MEDIA RELEASE

18 June 2010

Tourism is core activity for local govt

Local government support is critical to the success of tourism and must be allowed to continue, the Tourism Industry Association New Zealand (TIA) says.

TIA is concerned that proposed changes to local government legislation will mean councils will no longer invest in tourism development, harming economic activity in their regions. It may also damage the visitor’s experience of the region and New Zealand.

The Local Government Act 2002 Amendment Bill proposes that local authorities focus on ‘core activities’. In its submission to the Bill, TIA says this could jeopardise ongoing investment by councils in tourism development.

“An end to local government investment in the visitor industry could lead to a decline in economic activity in many regions of New Zealand,” Policy Manager Simon Wallace says.

Local authorities play a critical role in the tourism industry, through their investment in public amenities used by both residents and visitors, like water, sewerage, toilets and roads. In some cases, councils also operate visitor attractions like museums, art galleries, gardens, events and sports stadiums.

“Tourism is a core activity for most communities around the country and councils can help them provide the best possible experiences to visitors. By helping attract visitors to the region and encouraging them to stay for longer, councils are boosting the economic contribution from the tourism sector,” Mr Wallace says.

Councils also fund regional tourism organisations (RTOs) and economic development agencies for destination promotion and marketing.

“Local government support is vital, as most tourism businesses are small and operate on low margins, so they are not able to fund big marketing campaigns by themselves. But councils earn a good return on their investment in tourism, as visitors spend millions of dollars in the regions,” Mr Wallace says.

“Tourism provides employment and business activity directly and indirectly to many sectors of the community, including shops, supermarkets, cafes, taxis and food producers. Successful businesses in turn provide rating income for councils.”

Mr Wallace notes that the Bill comes at a time when central government has recognised the importance of tourism as an economic driver, with Prime Minister John Key holding the tourism portfolio. The Government has also committed an extra $50 million to international marketing in the past two years, as well as making a significant investment in a national cycle trail likely to benefit many regions of New Zealand.

“If this bill is passed into law, that would seem to create a fundamental difference of opinion between central and local government about the importance of tourism,” he says.

To read TIA’s submission, go to www.tianz.org.nz/main/local-government

ENDS

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