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Tuesday, 25 September 2001
Page: 31422


Mr FITZGIBBON (9:09 PM) — The government has been forced to impose this new tax on tourism for two reasons. The first is that after 5½ years in office and following the collapse of a number of companies in this country, denying workers their hard worked for entitlements, the government has been unwilling, unprepared or unable to do something about that issue—notwithstanding the fact that the opposition has put forward in this House a number of proposals to address that very important issue in the Australian community. The second reason, of course, is the government's incompetent management—or mismanagement, I suppose I should say—of the Ansett collapse and its unwillingness to act to get this national icon back in the air. The Minister for Transport and Regional Services, the Deputy Prime Minister, is happy to describe the now defunct Ansett as a carcass, and has demonstrated an absolute unwillingness to attempt to get that airline back in the air. That is why I rise tonight to support the amendments moved by the member for Batman, which highlight the government's incompetence and the impact of this new tax on jobs, particularly tourism jobs.

The week commencing 10 September was the worst week in the tourism industry's relatively short history. The combined effect of the events in the US and the collapse of Australia's second largest commercial airline will reverberate throughout the tourism sector for many years to come. International tourists are no longer travelling and domestic travellers simply cannot secure a flight to undertake those long-planned holidays. The crisis will cost the tourism industry in this country literally billions of dollars. The tourism sector was somewhat disappointed last week when the Minister for Sport and Tourism, Jackie Kelly, described the crisis as a `little blip'. Let me share with the House the comments of those in the industry. Revenue losses reported by some inbound tour operators and suppliers were as high as $2.1 million in the first week after the crisis, with cancellations estimated to be as high as 7,500 for the period up to December. The Australian Hotels Association found that the first week of this crisis has cost the hotel industry about $15 million, with the rate of forward bookings taking a huge downturn. The AHA estimates that, at the current rate, 1.2 million room nights in hotels across Australia will be lost due to the Ansett collapse and the US terrorist attacks.

The Gold Coast Tourism Bureau says that Ansett brought 60,000 passengers a year to Coolangatta Airport, and twice that number travelled to the Gold Coast from Brisbane. The Ansett collapse represents a loss of 30 to 40 per cent of all business to that region. The manager of the bureau said that this was an `economic tragedy of massive proportions, which was particularly devastating for small business.' In the Kimberley-Broome region, the collapse of Ansett means that there has been an immediate 75 per cent drop in air capacity, with smaller hotels experiencing 100 per cent cancellation rates and larger hotels and resorts operating at 25 to 30 per cent capacity. Sixteen per cent of all jobs in that region are tourism related. Ansett carried about 65 per cent of the regional market. In Central Australia, air capacity to Ayers Rock Resort and Alice Springs is down from 5,500 to 3,625 a week, with two tourism companies already planning redundancies. Tourism represents about 50 per cent of the local economy in that region. In Tasmania, air capacity is down 40 per cent, with hotel chains reporting high cancellation rates. Tourism there represents about 10 per cent of the local economy, as you would know, Mr Deputy Speaker Quick.

The flow-on effect of this downturn means that, for taxis, hire car companies, restaurants, bars, tourist attractions, tourism related retailers and manufacturing, hundreds of millions of dollars in revenue will also be forgone. The combination of the two crises will undoubtedly have an impact on jobs. Many hotels are already scaling back the number of shifts worked by casual staff or in some cases are laying them off altogether. I could go on about the effects on the Whitsundays, Cairns, Townsville, Shark Bay and the New South Wales west—



Mr FITZGIBBON —and Queensland's north-west, as the member for Dawson interjects, and South Australia—anywhere around this country where there is a significant tourism economy. Ken Boundy, the Managing Director of the Australian Tourist Commission, said that he had never seen the industry hit this hard in such a short space of time. I would suggest that this is like the pilots strike hitting within a matter of days. He said that it was unlikely that the tourism industry would achieve its revised target of 4.5 per cent growth for 2001. That is an important point that I will return to in a moment. Mr Peter Shelley, the CEO of the Australian Tourism Export Council said that the US terrorist attacks could mean up to $5 billion worth of export tourism that will not be realised, just in the next 12 months. That is a massive loss to the sector—something the Minister for Sport and Tourism described as a `little blip'.

I want to go back pre crises—prior to the Ansett collapse and prior to those atrocious attacks in New York and Washington. Prior to those events, the tourism industry was already facing a number of challenges. As I indicated, coming off the words of Mr Ken Boundy, last month the Tourism Forecasting Council released its revised predictions for Australia's tourism sector for the next 10 years. In December last year the TFC was predicting that the number of visitors to Australia during 2001 would increase by 8.3 per cent. Its forecast for 2002 was 8.2 per cent. The revised predictions released last month are 4.5 per cent and 6.7 per cent respectively. I remind the House again that this is pre the crises that have received so much attention in the last week. The fact that the tourism industry is facing the consequences of those events means that the government should be seriously considering a rescue package for the industry.

