THE PRESS MONDAY, MAY 7, 1984. Another push for tourism

Press, 7 May 1984, Page 12

THE PRESS MONDAY, MAY 7, 1984. Another push for tourism

During the boom years for travel in the late 19705, New Zealand’s tourist industry was confidently predicting a million overseas visitors a year by 1990. The prediction, echoed in several planning reports, became a fading dream when the world economy slipped into recession in 1980 and tourism’s rate of growth slowed almost to a halt.

A new report prepared by the New Zealand Tourism Council and the Tourist and Publicity Department is predicting an annual growth rate of 6 to 7 per cent, which, if realised, would mean that New Zealand would attract about 750,000 visitors by 1989 — well short of, but certainly more realistic than, the earlier million mark. The authors undoubtedly base their forecast on the dramatic recovery of the market during the last 12 months. Reserve Bank travel receipts for the 12 months to the end of February were $402.4 million, an increase of 48 per cent over the same period a year ago. The number of visitors, which showed an increase of 6 per cent, passed 500,000 during the same period. In the 1982-83 financial year, travel receipts were up by only 1.9 per cent to $304 million. The number of arrivals in the same period grew 3.2 per cent to 487,658. If New Zealand is to achieve the revised targets by the end of the decade, the Government must implement soon a number of recommendations in the report. The report asks for a much-needed boost in the Tourist and Publicity Department’s marketing budget which, it suggests, should be more than doubled from $6 million to $l5 million during the next two years. Although Air New Zealand spends large sums on overseas promotion, and other travel businesses have enjoyed tax relief on advertising and promotion abroad, the Government for too long has adopted a pennypinching policy on tourism promotion. It has consistently turned a deaf ear to calls for expenditure in keeping with modern times. For instance, in 1982 the Tourist and Publicity Department could allocate only $600,000 for promotional advertising in the United States. About 10 million Americans travel overseas for holidays each year; but New Zealand attracts barely one in a hundred of them. This may seem a fair share, considering all the possible destinations around the world. Almost certainly, New Zealand could do better. New Zealand’s former senior travel commissioner in the United States, Mr Len Hunt, suggested on his retirement last year that a $5 million boost for promotion could double the number of American visitors. When the average tourist’s expenditure in New Zealand is about $lOOO, another 100,000 tourists on 16-day holidays would produce an additional $lOO million in foreign exchange. The goal is at least worth considering. The report notes that the greatest impediment to growth is the intensity of competition from other countries. New Zealand is not a cheap country to visit. Many countries offer more travel, accommodation, and service, for the United States dollar.

Noting that nearly 99 per cent of tourists reach New Zealand by air, the report says: “New Zealand will get the greatest economic benefit from airline activity when co-operation between Air New Zealand and the tourist industry in market development is at its highest.” It could have gone a good deal further. Inbound tour companies have been concerned for some time about the shortage of seats for groups between Australia and Auckland during peak times of the year. Air New Zealand has made no secret of the fact that it is carrying between Sydney and Los Angeles an increasing number of Australian and American tourists. However, they spend only 90 minutes in New Zealand — in the transit lounge at Auckland airport. While helping this country’s foreign exchange earnings through revenue from fares, they occupy seats that could be used for Australian groups wanting to visit New Zealand for holidays, particularly during the ski season. A survey taken for “The Press” last year showed

that up to a third of the airline’s trans-Pacific passengers by-passed New Zealand. This is producing revenue for Air New Zealand; it is not getting the greatest possible number of people into the country as visitors. The airline’s reliance on passengers whose final destination is not New Zealand is further indicated by its new London service. The twiceweekly flights, although well patronised over their various sectors, have failed to produce any apparent big increase in visitors to New Zealand from the United Kingdom. In 1980, two years before Air New Zealand started flying to London, 34,000 visitors from the United Kingdom travelled to New Zealand on the then existing air services. In 1982, Air New Zealand’s entry to London increased capacity on the route between London and Auckland by 43,680 seats a year. However, in the year to the end of February last, New Zealand managed to attract only 5800 visitors more than the 1980 total. The airline undoubtedly scored on the route; but New Zealand’s travel industry benefited very little at home.

Some allowance should be made for passengers from other countries and for New Zealanders returning home on the airline’s flights from London; yet the need to fill 43,680 seats a year highlights the airline’s dependence on transit traffic to its bigger and more widely publicised destinations beyond Auckland. The fact again highlights the need to push New Zealand as a destination.

Wellington’s shabby domestic air terminal and the unreliability of the Cook Strait ferry services have been singled out for justifiable criticism in the report. Travellers have had to put up with uncertainties over Cook Strait ferries for too long. Sailings cancelled at short notice can create intolerable difficulties for tourists on tight budgets and inflexible itineraries.

The criticism drew a quick response from the acting general manager of the Railways, Mr Bob Henare. He claimed that those who prepared the report had failed to acknowledge the realities of operating vessels on “a very turbulent stretch of water.” What Mr Henare failed to acknowledge was the role played by industrial disputes in the cancellation of sailings. For instance, of the 1975 round-trip sailings that were scheduled in the last financial year 98 were cancelled. Of these cancellations, 44 were due to industrial stoppages, 29 to a shortage of freight, and four to mechanical problems. The weather stopped only 21. This chance of one in 20 that a visitor’s planned travel would break down would not commend airline or coach travel anywhere. The suggestion in the report calling for competition is, nevertheless, illogical. Given the state of the unions and the weather, any ferry service would be vulnerable to disruptions. The report, among its other recommendations, calls for the broadening of financial incentives for all forms of approved tourism developments. If applied by the Government, such incentives, which worked well in the hotel industry for a time, should foster the kind of attractions that New Zealand will need to cater for the estimated number of visitors by 1989. The report also emphasises the need for a co-ordinated training programme for tourist industry employees to meet the more sophisticated demands of foreign visitors. The most casual observer will recognise the immense improvement in the capabilities, style, and status of thousands of people engaged in the travel business over the last decade or so. This improvement must be continued, just as capital investment must be continued. The returns from investment in this industry can be high for the whole economy, and New Zealand does not have to go to pretentious heights of tourist luxury to win more appreciative visitors. Much in the report is not new, and reams of previous reports have been produced on New Zealand’s tourism industry during the last 15 years. Unfortunately, words have not always been followed by deeds. Such should not be the fate of this latest, well researched, study.