AusLeisure

Amid warnings that tourism will be wrecked by border closures that have disrupted the holiday season, the Federal Government is facing calls for an extra $1 billion in financial support for the industry.

Danielle Wood, Chief Executive of non-aligned public policy group the Grattan Institute, predicts keeping the JobKeeper wage subsidy scheme for the tourism industry for an extra three months could cost as much as $1 billion, assuming one-quarter of the sector's workforce remains on the wage support after its scheduled end in March.

As reported by the Sydney Morning Herald, Wood said the extra spending "would be justified given the recent hit from border closures" intended to stop the spread of a coronavirus outbreak in Greater Sydney.

The reintroduction of hard borders between NSW and Victoria, South Australia and Western Australia was estimated by tourism industry groups to shave $3 billion off revenue for travel businesses over the critical Christmas period.

This is a hit to turnover of more than 50% and follows significant revenue declines from bushfires during the December 2019 to January 2020 period.

Wood advised “many operators were relying on school holidays to get through and the loss of revenue has been directly a result of the policies taken to contain the spread of the virus.

"(It) could raise some administrative challenges to offer (JobKeeper) to just one industry, but it's probably worth the complexity in this case."

In response to the border closures, industry peak bodies Tourism Accommodation Australia, the Tourism and Transport Forum, the Australian Tourism Industry Council (ATIC) and the Australian Chamber of Commerce and Industry on Friday flagged the need for more financial help from the Federal Government, either in the form of an extended JobKeeper or other cash grants.

Advising of pressure on the Federal Government to extend JobKeeper, ATIC Executive Director, Simon Westaway stated "JobKeeper remains an important business support policy while we remain faced with a hard international border close and severe domestic travel restrictions. "Without this program, thousands of businesses, through no fault of their own due to government responses to the virus, will be impacted to the point of closure."

While it would be hard to use industry data to determine whether some businesses hit by the closures should be eligible, Westaway said a 30% reduction in revenue test would be a suitable measure.

In July, when it was announced JobKeeper would be extended for six months to March at lower rates, the estimated cost was $16.6 billion. The overall scheme is forecast to cost $90 billion, down from earlier estimates of $101.3 billion amid business recovery in some sectors.

In mid-December, the Australian Federation of Travel Agents said in mid-December it intended to make a pre-budget submission this month asking for a JobKeeper 3.0, on top of an extra $128 million in support already provided for travel agents and tour operators in the form of one-off grants.

Federal Treasurer Josh Frydenberg said in a statement the Australian Government had "always maintained that JobKeeper is a temporary program designed to taper off as economic confidence and momentum builds".

He said fewer businesses and employees needed the wage subsidy and other support, with 734,000 jobs created over the past six months and a range of stimulus measures introduced as part of the economic recovery plan.

Related Articles

29th December 2020 - Preparing for a tourism revival in 2021

24th December 2020 - UNWTO points to tourism ‘looking forward with determination’

23rd December 2020 - ABS figures show part-time tourism jobs exceeding full-time positions for first time

21st December 2020 - ATEC welcomes Dan Tehan as Australia’s new Federal Tourism Minister

17th December 2020 - WTTC releases major new guidelines for Inclusion and Diversity to aid tourism sector

10th December 2020 - Insurance crisis set to force closures of Australian attractions and adventure tourism businesses

8th December 2020 - GSCORE helps local tourism operators enhance their marketing skills

8th December 2020 - Tourism boost expected to follow reopening of Western Australian border to NSW and Victoria

7th December 2020 - Queensland Government launches new campaign to attract tourism workers

4th December 2020 - Sunshine Coast partnerships promote new JOBS NOW campaign for tourism and hospitality sector

2nd December 2020 - 2020 Queensland Government Budget provides record funding for arts, sport and tourism

27th November 2020 - Village Roadshow leads Queensland tourism operators in advertising summer positions

27th November 2020 - Imminent reopening of MONA will help boost Tasmania’s tourism industry

27th November 2020 - Newcastle adopts fresh approach to boost tourism post COVID-19

25th November 2020 - Leading ecotourism businesses inducted into Ecotourism Australia’s Hall of Fame

24th November 2020 - ATEC to provide COVID Ready training for New Zealand based tourism businesses

16th November 2020 - Australian Tourism Industry Council urges Prime Minister to take on tourism

10th November 2020 - ATEC highlights that tourism exporters need JobKeeper support until international borders reopen

6th November 2020 - Tourism Australia’s Business Events Boost Program awards 86 successful applicants

4th November 2020 - Tourism Industry celebrates opening of NSW and Victoria border

28th October 2020 - Northern Territory tourism operators receive funding to enhance the visitor experience

7th August 2020 - Federal Government adds $15 billion to JobKeeper scheme to aid Victorian businesses

22nd July 2020 - Live Entertainment Industry Forum applauds Australian Government’s JobKeeper extension

18th July 2020 - Thousands back ATIC petition for retention of JobKeeper allowance

19th June 2020 - Tourism and Transport Forum calls for extension of JobKeeper for another six months

26th May 2020 - Call for JobKeeper underspend to be allocated to revive Australian tourism

12th May 2020 - Village Roadshow Chief Executive calls for JobKeeper extension as Queensland Government’s Coronavirus easing roadmap suggests reopening of theme parks, entertainment venues and stadiums in June

7th April 2020 - Fears tourism businesses may not be eligible for JobKeeper payments

31st March 2020 - ATIC supports $130 billion JobKeeper package

31st March 2020 - Australian Government launches $130 billion ‘JobKeeper’ wage subsidy

---

Support our industry news service
We hope that you value the news that we publish so while you're here can we ask for your support?

As an independent publisher, we need reader support for our industry news gathering so ask that - if you don't already do so - you back us by subscribing to the printed Australasian Leisure Management magazine and/or our online news.