The Federal Government’s decision to shrink Tourism Australia’s (TA) funding in 2026-27 Budget will hamper tourism recovery, according to the Australian Tourism Export Council (ATEC).
More than $50 million has been stripped from TA’s cash pool over the next four years, on top of a $10 increase to the Passenger Movement Charge – decisions that are poorly timed, considering inbound visitor momentum is dropping, ATEC has asserted.
“This Budget reduces support for an industry that is still stabilising post the pandemic, and facing growing pressure around traveller affordability, aviation costs and booking conversion as a result of the Middle East conflict,” ATEC managing director Peter Shelley said.
“Reduced Tourism Australia funding risks Australia’s ability to convert travellers in an increasingly cautious and price-sensitive long-haul travel environment,” he added.
Tourism expert and academic David Beirman expressed a similar view, telling travelBulletin that the budget cut is “a retrograde step and reduces the marketing competitiveness of Australia in the Asia-Pacific region”.
He also pointed out that the PMC hike “contributes to Australia’s image as an uncompetitive destination, especially for tourists coming from Asia”.
The funding slash will also have a knock-on effect for the cruise sector, with Australian Cruise Association chief executive officer Jill Abel pointing out that the organisation works closely with TA to build and convert demand for cruise into bookings.
Despite the cuts, business events will remain a core focus for TA, with the organisation targeting expenditure of between $3.9 billion and $4.2 billion for 2026-27.
It will continue to target incentive and association decision-makers in priority markets such as New Zealand, China, North America, the United Kingdom, and South Asia, as detailed in its entity resources and planned performance document.
Strategic activities to grow business events will include trade functions, consumer research to understand the needs of decision-makers, and familiarisation programs for buyers and agents.
Tourism Australia will also continue to invest in marketing activities, such as brand advertising, content, and PR.
The organisation saw a high return on investment and high stakeholder satisfaction in business events over the past year, particularly through the BE Bid Fund Program, which delivered a 50-1 return on investment and event satisfaction of 98%.
However, TA cautioned that global uncertainties such as the Iran war had the potential to hamper growth.
