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Good Morning,
Welcome to Canberra and the inaugural Tourism Directions Conference.
Through the National Long Term Tourism Strategy process it became obvious that the tourism industry needed the equivalent of the Agriculture and Resource's Sectors annual ABARE Outlook Conference which is now it its 40th year.
Frankly, there's no better place to be discussing the future of Australia's tourism industry than the National Capital and no better time than now for international and national speakers to debate key issues facing the industry.
Tourism is significant to our economy- it accounts for almost a million jobs directly and indirectly, and generates $24 billion in exports and 2.6 percent of Australia's GDP.
From an economic perspective, we're interested in all visitors to and within Australia for many purposes including leisure, work, education, family or health and wellbeing. And it's not just a question of how many visitors but the degree to which we can encourage them to spend money in Australia and support business and jobs.
Tourism benefits extend beyond economic activity- travel builds tolerance and understanding of different cultures, it helps to educate people about our history, natural assets and our indigenous heritage.
Tourism adds to the vitality of our cities and regions. Almost half of every domestic tourism dollar is spent in regional Australia. Towns from Yallingup to Yeppoon and Broome to Bridgewater as well as many others depend on visitors for jobs and the viability of their caravan parks, motels, restaurants, cafes, pubs and other businesses.
Our $33 billion industry has come a long way since the first report in 1964 into Australia's tourism situation and potential. The report lead to the establishment of the Australian Tourist Commission in 1967 and much later the development of the first national tourism data sets in 1980 for international visitor arrivals.
The international and domestic visitor survey began in 1999 when our tourism exports were $14 billion- which was 60 percent of the current levels.
The tourism industry's issues of the day included the construction of the Opera House and the prospect of the first Concorde flight to Australia!
Over the past decade tourism has lost domestic and global market share.
The globalisation of tourism is impacting hardest on its largest segment, domestic tourism.
Australians are substituting overnight trips for day trips and outbound travel continues to grow with population growth, the strong economy and increasing wealth.
Despite this, over the last ten years- tourism employment has grown by 14 percent, international visitor arrivals have increased by 74 percent and expenditure is up 44 percent.
In 2009, when global travel declined by four percent, Australia's international visitor numbers were line ball with those of the previous year and we have been able to maintain the industry's economic contribution to Australia.
During much of the last decade employment in Australia's accommodation and food services, a sector which accounts for 35 per cent of industry, grew at the second fastest rate of all OECD countries.
If tourism is to continue to grow and prosper we must be realistic about the competitive challenges we face. The success of the industry is based on an effective relationship between Governments and industry.
Collectively Governments spend almost $500 million a year on tourism marketing so the question is not about more funding, it is about how we better spend the money on the table.
But as you know only too well, there is no short term silver bullet.
Today, Tourism Research Australia is releasing The State of Industry report. The report provides industry with a set of benchmarks against which tourism industry performance can be measured.
Some of its findings show tourism faces a tough reality.
Australians are not taking as many overnight trips and do not regard domestic travel as compelling.
The opening up of new tourism experiences in many destinations and the growth in low-cost airlines have substantially increased the competitive pressures facing industry.
Australia is a developed, high-income economy increasingly competing against destinations with lower costs structures. That's generally good for Australians, but tough for tourism.
So what is to be done?
The Report says that higher productivity growth is essential for the industry to provide better infrastructure, service and products.
It says that industry must attract and retain a high quality labour force.
And it must deliver a new and renewed product, better matched to consumer needs.
These are tough messages we all need to hear if Australia's tourism industry is to properly prepare for an increasingly competitive future.
On a brighter note, we are already making serious progress towards meeting these challenges.
As a government we have been working over the past year to promote our industry, and ensure it is competitive over the long-term, securing the future for those half a million Australians employed directly in the industry.
The National Long Term Tourism Strategy is an unprecedented agreement by State and Territory Governments and the Commonwealth on the priorities for tourism over the coming years.
The Strategy identifies that the key challenges for the industry are in the areas of skills and labour, investment, regulatory reform, research as well as marketing.
Reform in these areas takes time and a lot of hard work and requires agreement to change by multiple Government departments and jurisdictions in collaboration with industry.
I'm pleased that the work has well and truly begun and Tourism Ministers recently met to discuss progress on more than 40 initiatives, some of which included:
- Development of a framework for national tourism accreditation- something the industry has been requesting for a number of years and an important step towards encouraging and stressing the importance of quality.
- National recognition of Responsible Service of Alcohol Certification- a simple step towards labour mobility;
- Preparation of a guide to help investors navigate development and planning approval processes.
Ensuring our tourism products and services remain fresh is key to our future success and I'm well aware of the challenges of trying to get a new hotel investment up.
Despite the strength of the Western Australian economy for example, which I'm well aware of wearing my Resources and Energy hat, Perth has not had a new hotel built since 2006.
Through the Long Term Strategy we need to work with State and Territory Government's to facilitate hotel development in the same way work is done to develop manufacturing plants.
I'm also very aware of the issues with labour and skills. We've done a good job in cleaning up the rorts associated with cooks and hairdressers.
Now through the Strategy's Labor and Skills working group, we're working closely with my colleagues Chris Evans and Chris Bowen on solutions for the hospitality industry. This is a first order priority.
With the Australian Government election commitment of an additional $6 million we will see the work program extended.
Drew Clarke, the Secretary of my Department will talk more about the Strategy later today.
During the election the Gillard Labor Government also committed an additional $40 million towards the TQUAL Grants program.
The competitive merits based grants program seeks to assist the industry to become more productive and competitive by providing dollar for dollar grants.
The program will be advertised widely and open in the first quarter next year with a view to funding announcements by mid 2011.
When it comes to support for tourism you need to look beyond my portfolio to the funding support provided across Government.
Tourism is a key beneficiary of the government's $37 billion Nation Building Program which has delivered much needed infrastructure and road upgrades not only to major tourism areas such as Cairns, around Perth Airport but throughout regional Australia.
And projects such as the $12.5 million for Three Capes Track in Tasmania directly support tourism jobs.
During the election we committed $42.5 million for the Cairns Cultural Precinct and convention centre and $47 million for the Townsville Convention Centre.
I am optimistic about the future of Australia's tourism industry, it is resilient and has proven time and again its ability to adapt.
Global travel is expected to increase four percent and the Tourism Forecasting Committee expects international arrivals to Australia to be 5.3 percent up on last year.
Already this year we have seen a six percent increase in short-term visitor arrivals.
The rise of the middle class in China and India is already bearing fruit with arrivals up 23 percent and 8.4 percent respectively this year.
The Chinese market is expected to grow by 7.5 percent a year to a staggering $5.9 billion by 2017.
Our recent investment of $4.1 million in the China Approved Destination Status Scheme extends this bilateral tourism trade partnership with China.
Over the last year airline capacity has increased, with 6.8 percent growth in the number of scheduled passenger seats to and from Australian international airports.
We will maintain our commitment to marketing including our budget for Tourism Australia.
The new Board Chaired by Geoff Dixon along with Managing Director- Andrew McEvoy are leading the organisation into the next exciting phase and frankly they are getting on with the job.
The recent coup of getting Oprah Winfrey will be a hard act to follow but I've not doubt it will be a huge success and a sign of things to come.
Thank you for your support up until now. I look forward to continuing to work with you over the coming months and years. I know we seek to all benefit from the growth of Australia's largest services export industry.