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ESTIMATES COMMITTEE E
26/08/1993
DEPARTMENT OF TOURISM
Program 1--Tourism

Senator FERGUSON --On page 30 of the program performance statements reference is made to $5.5 million for the regional tourism development program. Is this the first instalment of the $23 million that will be spent on this program over the next four years?

Mr Mazitelli --The answer is yes.

Senator FERGUSON --On 27 February 1993, the then Minister for Tourism, Mr Griffiths, announced funding of $300,000 for the arid lands botanic garden in Port Augusta. Is this funding included in the $5.5 million?

Mr Mazitelli --That project is likely to be funded out of this budget allocation.

Senator FERGUSON --When you say it `is likely to be funded', there has been no definite decision made as to whether it would definitely be funded out of this program this year?

Mr Mazitelli --That project is still being considered in the context of other projects that will also be considered against the regional tourism development program.

Senator Schacht --As I understand it, that includes a number of projects--not just that one--which are still being considered. Senator Ferguson, like me, is a South Australian and has been a devotee of supporting that arid desert project in Port Augusta. I suspect you have been lobbied about it as hard as I have.

Senator FERGUSON --Yes, I understand that. What concerns me is whether it is being considered only along with a number of other projects. In February it was a commitment that was made prior to the election that it would be funded as part of an election promise. That $300,000 is crucial to the project. I understand that that particular project has also received sponsorship and outside support from Western Mining and other people who are putting money into it. I think they need to know exactly when it may become available because the other corporate sponsorship may depend on it.

Senator Schacht --I have just been advised that because we have said that it is still being considered should not be taken automatically that it is not going to occur. It is just that in the process of dealing with the applications from a number of civil projects around Australia, it has got to go through a normal process and so on. I, like you, would imagine that that commitment made in February means that, once the consideration is completed and the due processes gone through, it has a substantial chance of getting the money granted. But we cannot say definitely because the formality of the process has not been completed yet.

Senator FERGUSON --If it is not possible to give a definite answer now, when would the people in that area be likely to know definitely whether it is going to be part of this year's funding?

Ms Williams --The guidelines are likely to go out next month and the decisions are probably likely to be made in December. This is an election commitment, as you say, but it is also a budget announcement, and the guidelines have not yet gone out to people to apply. They are very close.

Senator FERGUSON --I guess December is not that close for the people that are involved. Your commitment was made in February. It was made at roughly the same time as the commitment to provide for the survey of the Alice Springs-Darwin railway. That money has been promised and allocated. It would seem to me that this commitment was made at the same time. There ought to be some way in which people can be assured so that they can maintain the corporate sponsorship that they are getting from outside government. That is the important thing. Young people are being employed under the landcare program. The work program lasts for 22 weeks. Some of these people hope to gain employment by the continuation of that project, having been through the training programs.

Senator Schacht --The points you are making are quite reasonable. We are going to be sitting all day today and into this evening. I will ask the officials here, subsequent to the information we get from Tourism this morning, to get more information for me about the time scale of that process and come back to you later in the day.

Senator FERGUSON --In relation to the first dot point on page 32, I wonder whether it is possible for me to receive a copy of the submission on tourism radio that was prepared for the Australian Broadcasting Authority.

Senator Schacht --We can do that. We might not be able to give it to you today, but we will supply it to you.

Senator FERGUSON --Also on page 32, the second dot states:

. . . a meeting of all State and Territory Government tourism planning managers. . .

What was the outcome of the meeting of state and territory government tourism planning managers to discuss regional planning?

Mr Strang --The outcome of that meeting was that the tourism planning and development officers from each state and territory would meet on a regular basis to discuss tourism planning in a national context. The specific initiative that came out of that meeting is mentioned in the next dot point, the strategic planning best practice program, whereby each state and territory submitted an application under that program for assistance from the government.

Senator FERGUSON --The only concrete decision that was made at the meeting was that it would meet again as a group?

Mr Strang --It was an information meeting, principally, to bring everybody up to the same level on what was happening in the states and territories about tourism planning.

Senator FERGUSON --Can you explain the rationale behind the strategic planning best practice program? What do you mean by developing a best practice approach in regional tourism planning?

Mr Strang --Out of the national tourism strategy and the tourism report on ecologically sustainable development, there was an emphasis on the need for better integrated regional tourism planning. It was decided that we should investigate the opportunity for states and territories and the Commonwealth to participate in a program which would give states and territories a better handle on planning and planning systems. This is the first initiative under that program whereby each state and territory was given the opportunity to provide information on a demonstration project which it believed would have national application. Each was assessed on that basis and four projects were funded.

Senator FERGUSON --In light of that answer, and having only recently got the annual report, on page 27 of which there is mention, how will that support sustainable integrated tourism development?

Mr Strang --It is the basis of sustainable integrated tourism development. If the planning process is done properly, you have a better chance of sustainable tourism development.

Senator FERGUSON --As long as you do not spend more time on planning than you do on developing.

Mr Strang --The implementation stage is the next stage.

Senator FERGUSON --How much did the program cost to develop and how much will be spent this financial year?

Senator Schacht --We do not have the figures with us, but we will get them during the day for you.

Senator FERGUSON --On page 27 of the annual report, seven projects are listed as strategic planning case studies. I notice that none of those projects are from South Australia. Were any South Australian projects nominated by the state government?

Mr Strang --No, no projects were nominated by the South Australian government.

Senator FERGUSON --None at all?

Mr Strang --None at all.

Senator FERGUSON --Are there any plans at all to provide a grant or grants to tourism projects in South Australia under this program?

Mr Strang --This program may not continue. This was the first opportunity to look at regional planning. The program was in the last financial year and it may not continue this year.

Senator FERGUSON --On page 33, under the heading `Outlook for 1993-94', there is only one reference to the regional tourism development program, which reads:

Develop and implement the Regional Tourism Development Program.

How will the $5.5 million allocated to this program this financial year be spent? Can I be provided with a breakdown of the $5.5 million?

Mr Strang --As the secretary to the department indicated, the guidelines for the program are just being put together and are subject to approval by the minister. Applications will be sought from regional tourism associations, regional development organisations and local government authorities in September. They will be assessed against the guidelines. Some decision on the outcome of that application process is likely in December.

Senator FERGUSON --Would it be possible to get a breakdown of how the $5.5 million will be spent?

Senator Schacht --Yes. We will get that for you. The breakdown will depend upon the decisions taken about the allocation, and they do not occur until December. So we cannot give the breakdown to you today, I am sorry. Because we have a general allocation, we have not allocated the money and the breakdown has not yet occurred. We are unable to provide you with a breakdown. When those decisions are taken, it seems to me quite reasonable that we will supply you with the information about that breakdown.

Senator FERGUSON --So we have $5.5 million that is allocated. The decision about spending prior to the end of next June will not be made until December?

Senator Schacht --That is a normal process, I would have thought, within a financial year.

Senator FERGUSON --Page 27 states that the objective of the regional development subprogram is `to support the development of a competitive tourism industry'. One of the strategies is to `contribute to the diversification of regional economies through tourism development'. It is pretty obvious that the competitiveness of the industry depends to a large degree on how affordable it is for both domestic and overseas tourists to travel within Australia because of the large distances that are involved, and I can think of a lot of large distances in my own state. How does this objective of supporting the development of a competitive tourism industry sit with budget measures which increase fuel excise, making it more expensive for people to drive to holiday destinations?

Senator Schacht --You are making, I suppose, the first of--

Senator IAN MACDONALD --A very valid point, I would have thought.

Senator Schacht --I noticed you arrive, Senator Macdonald. I thought, `Here we go!'. I imagine this will be the first of many occasions during the next several hours where combinations such as that are put together. That is a comment about the overall policy of the budget. Of course, the imposition of the increase in fuel excise does not directly relate to the tourism portfolio expenditure. But you could make the comment about the politics of it, and that is what we are in politics for, Senator Ferguson.

Senator FERGUSON --It is not only the politics of it. Would you concede that the increase in petrol tax would increase the costs of people travelling to rural and regional areas?

Senator Schacht --Of course I concede that. Any increase in the fuel excise means that there will be an increased cost. I point out to you that, even with those increases, we still have the third lowest petrol prices in the OECD. Only Canada and the United States are ahead of us. Our prices are still way below the average of the OECD. Many of those other countries have well developed tourism industries that also rely on people travelling around in cars, hiring cars and paying petrol prices.

Senator FERGUSON --And pushbikes.

Senator Schacht --I do not think you would pedal around France on a pushbike unless you wanted to be in the Tour de France. I certainly concede it is an increased cost, but I believe other countries which have much higher fuel costs than we do also have very successful tourism industries.

Senator FERGUSON --And far shorter distances to travel.

Senator Schacht --That is true. We are not like Luxembourg or Monaco, but Europe is a pretty big area to travel around, so I think there are some analogies that can be drawn.

Senator FERGUSON --Would you agree that it is contrary to the aim of the program to contribute to the diversity of rural economies?

Senator Schacht --I do not think that necessarily follows.

Senator FERGUSON --I guess it leads to the same question: did officers of the regional tourism development program assess the possible impact of these increases on areas like the Barossa Valley which is affected not only by a fuel tax increase but also by a wine tax increase?

Senator Schacht --Obviously, they would not have assessed it before the announcement in the budget because they did not know about it. I presume that at the regional level they may choose to make assessments of the impact in their own planning. I would have thought the attractions of the Barossa Valley were such that it would not be significantly affected in any way. There might be a bit of a dip, but I would have thought the value and quality of Barossa Valley wines and the general amenities of the Barossa Valley as an attraction in its own right would outweigh any concern about an increase of a few cents a litre in the price of the petrol needed to get there.

I would also point out that if you are going to the Barossa Valley to drink wine, and you are driving there, you had better make sure that you or one of your companions does not drink. Also, I would have thought that if it encourages more people to visit the area by bus or to hire a bus so that there is no risk of drinking and driving, that would be a good social outcome.

Senator FERGUSON --You and I probably know that, but some people travelling from greater distances might not be quite so sure about it.

Senator Schacht --They ought to be weighing those things up because that is a good social outcome.

Senator FERGUSON --Assuming that these increases in costs by way of wine tax and fuel tax go ahead, will the regional tourism development program be assessing the impact of those increases on tourism dollars flowing into regional areas of Australia, particularly wine growing areas?

Senator Schacht --I have been informed that the criteria have not been finalised yet, but I would have thought that, whatever the criteria are, these are general issues and in any assessment by competent program devisers the broader macro-economic and micro-economic settings will be taken into account, as well as the impact. I think that is just good public policy management and development.

Senator FERGUSON --I come back to one question asked previously regarding arid lands. Will the arid lands project have to reapply for funds in September or will the fact that the promise was made prior to February mean that that application still exists? Will they have to reapply or will it be under consideration?

