Labour plans tourism boost

Press, 28 May 1984, Page 8

Labour plans tourism boost

Parliamentary reporter Substantial Government grants have been proposed by the Labour Party to develop tourist markets to their fuU potential. Grants of between $5 million and $lO miUion may be needed to develop markets such as Japan or the United States, according to Labour’s finance spokesman, Mr R. 0. Douglas, who yesterday released an economic paper on tourism. Mr Douglas suggested the grants could finance market research, promotion, advertising and public relations. “This will need to be upfront money in amounts the private sector could not possibly spend because the return would not be there to any individual operator,” he said. “On the other hand, the Government can spAd considerable amounts in these

areas and benefit.” He told “The Press” he expected there would be a fairly quick “payback” on the grants made by the Government. For every 100,000 extra tourists, 10,000 jobs would be generated in New Zealand, and another $lOO million would be generated in overseas funds. The Government would be saved between $5O million and $lOO million in unemployment benefits, depending on whether jobs went to people on the dole or unemployed married women, for example. The Government also stood to gain between $5O million and $6O million extra revenue in tax. “I don’t see (the grants) as any real drain,” Mr Douglas said. “I see them as a revolving sort of fund.” A levy on the tourist industry was also possible, but this would depend on consultation with the tourist

industry. Mr Douglas said, however, that there would have to be a partnership between the industry and the Government “What we’re saying is that if the private sector doesn’t come to the party, there’ll be no party. But we’re not forcing this on the private sector,” he said. Mr Douglas’s suggestion was part of an “economic plan” he believed was needed to set out the tourist industry’s over-all aims. He said such a plan should be drawn up by a small group of people from the tourist industry, industrial labour and the Government It would establish targets for • The number of tourists New Zealand aimed to attract each year for the next 10 years, country by try•Ufhe average length of stajPbr each tourist •*The average amount of

money to be spent by each tourist a day. A detailed working plan could then be drawn up on how the plan might best be implemented, and how the various parts of the tourist industry could be co-ordi-nated. Mr Douglas said that, unless details were tackled together in a co-ordinated way, nothing was likely to be achieved from an economic standpoint. “For tourism to succeed, there must be a genuine partnership between the Government and the private sector, from which both parties benefit: the private sector in terms of an adequate return on their investment; the Government in terms of foreign exchange earnings, extra employment and Government revenue.” Details that would need to be examined would include market research, marketing, public relations, advertising and promotion, new

industrial innovations, investment requirements, external air travel requirements, taxation provisions, accommodation requirements, internal travel, entertainment within New Zealand, and attractions. An assessment of profits and costs could be done on a particular market,' such as the United States, and the national benefits spelt out in an economic statement by the Government. The Government could then determine the net return to the nation from the extra investment, Mr Douglas said. The effectiveness of programmes would have to be monitored and reported on every six months, to ensure they were cost effective from the Government’s point of view. “Tourism alone has the potential to create an extra 20,000 jobs by early 1988, and earn an extra $250 million in overseas funds,” Mr Douglas said.