INQUIRY INTO OPPORTUNITIES AND METHODS FOR STIMULATING THE TOURISM INDUSTRY IN NORTHERN – LIVINGSTONE SHIRE SUBMISSION

TERMS OF REFERENCE

The Joint Standing Committee on Northern Australia will inquire into and report on opportunities and methods for, and impediments and challenges to stimulating the tourism industry in Northern Australia including but not limited to:

1. Domestic and international tourism comprising: recreational, environmental, cultural, educational, and industrial tourism;

2. The role of peak bodies, local communities, and all levels of government in developing and promoting tourism opportunities nationally and internationally, including regulations and workforce issues that may inhibit tourism development; and

3. Communication and transport infrastructure (particularly air, sea, road and rail transport and port infrastructure) which may facilitate and grow tourism.

1. INTRODUCTION - REGION

The Capricorn Coast region encompasses Livingstone Shire in Central at the southern end of the . The Capricorn Coast is a region of lifestyle, diversity, sustainability, innovation and untapped opportunities. We are driven and future focused. We embrace the opportunity to determine our future. The Capricorn Coast region is a popular tourism destination supported by a thriving community full of potential and possibilities for future investment and business development.

The Capricorn Coast region offers an outstanding range of lifestyle and business opportunities that stem from:

• Vibrant beachfront, urban and village environments • A modern boat harbour • Fantastic wide beaches • Numerous islands including (popular for its clear blue water and white sand beaches) • Rainforest retreats and limestone caves • National parks and coastal headlands as well as walkways/bikeways • Multiple golf courses, vacation stays and other tourist attractions • A picturesque volcanic plug and mountain-backed rural environments • Hosting state and national sporting and major leisure events such as Triathlon, and CQUniversity Village Festival • Award-winning range of restaurants showcasing our delicious local produce • Superior fishing, crabbing, sailing, boating, and water based recreational opportunities.

In addition to these assets, the Capricorn Coast region has a strong agricultural sector comprising beef cattle, pineapples and a range of tropical fruits, including mangos, lychees, dragon fruit and macadamias. The district is renowned for Pure Gold pineapples, the popularity of which is growing rapidly on a national level.

The Capricorn Coast region is the only place in Australia able to grow pineapples all year round. The region is also home to one of Australia’s most important defence force training facilities at , where the Australian Defence Force (ADF) and other allies, such as the Singapore Armed Forces (SAF) and United States Military (US) conduct regular training exercises every year.

The foundation of the economy is local small business, including retail stores, tourism and accommodation providers, restaurants and cafes, engineering and various service businesses. Small businesses make up 99% of all businesses in the region.

Living and working in the region is affordable, with very competitive rent and purchase prices for land, housing, commercial and industrial uses. Notwithstanding how great the community is right now, there is enormous potential for additional growth in agriculture, tourism, education, health and wellbeing services, and technology and innovation industries. Livingstone Shire Council believes in the incredible potential of the Capricorn Coast region and is investing heavily, in partnership with the Queensland and Australian governments (over $100 million), in multiple strategic game changing projects that will lay the foundation for future sustainable growth.

A) ECONOMIC CONTEXT

Tourism remains the region’s largest employer (1,150 people); injecting $151 million into the local economy (in the year ended September 2017). In fact, Capricorn Coast’s tourism sector is more lucrative than Queensland’s. Case in point: Tourism contributed 10% to Capricorn Coast region versus 6% to the state’s economy (in the financial year 2015-16). While tourism is important to the local economy, other service sectors – including education and healthcare – are also vital and growing employment sectors. Small businesses (those with 20 or fewer employees) are the backbone of Capricorn Coast’s regional economy comprising 99% of the region’s 5,500-plus registered businesses (ABS 2016).

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B) TOURISM SPORT AND LEISURE – REGIONAL OVERVIEW - OPPORTUNITIES

Tourism is already an important part of the economy providing 8.2% of all jobs and directly contributing nearly 10% to the local economy. Some assets are underleveraged. Great Keppel Island in particular could support substantially more visitors with its proximity to the Capricorn Coast. Regular transport from Rosslyn Bay Harbour to Great Keppel Island and its surrounding islands provide visitors direct access to the Southern Great Barrier Reef for swimming, snorkelling and fishing as well as unique nature-based island adventures.

