TNZ staff earning $100K+ jumps almost a quarter in FY17

Tourism New Zealand’s headquarters at 1 Nelson Street in Auckland. Credit: Bayleys

The number of Tourism New Zealand staff who earned $100,000 jumped by 24% in the government agency’s 2017 financial year, compared with the previous period.

In its annual report for the 12 months to June 2017, TNZ said 63 employees had received “remuneration and benefits which exceeded $100,000 per annum”. This is up from 51 employees in the previous year and compares to 55 in FY15, 44 in FY14 and just 24 in FY13.

TNZ employs around 160 people, which means almost 40% of them earned $100,000+ packages during the 2017 financial year.

A note to the report attributed the “increase in employee numbers who have earned $100,000 or more in FY17 compared to FY16 …to high employee turnover in the previous year resulting in a full years’ [sic] salary in the current year and salary increases pushing a few just above $100,000.”

The two highest paid employees received $300,000 – $309,999, in contrast with the previous period when the single highest paid employee, former chief executive Kevin Bowler, sat in the $480,000 – $489,999 band.

However, during FY17 Bowler left the agency to lead drinks maker Frucor and was replaced by Stephen England-Hall, then the chief executive of Loyalty NZ. England-Hall started in April so TNZ’s latest annual report does not capture the full value of his remuneration package.

The report, which was tabled in Parliament yesterday, also reveals that TNZ is seeking to combat falling visitors and spend from the Chinese market by investing in alternative markets.

It reported the ”notable significance” of the slow-down out of China which saw holiday visitors to June 2017 drop 2.3% year-on-year and average visitor spend fall by 14% to $4100 per visit.

It added: “It is too early to say if the recent drop in total Chinese visitor numbers is a reaction to peak holiday season pricing or a more sustained shift in market behaviour.

“Certainly it’s something we monitor closely and we will manage the risk by seeking to grow other markets.”

Chair Kerry Prendergast’s and England-Hall’s statement said that TNZ had “worked hard to target the higher-value FIT and at year end the number of visitors travelling on General Visitor Visas exceeded those travelling on Approved Destination Status Visas (ADS: tours and groups) for the first time with a 58/42% split.”

The annual report highlighted the challenges ahead of the agency as it seeks to grow value over volume in the tourism sector, with visitor arrival growth outstripping expenditure growth in NZ’s major markets during the 2016/2017 period.

Australia ended the year on 6.2% total growth and a massive 9.7% growth in holiday arrivals. Total visitor spend from the Australian market remained static year-on-year ($2.5bn), while the average visitor spend dropped 5% to $1900 per visitor. Currency rate fluctuations were said to have “played a part in this”.

The USA saw “outstanding growth” in holiday visitors, up by 31.2% “highlighting the influence of increased connectivity through air capacity”. However total visitor spend from the US market increased 8% to $1.162bn in FY17, while average visitor spend was down 13% to $4000 per visit.

Overall, the financial year to June 2017 saw total arrivals growing 10% to 3.6m and holiday arrivals up 12% at 1.9m – ahead of global tourism trends.

While total arrivals were up, total international visitor spend was $10.25bn, flat against the FY16 result. Total holiday spend increased “a pleasing” 4% to $6.55bn.

Prendergast and England-Hall said: “While the peaking of expenditure was disappointing it was not unexpected given the significant growth in spend seen over recent years.

“A contributing factor here has been the strength of the New Zealand dollar against a number of major currencies. Medium and long-term forecasts for tourism spend remain positive with growth expected from the Asian markets as well and the US and UK.

They added that international visitor spending is forecast to exceed $15bn a year by 2023, up 52% from the $10bn recorded in FY17.

The report’s statement of performance said that the agency, which had a £123m budget, “achieved” its overall objective, which is to boost New Zealand’s economy by growing the value of international tourism.

The measure was an increase in visitors contributing to an increase in the tourism sector’s contribution to NZ’s GDP, and the target was an increase on the previous year’s figures.

During the year, TNZ spent $45.5m on “delivering key messages through the 100% Pure New Zealand campaign activity” as it sought to market NZ as a visitor destination.

This was followed by $25.5m on “partnering with travel to convert interest in New Zealand into travel and extend marketing reach”.

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