, newish, 123-room resort thoughtfully constructed from hand-pressed local kaolin clay bricks, with native renggadai wood ceilings and finishes. The colour palette blends seamlessly with the white sands, dark green tropical garden and expansive natural lagoons, which are connected to the resort's zero-emissions water treatment plant. The resort is luxurious, but casually so, with a peaked-roof, wall-less lobby where my bare feet don't get a second glance, and clean and spacious rooms with comforts including balconies with standalone bathtubs. On the beachfront, the indoor-outdoor Island Restaurant, serving traditional Bangka Belitung cuisine, ensures long leisurely dining interspersed with kayaking, snorkelling, laps of the Olympic-sized pool, and volleyball jousts over a net whimsically strung between two coconut trees. Island hopping, in the reserve's characteristic wooden fishing boat, is part of the fun too. Over two days we zigzag around the Geopark to snorkel in the depths around bird-shaped Garuda Island and walk knee-deep in the echoing sea caves of Kelayang Island. We stop by a tiny floating fish market where grouper and napoleon fish are bred in cages sunken into the cobalt blue sea. We motor into a light headwind to Lengkuas Island and are greeted by a vision from a children's book, a 55-metre Dutch colonial lighthouse, built in 1882, with seven porthole windows ascending 12 floors to a domed lamp top. There's talk of turning it into a museum showcasing Belitung's long maritime trade-route history. On day three, I swap sand and sea for the reserve's Whistle Trail nature walk with guide Akbar Alfarisyi, a former biology teacher who joined the reserve in 2022. 'Now the biology teaches me,' he says as we walk through the cool forest, the island's biodiversity hotspot with more than 150 species of native flora and fauna. Along the path, Alfarisyi points out the reserve's rewilding successes – exquisite native orchids (of which there are 67 species on Belitung), termite nests (food for the reserve's four protected Sunda pangolin), cinnamon (a relatively rare species with a mint scent), and a strong-flavoured white pepper (once the island's chief agricultural export and now critically endangered). We visit the reserve's trigona beehives, which are cared for by the villagers of Komunitas Pelabo Sijuk, who receive an income from the bottles they sell. Unlike regular hexagonal hives, stingless beehives are a mesh of smallish sacks. I dip a reed straw into one to taste the delicious honey – it has a woody fermented flavour, both sweet and sour, like the aroma of wine barrels. On night three, I stay at the reserve's Billiton Ekobeach Retreat, accessible via a sandy shoreline walk or a short putt-putt by fishing boat. It has five rustically charming, stilted beach huts spaced along their own stretch of sand. The structures and bespoke furniture are made from beach-sourced driftwood and other natural waste items for a Robinson Crusoe vibe, but they're also comfortably appointed with air-conditioning, ceiling fans and hot showers. The final day might well be the finest. Once again, I meet Wakhyu Brata, this time to join a Bluemind Experience private island adventure. We skip over the waves to Kera Island, an idyllic oasis covered in a tropical garden with a hidden sandy cove where a picnic lunch is served. Afterwards, Brata, having snorkelled around the shallows with his net, waves me over. He has caught four fresh sea urchins, round, spiky and glistening black, with silver and blue spots that shimmer like crystals. Loading We stand knee-deep in water as he cuts the spikes off, then cracks the top off, the shell to reveal slivers of buttery yellow flesh, a delicacy known as uni in the Japanese culinary world. After swishing it clean in the salty water, I scoop the soft, briny, umami-loaded sea-shimi straight into my mouth. It's a taste sensation, yet another of Belitung Island's remarkable underwater treasures. THE DETAILS VISIT Belitung and Tanjung Kelayang Reserve are open year-round, with the dry season (April to October) typically offering the best time to visit. See Bluemind Experience organises the reserve's island-hopping activities. See FLY Qantas and Garuda Indonesia have direct flights from Sydney and Melbourne to Jakarta, where it's a one-hour flight to Belitung on domestic airlines, including Citilink and Batik Air. See