Australian Tourism Export Council: Bob Baldwin Speech
07/12/11
ATEC President John King AM, CEO Felicia Mariani, and ATEC members. When ATEC asked me to speak today I was asked to make sure I had a major policy announcement ready for you.
We will go to the next election with a solid policy document to promote tourism and hospitality in Australia. The content of the Coalition’s Industries For Australia’s Future report, due by Christmas, will give the industry a good ‘feel’ for our policy directions – though as you can appreciate it’s important that we keep much of our powder dry for the election so as not to have our best ideas stolen.
That said, I haven’t come here with a ‘stump’ speech.
Labor has been a bit sensitive about us saying “no, no, no” to them lately, so I’ll start with a few things we say “yes” to in the tourism portfolio:
First, I’m encouraged by yesterday’s announcement that the government will integrate Aboriginal and Torres Strait cultural tourism into the overall Australian tourism offering, something that the Coalition pursued in Senate Budget Estimates last month.
81 percent of international visitors seek out Aboriginal cultural experiences – and we do need to give our customers what they want.
Second, if it’s true that Labor will soon increase funding to market Australia to China and India, this should be welcomed. Only last month we expressed our concern that trade Events in both China and India was reduced over the 09/10 and 10/11 financial years.
And also, following our questions in Senate Estimates last month about reduced funding for cultural institutions, we also say “yes” to Labor sparing cultural institutions from last week’s funding cuts. Galleries and other cultural institutions are major drawcards for tourists and important parts of the fabric of the sector.
But in the short time I have been allocated, I’ll share a few concerns we have. I hate to give a one sided speech!
Over the past year a range of tourism industry stakeholders have expressed their worries about the absorption of Tourism Research Australia into the Department of Resources Energy and Tourism.
They’re concerned that the key issues facing the sector may not be researched if TRA would likely make adverse findings against the government.
Take for example the Carbon Tax debate. Industry has warned of 6,400 potential job losses resulting from the carbon dioxide tax. It would be reasonable, therefore, to assume that TRA would undertake some analysis.
So at estimates we asked;
“Has Tourism Research Australia been asked to model the impact of the carbon tax on the tourism sector?”
We are informed;
“ No, TRA has not undertaken any specific research into the net impacts on tourism from the introduction of the carbon tax in Australia.”
We followed up on a question we asked in February about the work we knew Frontier Economics had been commissioned to undertake in this area.
We have learned the contract awarded to Frontier Economics did not require industry consultation. Interestingly, the draft report was received by the Department on 10 February 2011; well before the bills were to be debated in the House of Representatives.
But no, a public release is not planned at this stage, despite the expense to the taxpayer.
I call on the Minister to release this information immediately, and have an open and honest dialogue with the sector about what this great big new tax will mean for you.
I was shocked also to learn the Department has not undertaken specific analysis of the existing Passenger Movement Charge – a $630m charge levied on tourists.
To determine what’s being done on red tape reduction, we asked;
“Has the Department undertaken any reviews in the past year to determine the effects of red tape on the Tourism sector’s businesses, and if so, what are the results?”
“Has the Department considered ways it can streamline engagement for Tourism and Hospitality businesses?”
We are told;
“the Department does not monitor or maintain a register of each and every regulation which is applied by the Australian Governments to tourism businesses and is not aware of any other specific requirements for ‘filing and certification, reporting, investigation, inspection and enforcement practices, and procedures’, that might be considered red tape by the sector.”
It’s the Coalition’s view that governments and the bureaucracies that report to them should be focused on making business easier, and should regularly review red tape and other burdens that advantage overseas tourism competitors. And the federal government should use the COAG process to drive improvements.
So today, I announce the launch of an online survey for the Tourism Sector. Given it will be hosted on Survey Monkey, I’ve called it (I hope memorably) “Get the red tape gorilla off your back”.
A link can be found via my personal website which can be found quite easily – and no doubt you’re all regular visitors to http://www.bobbaldwin.com.au/
This is no reflection on the Department – it does what it is directed to do. Under a Labor-Greens government it will shock nobody here today that efforts aren’t being made to reduce the reach of government into our lives and businesses.
But as a former tourism operator myself, I will make it my business to identify any measures, at any level of government, that require tourism and hospitality business owners to fill out paperwork, obtain licenses, deal with multiple people or committees to approve a decision or navigate the rules that make conducting tourism and hospitality businesses slower, more difficult, or both.
We know the tourism industry faces a disproportionate regulatory burden impacting negatively on investment. Tourism's multi-use nature means investment is often affected by a variety of regulations across a number of agencies and is not well understood by officials.
The dominance of small business in the tourism and hospitality space means the industry is less able to absorb the costs of delay caused by regulatory complexity.
The regulatory barriers faced by the tourism industry include planning, environmental, labour shortages and general business regulation and span across a range of areas and levels of government. Planning schemes are particularly challenging for the industry.
