Budget 2020: Tourism package falls short of Covid-hit industry's wishlist

Thursday, 14 May 2020

Tourism businesses fear job losses could surpass 100,000.

The Government's tourism funding package has fallen short of the wishlist from the tourism industry, which has borne much of the brunt of the coronavirus pandemic and for which the Budget was 'make or break'.

Tourism, which directly employed over 229,000 people and is a major export industry, first saw demand fall in January when Chinese travellers stopped arriving, with border closures compounding the pain.

In its Budget on Thursday, the Government announced a $400 million targeted tourism recovery fund and a domestic tourism campaign, alongside an extension of the Wage Subsidy Scheme.

Tourism Minister Kelvin Davis said there would be funding to identify and help protect key tourism attractions and amenities.

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'Some of these are at risk due to the effects of Covid-19 and if lost, could slow down either the national or regional recoveries,' Davis said.

A tourism transitions programme would advise and support businesses turning to the domestic and Australian market, hibernating, or considering other options.

A tourism recovery ministers group would be set up, with members set to include the ministers of tourism, finance, Māori development and conservation.

A public-private taskforce would help shape the future of tourism in New Zealand, consisting of cross-government and tourism sector representatives.

Minister of Tourism Kelvin Davis announced a $400 million targeted tourism recovery fund and a domestic tourism campaign.

'Tourism New Zealand has this week begun work to showcase New Zealand on social media promoting safe travel to New Zealanders,' Davis said.

'Further domestic activity will roll out soon, including a nationwide campaign.'

The Government would consider providing further support further down the track.

The extension of the 12-week Wage Subsidy Scheme would help businesses cover staffing costs and protect jobs while the domestic tourism campaign was being rolled out, he said.

Tourism operators had called for an extension of up to six months to help them survive until the peak summer season, and an increase in the amount offered from $585.80 a week for full time employees, up to $1000 a week.

However, the extension announced on Thursday amounted to an eight-week lump sum to employers at the same weekly rates as the current scheme.

From June 10, businesses that suffered or expected to suffer revenue loss of at least 50 per cent for a 30-day period would be eligible.

There had also been calls from the tourist industry for help with fixed costs such as rent, wages and rates in the form of grants or loans; and relief from charges such as Department of Conservation concession fees.

Annual tourism spending totalled more than $40 billion, with $23 billion of that from domestic tourists.

Since the level 4 lockdown, many operators had seen their income fall to zero.

The industry had a long lead-in time, which meant that bookings would not produce revenue for months, and in some cases years.