Opportunities for expansion in general include land based eco- and nature-based tourism, sports and business events (working with local schools and sporting organisations and professional conference organisers), agri tourism (particularly cattle stations and farm stays), rock climbing, beach and water sports and fishing. There is a rich array of attractions in and surrounding Yeppoon. Capitalising on these opportunities will foster longer stays and increased value-add from visitor spend. Actions required to achieve these goals include:

 Targeted industry product development training opportunities for tourism operators to build their capacity to attract and increase visitation to the Capricorn Coast region  Adding new tourism product and experiences including luxury accommodation convention/ conference event venues and other niche products such as health and wellness experiences, food tourism and Indigenous experiences  Increasing access to the Southern Great Barrier Reef, fishing, islands and other natural attractions  Expanding agri-tourism and eco-tourism experiences across the region  Improving the accessibility and legibility of attractions to the drive market, including grey nomads and backpackers  Improving the general appeal and attractiveness of the region’s communities and precincts through placemaking  Increasing the tourism profile of the Capricorn Coast region’s unique existing attractions such as Koorana Crocodile Farm, Capricorn Caves, Cooberrie Park, Great Keppel Island retreats, Byfield based B&B’s and retreats and via industry development and marketing programs  Development of locally distinctive events and better promoting existing events focused on business, sports, recreation, music, culture and celebrations.

The Great Keppel Island and Capricorn Resort redevelopment proposals remain incredible opportunities for future tourism growth. Investment in these iconic tourism resorts would create over 1,000 jobs locally and further promote the Capricorn Coast region as a destination of choice for both national and international visitors.

2. CAPRICORN COAST TOURISM PRIORITY REGIONAL OPPORTUNITIES

The closures of the Keppel Island Resort and Capricorn Resorts have had a major impact on the local economy. The redevelopment of one, or preferably both of these resorts will do much to bolster the local economy.

A) GREAT KEPPEL ISLAND

Great Keppel Island currently provides a variety of high quality, largely nature-based visitor experiences including fringing coral reefs and 17 pristine white sandy beaches. No other island in the Great Barrier Reef provides the same amenity. The quality of these natural assets and the island’s close proximity to the coast provides enormous scope for development of new tourism targeted infrastructure and experiences. The island is served by ferry services and a landing strip accommodating a variety of aircraft. Approvals are in place for a premier eco-luxury resort comprising 700 villas, 300 apartments, an 18-hole championship golf course, beachfront hotel comprising 250 5-star suites, day spa, restaurants, swimming pools and retail shops, a 250 berth marina with yacht club and ferry terminal and a commercial airstrip with potential for direct flights to , and Cairns.

The has committed $25 million towards the construction of water supply and electricity infrastructure to connect Great Keppel Island to mainland services. Council is working with the

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Queensland Government and Great Keppel Island tourism operators to deliver this major project to further facilitate and enhance the realisation of Great Keppel Island’s full development potential as an iconic tourism destination. Additional funding is being sought from the Regional Growth Fund.

B) CAPRICORN RESORT

Capricorn Resort is located approximately 10 km north of Yeppoon and encompasses 22,000 acres, including 20 km of beachfront, a 280-room resort and associated amenities such as a restaurant, golf courses and pools. The resort owners are currently preparing an environmental impact statement for a $600 million redevelopment of the site, to include a 300-room five-star resort, Wagyu cattle farm, residential community and village centre, airstrip and refurbishment of the existing 280-room resort. The closures of the Keppel Island Resort and Capricorn Resorts have had a major impact on the local economy. The redevelopment of one, or preferably both of these resorts will do much to bolster the local economy.

C) DEVELOPMENT OF NEW TOURISM PRODUCT

The region has a rich Indigenous and European history that can be much better leveraged to enhance our general tourism and business appeal through appropriate storytelling, interpretation and experiential engagement. Opportunities exist to develop unique new tourism products that provide memorable engagements with local Aboriginal culture, or a farm-stay experience at a crocodile farm or a working cattle station. These are opportunities both Australian and overseas visitors are looking for, however, often struggle to find.

