An extension to the wage subsidy scheme, a $400million targeted fund and a domestic marketing campaign are the highlights of yesterday’s Budget for the sector.
Queenstown Lakes Mayor Jim Boult said the Budget was "very supportive" overall for the district’s tourism-heavy economy, with measures such as training and employment schemes recognising that many people would have to seek employment outside the industry.
He supported the continuation of the wage subsidy scheme, provided it did not "prop up jobs that aren’t going to be there anymore".
"Probably for the tourism industry, it works.
"I’d think there are very few tourism businesses that wouldn’t have seen their revenue drop by more than 50% — most will be close to 100% at present."
"I think the point there is we haven’t figured out what the target is, so I’ll be interested to see how that plays out."
Enterprise Dunedin director John Christie said he was particularly interested in the domestic marketing campaign to be run by Tourism New Zealand, and how that would "dovetail" with its own marketing efforts.
He was "delighted" by the prospect of working in partnership with the Crown entity.
"We’re all learning in terms of the future of tourism.
"It’s a tough time for the sector and we’re certainly feeling the pain."
AJ Hackett Bungy New Zealand managing director and co-founder Henry van Asch said he was looking forward to seeing how the tourism recovery fund was allocated and "what it will mean for Bungy and Queenstown in general".
The extension of the wage subsidy scheme would give his company "breathing space" while it worked through the full impact of Covid-19 on the business, while a domestic marketing campaign would help stimulate a "much-needed New Zealand market".
NZONE Skydive Queenstown business development manager Derek Melnick said extending the wage subsidy would alleviate some of the pressure on tourism businesses.
"It’s a two-month lifeline we didn’t have 24 hours ago."
However, he would have preferred it was more specific, with a three-month extension for businesses suffering a 70% drop in revenue, rather than 50%.
Mr Melnick also applauded the domestic marketing campaign, but hoped funding would be earmarked for an intensive marketing campaign in Australia once a transtasman bubble was established.
Tourism Minister Kelvin Davis said the extension to the wage subsidy scheme would help eligible businesses "cover staffing costs and protect jobs".
However, consultation with the industry identified a desire for a "deep look at the future of tourism" as well as dealing with the short-term pressures caused by the pandemic.
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'During World War II, statistician Abraham Wald tried to determine where to add extra armor to airplanes. Based on the patterns of bullet holes in returning airplanes, he suggested that the parts not hit should be protected with extra armor. Why?
Wald was looking at what is sometimes called "dead evidence." He reasoned like this… if these planes are returning, we know that if they are hit in the spots they have been hit, they can still fly. The planes that did not return must have been hit in different places. So put the extra armor wherever the returning planes were not hit.
I think most people would have a natural inclination to put the armor where the returning planes had been hit. The real answer is simple, but counterintuitive. It's called "dead evidence" because it is what people ignore when they make these judgments.'
Should we instead of propping up the tourism industry, which is now riddled with bulletholes and seemingly unable to survive, how about we instead invest this money into the other industries that haven't been affected by this downturn.
Some other business I know of in technology actually experienced a significant upturn in revenue during this.