Senator Schacht --Everyone has to apply, but if there is anything in the present application that in process terms makes it awkward for them, or creates any difficulty, we will certainly inform them to adjust their application accordingly.

Senator FERGUSON --So the existing application that they have put in will suffice without their putting in another application.

Senator Schacht --As far as I am aware, I am advised that it will, but if there is any difficulty with it not sufficing, we will inform them that they need to put in further information and adjust it accordingly. We can assure them that they will not fall between the stools by accident with their application.

Senator FERGUSON --You understand that they are a very persistent crew.

Senator Schacht --You and I both understand how persistent they are.

Senator IAN MACDONALD --One of the performance information guides, on page 28, is effective communication between the tourism industry and the minister. How does that happen?

Ms Williams --The minister has reconstituted the Tourism Advisory Council. It is made up of a range of people from the tourism industry who the minister meets with. There is a general exchange of information. He listens to them and also passes on things that the government is doing at present. He has had his first meeting with that group, which was really to exchange information. He will have follow-up meetings which will be more directed to particular issues that are of relevance at the time.

Senator IAN MACDONALD --How is that committee constituted and how often does it meet?

Ms Williams --It will probably meet a couple of times a year. The people on it are chosen by the minister as being generally representative of the industry.

Senator IAN MACDONALD --Approximately how many people are on it?

Ms Williams --I understand there are 12 on it at the moment.

Senator IAN MACDONALD --What areas are they from?

Senator Schacht --I am told that we do not have that information with us, but we can provide a list during the day. Do you want the names of the 12 people?

Senator IAN MACDONALD --I do not want the specifics. I want to know whether generally they are drawn from different areas--both geographical and business--of the tourism industry.

Ms Williams --There is a broad range.

Senator IAN MACDONALD --Are some from the airlines, some from the Barrier Reef islands, some from the wine areas?

Ms Williams --There is a broad range of interests represented.

Senator IAN MACDONALD --Is that from all over Australia?

Senator Schacht --I cannot answer that because I have not seen the list. I think the best thing we can do is get Senator Macdonald the list of the names, addresses and backgrounds. I have not seen the list so I cannot answer.

Senator IAN MACDONALD --Thank you, minister. I appreciate it is not your direct portfolio. However, I would have thought that some of the officers of the department could provide it.

Senator Schacht --We do not have the list with us so we are a bit cautious about bowling up an answer which may have some inaccuracy in it.

Senator IAN MACDONALD --What part does the ATC play in effective communication between the industry and the minister?

Mr Hutchison --Where we can we attempt to involve the minister in ATC activities and functions. For example, in September the minister will be visiting a trade conference called TABS in Singapore. It has a rather extensive Australian involvement in it. This is where we put Australian sellers of tourism products with Asian buyers. This is an example of how we bring the minister into the functions and activities of the industry. Another example was the involvement of the minister in launching the Year of the Environment, promoting the great outdoors, at the Australian Tourism Exchange in June. There are many opportunities through ATC programs of bringing the minister and the industry together.

Senator IAN MACDONALD --Is promotion the commission's major role?

Mr Hutchison --It is totally a marketing organisation and it markets entirely on an international basis.

Senator IAN MACDONALD --What is your role in it?

Mr Hutchison --I am the managing director.

Senator IAN MACDONALD --Are you answerable to a board?

Mr Hutchison --I am answerable to a board.

Senator IAN MACDONALD --Who is on the board?

Mr Hutchison --The chairman of the board of directors is John Haddad. I will just run through the board, Senator.

Senator IAN MACDONALD --When you are running through the members, could you perhaps say where they are from and what their qualifications for appointment to the board are?

Mr Hutchison --There is Don Morris, the chairman of Mojo Australia, who was responsible for the Hogan campaign of the 1980s; Donald McDonald, who is general manager of the Australian Opera--

Senator IAN MACDONALD --Where do they live?

Mr Hutchison --They are from Sydney. Stephen Harrison, national secretary of the Federation of Industrial, Manufacturing and Engineering Employees, from Sydney as well; Helen Williams, secretary to the Department of Tourism--

Senator IAN MACDONALD --Where is she from?

Mr Hutchison --Canberra.

Senator Schacht --She is sitting on my right, Senator Macdonald.

Mr Hutchison --John Ward, previously managing director of Qantas, also from New South Wales; Sam Fiszman, a businessman from Sydney and former New South Wales tourism commissioner, from New South Wales; John Haddad, who I mentioned previously, the chairman of the Australian Tourist Commission, from Victoria; Judy Ashton, from the industry, managing director of Landmark (South Pacific) Pty Ltd, an inbound tour operator, New South Wales; Penny Figgis, vice-president of the ACF, director of Landcare Australia and a member of the National Trust--her activity is primarily environmental--also from New South Wales.

Senator IAN MACDONALD --I wanted the Australian Tourist Commission, not the New South Wales Tourism Commission.

Senator Schacht --I think that I can see the point that you are going to make.

Senator IAN MACDONALD --Perhaps you would give me the answer to that.

Senator Schacht --The answer is that you have just got the list of the names and where the members reside. Members of the Tourist Commission, like members of all government statutory authorities, are appointed by government on the judgment of their skills and the contribution they can make to the successful running of the organisation. Though they may all reside in Sydney, there are clear skills for the tourist industry amongst the members, given their backgrounds.I anticipate the comment that you are about to make as a senator from Queensland: there is no Queenslander on it and tourism is a big industry in Queensland. Senator Ferguson and I, as senators from South Australia, may also make a comment that there is no South Australian on it. There are no Western Australians, no Tasmanians and no Northern Territorians.

Senator IAN MACDONALD --And one Victorian.

Senator Schacht --Yes, one Victorian and one from the ACT, who is a member by virtue of being the head of the department. As members' terms expire from time to time and vacancies arise, I think there will be discussion about the point you are making--lack of other state representation. I do not think that positions on this commission have ever been divvied up among the states on a per capita basis, with each state getting 1 1/2 appointments.

Senator IAN MACDONALD --I do not wish to be parochial, but would you not accept that Queensland is the leading tourist destination in Australia?

Senator Schacht --I am not going to get into an argument about--

Senator IAN MACDONALD --No. That is a factual comment, though. Even you as a South Australian would concede that.

Senator Schacht --As a consumer of the Queensland tourism industry in the past, I fully understand and accept that it is a major industry, that it is the major tourist destination in Australia. All I can say to you is that I hear what you are saying. My personal view is that over a period--

Senator IAN MACDONALD --But, as I understand it, these people have just been appointed, have they not? The ink is barely dry on their appointment papers.

Senator Schacht --Yes, that is true, as I understand it. They were appointed towards the end of July. Four of them were appointed at the end of July. I will certainly ensure that your view, and I would say that view would be divorced from partisan politics, is considered and that in the future consideration be given to people with the expertise--that is the first criterion--from other areas of Australia.

Senator IAN MACDONALD --I am told that the minister is Mr Lee. Where is he from?

Senator Schacht --He is from north of Gosford in New South Wales.

Senator IAN MACDONALD --That was a silly question, was it not?

Senator Schacht --He is not from Sydney. I think he would make it very clear to you that he is more from the Hunter Valley region than from Sydney.

Senator IAN MACDONALD --Where I come from, and where the major tourism industry is, Sydney and Gosford are one and the same.

Senator Schacht --If you went to Brisbane and said that the Gold Coast was part of Brisbane, the people of the Gold Coast would argue that they are not the same. The Sunshine Coast is not the same as Brisbane, but they are about the same distance from Brisbane as the Hunter Valley is from Sydney.

Senator IAN MACDONALD --What was the geographical mix of the previous board? Perhaps the managing director might be able to assist you.

Senator Schacht --I do not have that information.

Mr Hutchison --I have been with the ATC for a year. When I arrived there were two Queenslanders on the board. There were no other representatives from other states or territories.

Senator IAN MACDONALD --Are you saying that all the rest came from New South Wales--two Queenslanders and--

Mr Hutchison --The same mix except for two from Queensland. One Queensland board member, Marie Watson-Blake, died in the middle of the year. She was deputy chairman of the QTTC. The other Queensland board member moved to Western Australia and then overseas; he then resigned from the board.

Senator IAN MACDONALD --What is the ATC's budget for the year on marketing?

Mr Hutchison --The ATC's total net funds available are $77.8 million. Of that, 83 per cent is spent in marketing--that is, $64.2 million.

Senator IAN MACDONALD --And the rest?

Mr Hutchison --The rest would be in administration. You could probably classify the running of our offices throughout the world, but I have not included those--the cost of rentals and those sorts of things.

Senator IAN MACDONALD --That is in the other what?

Mr Hutchison --That is in the remaining.

Senator IAN MACDONALD --How many million is that? I am sorry; I did not take your figures. Are they somewhere before me?

CHAIRMAN --They are probably in section 3, which is the ATC program. We are on subprogram 1.2--regional development. If you could stray towards the regional development side of things I would appreciate it.

Senator IAN MACDONALD --It was the advice the minister receives in relation to tourism. What percentage of Australian inbound tourism comes out of Queensland? Would you have the total figure?

Senator Schacht --People within Australia travelling to Queensland?

Senator IAN MACDONALD --No, inbound from overseas.

CHAIRMAN --What program is that in? It is not in subprogram 1.2.

Senator Schacht --We might be jumping a bit ahead of the program. I suppose we will take them as they come. I am informed that we do not have the figures. I am sorry, I have just been informed that about 30 per cent of inbound overseas tourists go to Queensland, amongst other places, or solely to Queensland; is that right? Thirty per cent go to Queensland, but they might go somewhere else as well.

Senator IAN MACDONALD --I would have put first point of entry perhaps. Is that how you do your statistics?

Senator Schacht --I have just been informed that we do not have that figure, but we can go back to the international visitors survey and provide you with information during the day.

Senator IAN MACDONALD --Thank you. What is the criteria for the appointment of people to the ATC board?

Senator Schacht --The skills and competence, and the contribution that they can make to the successful running of the board and the programs it conducts. In my view they would be the standard criteria that you would want to appoint people to any board that has responsibility for carrying out programs on behalf of the Australian government and the Australian parliament.

Senator IAN MACDONALD --You concede that there is a great number of people in the tourism industry right around Australia who would fit that qualification?

Senator Schacht --Absolutely. It would run into, if not hundreds, maybe thousands. There will always be an argument about who is better. You have to have a reasonable balance of background and expertise to make sure that the board has a range of opinion and skills so that it can judge its performance. As directors they should have due diligence and even fiduciary responsibility. The board should not comprise all small business operators, all big business operators in the industry, all bus company operators, all train operators, all plane operators, all hotel operators; you have to have a mixture. That is the first criterion for any judgment. In the end, the cabinet has to weigh all of that up. I think you would have to accept the fact that there are always going to be ranges of opinion and discussion, but that is part of the process.

