HOTEL TRADE IN NEW ZEALAND

Press, Volume XCII, Issue 27838, 10 December 1955, Page 2

HOTEL TRADE IN NEW ZEALAND

BREWERY CHAIRMAN’S COMMENTS “ACCOMMODATION REALLY SEPARATE BUSINESS” “The provision of accommodation, while closely linked to the sale of liquor, is really a separate business. Until this is realised and until those who are engaged in the business of providing accommodation can earn a normal profit in the same manner as any other business, the provision of accommodation will be a dying industry, and the existing accommodation hotels, now fast becoming obsolete, will never be replaced.” This statement was made by the chairman of Ballins Breweries (N.Z.) Ltd. (Mr N. W. Millner) in his address to shareholders at the annual meeting of the company in Christchurch on Thursday.

“Traditionally, in New Zealand, accommodation has been regarded as an obligation of the hotelkeeper-—a burden that he bears in consideration, of the licence granted to him to sell liquor, a burden based on the erroneous belief that the profits being made from the sale of liquor are excessive,” he said. “It has been an

occupation which the hotelkeeper has been compelled to engage in. however reluctant he may be so to do. “Until the guest entering the hotel becomes a welcome customer, intsead of a statutory obligation, the present position will continue, and no amount of internal adjustment of the methods by which the profits from drink and the profits from accommodation are juggled will effect a permanent cure. Surely it is time for New Zealand to follow overseas practice and let accommodation stand on its own feet.

“Some few hotels may be making an undue profit from liquor, but their number is negligible, and this profit is quite irrelevant so far as the provision of accommodation throughout New Zealand is concerned. The accommodation business is certainly not one that requires to be controlled—it is one that needs to be encouraged. To talk of inquiries into ’earnings,’ ‘obligations,’ ‘suitable accounts,’ ‘equitable balance of earnings.’ etc., as proposed in the further inquiry by the Licensing Control Commission under these headings, shows a complete lack of appreciation of the problem. “Should Be Decontrolled” “Sufficient has been written over the years to convince fair-minded people that hotel accommodation charges should be decontrolled and permitted to find their own level on a competitive market,” Mr Millner said. “Complaints are frequently ventilated in the press that overseas tourists are unable to secure really first-class accommodation; thus the trouble commences at the top-grade houses whose tariffs are so keenly cheesepared by our price controllers .that such hotels are under pressure to cope with the demand.

“It must be admitted that this pressure is accentuated by ‘every-day’ New Zealanders of moderate means, who find that the difference in charges between first-class and lower-grade hotels is not worthy of consideration.

even on a limited budget. Therefore the bona fide overseas tourist of ample means, as distinct from the New Zealand holiday-maker, cannot be catered for in the manner to which he has been accustomed. The failure to decontrol this side of the hotel industry, at least in respect of the tourist class hotels, has injured our tourist trade.”

Mr Millner said that with the heavy demand for top-grade accommodation at the controlled price, lower-grade hotels found practically no demand for their accommodation. “Should this position continue it Will be necessary to consider seriously the future of these hotels, which at the present time are uneconomic to run and will continue to be so unless some relief from control is given. “With decontrol, higher standards of service, including extended meal hours, could be provided in the leading hotels for the person who is willing to pay for this service. The effect of this would be that, pressure -would be taken off the top-grade hotels, and thus would increase the demand for accommodation in lower-graded hotels.”