D) ATTRACTING THE INTERNATIONAL MARKET

The domestic market is dominant for this area and has been for many years. As international visitors start to look for more authentic and adventurous products and places, the international market will continue to become an emerging visitor market for our region. The focus should be on high end international visitors especially those from Asia. Livingstone Shire Council has successfully completed a Sister City Friendship Agreement with Yangzhong and the Town Friendship agreement with Xinba, in China. Since entering into these agreements, Council has hosted delegations from China as potential investor show increasing interest in the region. Livingstone Shire Council was also involved in the Australian Government’s Singapore Business Mission in August 2017. Ongoing support and assistance from the Australian Trade and Investment Commission (Austrade) and Trade and Investment Queensland to assist with undertaking such mission is critically important.

E) IMPLEMENTATION OF CAPRICORN DESTINATION TOURISM PLAN 2014-2020

Tourism is both a major economic activity and lifestyle driver for the Capricorn Region. To help achieve the ’s 2020 target aspirations, the Capricorn Destination Tourism Plan (DTP), which is recognised by State Government, has been prepared to provide the definitive direction for tourism and events in the Capricorn region, highlighting the resources required to achieve the target and create a sustainable and competitive tourism and events destination (including in the areas of recreational, educational and cultural). All thirteen (13) Official Regional Tourism Organisations (RTOs) in Queensland have a Destination Tourism Plan. Ongoing funding support of Capricorn Enterprise enabling implementation of the DTP is critical.

F) INVESTING IN SINGAPORE ARMED FORCES AND UNITED STATES MILITARY EDUCATION TOUR PACKAGES PLANNED ACTIVITIES

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Investing in developing a Capricorn Coast regional experience/planned activities specifically tailored to the wants and needs of members of the Singapore Armed Forces and United States Military during their days off military training exercises. Ensuring those days are spent in region is fundamental to capitilising on the economic flow on benefits remain to the Capricorn Coast region, the home of Shoalwater Bay.

G) ENHANCING NATIONAL PARKS AS TOURISM DESTINATIONS

National Parks and other protected areas are one of the key nature-based tourism assets within the Capricorn Coast region. For the industry to thrive, Governments need to invest wisely and sustainably to protect and enhance the National Parks, and other protected areas’, values and potential. International visitation to National Parks increased by 15% in 2015. The continuing attraction of the natural environment and the quality of the visitor experience depend on destinations that are well managed and work in a collaborative manner. National Parks and other types of protected areas provide the setting for many nature-based experiences and are seen by the visiting public as the tourism destination. There needs to be a commitment to increased capital and recurrent budgets for parks agencies to develop and maintain high quality and innovative built tourism infrastructure.

3. INFRASTRUCTURE - ESSENTIAL UPGRADES

High quality infrastructure and ease of access are crucial to expanding the tourism industry driving growth in tourism opportunities and jobs. Tourism infrastructure development needs to be given equal value and importance to resource and agricultural sector infrastructure needs.

Australia’s export tourism industry is now more valuable to the national economy than coal or rural exports, and with international tourism spending growing at more than 10% a year the future looks amazing (ATEC, 2017). Tourism should be embedded in and represented in all infrastructure planning decisions.

Recommendation: It is essential the Australian Government continue to support and fund investment in tourism infrastructure development funds.

A) CONVENTION / MULTI-PURPOSE CENTRE

Currently the Capricorn Coast region has no facilities to host major conventions and trade shows. The development of a Convention Centre (1,000 person capacity) would significantly increase the region’s ability to attract business and leisure events to grow the tourism industry. The abundant local attractions provided by the Capricorn Coast constitute an enticing draw for event organisers seeking regional settings for major meetings, conventions, training workshops, trade shows and like events. Development with consistent supportive uses such as accommodation, a cinema, virtual reality experiences or a maker space would further enhance the diversity and appeal of the venue.

B) CAPRICORN COAST - DIRECT AIR LINK

Closure of the Airport during major flood events severely impacts the local economy, often shutting down air-based business activity for weeks at a time. More importantly, however, this projects a message of uncertainty for investors. Development of direct air links to the Capricorn Coast Region catering for regular passenger transport would address this “all too frequent” occurrence, and substantially bolster the local tourism sector, particularly the re-development of Capricorn Resort and Great Keppel Island.

Direct air links would increase the reach of the destination in a similar fashion to Hamilton Island and Lord Howe Island making it easy for interstate visitors to access the destination. Direct air links increases accessibility for local businesses for freight services, along with an all-weather airport access option for military

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training services. There is a considerable amount of existing airport infrastructure on the Capricorn Coast region that could be investigated further for future expansion to enable regular passenger transport services.