Senator IAN MACDONALD --You would be aware, or Minister Lee would be aware, that there is a lot of ill feeling from people in the major tourism areas of Australia that this board seems to be purely New South Wales based. One can only accept that their natural inclination will be for a greater focus on an area that they know most about. People in the major tourist destinations of Australia have a real concern that they are not going to get a fair run out of this board.

Senator Schacht --I would not automatically accept that view. Often in these cases the proof is in the eating of the pudding.

Senator IAN MACDONALD --I did not say that you accepted it. I asked whether you accept that there is that feeling.

Senator Schacht --I can see that people would have that perception. It is very easy to promote that perception around the place.

Senator IAN MACDONALD --Do you think the minister considered that at all? I do not want to ask you about what happens within the cabinet walls. Quite rightly, you have told me not to. But do you think it might have formed part of his submission and discussions?

Senator Schacht --I have to confess that I have not discussed this with Minister Lee, so I cannot honestly comment on that; otherwise, I would be speculating. I am sure he took into account in his judgment the skill base needed for the appointments to the Tourist Commission. When one looks at the four appointments made, one of them by definition is the head of the department, whoever that may be. With the other three, Don Morris is chairman of Mojo. It was responsible for the Paul Hogan campaign that everyone says was a considerable success.

Senator IAN MACDONALD --I do not deny that the people you are going to mention have some skills in the industry. But you agreed with me before that those skills are shared by a lot of people. There are a lot of good advertising people in Cairns.

Senator Schacht --Purely on the advertising side, as Mr Morris was responsible for that international advertising campaign and has had that experience, that probably makes him a bit better than the rest of us who have not had that experience. But I agree it is not the only criterion. I am informed that Donald McDonald was appointed as general manager of the Australian Opera. Opera is a major entertainment industry--

Senator IAN MACDONALD --That is what overseas tourists come to Australia for, is it?

Senator Schacht --I am not a great opera fan or participant.

Senator IAN MACDONALD --I would check your statistics before you say it.

Senator Schacht --I would have thought that, as Mr McDonald is a board member of the Entertainment Industry Council, entertainment was a major aspect of tourism.

Senator IAN MACDONALD --I would not have thought too many people came to Australia for entertainment; they come for our natural attractions.

CHAIRMAN --New Zealanders were coming across for Phantom of the Opera and Les Miserables. That was quite successful, I believe.

Senator IAN MACDONALD --But more people go to the Gold Coast beaches in one day than would come to see Phantom of the Opera in one year. I concede that those people are pretty good. All I am saying is that there are equally good people.

Senator Schacht --I concede there are equally good people in South Australia and Western Australia.

Senator IAN MACDONALD --I am sure there are.

Senator Schacht --All I can say to you is that I did not discuss this with Minister Lee before the hearing today. I am sure that the department will bring this hearing to his attention. If not, I will raise your concerns with him. Wearing my other hat as a parochial South Australian, I will suggest that there are some good people in South Australia. I think other members of the parliament representing other states would also make that suggestion about their own states. In the end, whoever he picks, he will probably end up with some complaint that the balance is not quite right this way or that way. I am aware there is a perception amongst some sections of the industry, as a result of the geographical aspect of where people live, that it is too heavily biased towards Sydney. I can understand why there is that perception. I think it should not be a concern, but it could be around and could be promoted.

Senator IAN MACDONALD --I thank you for your interest and your commitment in that matter. But I have to go back and try to justify to the people on the Gold Coast, the Sunshine Coast and in Cairns the government's explanation of why this has happened.

Senator Schacht --I am sure you will not justify the government's explanation.

Senator IAN MACDONALD --I will have to go back and say that the representative minister just does not know and cannot justify the unjustifiable--to use someone else's words--or defend the indefensible.

CHAIRMAN --Do you have any further questions, Senator Macdonald?

Senator IAN MACDONALD --Can I tell them that with your approval?

Senator Schacht --You do not need my approval, but you will do it anyway. I am sure you will do it in the most lurid way possible and also say that I am responsible for the end of Christianity, motherhood and families in Australia.

Senator IAN MACDONALD --I will respond in the way the complaints have come to me. Can you or any of your departmental officials identify or get for me the amount of your total budget spent on self-determination, self-management and self-sufficiency of the involvement of Aboriginal and Torres Strait Islander people in the tourism industry? It seems to me to be a separate compartment. Is there someone who could give me the details of the amount?

Mr Mazitelli --We probably do not have the figures here. It is essentially a resource cost related to the cost of people within the department that are working on it. There is some program cost associated with that as well, but we just do not have that figure disaggregated.

Senator IAN MACDONALD --You cannot get it for me; you do not have it at all?

Senator Schacht --We will try to do a calculation and provide it to you.

Senator IAN MACDONALD --That would be beneficial. I see as part of your goals for this year you are to publish profiles of successful Aboriginal and Torres Strait Islander tourism operations. Is that in your report? Would I find that anywhere? Could you give me an advance copy of the profiles?

Senator Schacht --I am informed that $20,000 will be the cost of preparing the profiles during this year as part of this budget.

Senator IAN MACDONALD --Are there many of them?

Senator Schacht --About a dozen, apparently.

Senator IAN MACDONALD --Are any of them in the Torres Strait? Has there been any focus on tourism in the Torres Strait? It seems to me to be a beautiful area for tourism in the future.

Mr Mazitelli --The actual profiles have not been selected at this stage.

Senator IAN MACDONALD --So they are not the whole 12; they are just some selections from that 12?

Mr Mazitelli --No. We would anticipate doing 12 profiles, but the personalities associated with that 12 have not been finally determined.

Senator IAN MACDONALD --This may come later, but can anyone tell me whether there is any tourism action in the Torres Strait?

Mr Mazitelli --I cannot answer that question at this stage.

Senator IAN MACDONALD --Can any of your people?

Mr Mazitelli --In terms of tourism activity in the Torres Strait?

Senator IAN MACDONALD --Yes.

Senator Schacht --I presume it is a question of which comes first, the chicken or the egg. Do you have tourism in the Torres Strait when there is not an infrastructure or program to promote it? Do you get that into place first so you can have it and handle it?

Senator IAN MACDONALD --One of the strategies is to contribute to the development of Aboriginal and Torres Strait Islander people in the tourism area. What contribution has been made to the development of tourism in the Torres Strait islands? Is there any that anyone in your department would know about?

Mr Mazitelli --Not in terms of funding from this program.

Senator IAN MACDONALD --You are in the tourist industry. Do you know about funding from any program?

Mr Mazitelli --I could not say that I am familiar with what might have occurred in other programs or at other levels of programming.

Senator IAN MACDONALD --Even if it is tourism related?

Mr Mazitelli --Not specifically down to that level.

Senator IAN MACDONALD --Would anyone, in all the people behind you, be able to tell me that? I do not expect you to know the intricacies of every aspect of your department, but someone else might know.

Mr Mazitelli --The department, in conjunction with the Aboriginal and Torres Strait Islander Commission, is undertaking a national tourism strategy. The department is working very closely with ATSIC in that endeavour. That strategy is aimed at identifying tourism opportunities for Aboriginal and Torres Strait Islander people. In that process a significant amount of consultation is going on and research is being undertaken on the opportunities for Aboriginal and Torres Strait Islander involvement--and the impediments to involvement.

Senator IAN MACDONALD --How long has that been going? I can see a bit of it in last year's program and the program for this year.

Mr Mazitelli --The first meeting of the advisory council was held in December last year.

Senator IAN MACDONALD --Are there any results to date or any tangible things you can point to?

Mr Mazitelli --The report will take some time in coming. A lot of preparatory work is being undertaken. A lot of consultation is required. That is what has progressed to date.

Senator IAN MACDONALD --I have been provided with a copy--as we all have, no doubt--of the annual report. On any question that I ask, if you can refer me to the annual report for an answer, please do so. Can you broadly say what money has been spent on your contribution to the wet tropics plan? What is anticipated for this year? Is that in a defined section of your budget?

Mr Mazitelli --That matter is a responsibility of the environment area; it is not in the primary carriage of this department. We have an involvement--and any costs would be related to staff costs.

Senator IAN MACDONALD --Does the same go for the Great Barrier Reef Marine Park Authority and the Wet Tropics Management Authority?

Mr Mazitelli --Yes, some work has been done by the Bureau of Tourism Research in relation to the Great Barrier Reef Marine Park Authority. But, essentially, costs to the department have been staff costs.

Senator IAN MACDONALD --On regional development, what percentage of Australian tourists travel by motor vehicle? Does 80 per cent sound right?

Mr Mazitelli --It is about right.

Senator Schacht --That was your dorothy dixer?

Senator IAN MACDONALD --I should have asked, `Can you confirm that it was 80 per cent?'. Was there any consultation with the department on the effect on tourism--of the 80 per cent that travel by road within Australia--of the increases in the fuel tax in the budget?

Senator Schacht --That is part of the budget process. All ministers obviously have a participation in the budget process at various times. I am not in a position to comment about the intricacies of discussions and so on--for obvious reasons. From my own limited experience as a minister I presume that at times those issues would have been discussed. Those things would have been taken on board in judging the broader macro-economic outcome of changes to things such as the excise on petrol.

Senator IAN MACDONALD --I accept that you are not the relevant minister so I do not expect you to have the answers.

Senator Schacht --The officials are not going to comment about the budget process because that is a policy issue.

Senator IAN MACDONALD --Perhaps you could get some advice from officials on the specific question. I am after facts; I am not interested in political rhetoric, as you know. It is not my style.

Senator Schacht --We have only about six hours to go in this area, so I will hold you to that.

Senator IAN MACDONALD --We will go very quickly after this. This is one of Australia's most important industries. The question I am really asking is: did the department do any calculations? Was it consulted in relation to the effect that any increase in the petrol tax might have on one of Australia's major industries?

Senator Schacht --That is central to the issue of budget discussion, preparation of budget options, and so on. If departmental officers provide me with advice that speculates about papers or their participation in it, in my view you are starting to get into the question of cabinet confidentiality and I do not believe that is the role of this estimates committee.

Senator IAN MACDONALD --Is the department intending to do any work on the effect it might have on tourism? This will have a major impact on one of Australia's major export earners. It is one of our major industries. Is the department, which obviously has tourism at heart, going to do anything about it? Is it going to find out what the ramifications are?

Senator Schacht --I would imagine that bodies such as the Bureau of Tourism Research at any time and from time to time will undertake studies on the development of the industry and the effects of the macro-economic decisions taken by government or other areas of the world economy and so on. I have just been informed that the effects will be monitored through the BTR's domestic tourism monitor. But that is just good public policy. It is good bureaucratic management to have the information available. There is nothing sensational about that.

Senator IAN MACDONALD --But you are not prepared to say whether the department was asked for advice before the budget came down on the likely effect this would have on a major industry?

