"It was not always certain this money would remain in Rotorua. The original funding
deed agreed by Government for $72 million stated that should the funding not be used for the original purpose it should be returned to Treasury.
"However, scientists believed the existing plan to divert nutrient-rich streams flowing
into the lake and cap sediments to stop nutrients flowing up from the lake bed wasn't a long-term solution.
"After ongoing and in depth discussions between Cabinet and the lakes stakeholder
advisory group it was agreed that the money may now be used instead to support the land use management and change efforts being driven by the Rotorua community.''
Mr McClay said it was a collaborative effort from local stakeholders which led the minister to agree to re-allocating the money. He said tourism was the biggest employer in the region and worth half a billion dollars to the local economy so improving the quality of the lakes was vital.
Agriculture was also worth half a billion dollars, so support for farmers was also needed.
"Everybody at the table may not agree with everything but we all agreed that we needed to stop looking at each other to blame and to do something together to find the solutions."
Rotorua mayor Steve Chadwick said it was a relief to hear the money would remain in the region.
"It is wonderful news, I was particularly worried about this, if Cabinet had not agreed it could have been lost ... the lakes programme is hugely important both for our local community and nationally, and we want to do whatever we can to help our landowners make the changes necessary to achieve our goals for Lake Rotorua."
Rotorua Te Arawa Lakes Strategy Group chairman Sir Toby Curtis said while the lake's water quality was improving, the challenge was sustaining that improvement in the long term.
Bay of Plenty Regional Council chairman Doug Leeder said the decision showed ongoing government support for the lakes programme.
"The Rotorua Te Arawa Lakes Programme is leading the way in New Zealand in water quality management and the Cabinet decision to allow the re-allocation of funds represents a significant milestone."