Tag Archives: Economic Development

Portobello has been a popular visitor area for 120 years

A Quiet Corner of the World

A Leopard Seal on a Peninsula Beach has come from Antarctica to enjoy the sun. International visitors of any kind have been rare on the Otago Peninsula since March 2020.

Its been noticeably quiet on the Otago Peninsula  with the latest Covid-19 related lockdown and our progression into level two.  As we move into spring and the days get longer the Peninsula begins awakening and preparing for summer. Both people and animals begin to shrug off the last vestiges of winter as the lawnmower gets dusted off and birds begin their frantic nest building in garages and trees around our community.

However, one thing that has not been awakened has been the visitor and tourism sector. Since our first lockdown in March 2020  and our second in August 2021 our local tourism industry has been under significant pressure. In 2019, New Zealand’s tourism industry generated $40.9 billion NZD in revenue (nearly 10% to New Zealand’s GDP) and creating nearly 400,000 jobs. This equates to 14.4% of all employment in New Zealand  working in a tourism related job (Stats NZ 2019). The Otago Peninsula’s reliance on international visitors is demonstrated by research that conservatively suggests that wildlife alone on the Otago Peninsula generates $100 million NZD annually and creates 800-1000 full-time equivalent jobs in the Dunedin area. With a record drop of 12.2% in GDP the contribution of tourism to the national economy has been keenly felt. The hours worked in the tourism industry has declined from 12%-59% across New Zealand.  This has been particularly high in Otago with a 32% decline in hours worked (Stats NZ 2020).

The 1980’s campaign to see more of New Zealand was developed to encourage domestic tourism. In the post Covid-19 climate domestic tourism would need to increase 72% to deal with the loss of international visitors.

After the eventual return to level one in 2020 there was a significant effort to encourage New Zealanders to travel and use local tourist services as domestic travellers. There was certainly some return on that campaign, but economically domestic tourism would need to increase by 72% to completely fill the void left by international tourism. (NZ Tourism, November 2020). Around 60% in tourism-related expenditure is either directly or indirectly generated by domestic tourism. Nationally, only in Auckland and Otago (including the Peninsula) does the international tourism expenditure outstrip domestic travellers. (ASB)

After the 2020 lockdown there was discussion about needing to “reset’ tourism in the wake of the closure of our borders. Certainly, its been a time to contemplate change, but just how much change remains debatable. Until we can open international borders safely and ensure that visitors and the local populace are vaccinated we remain very much in limbo. With the Australian response to the virus so varied and inconsistent it seems doubtful we’ll see one of our major markets open up to the industry for some time. I hope I’m wrong, because Covid-19 has been particularly tough on the visitor sector on the Otago Peninsula. Not too mention the prolonged Level 4 status of Auckland in 2021 which has not made the current conditions any easier. Finding solutions to this issue is not simple and finding the balance between opening up New Zealand’s borders and containing the spread of this deadly virus is a difficult one to navigate. Presently, all we can do is support those local businesses in our area by shopping local, supporting their events and recommending to all in sundry what they have to offer. Next time you meet someone who works in the tourism sector give them a smile and thank them for boxing on in very trying times.

 

Dunedin-the Affordable City?

One of the main themes of the Dunedin City Council Economic Development Strategy has been the notion that Dunedin is an affordable city. That’s an admirable idea and one that every person would naturally support. However, when looking at the annual fees and charges that the City Council ask citizens pay for services it becomes clear that our affordability is rapidly being eroded away. These types of costs hurt our community and our economy.

What’s new you might ask? Well when you compare the increases in City Council fees and charges over the last 3-5 years they’re generally higher than the current rate of inflation. Remember that inflation is a sustained increase in the general level of prices for goods and services. It is measured as an annual percentage increase. As inflation rises, every dollar you own buys a smaller percentage of a good or service. It means that you see a decline of the purchasing power of you money. This is particularly relevant to people on medium to low incomes who through that loss of purchasing power see a decline in their standard of living.

Several areas of the Council’s fees and charges are very concerning given that the New Zealand economy has been in a period of low inflation for several years and has dropped to 0.4% this year. Some examples of increases in fees and charges being considerably greater than the rate of inflation are;

  • Burial and cremation fees have risen by 18% in the last 5 years
  • Charges to sports clubs for sports fields have risen 13.4% in 5 years, 7.5% in the last 3 years.
  • A 3.25% increase in dog registration fees every year in the last 5 years.
  • The permit for building a deck in your  house has risen 27.5% in 4 years.

Some increases may be attributable to changes in government policy and legislation but in the light of the annual 3% increase in rates heralded by the City Council each year it appears fees and charges are subsidising those capped increases. These increases in the everyday aspects of peoples lives in Dunedin is hurting our community in a wide variety of areas. Its time that we had a more transparent look at the just how affordable our city really is in lieu of these costs for everyday things in our community.

The NZ Rate of Inflation

The NZ Rate of Inflation