Tuesday 14 March 2017 02:19 PM

Local govt pushes billion dollar bog fund as tourism explodes

By Pattrick Smellie

March 14 (BusinessDesk) - Local Government New Zealand estimates the country needs to plan for $1.38 billion of new public toilets, carparks, freedom camping facilities, footpaths and other basic infrastructure if the tourism industry is to keep up with booming arrival numbers.

The call comes amid widespread news media reports of an international tourist relieving themselves in a Dunedin street and is accompanied by a call for urgent decisions both to allow councils to develop new funding sources beyond property rates and user-pays charges.

The estimate covers requirements identified by local government over the next decade or so for tourism infrastructure that it agrees with the tourism industry should be paid for jointly by central and local government, and private tourism operators.

Some 683 projects, covering public toilets, waste water disposal, wi-fi, parking and freedom camping have been identified in a joint study involving LGNZ, Tourism Industry Aotearoa, Air New Zealand, Auckland and Christchurch international airports, and campervan hire firm Tourism Holdings.

LGNZ chair Lawrence Yule suggested some of the sharp increase in GST revenues coming from overseas tourism spending in New Zealand should be siphoned to tourism infrastructure.

GST receipts from tourism rose from $950 million to $1.5 billion between 2015 and 2016, said Yule.

"Not one dollar of that goes to local authorities," said LGNZ chief executive Malcolm Alexander, who said government funding should also include ongoing assistance for operating expenses. The government's $12 million in funding over three years,announced last year to start addressing public tourism infrastructure, was "not sufficient".

"You want to do these strategic things when things are burgeoning, not when things are really difficult," he said, saying government grants were not a long term funding solution. "We are talking system change."

Yule suggested also that tourism operators were less likely to object to imposing a "bed tax" to help fund tourism infrastructure than they would have been before the surge in visitor arrivals over the last few years.

"The risk to our reputation is very real if we don't get onto it," said Yule, citing evidence that repeat visits were among the greatest sources of growing value in New Zealand tourism, making impressions on a first visit vital.

Announcements may emerge in the government's May Budget, Yule said.

(BusinessDesk)

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