Unfortunately, it is not doing so. We are talking about one of Australia's largest export industries, earning about $16 billion in foreign exchange. It is an industry, in both inbound and domestic terms, worth between $60 billion and $70 billion to the Australian economy. The sector accounts for about 4.5 per cent of Australia's GDP and employs anywhere between, depending on whom you believe, 700,000 and a million people. Prior to the most recent crises, the ATC came to the government, warning it of its problems— as reflected in those figures of the Tourism Forecasting Council—and begging for a mere $10 million over four years to compensate it, largely for the fall in the Australian dollar which, of course, significantly impacts upon its purchasing power overseas. The Australian Tourist Commission, of course, is the government body charged with selling us to the rest of the world.

The Sydney Olympics provided Australian tourism and Australia generally with the biggest free kick probably in our history. There was a great opportunity to capitalise on that but, instead, the Howard government thought it could sit back and ride an easy path. Unfortunately, that was never going to be the case pre the US crisis and the Ansett collapse, and it is certainly not the case now. I talked about the impact of the Australian dollar on the ATC's purchasing power. Some people who are quite ignorant in terms of the industry are out there saying, `Tourism will be okay because of the decline in the Australian dollar.' Let me put that furphy to rest here and now, because I hear it all too often. Firstly, the largest component of a tourist's costs is, of course, the air fare. They are all written in US dollars and do not fluctuate with the exchange rate. Secondly, the reality is that tourists make their travel plans well and truly in advance and, if it is an international holiday, it is more than likely at least 12 months in advance. In addition, they do not sit in their lounge rooms in Tokyo, or in Boston or in London, checking the value of the Australian dollar each day. They simply do not do that. Thirdly, many of Australia's key tourism competitors, including South Africa, Thailand, Turkey, Spain and Italy also currently have weak currencies against the US dollar. Fourthly, the negative impact of the lower Australian dollar on the purchasing power is a very significant effect and will outweigh any positive impacts of a lower Australian dollar. I do not know why the member for Dawson is shaking her head. She obviously does not understand the answer. I look forward to her contribution.



Mr FITZGIBBON —Is the member for Dawson saying that the Whitsundays are doing very well?


Mr DEPUTY SPEAKER (Mr Quick)— Order! The honourable member for Hunter should not respond to interjections.


Mr FITZGIBBON —I would suggest, Mr Deputy Speaker, that, if the member for Dawson believes that the Whitsundays are doing very well, her ignorance with respect to the industry must almost compete with that of the minister for tourism herself. These were not the only adjustment issues facing tourism. Newly emerging competition on the international market, particularly in Asia, the GST and airport infrastructure issues head the list of others. While a number of other industries facing structural adjustment appear to have little difficulty securing a response from the federal government, tourism not only failed to secure support but also had a new tax imposed upon it. As the tax commissioner himself said, `It's like pouring petrol on the fire.' I am not begrudging any of the support: the dairying industry got a $1.7 billion package; when car manufacturing in Adelaide was in trouble, the Prime Minister was on a plane to Japan, along with other ministers, to talk to the company and the Prime Minister of that country; when a smelter in Queensland wanted $200 million, John Howard was on the phone, sending the money up as quickly as possible. But when tourism is in trouble—and I am now talking pre the crises and post the crises—the response from the government is to impose a new tax on it.


Mr Slipper —You're supporting it.


Mr FITZGIBBON —I will pick up the parliamentary secretary's remark on this occasion—through you, Mr Deputy Speaker. I chose to ignore him the first few times; I do not want to waste my time responding to him. He says the opposition is supporting it. What choice do we have? We have 16,000 employees potentially losing their employee entitlements because of the government's incompetence and mismanagement of the Ansett crisis, and the only solution they have put forward is to impose a tax. What do we do? Our choices are very limited. If the government would get off their backside and get Ansett back in the air, those 16,000 employees would be back at work and we would not be debating employee entitlements. It is no wonder the industry has lost confidence in its tourism minister—if it ever had any confidence in its tourism minister.

What the industry needs now, more than anything, is a rescue package from the government. We are seeing it happening in other nations around the world; in particular in the US. What it needs is strong leadership and a minister who can take the fight up on its behalf to this government. Instead, we have a minister who thinks nothing more of the crisis than to describe it as a mere `blip'. My view is—and this can be a message to the Prime Minister—that leaving the member for Lindsay in place as tourism minister is like having Dan Quayle in charge of New York at the moment rather than Mayor Giuliani. That is what it is like. The Prime Minister should move her on and put someone in place who can be a decent advocate for the industry, who can take the fight up to cabinet, and who can make them understand that these are real issues affecting real people in real regional communities. I have heard her say absolutely nothing about this crisis so far, except, of course, that there is going to be a `working group' to discuss the issues. When all else fails, form a committee. That is what the response of the minister for tourism has been: form a committee.

Having said that, there are some very capable people on that committee—I will be the first to acknowledge that—and I hope very sincerely that they can come up with some solutions; and then I hope that the government might finally look at embracing some of them. But what I want to say about that working group is this: not one person on the working group lives or works west of the Great Dividing Range. How representative is that? The biggest impact of this crisis will be felt in regional Australia, and this new tax, as a proportion of the ticket price, will disproportionately impact upon regional Australia—there is no doubt about that. And we get a working group—the minister's only solution—without any representation in rural and regional Australia. It is a disgrace.