C) UPGRADE ROCKHAMPTON REGIONAL AIRPORT

Rockhampton regional airport is a key access point to the region and therefore the Capricorn Coast, which relies on this important regional infrastructure for dispersal of visitors.

The upgrade of Rockhampton Regional Airport to full international status will facilitate and grow tourism in the region. With dedicated facilities for international capability, including quarantine and customs facilities, the airport and surrounding areas such as Rockhampton and the Capricorn Coast will become the centre for international tourism in the region.

D) COASTAL TOURING ROUTE FOR VISITORS

A challenge for the Capricorn Coast region is that it does not lie along the major North-South highway (Bruce Highway) and as such, visitors must seek out the destination and drive between 40 km to 50 km to access it. If there was a major coastal touring route in parallel with the Bruce Highway, considerably more traffic would be generated, which would create a significant increase in visitors to the region.

4. CHALLENGES

A) CAPRICORN COAST REGIONAL IMPEDIMENTS

 No significant investment in tourism infrastructure has occurred in the Capricorn Coast Queensland region for more than 25 years, until recent investment in Yeppoon Foreshore.  Connections via air into Rockhampton to and from capital cities, (aside from Brisbane) on the eastern seaboard are not as regular or competitively priced as other major regions.  Lack of a convention/multi-purpose centre which has a significant impact on business tourism and corporate visitation to the region.  No internationally recognised brand named hotels are located in the Capricorn Coast region  Limited brand awareness in southern markets of the Capricorn Coast region as a leisure destination.  The region lacks a range of iconic commercialised tourism products, despite having world class natural attractions such as Great Keppel Island, the Great Barrier Reef, Byfield National Park and the Capricorn Caves  Limited tourism operators working with trade partners, both domestically and internationally, therefore reducing the region’s ability to amplify destination content into new markets.  The Yeppoon Town Centre lacks visual appeal to visitors due to the vacant shops and lack of diversity in retail offerings, shade, tired streetscapes and undeveloped garden offerings.  Red tape - the Tourism and Hospitality industry is overtly licensed by government regulation and industry speaks of the constant frustration of the time taken to provide the same information to different government authorities’ year in and year out.  Attempts at industry reform have not gained much support or traction ; this is a clearly complex however it is a national issue and needs to be addressed if Australia is to remain competative.

B) GENERAL CROSS-REGIONAL CHALLENGES

1. Regional areas outside of the major capital cities share general cross-regional challenges including but not limited to:

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 Limited and inconsistent funding for local and regional tourism management organisations  Limited availabilities of workforce and required skills in rural and remote areas  Tourism not seen as a career path  Lack of accurate and beneficial tourism data and analysis for Northern Australia.

2. Emergence of AirBnB - Capricorn Coast region is also seeing an increase in the AirBnB market, not having enough accommodation within the region during busy times has opened the door for AirBnB to flourish. This creates challenges moving forward as the accommodation operators who have gained the requisite local government permits and approvals to establish and operate their business question Council’s ability to manage the compliance surrounding this industry. Clarity is required on the extent local governments can and should regulate the variety of Airbnb services including however not limited to planning scheme requirements, rates impositions, levies, water charges and bin collection. It is yet to be determined the full effect the AirBnB market has had on the local tourism operates and if it benefits other industries such as retail and Cafés on the Capricorn Coast region. This issue is not peculiar to our region and there are documented examples of the increasing issue nationally and worldwide.

5. GOVERNMENT FUNDED OPPORTUNITIES

A) NORTHERN AUSTRALIA TOURISM INITIATIVE

The $13.6 million Northern Australia Tourism Initiative is one of a suite of new programs announced in response to the White Paper on Developing Northern Australia and extends the Entrepreneurs' Program and Australian Small Business Advisory Services Program to meet the needs of tourism businesses in northern Australia.

The Entrepreneurs' Program provides businesses with access to market and industry information and advice, and business management advice and skills. The Program connects participants to experienced Advisers and Facilitators, sourced from the private sector, who work directly with businesses to help them grow.

Services provided through the Entrepreneurs’ Program are: Tourism Partnerships, Business Evaluations, Growth Services and Supply Chain Facilitation. Each of these services is designed to build differing aspects of management capability in business, and provides each with a tailored plan to embed change and generate sustainable growth. When the business is ready to implement the recommended improvements, the Adviser will help to identify areas of priority and coach and mentor the business over a 12 month period. This valuable step accelerates the change process and advances growth opportunities.

