New Zealand

Red setting revenue plunge paints clear picture

Businesses now facing most difficult position since start of pandemic

A pulse survey canvassing 200 nationally-located industry operators reveals the bulk of respondents expect to see their revenue plummet by close on 60 percent for the period February 01 – April 30 compared to the same period in 2021.

The survey, conducted by Tourism Industry Aotearoa (TIA) also revealed that 95 percent of respondents classified the current operating environment as difficult, with 66 percent saying it is extremely difficult, a factor TIA communications manager, Ann-Marie Johnson said paints a clear picture of the challenges facing the tourism industry as a result of the current Red setting.

“Many tourism businesses are arguably now in the most difficult financial position they have been since the pandemic began, with New Zealanders reverting to a lockdown mentality and not travelling,” Ms Johnson said.

“TIA is sharing these results with the Government and is continuing to advocate for targeted support until we can get back to business.”

Ms Johnson went on to say the financial support for business announced by the Government ticks some boxes for the industry but has launched another survey to assess how effective it will be in meeting operators’ needs.

Preliminary results show 91 percent respondents said government support would be important to enable them to survive the current period, with 61 percent saying it was very important.

Almost 18 percent of respondents were keen on an extension of the Small Business Cashflow Scheme, which was included in yesterday’s announcement.

However, the reinstatement of wage subsidies was considered to be the most important assistance that the Government could offer (84 percent), closely followed by Business Resurgence Payments (77 percent), neither of which have not been included in the new business support package.

A further 29 percent of respondents sought relief from government fees and levies such as Department of Conservation concession fees while 15 percent considered there was a need for more mental health and wellbeing support. TIA will continue to advocate for these measures.

When asked what else they would like the Government to do, 89 percent of respondents identified the removal of self-isolation requirements for international visitors as the top priority. This was closely followed (85 percent) by speeding up the border reopening timeframes when Omicron is widespread in the community.

Ms Johnson said the removal of self-isolation requirements for international visitors is the critical change TIA is seeking from the Government.

“The industry cannot resume making its contribution to Aotearoa New Zealand’s economy – up to $17.5 billion a year pre-COVID – until holidaymakers can come here without having to self-isolate,” she said.

“With Omicron endemic in New Zealand, the case for self-isolation essentially disappears.

“As soon as we get past the spike of Omicron over the coming weeks, TIA will be calling for self-isolation requirements to be removed so the industry can plan for a future where other forms of government support will not be needed.”

Survey respondents also showed strong support for stepping down from the Red level as soon as possible (70 percent) and adjusting the stand-down requirements for close and casual contacts (64 percent).

Ms Johnson said the tourism industry is not seeking long-term government support and the need for support will likely disappear when we can once again welcome international manuhiri with no self-isolation requirement.

“We are pressing Government to act with urgency on the removal of self-isolation as soon as possible,” Ms Johnson said.

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