Senator Schacht --You are quite right in that I am not the responsible minister and I am very cautious about speaking on behalf of another minister on his involvement in the budget process.

Senator IAN MACDONALD --Was the department consulted?

Senator Schacht --The minister is responsible for the department, and whatever is prepared is done so that the minister can participate, or not participate as the case may be, in the budget discussion. I would imagine that, for the good preparation of the budget, ministers with an interest in particular areas would automatically be involved and make a comment. But in the end it is a collective decision of cabinet as to what the outcome of the budget is.

Senator IAN MACDONALD --I accept that but I am just trying to find out what the effect might be on tourism?

Senator Schacht --I will not take this matter as a question on notice but I will raise the matter with Minister Lee. If he chooses to say it is all a matter of budget confidentiality, that is that. If he chooses to provide any other answer, that is his business and I will come back to you.

Senator IAN MACDONALD --Policy decisions are matters for the government, and I concede that, but has the department done any work on what the effect might be? If it has, can I be told what the factual research has--

Senator Schacht --Subsequent to the decision of the budget, or leading up to the budget decision?

Senator IAN MACDONALD --Leading up to the budget, did the department do any work on the possible effect on the tourist industry of any increase in the excise? If so, can I, as a representative of the people, be told what the result of that research was? I am not interested in your policy or the reasons.

Senator Schacht --I think you have to accept that such preparation is absolutely germane to the policy development and is in the context of preparation of the budget and, in my view, has cabinet confidentiality. However, out of courtesy to you and because of your interest, I will raise this with Minister Lee. If he wants to make a response different from that which I am now making, that will be his decision because it is his portfolio area. But I am certainly not going to prejudge anything or give any indication about this area because I believe it is germane to the issue of budget confidentiality.

Senator IAN MACDONALD --If any consultancy work or any individual program work was done on such a thing, where would I find the cost of doing it in the budget figures?

Senator Schacht --I presume that has been listed somewhere in here--

Senator IAN MACDONALD --You have a whole department of officers behind you, Minister. Could someone point it out to me. I have not had a chance to read it all. Could someone just tell me where I would find it. If any work has been done on an investigation into fuel--I am not even asking what the result was now--where would I establish what the cost of that consultancy work was?

Senator Schacht --We are going to be here all day, so could I suggest that this issue be referred to Minister Lee and that we come back to you during the day.

Senator IAN MACDONALD --All right.

Senator Schacht --Otherwise we are going to go round and round this table standing in two different buckets of quicksand.

CHAIRMAN --And have subprogram 1.2 before us for the rest of the day.

Senator IAN MACDONALD --If any work was done--you are not going to tell me what the result was--at least tell me what the cost of doing it was.

Senator Schacht --It is Minister Lee's area and I will try to find out what his response would be.

Senator IAN MACDONALD --In the regional development area, the program performance statements state that seminars were organised, aimed at local government authorities that had received local capital works program funding, to promote the importance of tourism infrastructure. Can someone give me the results of those seminars and tell me, for example, how many local governments used their LCWP funds for tourism infrastructure work or any sort of funding work?

Senator Schacht --To whom was that question directed? I was sending instructions out to someone to get that other information so I missed a bit of the question.

Senator IAN MACDONALD --It was directed at you, Minister, as I understand everything has to be. I referred to the second item on page 31 under `Regional development'. A series of seminars were organised, aimed at local government authorities that had received local capital works program funding, to promote the importance of tourism infrastructure. I am wondering what the results of those seminars were. How many local authorities did use their LCWP money for this?

Ms Williams --We ran some seminars on local government funding. We do not have the costs at this stage. I have not got them with me at the moment.

Senator IAN MACDONALD --We will be spending a lot of time on this if nobody listens to my questions. Maybe they are boring questions. What was the result of those seminars? Have you done work to ascertain how many local authorities spent their local capital works money on tourist related projects?

Mr Strang --About 30 per cent of the money allocated under the local capital works program was allocated to tourism related infrastructure.

Senator IAN MACDONALD --Tourism related projects?

Mr Strang --Yes.

Senator IAN MACDONALD --Can you identify them?

Mr Strang --We can. We have that information, but we do not have it with us here.

Senator IAN MACDONALD --Can I have at some future time the figure for the local capital works funds spent on tourist related projects. Where were the seminars for local government held?

Mr Strang --From memory, the seminars were held in Adelaide, Ballarat and Liverpool in Sydney. I think they were the three. I think, from memory again, 35 local government authorities were represented across those three seminars.

Senator IAN MACDONALD --None in Queensland again related to tourism activities?

Mr Strang --I am not sure on that. I will need to check.

Senator Schacht --We will check that.

Senator IAN MACDONALD --At least your state, Minister, got a guernsey. You should be very proud of that.

Senator Schacht --There was one at Ipswich.

Senator IAN MACDONALD --A great tourism area. What part does the department play in promoting ecotourism? Are there specific project programs or is there specific budget expenditure for that?

Ms Williams --The department is developing an ecotourism strategy. That is under development at the moment. It will be finalised this year. We are going out for consultation and submissions at the moment. The ecotourism strategy then guides the program which will be the result of that strategy, and that will start in the second half of this financial year.

Senator IAN MACDONALD --What input do you get from tourism operators into that strategy?

Mr Strang --To date, in the consultative process on the development of the strategy, a series of seminars have been held in all states and the Northern Territory. There was one held in Cairns in July, which a range of representatives attended, including a representative of the tourism industry.

Senator IAN MACDONALD --Is there a separate budget figure for the projected costs of the secretariat support for the Tourism Advisory Council?

Senator Schacht --There is not a separate line in this budget. It is in subprogram 1.2. There is no specific line. It is part of the staffing resources. It is on page 29. It will be one of those lines there. It is under Appropriation Bill No. 1--the staff salaries and payments area.

Senator IAN MACDONALD --Finally, on this program, one of your outlooks for 1993-94 is to develop and implement a regional tourism development program. How are you going about that and how is it being funded?

Senator Schacht --We covered that with Senator Ferguson earlier on before your arrival.

Senator IAN MACDONALD --Did you cover the point of how it is being established, who is being consulted and who is involved in it?

Senator Schacht --We probably did but, in deference, we will give it another go.

Mr Strang --The guidelines for that program and the application forms will be despatched to all local government authorities, regional tourism associations and regional development organisations in September. We expect to assess the applications between then and December. The first announcement of grants will be in December.

Senator IAN MACDONALD --So there will be grants that follow that, will there?

Mr Strang --Yes.

Senator IAN MACDONALD --How much is allocated for the grant?

Mr Strang --It is $5.5 million in this year out of a program of $23 million over the four years.

Senator IAN MACDONALD --This was announced in the election campaign, was it?

Mr Strang --It was.

Senator Schacht --Yes.

Senator IAN MACDONALD --Who makes the decision on those programs? Will it be a political decision, a ministerial decision or will it be done by the department?

Senator Schacht --It is put by the department to the minister and the minister makes the decision as is appropriate.

Senator IAN MACDONALD --The forms going out to all of these people will indicate the criteria?

Senator Schacht --There will be transparent criteria which people are aware of. They will fill in their application forms, as is the normal process. Those applications will go to the department, and the department obviously will assess them against the criteria. I would naturally presume that the department would make recommendations to the minister if there are more applications than the $5.5 million could meet, as I suspect there probably will be. Then the minister will make the decision and be responsible for that decision.

Senator IAN MACDONALD --Is it the general strategy that there will be a small number of large projects or is the strategy more to have a big number of little dollops?

Senator Schacht --You have clean bowled me. I do not know.

Ms Williams --That is still to be decided. The guidelines have not been finalised.

Senator FERGUSON --According to page 30 of the annual report and page 40 of the program performance statement, one of the outcomes achieved last year was the continued development of an import replacement strategy which aims to increase the number of domestic leisure trips made by Australians relative to the total number of leisure trips made. At the risk of going over old ground that has been covered by Senator Macdonald in some of his previous questions, I ask: how does that aim sit with measures which are going to make it more expensive to holiday within Australia? What sort of investigations has the department done to see what effect that will have? If the aim is to increase domestic travel, surely this is going to work against that aim.

Senator Schacht --I think we are starting to go over the same arguments. You are referring to costs such as the excise on petrol.

Senator FERGUSON --How does the department intend to counteract the problem that is going to arise if your aim is to increase domestic tourism?

Senator Schacht --We have already said that the Bureau of Tourism Research will be conducting ongoing research and assessing of the impact. That is part of its job. The results of that will be made available to government and to the parliament at the appropriate time. We will be making that assessment, but decisions about the general macro settings of the budget have to be made against the total picture, not just the particular needs of every individual portfolio or industry, and people have to judge accordingly. As I said before, our petrol prices, even with these increases, are still the third lowest in the OECD. The American petrol prices are substantially lower than ours, even with the recent increases. I think the price there is about the 40c per litre mark.

Senator FERGUSON --And that country is roughly the same size.

Senator Schacht --If you put Alaska in, it is probably a bit bigger.

Senator FERGUSON --Roughly.

Senator Schacht --By putting Alaska in, it is a lot bigger. Of course, we accept that, but a lot of people will argue that, from the conservation and energy saving point of view, putting a higher price on fuel encourages people to conserve. It may encourage people to look at other ways of travelling around Australia and, instead of relying so much on the private car, rely on aeroplanes, trains and buses, which people might say are more effective overall even for the tourist industry. That is a matter of judgment. Again, I think you and I can have this dialogue on and off for several hours. Your viewpoint and my viewpoint will be a bit different, but I do not believe that the changes in the fuel excise have taken prices to what I would call a catastrophic level that would make a sudden and dramatic change to the internal demand for tourism and the use of the car for tourism in Australia.

Senator FERGUSON --Surely you would have to concede that if 80 per cent of domestic tourists travel by private vehicle or by vehicle, and if the aim of the department is to encourage domestic tourism as part of the leisure market as against people travelling overseas, some extra emphasis will have to be placed on that by the department.

Senator Schacht --If people went overseas to a destination other than America or Canada, they would pay a lot more for petrol than they would in Australia.

Senator FERGUSON --And drive a tenth of the distance.

Senator Schacht --Some people might think about hiring a car and doing a tour of Europe through several countries, which would be a fair distance. That is not totally like driving across Australia, of course. Even though the distance would be shorter, it would still be immeasurably more expensive than in Australia because of the high cost of petrol. I am talking figures of about $1.50 a litre. There are smaller cars and so on. But I think you have to make a judgment about where the prices fit in. I think if we had jacked up our fuel prices to a level equivalent to what the Italians, French or British pay, then you would probably find that that would have an extraordinary impact. We are talking of only a few cents a litre. We are still the third cheapest in the OECD. We were third cheapest before these increases. We are still the third cheapest and I think that that ought to be kept in perspective.

