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Predicted tourism boom could push New Zealand’s infrastructure to breaking point

Predicted tourism boom could push New Zealand’s infrastructure to breaking point
May 10, 2018

Local Government New Zealand (LGNZ) President Dave Cull says that a new forecast predicting an international visitor increase of 37% to 5.1 million annually by 2024 will be a great boost to regional economies across New Zealand but fears that infrastructure will be stretched.

Figures released this week by New Zealand’s Ministry of Business, Innovation and Employment shows a big uplift in tourist numbers and spending, with total international visitor spend expected to reach $14.8 billion in 2024, up 40% from 2017.

Explaining that a new funding division needs to be achieved between tourists and local ratepayers, Cull advises “the tourism sector is predicted to grow rapidly over the next two years, but as evidenced last summer infrastructure it is extremely stretched in many regions, with provision of public toilets, car parks and basic potable and waste water infrastructure coming at a substantial cost to communities.

“Those communities with scale can share the burden across many rate payers, but smaller ratepaying bases are picking up big bills to accommodate visitor demand and the lack of infrastructure is resulting in tension among communities.”

Cull contends that the increase in international visitor spend should be harnessed to provide tourism infrastructure, commenting “this is about fairness. It’s not right to burden ratepayers with subsiding the entire cost of infrastructure which is used by tourists, and there needs to be a new mechanism for tourism to support itself.”

LGNZ has welcomed the Government’s efforts to provide supporting funding for councils through the Tourism Infrastructure Fund launched in 2017. The initial investment of $14,222,594 for round one to fund 34 applications has helped, but it falls well short of what will be needed in the future to prepare for this influx.

This funding mechanism is a grants funding scheme administered by a government department which has limitations in its ability to effectively resolve the funding gap that is ever widening, particularly in supporting ongoing maintenance of infrastructure.

LGNZ is advocating strongly to Government on councils’ behalf that the Government introduce a Local Tourist Tax to raise the necessary funding to meet the capital and operating costs associated with tourism mix-used infrastructure future demand, thus alleviating the financial burden on local ratepayers.

Without the necessary funding tools to ensure the needs of both locals and tourists are met, New Zealand faces the prospect of over promising and under delivering in a sector that is so critical to our economic future.

However, Cull concludes “New Zealand should be known as a high-quality tourist destination with fit-for-purpose facilities to handle the expected increase in numbers and a country that welcomes and embraces their visit.”

Images: Wild camping at Lake Wanaka (top) and Milford Sound (below).

23rd March 2018 - WTTC SAYS ONE IN FIVE OF ALL NEW JOBS CREATED GLOBALLY IN 2017 ARE ATTRIBUTABLE TO TOURISM

20th February 2018 - REGIONAL TOURISM NEW ZEALAND CALLS FOR COUNCILS TO BACK TOURISM

31st January 2018 - CONFIDENCE STRONG AMONG NEW ZEALAND TOURISM BUSINESSES 

15th December 2017 - COUNCILS TO BENEFIT FROM NEW TOURISM INFRASTRUCTURE FUNDING

14th December 2017 - TOURISM MAKES MAJOR CONTRIBUTION TO NEW ZEALAND ECONOMY

4th December 2017 - REGIONAL TOURISM CALLS FOR NATIONAL DEBATE ON PLANNED TOURISM TAX

6th September 2017 - TOURISM TAX ON THE AGENDA IN NEW ZEALAND ELECTION 

21st August 2017 - INTERNATIONAL VISITORS TO NEW ZEALAND SPEND $10.3 BILLION IN YEAR TO JUNE 2017

13th June 2017 - NEW ZEALAND GOVERNMENT COMMITS $5.2 MILLION FOR 28 NEW TOURISM INFRASTRUCTURE PROJECTS 

12th May 2017 - DEPARTMENT OF CONSERVATION TO RAISE CHARGES FOR OVERSEAS VISITORS WALKING NEW ZEALAND’S TRAILS 

14th March 2017 - SURVEY REVEALS DEPTH OF NEW ZEALAND TOURISM INFRASTRUCTURE NEEDS 

11th October 2013 - LOCAL GOVERNMENT NEW ZEALAND WELCOMES PLAN FOR NEW ZEALAND TOURISM

26th July 2012 - TOURISM MUST BE A CORE FUNCTION OF COUNCIL’S ECONOMIC DEVELOPMENT ROLE 


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