This is the view of LEK consulting whose report ‘Tourism Investment and Regulation Review’was made public, quite conveniently, only after the Tourism Future Directions Conference in Canberra this year. I would like to read you the opening paragraph of that report.
“Over the last decade Australia’s tourism performance and competitiveness has faltered. ABS data show that over the last decade, domestic overnight trips have fallen from 72 million to 64 million (7.8 percent).”
In fact when the Coalition left office Australia’s share of international visitors was 73.6 million, so LEK was being too generous to the current government in describing this as a decade-long decline. According to the World Economic Forum, since 2007 Australia’s competitiveness as a tourism destination has fallen from 4th place to 13th place.
If we can take a whole of government view – between departments and between tiers of government – there’s much we can achieve.
Let me give you an example.
Over the weekend, Elton John sang to two sold out concerts at the Hope Estate in the Hunter Valley (in the Cessnock Local Government Area). He sang to 34,000 people who had come to the region. His song “I’m still standing” should be an anthem for Australia’s resilient tourism operators.
Much of the audience were day-trippers to the district, since accommodation was also ‘sold out’.
Some people have urged me to boost accommodation stock when we are in government – or even work to ensure campervan and caravan park development there so day trippers could have come up from Sydney on Friday night and return Sunday night, visiting vineyard cellar doors, local restaurants and other places of interest.
Stimulating investment into accommodation capital is only part of the solution.
In some regions, it may be that providing more stock may not be a sustainable tourism outcome. In the Cessnock Local Government Area weekday occupancy rates are often less than 40%. The local Regional Tourism Organisation needs to provide a detailed programme of events, and the federal government can do more to support them in their destination management plans and in marketing their events to tourists.
As we know, wine tourism and event tourism, while having some commonalities and co-dependencies, often conflict as the demands for events encroach on the very essence of what attracts people to the vineyards and the events. That is, the vistas, experience and atmosphere that the vines and agricultural lands provide.
In the Cessnock local government area alone the total tourism spend (Cellar Door, Accommodation, Restaurants, Cafes, Weddings et cetera) is up just half a percent to $94.8 million dollars per annum over the last available reporting period. This can be improved with better coordination assistance from the Federal Government.
The government can also better leverage its budgetary allocations in other portfolios to help tourism.
For example, we asked at Estimates; “of the 11.8 million that was allocated to Wine Australia Corporation in this year’s budget, will the total amount spent on marketing Australian wine to consumers, or will some be earmarked for marketing the Upper Hunter, Margaret River, Barossa and other wine tourism destinations? If not, does this not represent a significant missed opportunity for the tourism sector?”
The response was this: “This information and the question of allocation of marketing funds is more appropriately directed to the Wine Australia Corporation”. This is disappointing and emblematic of a government that isn’t seeking to extract value for the tourism industry and maximise the return on investment of taxpayer funds.
We asked in Estimates, “can RET provide an update on your discussions with the Department of Immigration and Citizenship on lengthening the time limit for working holiday visas by a year?”
We’re told “As a member of the Labour and Skills Working Group, the Department of Resources, Energy and Tourism is involved in a dialogue with Department of Immigration and Citizenship and other (group) members on developing options for reform of the WHM program.”
Full stop.
I’m no clearer on what has actually been achieved in this area. To say that a working group is having dialogue is frankly a non-answer.
Time permitting I would love to take you through the questions and answers put at estimates and since, but I will let you consult the Hansard record, or my office, for more information.
I will, however, leave the following with you to reflect upon.
When we noticed that Tourism Australia Annual Report cash on hand appeared to have almost doubled from $12 million in 2009 to over $20 million 2010, my Senate colleagues asked if this represented an under spending in marketing.
We’re told this was mainly as a result of foreign exchange gains – Tourism Australia spends its marketing allocation in local currency and consequently it could buy its intended marketing space overseas with less money. The unexpected surplus cash was refunded to government.
The high dollar is precisely why Aussies are travelling overseas more than ever before. And this, friends, is why we need to do more than ever to ensure they “holiday at home”…and do more to attract foreign tourists to our shores.
Given the size of the refund made by Tourism Australia to consolidated revenue, you would think the government could have gone easy on the sector during the mini-budget and spared the sector the extra $4.1 million cut it inflicted on the sector.
What makes it worse is that the government has shown it has money to spend marketing its great big new tax – a tax people don’t want and didn’t vote for.
The cost of selling Labor’s Carbon Tax is $102.4m – much larger than the $24m originally known.
Labor has committed the equivalent of two-thirds of Tourism Australia’s budget to a campaign to sell its broken promise.
And so I say, it is high time that Martin Ferguson starts putting some resources and energy into tourism – to restore Hope, Reward and Opportunity to the tourism sector.
Thank you.