Overview
4.1
Many towns across Northern Australia are primarily accessed by tourists via road. The progressive sealing and upgrading of roads throughout Northern Australia can make drive journeys safer for tourists, enable the tourist season to be lengthened in areas that would otherwise be inaccessible due to roads being washed out, and improve visitor access to remote Aboriginal and Torres Strait Islander communities. At the same time, maintaining and promoting some unsealed drive routes could boost the adventure tourism market.
4.2
While road infrastructure becomes critical once tourists arrive in Northern Australia, the majority of international and a large proportion of domestic tourists will reach Northern Australia by plane. Many regional airports in the north are not equipped to receive international flights, which may impact their ability to attract international tourists. On the other hand, upgrading an airport to international status comes at a considerable cost which may be passed on to passengers.
4.3
Developing new air routes from the southern states to the north, from key international airports, and between northern destinations could help to increase the number of visitors to Northern Australia. Reducing the cost of airfares could also stimulate tourism, which could be achieved by introducing low cost carriers, reducing the Passenger Movement Charge and changing cabotage restrictions.
4.4
Tourists may also arrive in Northern Australia via cruise ship. The cruise ship industry generates millions of dollars in tourist expenditure in Northern Australia. Coastal destinations across the north are looking to capitalise on this opportunity, but require upgrades to port facilities to accommodate large cruise vessels.
4.5
While train travel is utilised less widely in Northern Australia than roads, flights and cruise ships, travel via rail can be a unique and unforgettable tourist experience as well as a means of transport. Improving the affordability and accessibility of rail services could expand the appeal of this tourist experience.
Infrastructure Funding
Northern Australia Infrastructure Facility
4.6
The Australian Government’s flagship infrastructure program for Northern Australia is the $5 billion Northern Australia Infrastructure Facility (NAIF). The NAIF, which opened on 1 July 2016:
… offers finance on concessional terms to encourage and complement private sector investment in economic infrastructure in Northern Australia that otherwise would not be built, or would not be built for some time.
4.7
The NAIF is open to all industries, including tourism, and examples of eligible infrastructure include ‘roads, railways, communications, airport infrastructure and seaport infrastructure such as ports and marinas.’
4.8
A number of submissions recommended expanding the NAIF to include funding opportunities for the tourism sector, particularly for smaller tourism businesses. Capricorn Enterprise suggested that dollar-for-dollar grants in the tens and hundreds of thousands may be more appropriate than the millions on offer under the NAIF. The Australian Conservation Foundation similarly recommended the Australian Government ‘revise the investment mandate of [the] NAIF and restructure the facility to enable a stronger focus and more accessible scale in support of regional and remote tourism’.
4.9
The Queensland (Qld) Government encouraged the Australian Government to ‘consider broadening the scope of the NAIF to include tourism-related infrastructure, or common use infrastructure associated with hotel and resort developments.’
4.10
The Northern Territory Department of Tourism and Culture (NT DTC) recommended the Australian Government:
‘provide new funding for access infrastructure in Northern Australia particularly for projects which are not eligible for NAIF funding; [and]
set specific eligibility, selection and assessment criteria for existing funding programs that meet the north Australian context, such as providing funding for project feasibilities.’
4.11
North Qld Airports recommended any remaining NAIF funds be used to attract international airlines to establish direct routes to Northern Australia. North Qld Airports further explained that also using NAIF funding to establish export-building projects and to attract major international events will help ensure any new international flights remain viable.
4.12
The Office of Northern Australia advised that the Indian Ocean Territories are ineligible for NAIF funding, as the NAIF legislation only pertains to mainland Australia and ten nautical miles out to sea. The Office of Northern Australia advised that amending the NAIF legislation to include the Indian Ocean Territories ‘would be helpful.’
4.13
In April 2018 the Minister for Resources and Northern Australia, Senator the Hon Matthew Canavan, announced changes to the NAIF’s investment mandate and eligibility criteria. These changes included: removing the non‑mandatory criteria that a project had to be worth a minimum of $50 million, and ‘allowing the NAIF to lend up to 100 per cent of the debt, for appropriate projects, which removes the 50 per cent cap on NAIF debt financing.’ The Office of Northern Australia added that social infrastructure is now included in ‘the scope of what is economic infrastructure’, which is a ‘good step forward.’ These changes were welcomed by the Capricorn Enterprise, which stated that it had been lobbying for change. The Office of Northern Australia also welcomed the changes and stated that they ‘open up the opportunities for the tourism sector.’
