The minister in charge of managed isolation facilities insists ruling out Queenstown as a location had nothing to do with local's resistance - but she also acknowledged there were concerns.
Megan Woods has been holding meetings in the south to determine the best place for an additional managed isolation and quarantine facility, and she announced on Friday that Queenstown and Invercargill have both been ruled out.
"We are ruling out Queenstown and Invercargill as places for the managed isolation of returning New Zealand citizens and permanent residents," Dr Woods told reporters in Dunedin.
"This is a combination of health capacity issues and the capacity that sits around the hotels and also the ability for critical mass of the number of facilities. If you think about Queenstown and Invercargill they probably represent one of those each."
The prospect of setting up a facility in Queenstown sparked backlash earlier this month from some locals whose concerns were voiced by Clutha-Southland MP National MP Hamish Walker, who said the community should have been consulted.
He issued a press statement at the time claiming up to 11,000 people arriving from India, Pakistan and Korea could be destined for quarantine in the south.
"It's absolutely disgraceful that the community hasn't been consulted on this," he said. "These people are possibly heading for Dunedin, Invercargill and Queenstown from India, Pakistan and Korea."
Walker's singling out of Asian countries earned him a rebuke from Dr Woods who described his comments at the time to RNZ as "racist" and she questioned where Walker got the 11,000 arrivals figure from.
Walker has since announced he will not seek re-election for the Southland electorate after he confessed to leaking confidential COVID-19 patient information to the press.
Ex-National leader Todd Muller said Walker never sought approval before releasing the statement.
Queenstown Lakes District Councillor Dr Valerie Miller, who is also a senior GP at the Wakatipu Medical Centre, said Walker was just doing his job by trying to keep the community safe.
"We just simply don't have the capacity here in Queenstown to deal with isolating people that have been in contact and still run a service."
Dr Miller said she was told via a local hospital that there could be 11,000 people spread throughout the region. She said she heard "whispers" about a managed isolation facility being set up in Queenstown from other councillors.
Dr Woods acknowledged on Friday that "clearly there were local concerns" about setting up a facility in Queenstown, but she denied that's the reason why it wasn't chosen as a location.
She said it became "abundantly clear" that the capacity of Queenstown's broader health system wouldn't be able to cope with a potential outbreak, including the required mental health services for returnees.
"We heard very clearly that there were local concerns around that and the ability of the system to cope. That was the reason we made the decision."
Dr Woods said the Government is continuing to look at Dunedin as an option for a facility.
Air Commodore Webb said 29,631 people have gone through state-run managed isolation and quarantine facilities since March 26 and there are currently 4475 people in the facilities.
There are 31 facilities across five regions - an increase of 10 over the past three weeks.