The seemingly minor issue of how Noosa Council’s funding mechanism for Tourism Noosa might work in the future has become a hot topic around Pelican Street, the Noosa Marina and most of Hastings Street, with both parties seeming to be intractable. In search of some answers, PHIL JARRATT put Tourism Noosa chair RICHARD STEPHENS in the Hot Seat.
My opening question was going to be, is there a resolution or even a truce in Tourism Noosa’s war with Noosa Council, but your body language is telling me there is neither.
I don’t want to suggest we’re at war because one of the greatest measures of success is our relationship with our council. What I put to council today (Monday) was why mess with that success. What I mean by that is that our tourism funding levy model is highly regarded around the country and its success has been acknowledged. Why mess with that? I haven’t been able to get an answer to that.
But you get the yearly funding under a separate agreement regardless, so does the method of delivery actually matter that much?
Yes, because we are about to enter the last year of a five-year agreement and the $2.52 million per year funding agreement is only good until it expires in another 12 months. Thereafter, we have no agreement, so where do we go from there? The levy is protected under legislation, it’s not to be used for general council purposes other than what it’s been defined to do. Right now, that means it’s for tourism and economic development, nothing else. But from July 1, 2022, we have no assurance that this will be the case. I’m confident we’ll have a solid funding base for a further five years, but am I hanging the industry out to dry after that?
What am I missing here? Wouldn’t you always have to negotiate each five-year deal?
Within those five-year deals we have to justify our existence each year. We’re always under review, but fundamentally what the levy does is it gives everyone a clear line of sight. Every rate payer can follow the money trail and see how it’s managed and how it’s directed back into tourism. That transparency will be gone for the rate-payer and for the industry. Basically, the council is saying trust me, we’ll run the rates and you’ll still get your money, but they don’t seem to understand that we lose the protection of the specific and transparent use of those funds for tourism promotion and economic development.
In the minutes of last week’s special meeting of council, there seemed to be a clear mea culpa, an admission that they’d communicated badly on the issue, which I took to mean that a rethink was on the cards. Not so?
I acknowledged and appreciated their apology for the poor communication, and then I waited for new communication. I haven’t had that, still waiting, and in my dealings with council I’m not seeing any change in approach.
I read in the minutes that the council CEO had been tasked with expediting an agreement with Tourism Noosa going forward. Has that happened yet?
Yes, I met with Brett de Chastel this morning to discuss the new funding deed and I have an undertaking with him that this will commence within two weeks. But I never thought that was going to be the issue. It’s the olive branch, and it’s designed to reassure us and the tourism industry that they will continue to support us, but that doesn’t change the fact that we are making a fundamental and monumental change to the transparency and use of those funds. I could sit back and go, don’t worry, we’re completely okay for the next five years, but whoever is representing Tourism Noosa and council then doesn’t have that basic mechanism in place. That’s why I’m concerned. If I had an answer as to why, maybe I’d think differently, but no one has yet shown an adequate justification for changing a mechanism that has been in place for two decades and is a clear success story, a magnificent instrument for funding tourism promotion.
Which is basically the if it ain’t broke, don’t fix it argument, expressed most eloquently by former Councillor and Tourism Noosa board member Vivien Griffin in the public submissions. Is anyone at council listening to a wise elder?
I know she hasn’t been approached about it, whether they’re heeding her warnings I don’t know, but I don’t have a sense of that happening. It’s worth noting that there are going to be significantly more funds being received by council through the levy on short term accommodations, which I understood was coming the way of the tourism levy.
Has anyone suggested that the proposed general rates delivery might have something to do with hiding the new revenue?
It’s a strong conversation within the industry.
As I understand it, there’s already an excess of half a million bucks from the levy paid by about 600 businesses involved in tourism, after the Tourism Noosa funding is paid, but nobody is quite sure where that goes. When the Airbnb tax revenue starts rolling that might add another million to the coffers. Will anyone know where that goes?
Well, the additional revenue currently all goes to economic development, which is why it’s called the tourism and economic development levy.
How much economic development can you buy for half a million bucks?
It’s not as transparent as the tourism funding, where you can follow the trail and see exactly how the money is managed in our annual reports, but it’s legit. I know it goes towards economic development.
But what does that mean?
It’s pretty broad. A playground in the hinterland might be classed as economic development.
So why would 600 people whose business is tourism want to see their rates levy spent on something that has nothing to do with tourism? Why are they funding economic development for the general good when the rest of us ratepayers are not?
I don’t have the answer to that, but I’m sure the council would say that the economic development we’re talking about is more tourism related.
But you say that there’s no evidence of that?
The evidence we’re concerned with is about where the tourism money goes, and that’s transparent. And the $2.52 million that Tourism Noosa has received in funding for the last four years represents only 3.5 percent of the total rates revenue, and this in a place that is totally reliant on the tourism industry.
Is there any kind of national benchmark for local government support of tourism bodies?
Not really, but there are two examples in the neighbourhood. Sunshine Coast had their tourism levy abolished in 2017 and Gold Coast likewise. But the reason for that was because their industry diversification is so much greater than ours. In both cases tourism revenue represented less than 20 percent, whereas here we are totally reliant on tourism. The model is different.
The public submissions sent to council on this matter were largely positive but there were a few negatives suggesting that you should get less or no funding because we don’t want any more tourists. How do you answer that?
In 2019 we completed a report called The Value of Tourism, interviewing 1000 residents across the community, and 83 percent said they understood the value of tourism to their lives and to their businesses. Five or six percent had the other view, that it was corrosive to their lifestyle. But the real number was this – 45 percent said that their businesses would fold without tourism.
Another argument going around is that if tourism benefits so many people indirectly, why aren’t they paying the levy? One example is real estate.
It’s a difficult science and you can always pick faults with how rates are levied. In this particular case there is no doubt that real estate derives a major benefit from tourism.
On another issue, lack of hospitality staff is a huge issue in many parts of the country. How bad is it here?
Every business is handling it differently. Some are compromising their service levels to compensate, which I think is sad. They might not service the room every day or they leave rooms vacant for a couple of days. Bars and restaurants are just closing when they don’t have staff. It’s very difficult.
What else is a problem, Richard?
I think value is a problem we have to be aware of. Everywhere is full all the time right now, and some businesses are taking advantage of that to ramp their rates up when it’s not reflected in the value they offer. That has an impact on reputation. This is a long-term venture, and they need to consider that.
Last question, and it’s back to the levy. I know both of the protagonists and you seem like sensible, down to earth guys. Can’t you and Brett just sit down behind closed doors and sort this out?
Brett de Chastel and I have a very good relationship, so there’s no doubt that I’m disappointed that we haven’t been able to do that yet. He understands that I have a duty to represent the industry and that I need to go back to my members with something, and so far I haven’t got that. So I urge people to go out and talk to their councillors this week about the importance of tourism and its funding and help resolve this.