4.14
The Office of Northern Australia further advised that it was working with other departments to ensure businesses that may now be eligible for NAIF funding as a result of these changes are aware of them.
Other Federal Infrastructure Funding
4.15
Federal programs which fund infrastructure include:
Roads Funding: the Government has committed $600 million to the Northern Australia Roads Programme and $100 million to the Northern Australia Beef Roads Programme.
National Stronger Regions Fund (NSRF): while there will be no further funding rounds under the NSRF, there are ten projects receiving over $55 million in funding which have a ‘strong tourism outcome.’
Building Better Regions Fund (BBRF): following the closure of the NSRF, the Australian Government established the BBRF which focuses on projects in regional areas. In the 2018-19 Federal Budget, $206.5 million was committed over four years to round three of the BBRF, which included $45 million to ‘improve tourism-related infrastructure’. The Government stated that this increased total funding under the BBRF to $641.6 million.
Regional Jobs and Investment Packages: funding packages in Northern Australia include the Cairns Jobs and Investment Package ($20 million) and the Bowen Basin Jobs and Investment Package ($30 million).
Community Development Grants: there are six projects with a ‘strong tourism outcome’ in Northern Australia receiving almost $9 million in funding under this program.
Regional Growth Fund: this fund provides ‘grants of $10 million or more for major transformational projects which support long-term economic growth and create jobs in regions undergoing structural adjustment’. Applications for the Regional Growth Fund closed in April 2018, and the Livingstone Shire Council stated it had applied for funding in relation to the development of Great Keppel Island.
Travel by Road
Funding of Roads for Tourism
4.16
The Department of Infrastructure, Regional Development and Cities (DIRDC) stated that 38 projects were announced under the Northern Australia Roads Programme and Northern Australia Beef Roads Programme in 2016. Road funding for projects which have flow on benefits for tourism are:
over $88 million for four projects on the Great Northern Highway, Western Australia (WA);
approximately $62 million to upgrade the Adelaide River Floodplain on the Arnhem Highway, Northern Territory (NT); and
almost $60 million for works on the Capricorn Highway, Qld.
4.17
The Qld Government stated that Qld roads have received $350 million of state and federal funding under the Northern Australia Roads Programme and the Northern Australia Beef Roads Programme. The Qld Government further advised that a number of other road projects which have not attracted federal funding ‘remain priorities that would provide significant benefit to tourism in Northern Australia if funded.’
4.18
A project funded jointly by the WA and Federal governments under the Northern Australia Roads Programme is the sealing of the Cape Leveque Road. Tourism WA advised that the sealing of this road may create tourism opportunities for Aboriginal communities on the Dampier Peninsula. This is explored further in Box 4.2.
4.19
The NT DTC welcomed federal funding provided for roads in the NT, but called for ongoing support to ensure the roads are maintained. The NT DTC stated that:
Funding provided in the Northern Australia Roads Package will make a real difference to critical routes to some tourism sites. However a mechanism is now needed to deliver annual funding for maintenance, staged upgrades and new road projects to deliver a reliable road network that supports sustainable year-round tourism businesses.
4.20
The Federal and Qld Governments are also providing $260.5 million (on an 80:20 basis) to fund the Cape York Region Package. The Cape York Region Package funds the sealing of roads to Cape York, which will improve access to Aboriginal and Torres Strait Islander communities and create business development opportunities.
4.21
The Australian Government is also providing $330 million to upgrade ‘key sections of the Outback Way’, which links Laverton, WA to Winton, Qld, via Alice Springs, NT. This will be delivered in partnership with state and territory governments and relative local councils.
Road Funding Opportunities
4.22
Road travel was described as ‘critical’ to tourism in the north. Despite this, the Shire of Halls Creek advised that it can be challenging to attract road infrastructure funding based solely on tourism factors, especially in remote areas. The Shire of Halls Creek further stated that ‘a number of roads which have the potential to increase tourism travel cross over state boundaries’, meaning federal, state, territory and/or local governments have to be in agreement for upgrading to commence.
4.23
The Northern Regional Development Australia Alliance (Northern RDA Alliance) recommended that the Australian Government develop a tourism roads program, which could be based on the current Northern Australia Beef Roads Programme. The Northern RDA Alliance stated that it would:
… highly recommend consideration of developing a beef roads equivalent for the tourism industry—a tourism roads program. Rural and regional tourism relies heavily on drive tourism, with tourists either driving into the region or flying and then hiring a car … [grey nomads] are certainly a very significant part of the drive tourism market in the north and provide significant opportunities for further growth.
