After 30 years is this all we’ve achieved?
No wonder we’re arguing over the State and federal budgets
Australia’s international tourism industry has expanded in the last 30 years, but a closer look at the current statistics suggest it is not making anywhere near the contribution to the Australian economy and the nation’s prosperity some of the hype might suggest, a former federal adviser on Queensland and northern Australia issues said today.
The claim, by Brisbane-based policy and public issues consultant, John Moran, comes as Australian government’s struggle with post-GFC budget deficits and reduced tax revenues and concerns about the ongoing strength of the mining sector. In the early 1990s Mr Moran was also an adviser to the Minister Assisting the Prime Minister for Northern Australia, at a time when Australia’s international tourism potential and environment-heritage issues and tourism draw cards, such as the protection and promotion of Queensland’s wet tropics region, were gaining prominence.
“Australian governments currently seem obsessed with cost cutting to balance their budgets. As Australians today come to grips with the 2014 federal budget and a range of new or increased taxes, service and job cuts and new health charges, they are entitled to ask why the nation’s international tourism industry has only reached such modest levels in 30 years,” Mr Moran said.
“In the context of the current budget and financial debate Australians should get a full and frank discussion about the performance of industries such as this. So let’s put a few numbers out there for closer scrutiny.
“It’s been 30 years since the Hawke Government’s flamboyant tourism minister, John (JJ) Brown, challenged Australia to move beyond ‘piddling koalas’ as its promotional symbol and Paul Hogan first convinced Americans they needed a holiday, yet the annual spend by international visitors is still only about $30 billion from about 6.5 million visitors.
“There was a lot of talk in government and business circles in the 1980s and 90s about tourism being an important new and replacement industry in many areas. Ministers and advisers were always talking it up when we met with local community leaders and business groups. There was also a lot of investment in potential draw cards like outback heritage sites and the protection of environmental and cultural areas like the Queensland wet tropics. Twenty-seven years ago this month (7 May 1987) Brown made a major speech to parliament – Tourism under Labor – outlining the industry’s potential in glowing terms.
“Yet 20 or 30 years later, when the Australian economy is nearly $1.5 trillion in size and the Federal Government’s annual budget is itself nearly $400 billion, international visitors are only providing about $30 billion a year. And in ten years’ time they predict it will still only be $39 billion, spent by about 9.3 million visitors:
Inbound spend to grow 5.2 per cent to $29 billion in 2013−14
• Total inbound expenditure is forecast to grow 5.2 per cent
to $29 billion in 2013−14 and 5.0 per cent to $30 billion in
2014−15.
• The 10 year long-run average growth is for total inbound
expenditure to grow 3.5 per cent per annum on average to
$39 billion.
(Source: Tourism Research Australia – Tourism Forecasts Spring 2013)
“The Department of Foreign Affairs and Trade states that international tourism is now earning just over $25 billion in exports, out of total national export earnings in excess of $300 billion. (Source: DFAT – Australia’s trade in goods and services 2012-13)
“That’s useful income, but it’s got to be much higher than that if we are going to continue building national prosperity, in what some call the post-industrial age, as opposed to just cutting spending on services like health and education. Last night’s federal budget deficit was $30 billion for the year – the total size of the current international visitor spend in Australia. And how much of that spend eventually finds its way into government revenues?
“Of particular concern, in terms of national income growth, is that Australia is ranked as one of the biggest tourism earners in the world, even though it is a relatively low performer in terms of international visitor numbers. If $30 billion represents strong earnings by international standards then just what does this industry have to offer a nation trying to fund a $400 billion national budget?
“According to the World Travel and Tourism Council tourism, total domestic and international, has gone from being one of Australia’s top ten GDP industries in the 1990s to 15th place in 2013. It drops to 16th place by 2023. (WTTC rankings, November 2013.)
“Here in Queensland, where the State Government is describing tourism as one of the four pillars of the State economy, the picture is just as concerning. In the scheme of things there doesn’t seem to be a lot of foreign exchange being earned.
“To the end of September 2013 just over two million international visitors spent just under $4 billion in Queensland, which has an economy nearly $300 billion in size and a State Government budget approaching $50 billion.
“According to Tourism and Events Qld, net taxes on tourism products arising from tourism consumption in Queensland last year raised $951 million in federal, state and local government revenues, and was 27.4% of total taxes on tourism products as a whole. (Source: Tourism Research Australia – State Tourism Satellite Accounts 2012-13)
“There is clearly the potential to earn a lot more from tourism than we currently are. It is time for a renewed debate on how to grow our export income, and in turn government revenues, in this area,” Mr Moran said.
End
Media inquiries: John Moran 07-3366 9010; 0410-603 278