Key Points:

The most toxic site in New Zealand, the Tui mine near Te Aroha, is to be cleaned up after 34 years.

Environment Minister David Benson-Pope visited the site yesterday to announce the Government would pay $9.88 million over two years for remedial work.

This means the mine should be declared safe by 2010.

The Tui mine is on the western slopes of Mt Te Aroha in the Kaimai range, and is regarded as an environmental timebomb.

Highly poisonous tailings are stored in a large pool-like area which has an oxidised, solid top, and is held in check by a dam.

But its vulnerability to earthquakes, storms and erosion - as well as its elevated location - makes it a threat to human life, farm animals, and aquatic life.

The Government's grant appears timely. Matamata-Piako Mayor Hugh Vercoe said yesterday that recent checks by consultants had found the dam wall was deteriorating and the entire tailings area was starting to move slightly.

The contents looked like black molasses, he said.

"I wouldn't like to be mayor if a disaster came and the whole lot went down into the Hauraki Gulf. Not that it's my particular issue - but that's why we've advised the Government it's their issue and not ours."

The mine leftovers have been slowly seeping out for years, contaminating the Tui and Tunakohioa Streams, both of which feed the Waihou River, which runs into the Firth of Thames.

The site became the No 1 contaminated in the country after an $8 million clean-up project began on the previous worst, the former Fruitgrowers Chemical Company site at Mapua, near Nelson, two years ago.

At the Tui mine site yesterday, Mr Benson-Pope said much planning had been done.

"The clean-up will significantly improve the catchment's water quality, eliminate the unacceptable risk of the dam failing, ensure public safety, and improve access to reserves around the site," he said.

The long wait for the Tui Mine site to be cleaned up has been caused by political squabbles over who should take responsibility for it.

Environment Waikato and the Matamata-Piako District council both said the tailings were a Government responsibility.

Several options were considered, and the Government has decided to cap and strengthen the oxidised shell that surrounds the tailings, and reinforce the dam wall.

The most expensive option was to remove the contents from the mountain and bury them at Newmont Gold's Favona mine near Waihi. This was rejected because of its $15 million price tag.

Environment Waikato's special projects manager, Dennis Crequer, said the Government plan was the best value for money.

"It's not necessarily the best option, but it is a good one," he said. "Now funding is confirmed we can get into detailed design work and let the tenders."

Newmont Gold has offered technical assistance, Mr Crequer said, and "we're still talking to them".

Mr Vercoe said the area was easy to reach, and the dam wall was causing a great deal of concern.

"The local young people with their trail bikes hoon up and down that wall and it's deteriorated."

A more substantial dam wall would be put in place, and the pool of exposed tailings would be covered in topsoil and planted out.

"They've done some trials on this, and it will regenerate with plants to take away the visual aspect."

The site would be as safe as it could be, but Mr Vercoe conceded that "in an ideal world" the tailings would be removed from the mountain.

"Also from an iwi perspective, the tailings are part and parcel of the mountain, they weren't brought in from the outside. But the chemicals that were added to them were brought in."

Iwi concerns had been one of the factors in the decision to cap the tailings rather than remove them.

The Matamata-Piako District Council and Environment Waikato had agreed to cover the cost of gaining necessary resource consents for the work.

Environment Waikato chairwoman Jenni Vernon said a "considerable amount of public consultation and detailed planning" was needed before remedial work could start.

"We will work closely with the Government to ensure a successful completion of this important project."

Poison peril

* The eastern Waikato mine was abandoned when Norpac Mining went bust in 1973, leaving behind the tailings from its previous seven years work.

* The abandoned debris was the waste from the extraction of 43,500 tonnes of copper, lead, zinc, silver, and gold.

* More than 100,000cu m of poisonous "black molasses-like" substance has threatened human and aquatic life for decades.

* Local councils have been worried about the effects of an earthquake or a heavy storm on the toxic tailings.

* They will be made safe by strengthening and capping work, paid for by $9.8 million from the Government.