In our series* of interviews and Q&A’s with political party tourism spokespersons, we hear the National Party’s Paula Bennett outline her vision for the industry and how she would meet the challenges ahead if she were to remain Minister of Tourism.
Listen to Bennett explain why she believes NZ must remain a competitive destination, why a border tax is off the table and why returning tourist GST to the regions to pay for infrastructure would create another problem for the government.
Q. Tourism is a $35bn industry, earning $15bn a year in international expenditure making it NZ’s largest export earner – what is your overall vision for the industry and what will you do to help bring that about?
A. Tourism is a huge success story for New Zealand, directly employing 188,000 people and indirectly supporting 330,000 jobs. We’ve seen great growth in both visitor numbers and spend over the past few years and now our focus is on attracting quality over quantity: attracting more high-value visitors and encouraging them to stay longer, spend more, travel in the shoulder seasons and visit more of New Zealand’s regions.
Q. Many regions are suffering under the strain of growing tourism numbers with infrastructure such as toilets, roads and rubbish disposal coming under strain – how will you help those regions, many with very low ratepayer bases, cope with the number of tourists visiting?
A. We have already funded 42 projects around New Zealand through the Mid-Sized Facilities Fund. This $8.2 million in co-funding has provided facilities like rubbish compactors in Thames Coromandel, toilets in Tekapo and Timaru, and parking facilities at Te Mata Peak. In Budget 2017 we recognised the growing need for further infrastructure funding and announced $178m in tourism infrastructure funding. $76m of this will be four infrastructure on the DOC Estate: new great walks, upgraded tracks and facilities, and new technology to introduce differential charging for international users of our huts. We’re also providing a $100m Tourism Infrastructure Fund to support councils with high visitor numbers and a low ratepayer base, and the first round of this fund closed this month.
Q. Do you support a tourist border levy? If not, why not, especially if it is believed it would not affect the number of visitors to NZ?
A. We don’t support a tax on travellers entering New Zealand as we already have the $100m Tourism Infrastructure Fund to support tourism infrastructure. There are many unanswered questions about proposed tourism taxes – how it would be collected, who it would apply to, how it would be distributed – and we think we should spend the money we have already allocated and then look at what else is needed.
Q. The government collects more than $1bn in GST from international visitors, do you support the return of tourist GST to the regions to help pay for infrastructure? Why or why not?
A. With the $100m Tourism Infrastructure Fund we are in essence already using some of that general taxation to provide new tourism infrastructure. Such a policy would leave a $1.2b shortfall in funding for core health, transport and law and order services that everyone in New Zealand relies on.
Q. Do you support Auckland’s move to implement a bed tax on accommodation providers and if so, do you believe it should be put in place in other cities such as Queenstown?
A. We don’t support the bed tax (or targeted rate) in the way it is proposed. It unfairly targets the accommodation sector and could result in fewer accommodation options being available. Targeted rates like those in Wellington that apply to all central city businesses could be a fairer way but ultimately it is a decision for local council to make.
Q. Five million tourists are expected in the country annually in just six years’ time, up from 3.5 million last year – do you believe the country is preparing itself adequately for such numbers and what can you do to help ensure we have the social license to cope with such growth?
A. Yes – Ireland is a country that is a similar size to New Zealand and they received about 10 million visitors a year so I think there is still room to grow. Our new $100m Tourism Infrastructure Fund will help support local tourism infrastructure and proposed changes to freedom camping laws will address some of the issues around the growing number of freedom campers.
Q. The industry is predicting it will need an additional 36,000 full-time jobs by 2025 to cope with the expected growth, that includes 8000 accommodation managers and 6000 chefs – how will you help ensure we can fill all of those jobs?
A. The main thing we can do is ensure our young people leave school equipped with the skills and education they need to thrive in a growing economy. Since coming into Government we have lifted the rate of NCEA Level 2 achievement from 68% to 85% and we can do more. In places like Queenstown and Blenheim in the South Island where demand is high we will continue to provide temporary work visas to skilled workers and invest in tertiary education providers, such as the Tai Tokerau Resort College in Northland, to ensure there are New Zealanders ready and available to work as well.
Q. Many tourism activity, accommodation and hospitality operators struggle to find local staff and rely on overseas workers to help fill vacancies – what guarantee can you give those operators that good access to overseas workers will remain in place?
A. We will not be drastically slashing immigration like other parties have proposed. We recognised the need for quality, skilled workers in areas where there are shortages. What we have done is made it clearer to temporary workers that this work is temporary – for too long people were moving here with partners and raising families with no path to residency. It’s only fair on those workers that they know temporary work visas are temporary, and the new guidelines on stand-down periods and restrictions on bringing family will help with that. We will maintain the favourable points systems for regions like the South Island who have a high demand for skilled labour we can’t otherwise source in New Zealand.
Q. The tourism sector struggles with concerns of low industry pay and a lack of a career pathway – what can you do to help next generation of New Zealanders believe tourism is an attractive career to pursue?
A. We need to keep talking positively about tourism, about the opportunities that there are to grow and run your own business, and decision to choose hospitality and tourism as a career in itself. Investment in high quality tertiary education providers like Queenstown Resort College and continued strong leadership from industry will help this. When people see tourism as a long-term career option, turnover rates drop and wages stabilise and grow as businesses are able to invest for the long term.
Q. Given the size of the industry, its expected growth, and its value to NZ’s economy, will you make tourism a University Entrance subject again after it was removed as an NCEA subject in 2014?
A. Tourism was never a University Entrance subject. Until 2014 students could use Tourism unit standard credits to meet the ‘third subject’ requirement even though it wasn’t on the approved subjects list. They now cannot do that, although Tourism credits still count towards NCEA Level 3, which is required for UE.
* Because of our Election 2017 coverage this week, our regular columns, From the Regions, Wednesday Letter, Buy Side/Sell Side and An Operator’s View will not run and will return next week.