Senator FERGUSON --I guess there is not much point in pursuing the same line much longer, but can we be assured that the department, in its deliberations, will determine whether there is an impact on rural and regional tourism and, if so, assess that impact? I think that is important.

Senator Schacht --I am advised that the Bureau of Tourism Research will do the assessment. I will certainly bring to its attention that that is of interest to members of this estimates committee. Personally, as a senator from a smaller state, with regional interests--

Senator FERGUSON --With big distances.

Senator Schacht --I think that is quite reasonable. I would be surprised if the bureau did not assess the impact on regional tourism because so much of our tourism in Australia is regionally oriented.

Senator FERGUSON --On page 41 and also on page 44, reference is made to a discussion paper on rural tourism which was launched in--

Senator Schacht --Which dot point?

Senator FERGUSON --It is also in the annual report on pages 19 and 20, where I think it is dealt with in more detail. There is reference to a discussion paper on rural tourism. What were the major conclusions drawn from that discussion paper?

Senator Schacht --Do you have a copy of it?

Senator FERGUSON --I have not seen a copy. Can I get a copy?

Senator Schacht --It is a public document, so we will certainly provide it.

Senator FERGUSON --Could you briefly outline the major conclusions that were drawn from that discussion paper?

Mr Mazitelli --It was essentially an issues paper which raised for discussion purposes the sorts of factors that would impact on the expansion and development of tourism in rural Australia. It did not propose to come to any conclusions because it was just a discussion paper; it was the beginning of a process which would end up with a more strategic approach to the diversification of Australian tourism product in rural Australia.

Senator FERGUSON --If it were a discussion paper, surely some major issues relating to rural tourism must have been raised by industry groups or community groups.

Mr Mazitelli --The discussion paper was written on the basis of discussions that had been undertaken in that process. Essentially, it was to generate a broader ranging consideration of the issues. It looked at factors such as the level of investment that is currently going into the development of tourist infrastructure in rural Australia; it looked at the need for the marketing of rural Australia, in particular the coordination of marketing; it looked at the need for a more unified approach to the various organisations which operate throughout Australia and which have an interest in rural tourism, in particular the advantage that might flow from the development of a peak organisation to cover things such as farm tourism, including on-farm accommodation. Those are the sorts of issues that are dealt with.

Senator FERGUSON --If they discussed all those things in a discussion paper, when would they get down to the nitty-gritty of making some decisions that might affect rural tourism? It is all right to talk about issues, discussion papers, peak bodies and all of those sorts of things in an attempt to cover the issues, but surely there are major issues which can identify exactly what their rural tourism strategies will be. To talk about industries and peak bodies does not tell us anything if we do not identify what the issues are, does it?

Mr Mazitelli --That process requires consultation. The industry is diverse and is made up of a broad range of parts which have operated and been developed in the past, often times without linking into other components of it. The process that we are undertaking with the rural tourism discussion paper is to endeavour to bring together all those particular issues so that they can be dealt with as a whole.

Senator FERGUSON --How closely do you work with the state regional tourism boards and regional tourism associations? Surely they are closer to the mark than--

CHAIRMAN --Do not some of the states keep restructuring them and changing them all about?

Senator FERGUSON --Even if the states do restructure them, I just want to know how closely the states work with them. Surely they are closer to the areas that they are already supposed to be helping.

Mr Mazitelli --We consult with those types of bodies and organisations. There are many of them. But we have consultative processes that enable us to get input from that level.

Senator FERGUSON --I know that South Australia has a regional tourism board and a regional tourism association, and they are virtually one body. I would have thought that, if you are going to have discussion papers or talk about rural tourism strategies, they are the sorts of people who ought to be involved.

Mr Mazitelli --There is no reason why they will not be involved and cannot be involved.

Senator FERGUSON --Have they been until now?

Mr Mazitelli --I do not know whether that specific organisation was involved.

Senator FERGUSON --I am not wondering about that one specifically. But I am sure that other state bodies similar to that one could provide some details.

Senator Schacht --I think Senator Ferguson makes a reasonable point. The officers will take it on board. I am sure that, if there has not been enough discussion and consultation in the past, that is something they will address. So, by the time we come around to this next year, we will be in a better position to give more information about it and get a better outcome.

Senator FERGUSON --Reference is also made to a rural tourism strategy. Is this strategy still being prepared? Do you have a rural tourism strategy? What is the situation? I presume that rural and regional mean the same thing.

Mr Mazitelli --The rural tourism discussion paper was a document that was developed as a precursor to the development of a rural tourism strategy. It was a document that feeds into the development of the strategy. That strategy has not yet been finalised. It is a process that is undergoing development at this very point in time. In that process there are meetings with regional organisations, local government authorities and industry operators. Out of that process will come a draft strategy which will be developed. Again, that will become involved in a process of consultation and discussion with a view to finalising that document in a more definitive way.

Senator FERGUSON --It is a very longwinded process, is it not?

Mr Mazitelli --Of necessity. The tourism industry is extremely diverse and has developed in various ways, depending upon the regional variations. The process needs to incorporate as many views as possible. That does take time.

Senator FERGUSON --You mention in this tourism strategy words such as `associated program and cooperative marketing activities'. What program and marketing activities are you considering? Has anything been considered yet or are you still in the formative stages of it?

Mr Mazitelli --That is right.

Senator FERGUSON --How long can we expect it to take?

Mr Mazitelli --No funding has been allocated until this particular budget. In this budget, money has been allocated over the next four years.

Senator FERGUSON --How long do you think it will take you to get a strategy in place? It is the end people, the ones down the line, who really count.

Mr Mazitelli --It is proposed to have it in place by the end of this calendar year.

Senator FERGUSON --Page 41 states that the department `commenced examination of the characteristics of the backpacker market to determine avenues for product development'. I am wondering whether you could expand on that. What product development are you looking at in the backpacker market?

Senator Schacht --It is an initiative in this budget. As applies to the previous initiative, we will be developing that in this financial year. I hope that in the same sort of time scale, which is by the end of the calendar year, we will be in a position to get it under way.

Senator FERGUSON --What is meant by product development in the backpacker market?

Senator Schacht --I suppose it is encouraging people with backpacks to come to Australia and show that they can travel around Australia with ease and with comfort within the reasonable cost of what attracts backpackers to be backpackers. That is my own assessment; I hope that is correct with the line of the department.

Mr Mazitelli --The issue of product development is related to endeavouring to better present the Australian tourism product in that particular area, such that it is congruent with the needs and the demands of the consumer. The work that we are looking at undertaking in the backpacker market is looking towards better defining the needs and the demands of the backpacker segment and endeavouring to ensure that the Australian product fits that demand in the most efficient way.

Senator FERGUSON --The product for backpackers does not seem to vary much around the world. I would not have thought a lot of time ought to be expended on product development for the backpacker market.

Mr Mazitelli --There is some variation in the product around the world. The Youth Hostels Association, for example, has undertaken quite an amount of work on the variation of backpacker product around the world, as have some of the other organisations. But the Youth Hostels Association in particular has done a lot of segmentation work and is particularly interested in ensuring that its product maintains currency with the changing attitudes to backpacker travel. Those attitudes do change and have changed over time. It is only by doing that sort of work that the broader benefits that flow from that can be assured.

Senator FERGUSON --The annual report states that the backpacker market has grown rapidly in size and importance in recent years. Is the department expecting there will be any impact from the extensive media coverage of the disappearance of backpackers, particularly, without being parochial, in Coober Pedy, in my state of South Australia, where at least two that I know of have disappeared, presumed murdered? Has anything been done about that or have you been able to assess any impact on the backpacker market of this sort of publicity?

Mr Mazitelli --The answer is that this department has not done anything specifically in relation to that, although safety issues are always of concern and we look at the broader aspects of safety issues. In relation to the second point, whether there has been a decline in backpacker visitation as a result of those sorts of incidents, we would need to do that analysis in the context of the figures that exist through domestic tourism monitoring.

Senator FERGUSON --It is likely to harm Australia's reputation as a safe destination. You were talking earlier about examining the characteristics of the backpacker market and product development. Would it not be more advisable to do some monitoring of the effect of the extensive media coverage that we have had of these things?

Senator Schacht --Within Australia or without?

Senator FERGUSON --Both within and without, because we get backpackers from within Australia and from outside. Admittedly, most of them are from overseas. I think we ought also to monitor the effect on tourism in areas such as Coober Pedy where this has happened, to gauge the effect of the disappearance of these young women on overseas tourists.

Mr Hutchison --Through the visiting journalists program, which is a fairly extensive program of the ATC in which we bring journalists from all over the world to Australia, we focused on bringing journalists during the period of difficulties--particularly with regard to the disappearance of the British backpackers--to see the facilities that we have and the comparative safety of backpacking in Australia compared with other parts of the world.

Senator FERGUSON --How does it compare with other parts of the world in terms of safety?

Mr Hutchison --Very well. The number of disappearances in Australia is significantly less than the average for most countries.

Senator FERGUSON --Which countries would you be comparing it to--European countries or the Middle East?

Mr Hutchison --I do not have those statistics handy, but we looked at European countries, the United States, continental Africa--quite a range of comparisons. At the time we set out, obviously, to create the right impression in the international media that the safety factor is significantly higher in Australia than elsewhere.

Senator Schacht --I inform Senator Macdonald that we have contacted Minister Lee about the issue of preparation of the budget and material from his department. He has a view that that material, any discussion within the department, is part of the budget process and, as a result, he is not going to comment about it because it affects the budget process and cabinet confidentiality.

Senator IAN MACDONALD --But he is not prepared to say whether research was done.

Senator Schacht --He is just saying that he is not commenting on what his department may or may not have done in preparing for his involvement in the budget process.

Senator IAN MACDONALD --Can I follow up one of Senator Ferguson's questions? He covered that program very well and I have no other questions on it, but I should say, in regard to the backpacker market, that although I do not register my interest and would not have to disclose this if I filled in that silly form that you are wanting me to fill in, I declare that I have a very small interest in a backpackers establishment.

Senator Schacht --Not at Coober Pedy, though!

Senator IAN MACDONALD --Not at Coober Pedy, no.

Senator Schacht --Are you also a consumer as a backpacker?

Senator IAN MACDONALD --Not at the moment. I have stayed in my own establishment once.

Senator Schacht --And never again!

Senator IAN MACDONALD --The report that Senator Ferguson referred to stated that the department was continuing to work on a number of options. What are those options?

Senator Schacht --Which report?

Senator IAN MACDONALD --Page 22 of the annual report states:

The Department is continuing to work on a number of options for the development of the backpacker industry.

I was just wondering what those options might have been.

Mr Strang --A number of options are being considered. One looks at the need for accreditation and standards of facilities and services in the industry. One of the other options looks at the research needs in terms of identifying the net economic benefit of the backpacker market to Australia. Another one involves options for cooperative marketing of backpacker accommodation in Australia.

