Budget 2022: what it means for Australia’s hospitality and tourism sectors

Australia’s 2022-23 federal budget, presented by Treasurer Josh Frydenberg on Tuesday, offers little targeted support for businesses in the hospitality and travel sector, but investment in training programs and efforts to reduce the cost life of Australians give some hope.

“The budget will help the economy, people and households and is a good step forward,” said Sarah Derry, CEO of Accor Pacific. SM.

“We urge the government to do more for our cities to help them return to prosperity and support the skills shortage.”

Tourism Accommodation Australia (TAA) chief executive Michael Johnson was optimistic about the knock-on effect this year’s budget could have on the industry, but shared his frustrations over areas that have been overlooked.

“We were hoping we would also see a reduction in excise duty on beer – we didn’t see which is disappointing,” Johnson said. SM.

“We were also hoping for support from FBT in the areas of food, beverage and accommodation, and that didn’t materialize either. From that point of view, it was a little frustrating.

International workers

The budget allowed for an additional 11,000 Working Holiday Maker visas, which is good news for the accommodation industry.

Accommodation Association of Australia (AAoA) chair Leanne Harwood welcomed the move.

“Our industry is more than most grappling with the loss of skills and people at all levels,” Harwood said.

“As the Accommodation Association continues to invest in developing our own strategies to attract, retrain and retain people, we welcome the increase of 11,000 places in the national caps for work and holiday visas. Working holidaymakers make up a significant portion of our workforce, filling 250,000 jobs before the impact of COVID.

The AAoA and TAA agreed they were disappointed that the Working Holiday Maker visa refund program, which is due to end on April 19, is not being extended.

“[TAA has been] calling for an extension of the working holiday and international student incentives put in place this year to make Australia a more attractive destination,” Johnson said.

“We are still working with the government on this and hopefully we will be successful.”

Hilton APAC Vice President and Head of Australasia Paul Hutton echoed the need for increased government action on labor shortages.

“Our team members are at the heart of everything we do, and workforce availability is the biggest challenge facing our industry right now,” Hutton said.

“The industry as a whole has been impacted by the pandemic and retaining and rehiring strong talent is absolutely critical to our recovery.

“While the relaxation of work visa laws is welcome, we need to see investment in our industry and encourage the Australian Federal Government to do all they can to fast-track visas for hospitality professionals. , international students and backpackers.”

The lack of international workers in Australia since the borders closed in 2020 has driven the unemployment rate down to 4.4% and it is expected to fall further in the coming months.

Skill Boost

In an effort to address the country’s crippling skills shortage, the budget included an additional $365.3 million for the creation of an additional 35,000 apprentices and interns – an extension of the Boosting Apprenticeship Commencement wage subsidy.

Johnson said that will be essential to surviving the labor crisis.

“I think the increased focus on skills [in this budget] will help us. There is a lot of indirect aid that will go to the industry,” he said.

Frydenberg also announced $1.6 billion in tax relief to help companies with annual revenue of less than $50 million go digital and upskill their employees.

“[AAoA is] We are currently working out the details of various small business incentives, including the ability to instantly cancel assets which is in place until June 30, 2023, as well as the ability for businesses with lower annual turnover $50 million to benefit from a range of initiatives under the Digital and Skills Tax Boost package,” Harwood said.

The $146.5 million budget allocated to tourism includes the previously announced $75.5 million for travel agents and tour operators and $60 million for marketing to bring international tourists back, while $6.8 million will go towards the government’s Thrive 2030 strategy, which was launched on Friday.

Johnson pointed to additional funding for Tourism Australia as a major win.

“It’s essential and something that was in our pre-budget requests,” he said. “They need this extra funding in such a competitive international arena. It has certainly been positive.

Harwood hailed the moves saying they “will help Australia stand out”.

“The challenges facing our hotels, motels and accommodation providers aren’t going away anytime soon, and the sooner we see tourism normalize, the better,” she said.

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