Debates Day 3 - Thursday 19 November 2015
Parliamentary Record 24
Debates for 12th Assembly 2012 - 2016; ParliamentNT; Parliamentary Record; 12th Assembly 2012 - 2016
2015-11-19
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DEBATES Thursday 19 November 2015 7428 stay for the youth market was down to 14 nights from 21 nights. A job placement business says its backpacker membership is down 40% on last years figures. Inquiries for work in the hospitality industry are down 70% at one popular CBD hotel. In previous years it was not uncommon for that business to get 15 to 20 applicants a day, but they are now lucky to see a handful each week. Another business is reporting that working holidaymakers are asking to be paid in cash. Another is saying that there is a big drop in the traditional markets of UK and Ireland, along with the French and Italians. Many backpackers left the Top End earlier this year. In Alice Springs a reduction in backpacker numbers has also led to the closure of a number of backpacker establishments, including the longrunning Toddys Backpackers earlier this year. It is not all doom and gloom for the tourism industry. The tourism industry is up, but the drop in backpackers numbers is a concern. There are, of course, a range of reasons for this. I will focus on one area of greatest common agreement amongst key industry players. Many are laying a lot of the blame on federal government fees and upcoming changes to income tax and residency rules for working holidaymakers. According to the federal budget papers, the changes are set to net Canberra an extra $540m in revenue over the forward estimates. I am the last person to begrudge a government seeking extra revenue to repay inherited Labor debt, but this may be a short-sighted way of achieving that goal and may result in a net loss. In fact, some 2015-16 federal government initiatives appear at odds with the white paper initiatives that are focused on the development of northern Australia. Of course, there are also other issues at play here such as airfares, Airbnb and improving economic conditions in source countries such as Ireland, to name a few. But fees, taxes and visas seem to be a consistent and concerning theme at the moment with the latest figures showing 10% fewer working holidaymaker visa holders in Australia, compared with the same time last year. This is not just about the Territory. Australia is currently around three times the price of Canada for a working holidaymaker visa. Australia charges $440, while the fee in Canada is $150. Canada also has other advantages over Australia. In Canada the age criteria for a working holidaymaker visa is 18 to 35 years, which is five years more than Australia. Further, in Canada under the working holidaymaker visa, you are eligible to work and holiday for up to 24 months one application, one cost. Under Australian conditions it is 12 months and then you need to apply for a second visa and meet eligibility criteria, that is, have worked 88 days in a specified industry in a specified job in a specified location. This means two applications, two lots of costs and a range of criteria. I suggest a cost increase in the working holidaymaker fee has definitely had an impact on Australias competitive position as a destination of choice for working holidaymakers. It is outstanding that while competitor destinations such as Canada are reducing the cost of working holidaymaker visa fees, Australia is increasing the cost to come here under the guise of cost recovery. It is a false economy by the federal government. Additionally, the impact of the changes to the taxfree threshold for working holidaymaker visa holders from the 1 July 2016 will further erode Australias competitive position for working holidaymakers. Local industry feedback all over the place suggests paying 32.5% tax from the first dollar earned instead of having the $18 000 taxfree threshold will create a disincentive for working holiday visitors coming to the Territory, which our tourism and hospitality industries have come to rely on as a source of essential seasonal labour supply. This tax change message, even though it does not start until July next year, appears to be already out on the backpacker social media channels and is not helping. Working holidaymakers are entitled to a refund of the superannuation contributions paid by their employer when they leave the country. However, the refund is now subject to a tax deduction of 35%. Another example I heard recently related to methods being used by the Department of Immigration and Border Protection when monitoring sponsored overseas workers in the hospitality sector. Their recent random inspections have led to the prohibition of many industry players being able to engage in the employment of working holidaymakers, simply because a hospitality manager happened to pick up some plates off a table at the end of a shift. Now they are being banned because they are not allowed to pick up plates as working holidaymakers. It is completely outrageous. However, whilst this example is causing great concern, I have asked the Minister for Business, Mr Peter Styles, to write to federal Immigration minister Peter Dutton, placing the significant concerns of the NT government on the record and demanding there be changes to the way policy is being implemented, monitored and measured, as well as the other policy parameters.