- The Australian government’s $1.2 billion tourism rescue package has been met with a mixed reception, with some industries frustrated that the aviation sector has received so much support.
- While Qantas CEO Alan Joyce proclaimed the stimulus package “ticks all the boxes”, accomodation, tourism and hospitality operators say there’s little in it for them.
- Faced with the imminent termination of JobKeeper, the sectors are calling for more support beyond shoring up domestic tourism in regional areas.
- Visit Business Insider Australia’s homepage for more stories.
The Morrison government wants to subsidise your next holiday, but its refusal to subsidise industries outside of aviation will cost jobs, other sectors warn.
The new $1.2 billion tourism package, which at this point simply should be called HolidayMaker, promises 800,000 half-price plane tickets to regional destinations, in a bid to stimulate demand for domestic tourism.
Here’s how it works.
How to get half-price tickets in Australia
Australians must book from the beginning of April to the end of July, and travel after May 1.
The program covers 33 different flight paths from major cities. All are interstate flights, with the exception of Adelaide-Kangaroo Island, with the Prime Minister putting pressure on state premiers to keep their borders open.
With their tax dollars paying for half the ticket, Australians will chip in the remainder from their own pocket to visit 13 tourism-dependent locations stretching from Broome and Uluru to Launceston.
As long as an airline has flown the route in the last two years they will be eligible, which should realistically cover Qantas, Jetstar, Virgin and in some instances, regional carriers like Rex.
What else does the tourism package include?
While Australians are likely most interested in the prospect of half-price travel, there are a few other bits and pieces tied up in the government’s $1.2 billion package.
Airlines Qantas and Virgin will also pocket undisclosed payments for assurances they won’t axe 8,600 jobs dependent on the recommencement of international travel, ambitiously slated for October this year.
Small businesses reliant on JobKeeper will also be eligible for bolstered low-interest loans when the wage subsidy ends this month. The loans will be 80% guaranteed by the government for amounts up to $5 million over a ten year period. A repayment-free period of up to two years is also available.
To be eligible, a business must turnover less than $250 million, with 350,000 Australian businesses said to qualify.
A smaller version of the same scheme running last year only saw $3 billion of an $40 billion allotment lent out.
Airlines win out at the expense of tourism operators
Clearly such a scheme, largely oriented towards Qantas and Virgin, has pleased the airlines.
Qantas CEO Alan Joyce cheerfully remarked that the package “ticks all the boxes” on Thursday, as Prime Minister Scott Morrison posed inside plane cockpits giving thumbs up for the cameras.
— AAP Photos (@aap_photos) March 10, 2021
However, the same photo opportunities are unlikely to be extended to him from many other industries frustrated to have been left out.
Facing the prospect of letting go of 80% of its workforce, the travel industry’s assessment was less than glowing.
“It is a very small, very meagre package at best,” Flight Centre co-founder Graham Turner told Today, noting 800,000 tickets was roughly equivalent to two weeks of normal travel.
“There is nothing in it for us. I don’t think it will help tourism either….we can survive until the borders reopen but there is going to be a lot of small businesses suffer through this, unfortunately.”
The Australian Federation of Travel Agents (AFTA) has been crying out an extension of JobKeeper. It noted on Thursday that it was grateful for the promise of $128 million of extra grants for tourism operators but was still waiting on more details.
“Without tailored support we will see 8 in 10 people still working in travel out of a job, and 3 in 10 businesses having to close with a further 52% uncertain about their future,” AFTA chair Tom Manwaring said.
“We all understand the urgency and critical nature of resolving this.”
Hospitality and accomodation industries are waiting on more relief
Other hard-hit industries meanwhile have been left wondering if they’ll receive any further stimulus as JobKeeper hits the chopping board.
The Restaurant and Catering Industry Association of Australia (RCA) has said the package will do nothing for the hospitality industry that have lost out from a city exodus.
Those same concerns were echoed by Accomodation Association CEO Dean Long, who said loans were of no use without future certainty.
“For Sydney and Melbourne where 80% of the market is from international and corporate markets which are still not operating due to Government restrictions, the lack of support in this package will result in a loss of jobs and slow our recovery once borders are open,” Long said.
“Our hotels in these two major international gateways currently have a forward booking rate of less than 10% for the next 90 days and desperately need immediate support.”
No substitute for JobKeeper
While of an entirely different structure, the ‘rescue package’ is the first indication of what could replace JobKeeper.
Both unions and Labor lamented the fact it offers little of the same guarantees.
“Without the connection to jobs, or putting money in the pockets of workers who need it, this is just corporate welfare. This is taxpayer money designed to flow into the pockets of businesses, not workers,” Australian Services Union (ASU) assistant national secretary Emeline Gaske said.
Federal Labor leader Anthony Albanese was also critical of the fact that package was largely limited to airlines.
“This isn’t a tourism package. It is a selective aviation package,” he said.
“I think it is very disappointing that for tourism operators around the country there is not a single extra dollar in today’s announcement.”
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