Saturday, June 23, 2018

What should be the political focus for Aussie accom providers?

accomnews spoke exclusively with Joe Shlegeris, the Greens candidate with a business background who is running for the Queensland seat of Noosa. He talked about Airbnb, the backpacker tax, rate parity and which policies he thinks will impact accom professionals most directly over the next few years.

Joe Shlegeris

“The key issues are focusing on how the government works for the benefit of the electorate. For so long, we’ve been willing to say ‘Labor has the seat, it belongs to them, or LNP has the seat’, we’ve had 10 years of that and we have major problems in Noosa that don’t get looked at.

“A few months ago, I said Glen Elmes could solve every problem in Noosa if he were just willing to go to the premier and say ‘I’ll vote for the tree clearing legislation’, because that’s essential to the wellbeing of everyone in Queensland and the life of the Great Barrier Reef, which tourism operators depend on. But because the financial backers of the LNP chose to oppose it, he had to go along with his party.”

“It pays to have a representative in government who’s not part of the major parties,” he notes, citing that because the government is finely “balanced”, it “has to be nice to the people who sit in the middle with the balance of power”, which means “creating opportunities to get benefits for your electorate”.

We have reached out to other parties for candidate interviews: let us know which local representatives you want to hear from.

Is new development good for accom providers?

Policies on development are something Joe stressed should be a key factor for voters in the tourism industry going forward. “There’s development and then there’s development. It’s now cheaper to generate electricity locally than it’ll ever be via the grid, so why wouldn’t you require new developments to look after themselves? You’ve got to think about transport as part of it: one of the biggest issues is the disaster of Beckmans Road. If you just let that sort of suburban development go crazy you’re doing a couple of things that aren’t great for tourism; one is that you’re making the traffic as bad as it is in the city and second, you’re destroying the natural environment for which people come to Noosa.”

He queried: “Are [providers] in favour of further development and dilution of their brand? Because what you worry about is that Noosa is special partly because of its natural surroundings; if you greatly increase the number of units on offer are you still going to be able to ask for special prices? If you turn it into Caloundra, you’ll be able to charge Caloundra prices. That benefits builders and developers who make the money but I would have thought [providers] would be keen to protect the special premium they can ask for because it’s Noosa.

“Imagine if the Noosa National Park was just another suburb, how would Hastings Street look? It would still have a nice beach and nice restaurants but I have to suspect operators there can charge more because it’s Hastings Street right next to a national park, not appended to another suburb.”

Backpacker tax

The morning we interviewed Joe, the federal Green party had just struck a deal with government regarding the backpacker tax. The deal made it almost certain that the tax would pass through parliament, which many have criticised. At the same time, the conditions of the deal reduced the percentage of superannuation backpackers have to surrender when leaving Australia from 95 percent to 65 percent; demanded an extra $100m in Landcare funding; and more than halved the overall backpacker tax proposal from 32.5 percent to 15 percent. Tourism organisations, such as TAA, widely slammed the backpacker tax as a “disincentive” to working holiday-makers.

Joe tended to agree: “Why on earth would you want to tax the backpackers at all?” He said he was “totally astonished that it was even a topic. It’s not like they’re making a vast amount of money. People who are picking fruit and taking those low-paid jobs are going to spend every penny they earn and they’re going to pay GST on almost all of it, which is 10 percent. They are also probably going to spend close to where they are, which will make people in those small towns happy. So I would’ve thought the dominant consideration would be making sure enough labour is available so the agriculture industry can carry on.”

Although, he noted that the agreement was a positive indication that the federal Green party was willing to compromise where necessary. “Richard Di Natale [Green party leader] has taken the view, I think, that he’s not going to let ‘perfect’ be the enemy of the good and if he can achieve something pretty good then that’s better than not.”

Airbnb, OTAs and rate parity

Corporate monopolies are a huge market issue, with two dominant OTAs eating into the direct booking sphere an obvious example in the accommodation sector.

“It’s a competitive world and new channels of selling things, including accommodation, are going to be coming our way, whether you can regulate them out of existence or slow them down remains to be seen. I think the key issue is where the industry is paying its own way; everyone in the industry should be participating equally. There’s a grey area around Airbnb; when do you become a tourism operator? Is it when you rent a room in your house 10 nights a year or 30 nights a year, etc.”

He later added: “The business guy in me says there’s plenty of legislation in Australia, not specifically about the hospitality industry, about the use and misuse of market power. I would’ve thought the resorts should be free to compete and deliver cheaper holidays to customers.”

Penalty rates and workforce casualisation

A contentious issue in the accommodation sector as it has such an impact on smaller accom operators, penalty rates are a key industry concern. accomnews was intrigued to find out which side of the fence Joe sat, as ‘Greens candidate’ and ‘businessman’ likely seem contradictory descriptors to many people. “If we get to the point where we have these big public holidays and coffee shops closed because they can’t afford to pay penalty rates; it doesn’t just hurt that coffee shop, it hurts business in the whole town. If one coffee shop is closed and another is so busy that you have to wait half-an-hour, nobody’s winning.

But he added: “I appreciate that the power can swing too far the other way and if you’ve got business proprietors that will suddenly tell people ‘you have to work these horrible hours and there’s no extra pay for it and if you say no, you’re sacked’, that’s pretty harsh too. But I have to say I’d come down gently on the side that says the penalty rates have gone too far.”

Joe’s background in business started with an MBA in the USA where he headed up a software firm before relocating to Australia age 30 and ultimately becoming a volunteer small business mentor. “I’m a business guy through-and-through, I just happen to think the Greens have the right policies,” he surmised.

Employment is a key issue not just for the accommodation and tourism industry, but for Noosa, Queensland, and Australia as a whole. “Buy-and-large, we have a real problem with the casualisation of the workforce. I’m not against casual work, but people want permanent and full-time work and if we are going to deliver it, we must encourage businesses around the accommodation industry. Accommodation, just inevitably, is going to have more shift-work, more part-time work, more casual work; I’m sure your [readers] would agree, it’s just part of the nature of that business and that’s okay because some people specifically want that work, but not everyone.

“All of the net new jobs come from small businesses. Large organisations are really good at working out how they can get rid of people and there’s nothing wrong with that, it’s just the nature of large organisations responding to the requirements of their shareholders, etc. If a key concern is decent employment then you have to have a robust small business sector, there’s just no way around it.”

He added that small businesses providing good quality jobs to locals “could be located anywhere but they are here because their owners and proprietors want to live in Noosa and they want to live in Noosa because of the natural environment. So, if you want those kind of businesses, you have to protect the reason they are here, which is the natural environment, because they can go somewhere else.”

About Rosie Clarke

Rosie Clarke
Rosie Clarke is the editor of Resort News and Accom Management Guide as well at their digital home, accomnews. You can reach her at any time with questions or submissions.

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