The Otago Southland Rescue Helicopter service will have a shortfall of about $2M going into the next financial year, as it seeks to renew vital air ambulance contracts.

HeliOtago director Graeme Gale told Otago Regional Council (ORC) on Thursday (September 25) the rescue service’s four year contract with Health NZ/ACC would expire in October 2026, and there were no negotiations underway yet for its future.

ORC gave the Otago Southland Rescue Helicopter Trust $350,000 a year, and the ILT Foundation in Invercargill contributed $150,000, with funding also from community groups and individuals, and bequests had increased to $335,000.

Graeme said the government contract for air ambulance services in the South Island was split between HeliOtago and Garden City Helicopters in Christchurch, and the Southern operation was able to subsidise the funding shortfall from the other areas of Graeme’s commercial flying business.

There are five helicopters based at the Taieri airbase and a further two in Queenstown, and the total missions over the past year increased from 2,057 to 2,165 - with hospital transfers the highest (946), accidents 621, medical emergencies 490, and Search and Rescue 108.

New Instrument Flight Rules (IFR) routes have enabled the service “to go to places that I never thought possible before”, Graeme said.

He described the Otago operation as the most comprehensive low level IFR network in the country. The new routes enabled pilots to cover areas such as out at sea near Campbell Island in the South, right through to Christchurch.

“We are flying in the middle of the night, in the dark and at low levels, in the valley systems and in bad weather.”

Graeme said the only days the helicopters were grounded was in bad fog or low freezing levels.

Central Otago mayor Tamah Alley opening the new helipad in Cromwell recently. Photo: File

HeliOtago was in the process of ordering two new Airbus D3 helicopters from Europe at a cost of $22M each, making it one of the sophisticated air ambulance services in the country.

The service has also made its own specialised equipment such as stretchers to fit inside the choppers, and employed its own medics - no longer using St John’s.

Graeme said he was concerned about future funding, and the new technological advancements meant they now faced a major funding shortfall.

“It’s just so capital intensive now, we are going to be a major player, but there is no way five to 10 years ago we would be able to deliver that level of care.”

The air ambulance funding contract with the government which started in October 2026 was going to be for the next 10 years.

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