Senator IAN MACDONALD --The minister said earlier that the Youth Hostels Association had done a lot of research into this market. What does the department do that YHA and backpackers resorts have not already done? Are you going over the same ground?

Mr Mazitelli --An organisation such as YHA has its own product, and there are other operators, such as BRA and other independents. The work that we are doing is really looking at ways in which we can ensure that the best outcome is achieved for Australia as opposed to the best outcome for any particular organisation within that market segment. In some cases the excellent work that has been done by the Youth Hostels Association would complement that sort of work. Where there is work that it has done, we would not necessarily choose to go over that ground. But even in talking to those sorts of organisations, we find there are areas that they feel need to be handled, in terms of international promotion and better coordination at the domestic level, that are bigger than that organisation or those organisations can handle. It is in that area that the department would be seen to be operating.

Senator IAN MACDONALD --Are you doing that sort of work at the behest of the tourist industry? Has there been a push from the industry for you to do this, or are you initiating it yourselves?

Mr Mazitelli --The national tourism strategy, which was released last year, identified a range of areas for government involvement. The work done in this area is consistent with the strategies identified in the national tourism strategy. It is supported by the industry, however.

Senator IAN MACDONALD --Again, on the same line, you talk about your research into the economics of the backpacker market in Australia. I know that the James Cook University in Townsville has already done substantial research into that matter, and they have some very interesting figures. I just wonder, over and above what they have done, what your department could do in that area.

Mr Mazitelli --There are a number of additional pieces of work that need to be done. I do not think that anybody would agree that all the research that needs to be done into the backpacker market has been done. It is an area that has been researched probably quite effectively. There are still areas where more knowledge is needed, for example on the issue of the net national benefit vis-a-vis the total spend of backpackers. It is not known what proportion of the total spend of backpackers is generated through work in Australia compared to the expenditure of funds that might be brought into the country. Those sorts of issues have a broader economic effect than some of the work that has been done would allow us to see.

Senator IAN MACDONALD --In doing that sort of research, do you employ universities or consultants; do you do it from within your own department; or do you use the BTR?

Mr Mazitelli --It is a mixture of a number of organisations. The Bureau of Tourism Research is probably the pre-eminent research organisation within the ambit of the federal government from the tourism perspective, and we work through the BTR. Where it is necessary we would also engage consultants, and a university could be engaged as a consultant. We also do some work ourselves.

Senator IAN MACDONALD --On program 1.4, an objective of your economic policy is:

To promote the development of an economically efficient tourism industry consistent with the broader national economic objective.

One of your strategies was:

Seek a reduction in impediments to the efficient provision of transport infrastructure and the processing of inbound passengers.

I appreciate that that is a strategy; it is also referred to in your outcomes for the last year and your outlooks for the next year. What ways did your department determine would reduce the impediments to the efficient provision of transport?

Mr Spurr --The IAC, as it then was, now the Industry Commission, did a study in 1989 which was published in 1990 that identified transport issues as a major impediment to the development of the tourism industry, and it particularly focused on international aviation issues. With that in mind, the department has done substantial research work on aviation issues. It plays a significant role interdepartmentally in developing strategies for international aviation negotiations; it participates in the delegations which negotiate those aviation agreements with other countries, and in doing so it seeks to ensure that the tourism interests are given adequate weight, firstly in developing the Australian position, and secondly in the negotiation itself. That would be an important area.

The facilitation of passengers who arrive in Australia is another area. The department is a member of a body called the National Passenger Processing Committee which brings together the various facilitation agencies like customs, immigration, quarantine, the police services, the airport authorities et cetera. In that body we seek to ensure that policies are developed which will speed and facilitate the handling of passengers on arrival and which will make that process as user friendly as possible. The NPPC has produced a number of targets for the handling of passengers--for instance, time targets in getting people through the airports. We have played a significant role in the development of those targets. I am glad to say that for the most part they have been met.

Senator IAN MACDONALD --Have you investigated the impact of arrival and departure taxes? I understand that there are arrival taxes in some countries. There was some suggestion that it might have been considered in the budget, but I do not want you to talk about that!

CHAIRMAN --I am sure that they will not.

Senator IAN MACDONALD --Have you done any work on the effect of the arrival and departure taxes on the processing of people within Australia?

Mr Spurr --Yes. In the context of examining the elasticities of demand for travel, we looked at what the impact would be of a price change in any area of the supply side, including on aviation travel, or on the tax side.

Senator IAN MACDONALD --I was getting down to the mundane, the physical processing of people through the terminal if they have to buy departure or arrival tax tickets. Do you add them to the air fare tickets? Have you looked into that area?

Senator Schacht --In regard to the physical delay that could occur, or the inconvenience to passengers?

Senator IAN MACDONALD --By standing in line at a customs point or standing in line to pay for an arrival or a departure tax. Has that been looked at in any way?

Mr Spurr --I think that issue is discussed at considerable length in bodies like the National Passenger Processing Committee. Obviously, our objective is to make those processes work in a way that is as user friendly for the tourist as possible. That objective has to be balanced against a number of other factors including customs requirements, policing requirements and immigration act requirements. There is a constant search to find the most appropriate balance between those objectives.

Senator IAN MACDONALD --In looking at your economic policies as a department, have you done any work on the effect of the fuel excise on transport and transport infrastructure within the tourism industry as part of your strategy? I suggest that you probably would have because, like Senator Schacht and all the rest of us, you thought that we would not be in a regime where there would be any fuel tax because we would have had a change of government.

Senator Schacht --There would have been a GST on everything else. You would not have been able to get out of bed in a hotel without having to pay GST. You would not have even been able to go to the toilet in a tourist hotel without having to pay a GST.

Senator IAN MACDONALD --Maybe you could ask a question of your officials about the impact of that issue. What did they do in relation to the abolition of fuel tax as it would have enhanced the tourism industry?

Senator Schacht --On the impact of abolition of the so-called fuel tax?

Senator IAN MACDONALD --Was any work done on how the effect of a fuel tax or how the abolition of a fuel tax might have restructured the industry?

Senator Schacht --I am informed that work was done on the impact of changes of certain fuel taxes, but not on the abolition of a fuel tax. That was not done in the context of this budget; it is just the general work.

Senator IAN MACDONALD --That is what I am talking about. It is part of the strategy to seek a reduction in the impediments to the efficient provision of transport infrastructure. I feel certain that under those guidelines there would have been some there. What sort of work was done?

Mr Spurr --The study of the Industry Commission modelled the effects of price changes on various kinds on inbound tourism. It is possible to use that modelling approach to estimate what the effect might be of a price change on travel to Australia. Through that sort of mechanism, you can pick any element in the price chain and make estimates of what the impact might be. We have done that from time to time in looking at various elements in prices that are paid by tourists, and I think it is quite likely that at some time we have looked at the issue of variations in fuel prices. I cannot talk on that in any detail at this moment.

Senator FERGUSON --When you talk about variations, do you mean to say that you have created a model which has assessed the impact of price variations if the price goes down but you have never dreamt that the price might go up so it has never done it?

Mr Spurr --The model works both ways, of course.

Senator FERGUSON --But you have used it only for the price going down; you have never used it for the price increasing.

Mr Spurr --No, I think I said price changes; I did not say price reductions.

Senator FERGUSON --So some work may have been done on the impact of the increased fuel charges?

Mr Spurr --I think work has been done on the impact of price changes. You can apply that to any element in the pricing structure. We work within a framework that has taxes and charges built throughout it. You can model what the effect might be if something changes in the total price to the tourist.

Senator Schacht --This work was not done specifically in the context of this budget.

Senator FERGUSON --I understand that. We have been asking all morning whether any work has been done to assess the impact of an increase in fuel prices on tourism.

Senator Schacht --The way it came across to me was whether, in view of the fact that excise went up in this budget, work was done by the tourism department and the minister to respond to those proposals in the budget. Now we are talking about wider issues, the modelling and the research base in tourism generally, and having information available to assess such changes that may occur, whether they go up, down or sideways. I think the tourism department and the Bureau of Tourism Research are playing out a very natural role of ensuring that they have the database and the information available to assess changes which may occur.

Senator FERGUSON --We were asking questions about whether work has been done to assess the impact of the increase in fuel tax as it is in this budget. If this model is already in existence and work has been done to assess the impact of a change in prices, surely you ought to be able to give us some idea of what the impact might be of the fuel rises that have occurred in the budget.

Mr Spurr --I think there may have been a misunderstanding between us. When I talked about modelling, I was referring to impacts on international tourists, because that essentially has been where the focus of our work on impediments has been. The pricing models that we have done, which are based on the Industry Commission work, are all about inbound tourism, so they would not help us with the question of impact of a change in fuel excise on domestic tourism.

Senator FERGUSON --I am sorry, I know that Senator Macdonald started asking this question, but if you have done an assessment of its impact on international tourists coming into Australia--it is the impact that the fuel excise will have once they get here--surely it will have the same impact on domestic tourists. I cannot see the difference.

Mr Spurr --It would be possible to build that price effect into the model, but I would expect that the price change would be so small that you would get no result, because within the context of a total package holiday for an international tourist coming to Australia with airfares, accommodation expenses and transport expenses generally you would be talking about a very small change in the total price to that tourist.

Senator IAN MACDONALD --So development of this strategy is related only to international inbound tourism?

Senator Schacht --In the third dot point of the strategies, which Senator Macdonald raised, it ends off by saying, `the efficient provision of transport infrastructure and the processing of inbound passengers'.

Senator IAN MACDONALD --The objective of subprogram 1.4--`Economic Policy'--is:

To promote the development of an economically efficient tourism industry consistent with broader national economic objectives.

That does not refer to international.

Senator Schacht --When you raised this issue you referred to the third dot point in the strategies--that is what we were talking about--which is overwhelmingly directed at the processing of inbound passengers.

Senator IAN MACDONALD --You talk about the Industry Commission. The Industry Commission did a lot of work on the effects of petrol price increases or fuel price increases or decreases right around Australia in every industry. As you quite rightly point out, the tourism industry is no different. But I was getting on to the point that you have obviously looked at the Industry Commission work on that and done some independent thinking of it for your department. Could you indicate where I could find in the Industry Commission reports or in some work that you have published, or perhaps in some work that you have not published, what effect price rises have on internal tourism travel? It does not seem to matter whether it is international tourists or Australian tourists. You have obviously done some work on that. Can we see some of the results?

Mr Spurr --We are not aware of any work that the Industry Commission has done on that particular subject that we could directly refer you to.

Senator IAN MACDONALD --You said that the Industry Commission had done work which you can extrapolate to various areas and use its work to go to your own area.

Mr Spurr --Yes, in relation to international inbound aviation.

Senator IAN MACDONALD --So you can do that with international people but you cannot do it with domestic?

Mr Spurr --I am not saying that it has not done it; I am saying that I am not aware of it.