Subsequent to the delivery of a service, the business can also apply for a Business Growth Grant to offset costs for engaging external expertise to implement improvements identified by the Business Adviser.

Through the White Paper on Developing Northern Australia, the financial threshold for businesses in northern Australia to access the Entrepreneurs’ Programme was halved from $1.5m to $750,000. Research indicated that approximately 100 tourism businesses each year would be able to access the Programme without further reducing this threshold, and those that did not meet the criteria would be suitable to receive advisory services under ASBAS.

Recommendation: That the threshold of this program be reduced to around $250,000 to $300,000 financial threshold to provide opportunities for smaller regional tourism businesses to access the program’s advantages.

The Australian Small Business Advisory Services Program Northern Australia Tourism Initiative (ASBAS NATI) has improved the capacity of established, not-for-profit small business advisory service providers to deliver

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low cost small business advisory services to tourism small businesses and tourism small business intenders in northern Australia, whose products and/or services are or will be used by tourists.

Low cost business advisory services can be accessed in the following areas:

1. Funding avenues and financial analysis

2. Building your business

3. Making the most of your talent and team

4. Management capabilities

5. Digital engagement implementation

6. Tourism readiness

Recommendation: Advertise this resource/facility more widely many tourism-based businesses have not heard of this program.

B) REWARDING HIGH-PERFORMING TOUR OPERATORS THROUGH PREFERENTIAL TREATMENT

The Capricorn Coast region needs to promote itself by putting its best foot forward. The tourism campaigns promote Capricorn Coast region and the Southern Great Barrier Reef as a premium quality destination so encouraging tour operators to function at the best of their ability, adopt best practice behaviours and constantly seek to improve their business is an obvious strategy. Tour Operators who voluntarily commit to Government and Industry driven programs that encourage these behaviours should be encouraged and rewarded.

Recommendation: Implementing a meaningful reward and recognition program would have a huge impact on tour operator behaviour, and ultimately the performance of the region

C) TOURISM PRODUCT INFRASTRUCTURE DEVELOPMENT VIA $ FOR $ GRANTS

The abolition of the T-QUAL (T-QUAL Tourism Quality Projects Grants up to $100,000 per grant, T-QUAL Strategic Tourism Investment Grants up to $1 Million per grant) and TIRF (Tourism Industry Regional Development Fund up to $250,000 per grant) Grants at a Federal level destroyed incredibly successful programs and opportunities to grow tourism in regional Australia. Local tourism organisations that benefited greatly in the past from this grant were the Capricorn Caves and Henderson Park Retreat.

Recommendation: Re-institution of a Tourism Infrastructure Product Development $ for $ Grant for small to medium enterprises (SMEs) to access dollar for dollar grants from the Australian Government for product development for up to $1 Million per grant. This form of grant assistance is charitable donation but rather an investment in the growth and development of businesses, allowing businesses to go from strength-to- strength with the development of additional facilities. Lending from banking institutions for tourism expansion, particularly in regional Australia is widely known to be futile exercise

D) REVIEW OF NORTHERN AUSTRALIA INFRASTRUCTURE FACILITY (NAIF)

There is an opportunity to expand the current Northern Australia Infrastructure Facility to include grant opportunities for small- to medium-sized tourism businesses. This fund is already proving to be too restrictive for any development, let alone tourism development.

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The current mandatory requirements of $50 Million (albeit having NAIF Board discretion to review for loan applications made for less than that), with 50% debt as opposed to equity is a non-realistic expectation for the broader tourism industry.

For the tourism industry to prosper, amounts of tens and hundreds of thousands of dollars are more realistic, as opposed to millions. The majority of tourism businesses are small to medium enterprises (SMEs), so a dollar for dollar grant opportunity is much more realistic.

Recommendation: The NAIF fund could allocate $20 Million per annum for a Tourism Infrastructure Product Development Fund in Northern Australia to businesses employing up to, 50 FTE’s. This should be a dollar for dollar grant, not a concessional loan that would expedite major tourism infrastructure product development.

Livingstone Shire Council thanks the Joint Standing Committee on Northern Australia for accepting and considering this submission and looks forward to hearing the outcomes and opportunities identified through this process that will remove impediments, attract investment and drive sustainable growth for the tourism industry in Northern Australia.

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