Government Assistance to Tourism

The tourism industry receives a diverse range of government assistance totalling around $1 billion, according to a new Productivity Commission study, Assistance to Tourism: Exploratory Estimates.

Measures such as destination marketing and support for high-profile cultural or sporting events seek to attract tourists to various locations within Australia. Similarly, a proportion of government funding for art galleries, national parks and transport also assists tourism. On the other hand, tariffs on imported items inflate the industry’s costs.

Estimates compiled by the Commission suggest that the Australian Government provided budgetary assistance to tourism of around $230-260 million per annum, on average, over the three years to 2002-03. Net of tariffs, Australian Government assistance to tourism averaged around $150 million per year.

As a share of its output, tourism receives a lower rate of Australian Government assistance than the average for the manufacturing and primary sectors, although more than is afforded to a number of other industries in the services sector.

The study indicates that most assistance to tourism has been provided by the States and Territories, averaging some $780-960 million per annum between 2000-01 and 2002-03.

The Commission notes that this study is the first comprehensive attempt to quantify the extent of assistance to tourism on a comparable basis to that for other industries. Conceptual and informational limitations mean that the estimates should be considered ‘exploratory’ and interpreted with care.