Senator IAN MACDONALD --So you know of the international one but you do not know of the internal one?

Mr Spurr --That is right. Of course, it is not beyond the bounds of possibility that that kind of work can be done. The minister has announced the establishment of a tourism forecasting council, and it may be that that will be one of the areas that the forecasting council will address itself to.

Senator IAN MACDONALD --In the department, you are the first assistant secretary in charge of tourism. Is that right?

Mr Spurr --Yes.

Senator IAN MACDONALD --You are aware of the studies being done on international tourism but you have no idea what has been done on domestic tourism? Is that what you are telling me?

Senator Schacht --He did not say he had no idea; he said he was not aware of it. You use `no idea' in a pejorative sense.

Senator IAN MACDONALD --`Not aware of' or `do not know'. Are you telling me that you know about one but you do not know about the other?

Senator Schacht --Maybe the Industry Commission has not done the work. The official is actually saying that he is unaware; there may have been none.

Senator IAN MACDONALD --You seem very selective that the official knows about some aspects but not about the aspect I want to know about.

Senator Schacht --I do not think you should automatically suppose. Clearly, the import of what you have said is that there is a conspiracy of selective information being made available. On this issue, I suppose you could say that the officials, in saying that, are just being safe. If the official had said, `No, I am not aware of any of them', and there had been some, at a subsequent hearing you would jump up and down saying, `You have led us up the garden path'. They would expect to have been consulted by the Industry Commission if there had been such work. As

they have not, they are still saying that the safe thing to say is that they are unaware of any.

Senator IAN MACDONALD --Did the official not say that the Industry Commission had done certain work in the broad range which you could then use to work off?

Senator Schacht --I thought he said he was unaware.

Senator IAN MACDONALD --I thought he said that he had done that in relation to what later turned out to be inbound tourism. I am just questioning again--

Senator Schacht --We take your point, that you find that a slightly--

Senator IAN MACDONALD --I am just confirming that my understanding of what the official is saying is correct.

Senator Schacht --I do not know that I want to confirm what your view is about it, but my understanding is pretty clear. They have not been consulted by the Industry Commission about internal work in Australia. The officers certainly have been talking about international impediments.

Senator IAN MACDONALD --It is not a question of being consulted. I thought the official said the Industry Commission had done work and that the department used that work to add to it in relation to what I thought he said was--

Senator Schacht --Inbound international passengers. Right.

Senator IAN MACDONALD --He has not done it for domestic tourism?

Senator Schacht --Because there has been no indication, apparently, from the Industry Commission that that work has been done.

Senator IAN MACDONALD --Your officials indicated earlier that they are going to do work on the impact of fuel price increases on domestic tourism. Are there any officials currently with you who can indicate when that work will be done and when it will be available?

Senator Schacht --I think I indicated on behalf of them that this work is a natural part of the work of any good department or organisation in ensuring it is up to date with trends and what is happening within the industry. I did not say it was particular about looking at the excise. I would presume that, as that has an impact, it would come up in their studies, but we were not going to chase it specifically and now say that we will look at the excise as a direct impact. We would be monitoring all impacts on the development of the tourism industry.

Senator IAN MACDONALD --Are there people here from the Bureau of Tourism Research?

Senator Schacht --We are coming to that later.

Senator IAN MACDONALD --The last strategy on page 45 is a strategy to promote a reduction in barriers to investment in tourism infrastructure. I wonder whether you or some relevant officer could indicate broadly in what way a reduction in barriers to investment has been promoted?

Mr Spurr --Considerable research has been done on the factors impacting on investment decisions. There were some tax decisions announced in the One Nation statement last year, for example, in relation to amortisation rates for tourism, and a number of other particular incentives provided for infrastructure development generally. We have also worked with the Australian Bankers Association in the production of a booklet, which has been widely distributed, which advises people on investing in and getting into the tourism industry. It was particularly directed to overcoming what we saw as one of the impediments, which was an understanding of how to approach the banks for financing and what sorts of issues needed to be prepared for in that kind of approach.

Senator IAN MACDONALD --So it was sort of looking at the existing situation and saying how to get around it, rather than promoting, say, a removal of taxes from the tourism industry? It did not get to that? Nothing in your strategies led you in that direction?

Mr Spurr --I suppose another major area we have identified is an information problem. It is to deal with that that the tourism forecasting council is to be established as a way of providing better forecasts and estimates which can help to guide potential investors in their decision making.

Senator IAN MACDONALD --You do not do work on what impact taxes have on investment in the tourism industry?

Mr Spurr --In specific contexts we do. For example, when the amortisation issue was being examined we consulted with people in the industry to try to establish what the impact of a change might be.

Senator IAN MACDONALD --You have done no work in your role of advising the government on what the impact of sales taxes, fuel taxes and departure taxes would have on the tourism industry?

Mr Spurr --I think the answer to the question is that we have not done an analysis of macro impacts of taxation measures on the industry. We have tried to analyse where there are anomalies in the taxation system that perhaps treat one industry differently from the tourism industry. We have tried to identify particular areas where we thought there may have been some perhaps unintended advantage given to another industry against tourism. We have tried to explore those issues with the taxation department to see whether those anomalies could be corrected.

Senator IAN MACDONALD --Have you done some work into the fact that tourist industry launches, boats, plying regular routes do not pay sales tax, but if they are just doing charter work they do pay sales tax--that sort of thing?

Mr Spurr --That is the sort of issue that has been examined. For example, the question of sales tax on the purchase of smaller vessels which are used for tourism chartering as bare boats, for example, has been one of the issues we have examined.

Senator IAN MACDONALD --Is that research available to members of parliament?

Mr Spurr --I think it is probably overstating it to say that it is research. It is qualitative discussion of the issue.

Senator IAN MACDONALD --Is the qualitative discussion available to members of parliament? Can I put a question on notice either here or through the normal channels to get that research?

Senator Schacht --It is a reasonable request but, in view of the description by Mr Spurr of qualitative research, it may have involved discussions of confidentiality with particular people. You may smile wryly--

Senator IAN MACDONALD --I am not smiling; I am laughing.

Senator Schacht --Silent laughter. I will refer that to the minister and see what can be made available. I am always in favour of making available whatever is reasonable, but there may be things that I cannot think of that would limit its release.

Senator IAN MACDONALD --While you are at it, I talked about sales tax, but I understand there are diesel fuel rebates for some boats but not for others. Perhaps you could throw that in. I am asking a series of questions: has the research been done; if the answer is yes, can I have a look at it? If the answer is yes, then give it to me. The answers may be no, no, no.

Senator Schacht --We will take that on board.

Senator IAN MACDONALD --I do not want to take you out of order, but on the same subject, skipping to page 49, I understand that in your outcomes for 1992-93 you did facilitate and undertake high level economic analysis on issues affecting the development of the tourism industry. I would have thought that taxes on the tourism industry, arrival taxes, departure taxes, sales taxes and petrol taxes would have formed part of that high level economic analysis, particularly in view of the fact that during 1992-93 there was a real expectation that, with a change of government, a new government would have been looking at things such as that. If that work has not been done, why is it reflected on page 49? I might be misinterpreting it.

Mr Spurr --Essentially, those sorts of issues are taken up in the national tourism strategy, which is a public document and is available to you, Senator.

Senator IAN MACDONALD --So the work on the impact of taxes on the economics of the tourist industry has not been published?

Mr Spurr --No; the analysis of the issues affecting the development of the tourism industry.

Senator IAN MACDONALD --Does that include the effect of taxes on the industry?

Mr Spurr --There is broad reference to taxes in the strategy. I am not sure whether there is the detailed analysis that you may be suggesting.

Senator IAN MACDONALD --What is the difference between detailed and high level? I suppose it depends on how much they are paying their researchers. Does that make it high level?

Mr Spurr --I think the sort of economic analysis we are talking about has been mainly macro-analysis on the impacts of tourism on the economy, on the balance of payments, and so on, in terms of factors affecting the development of the industry: the broad policy framework marketing issues and the infrastructure issues, which have been addressed at some length in the national tourism strategy, and which is the primary policy document we draw on.

Senator IAN MACDONALD --Would you be prepared to have your officers identify for me any analysis under this program which looks at the effect of taxes and charges on the economics of the tourism industry?

Senator Schacht --We will give that consideration.

Senator FERGUSON --On page 48 there is a fair increase in your estimated outlays for the coming year of around 50 per cent. Salaries show a $500,000 increase. Can you explain this re-establishing of the 1992-93 base salary outlined on page 48?

Ms Peachey --Essentially, the $87,000 identified there is simply an adjustment to bring the budget figure back to the actual outcome from the year before. It is an adjustment bringing into account the carryover from the year before. I think what you are really talking about is that there is a fairly significant difference between one year--the actual outcome--and the next.

Senator FERGUSON --The outlays.

Ms Peachey --The reason for that is that in the economic policy branch there was a very low level of staffing in 1992-93. We are anticipating that in 1993-94 the branch will be fully staffed.

Senator FERGUSON --Why was there a low level in 1992-93?

Ms Peachey --Essentially due to the fact that the department was growing, that it was recruiting over 1992-93, and that there were a large number of positions unfilled during the year.

Senator FERGUSON --You are anticipating having a lot larger staff this coming year?

Ms Peachey --We are anticipating that all of the positions that are allocated will be filled, yes.

Senator FERGUSON --But it was not necessary to have them filled last year?

Ms Peachey --It was necessary, but it was difficult, given the timing over 1992-93, to have all the positions filled during the entire financial year.

Senator FERGUSON --In the middle of page 50 there is a segment on industrial relations. A paper entitled Working better: industrial relations flexibility in the tourism industry was released in conjunction with the Department of Industrial Relations and was distributed to key industry bodies and unions and to over 8,000 tourism industry operators. Can you tell me what the response to that working paper has been from the industry?

Mr Spurr --The purpose of the paper was to provide information to the industry that would assist it in making maximum use of the flexibility that was available to it under existing industrial relations arrangements. There has been some development of new tourism enterprise agreements during the year. For example, Sheraton negotiated a major agreement with its staff, and there have been some other agreements negotiated during the year. We have certainly not had any negative remarks made to us about the value of that publication. We have every reason to believe that it has contributed to a better understanding of what is possible in the industry.

Senator FERGUSON --You have said that you have not had any negative remarks. Have you had any positive remarks?

Mr Spurr --Yes, we have had positive remarks.

Senator FERGUSON --On page 49 it says that you are commencing discussions with industry representatives to gauge the industry views on opportunities and impediments to workplace reform. Have these discussions commenced already?

Mr Spurr --Yes. I understand they have begun.

Senator FERGUSON --How far advanced are they?

Mr Spurr --We are about halfway through those discussions. They should be completed by the end of the year.

Senator FERGUSON --Is there any chance of input by the industry that is likely to affect the outcome of those discussions?

Senator Schacht --It has input, I presume. By definition, it must have some effect on the outcome.

Senator FERGUSON --I see that you have commissioned further work: estimating tourism industry labour requirements by the year 2000. Is that work to be done this year? It is just that you have commissioned further work. Is that four or five years down the track? Is it to be done now?

Mr Spurr --It should be completed within the next four or five months.

Senator FERGUSON --You have established a tourism forecasting council. By definition, does this mean that you have not had a tourism forecasting council of any sort before?

Senator Schacht --From my knowledge and observations, there has been some dispute between various bodies interested in tourism about the forecasting of visitors, et cetera, to Australia. I think you may remember that in the last election campaign there was considerable public debate and controversy about your figures, our figures and someone else's figures on what the industry would be at the turn of the century vis-a-vis how many jobs it would create.

Senator IAN MACDONALD --Nobody believes any of your figures on anything.

Senator Schacht --We certainly did not believe yours. The public did not believe yours either. We won; you lost. That is game, set and match.

Senator IAN MACDONALD --Ask them today and see who they believe.

CHAIRMAN --Let us keep politics out of this and get on with the questions.

Senator IAN MACDONALD --That is just a matter of fact; that is not politics.

Senator FERGUSON --When will the tourism forecasting council be established? Has it been established?

Ms Williams --It has been announced but not yet established. It is proposed to be based on the model of the Indicative Planning Council for the Housing Industry, which is a two-level body. The top level is composed of significant figures in the industry--from the banking, tourism and building and construction industries.

Senator FERGUSON --They are not all from New South Wales?

Ms Williams --They have not been chosen yet. There is a second body, a technical body, under that which will do a lot of the technical research. The idea of this two-level structure is really to enable the figures to be improved and better applied. A lot of that is done in the technical body with advice from the Bureau of Tourism Research. That goes up to the higher body, the council. The purpose is for confidence in the figures to be generally gained throughout the industry. This top council, having significant figures from industry, can promulgate them. So we hope to do something to escape the boom-bust cycle that we have had in recent years.

Senator FERGUSON --How many people will be on the council?

Ms Williams --It is not yet decided.

Senator FERGUSON --Who is doing the forecasting now?

Senator Schacht --As I understand it, there are various bodies.

Senator FERGUSON --I was just wondering what the bodies are.

Senator Schacht --The Bureau of Tourism Research is one on the government side but there are non-government bodies--such as ATIA--throwing figures around as well and making predictions.

Senator FERGUSON --Whose figures does the department believe when doing forecasting?

Senator Schacht --The whole point of establishing this forecasting council is to try to get a body on which the various interests of the tourism industry are well represented so that a figure it comes up with may be given substantial credibility without there being controversy about the projected figures. This initiative by the government and the minister is addressing what clearly has been, in my perception, a deficiency in the past. Over a few years there has been a variation of probably several million in the numbers of international visitors to Australia from what the figures are. Clearly the government's intention is to establish a creditable forum where the various views can be assessed and we can come up with a figure of substance--we will not get 100 per cent unanimity--that industry and government can proceed to plan upon.

Senator FERGUSON --Is it likely to duplicate any work already done by state governments in forecasting tourism? I know that the Queensland government, for instance, does a fair bit of forecasting.

Senator Schacht --I suspect that there might be some overlap but state governments are overwhelmingly looking at their own figures. I imagine that Queensland is more interested in assessing how many visitors it gets than in how many turn up in Tasmania.

Senator FERGUSON --But I am worried about the duplication because if they go to Queensland they are coming to Australia. We have to put them together somewhere.

Senator Schacht --There will be state representation on the council. From what I understand, the proof will be in the eating of the pudding about how the representation will be structured. It will be established over time that the figure has some credibility. At the moment, from my observations, there is too much dispute about the figures that are floating around. Therefore, it is very hard.

Senator FERGUSON --The thing that concerns me in establishing another council or body is that, unless it is replacing something that is already in existence, all we are doing is creating another body.

Senator Schacht --Commissions or other bodies often have targets for what they would like to occur which often are reported as actual forecasts. I think that is where some confusion arises. With this body we will have substantial, significant and creditable forecasts for planning purposes both at government and private sector levels. That is why there will be a mixture of representatives. I have just been informed that Queensland is getting out of the work that you have just mentioned. That might indicate that people realise the present system is not creditable overall.

Senator FERGUSON --I can understand people wanting to get out of the forecasting business after the past four or five years.

Senator Schacht --Forecasting is a very difficult business for all of us. Clearly, in planning terms, it is needed for an industry that offers so much potential to this country.

Senator IAN MACDONALD --Just on the tourism forecasting council, where would I find the budget for it? How much is set aside for that? Who will be on it and who will staff it?

Senator Schacht --It is on page 48. The figure for the tourism forecasting council is $260,000.

Senator IAN MACDONALD --Can you tell me what the council will consist of?

Senator Schacht --I presume it will be the usual suspect things that we all associate with such bodies, such as travelling expenses and administrative expenses.

Senator IAN MACDONALD --What number of personnel and what type of personnel will there be?

Senator Schacht --We have given it before.

Senator IAN MACDONALD --No, that was for the advisory council. You have red tape, bureaucracy and councils everywhere. Not even you can keep up with it, Minister.

Senator Schacht --I know and I absolutely agree. I have had more hot dinners than we have bodies advising us; but that is the sign of a mature, sophisticated economy, I am told. We can give you the indicative break-up of the $260,000.

Ms Peachey --The break-up is two staffing ASL.

Senator IAN MACDONALD --What is ASL?

Ms Peachey --That is two staff years; two extra staff bodies in the department.

Senator Schacht --That is the equivalent of two staff years to service the council.

Ms Peachey --The $260,000 is split between $128,000 for salaries--

Senator IAN MACDONALD --For those two staff years? Who is on the council?

Ms Peachey --A combination of staffing costs, sitting fees and a retainer fee for the chair amounts to a total of $128,000. There is $132,000 for administrative costs, for such things as venue hire, members' travel, database maintenance and publication costs.

Senator IAN MACDONALD --And what does the council consist of? Is it just two staff and the chairman? What is represented by two staff years?

Ms Williams --Those two staff are administrative support staff, one in the department and one in the Bureau of Tourism Research. The council will be private sector people mainly, with one from state government, but that has not yet been decided.

Senator Schacht --We have not decided the total number--whether eight, nine, 10 or whatever. But there will be a state government representative and a chair. The minister will sort out what sort of arrangements for travel, sitting fees and so on there will be. These are indicative figures.

Senator IAN MACDONALD --That is fine. The council will have a chairman. What type of person will he be--a bureaucrat?

Senator Schacht --No.

Senator IAN MACDONALD --What will he be?

Senator Schacht --That is for the minister to decide. But the council will reflect people with expertise in the industry--hopefully at least one Queenslander and one South Australian.

Senator IAN MACDONALD --You did say that there would be a representative from each state.

Senator Schacht --No, a representative from state government, collectively. Otherwise we will end up with a body so big that we would not fit them in this room.

Senator IAN MACDONALD --Did you tell me what the total numbers would be on the council?

Senator Schacht --No. That has not been determined but it must be a manageable size for a body to do this sort of work.

Senator IAN MACDONALD --Is the council going to be made up of doers or thinkers?

Senator Schacht --Thinkers and doers ought to be the same.

Senator IAN MACDONALD --Will it be a board that gives directions or will the members get down with calculators and do some forecasting?

Senator Schacht --I would have thought--

Senator IAN MACDONALD --I would like to know what the department says, not what you think--without being rude.

Senator Schacht --You have cut me to the quick, Senator.

Senator IAN MACDONALD --Why do we not just ask the department? Its officers know: you only think.

Senator Schacht --Ms Williams will answer, if she wants to.

Ms Williams --The calculations will be done by the second level body, which is the technical committee, with assistance from the Bureau of Tourism Research. The top level body will have to understand those calculations, simply because to understand them gives faith in them. But a lot of the detailed work will be done by the second level committee.

Senator IAN MACDONALD --So there will be a level of board type people, then there will be a second level of technical type people?

Ms Williams --Yes--a two-structure thing like the indicative planning council that does the work for our industry.

Senator IAN MACDONALD --Where are those technical people going to come from? You are not going to pay them out of the $128,000?

Ms Williams --Again, it will not be a full-time committee.

Senator IAN MACDONALD --Where are those sorts of people going to come from? Will you second them from private industry, from the department or from the BTR?

Ms Williams --There will be a mixture but, again, I am afraid it is not yet decided. But certainly that is why one of the staffing positions will go to the BTR. The BTR will be heavily involved in this.

Senator IAN MACDONALD --I understand that. Thank you. Is the industry being fully consulted in the establishment of this forecasting council?

Senator Schacht --I would hope so. Yes, says the department.

Senator IAN MACDONALD --Just slipping back a page which Senator Ferguson jumped over, the last item on page 50 states:

Facilitate entry of new Australian international aviation carriers.

I presume that means new international aviation carriers to Australia?

Senator Schacht --You mean the last dot point on page 50?

Senator IAN MACDONALD --Yes. But, we have lost Continental. How are we going about that in our program for 1993-94?

Senator Schacht --I read that as an airline such as Ansett becoming international.

Senator IAN MACDONALD --All right.

Senator Schacht --Yes, facilitating Australian airline companies becoming international such as with the new arrangements for Ansett. It is now starting to fly internationally. It is starting soon to fly to Japan, I think.

Senator IAN MACDONALD --Is that what that plan or vision is, to help Ansett get into the international--

Senator Schacht --Well, it is Ansett; but if someone else wants to have a go in Australia and commit the money--

Senator IAN MACDONALD --I only used Ansett because it is the only other airline. Sure, if there are other airlines, great.

Senator Schacht --The principle is that if a company wants to commit the money and establish itself and have a go, under the system it can. Obviously it is an extraordinary expenditure to become an international airline. You have to get landing rights. We have that separate independent committee now allocating and negotiating landing rights for various companies, and it is not all just Qantas.

Senator IAN MACDONALD --Are we all agreed? The minister is right, is he?

Senator Schacht --Absolutely. How dare you suggest--

Senator IAN MACDONALD --I just wonder sometimes. The officials seem to have the answers but you do not even ask them. But you go on to say, `Well, I do not really know'.

Senator Schacht --Just a well-briefed minister on a lot of things.

Senator IAN MACDONALD --I had not realised. You state:

Improve database to enhance understanding of the economic impact of tourism.

How is that going to be developed in the current year? What sorts of funds are going to be allocated for that?

Senator Schacht --I am not briefed on this one so I will pass it on to the officials.

Mr Jones --There are a number of small consultancies that have been let to look at specific issues in relation to our database information such as the impact on foreign exchange earnings and the way in which calculations are made of benefits from tourism, and it relates to those issues.

Senator IAN MACDONALD --Thank you.

CHAIRMAN --That has completed program 1.