Box 4.1: Inland Queensland Roads Action Plan
In 2016, 33 local governments, eight regional road groups and five RDA committees from across Qld developed the Inland Queensland Roads Action Plan (IQ-RAP). IQ-RAP was described as ‘a well-researched, evidence-based planning tool to inform future road network planning, programming and investment.’
IQ-RAP reviewed 16 000 kilometres of inland roads in Qld and identified that 3000 kilometres of roads and 300 bridges required upgrading. IQ‑RAP then outlined the investment priorities and a plan for staged upgrades over an 18 year period.
The IQ-RAP Working Group advised that ‘since the IQ-RAP was launched, nearly $300 million has been committed to Northern Australia roads within IQ-RAP through the Northern Australia Roads and Beef Roads Programmes’ while ‘approximately $530 million has been committed through the Queensland Transport and Roads Investment Program.’
The IQ-RAP is currently seeking $2 million in funding to ‘undertake wider economic and social benefit analysis to inform future programs and investment’ over two years. Part of this analysis would consider the impact of an improved road network on drive tourism opportunities for inland Qld.
Tourism and Roads
Improving Access and Safety for Tourists
4.24
Tourism Tropical North Qld (TTNQ) explained that the sealing of roads in Northern Australia would allow greater access for visitors and stated that:
Increased investment in roads would make more destinations and entire sub‑routes available for more vehicles for more of the year. In every instance the sealing of roads in Northern Australia has increased visitation as caravans and two‑wheel drive vehicles bring new market segments. Road investment adds more confidence to advance holiday planning as well as supporting all other industries and community functions.
4.25
The TTNQ further explained that sealing of roads encourages dispersal of tourists, which ‘improves the yield for the region’, as more places benefit from tourist visits. Tourism Top End identified the sealing of roads as a high priority for the NT, where only 25 per cent of roads are bitumen.
4.26
Creating fully sealed circuit routes that link a number of tourist sites could create new business opportunities for tour companies and tourism ventures along the route, increase visitation to destinations along a route and encourage visitors to extend their stay.
4.27
Improved road surfaces can also help ensure the safety of residents and visitors. The Shire of Halls Creek stated that ‘unsealed roads are perceived to be, and are in fact, a significant risk to vehicles and personal safety.’ The Northern RDA Alliance also highlighted a need for the addition of passing lanes on high traffic roads, particularly those with road trains.
4.28
The Northern RDA Alliance advised that most hire vehicle insurance companies do not allow for driving on dirt roads. Sealing roads could therefore enable tourists with hire cars to reach more destinations.
Extending the Tourist Season
4.29
Rainfall and seasonality can impede road access to tourist sites. The Office of Northern Australia provided examples of seasonality impacting on tourist areas in Northern Australia, such as:
Following heavy rains in Alice Springs and surrounds in December 2016, tourist sites including the Uluru-Kata Tjuta National Park became inaccessible;
As at 13 February 2017, there were more than 170 restrictions on NT Government controlled roads, including access points for tourism areas such as Litchfield National Park and Shady Camp; and
Unsealed roads in tourist areas including Cape York in north Qld, the Kimberley region of WA and between Broome and the Dampier Peninsula, WA are ‘all similarly impacted by the effects of the wet season.’
4.30
Kakadu Tourism advised that if ground infrastructure was more developed, the length of the tourist season could be doubled from the four month dry season to eight months. Cape York Sustainable Futures (CYSF) cautioned that as roads are progressively sealed, and tourism numbers increase, extending the tourism season will become critical in order to ‘ease the burden on the resources’ of tourist towns (such as water, sewerage and power).
Connecting Aboriginal and Torres Strait Islander Communities to Tourism
4.31
While cultural tourism can be a drawcard for tourists, remoteness and unsealed roads can make some Aboriginal communities difficult to access. Remoteness and infrastructure issues have also been identified as limiting the capacity of Indigenous businesses to develop. Indigenous Business Australia stated that ‘the time taken to access remote locations because of poor transport infrastructure will make a tourism product less attractive for the time-poor tourist.’
4.32
The Shire of Halls Creek stated that in addition to creating opportunities for cultural tourism, the sealing of major roads in remote areas (such as the Tanami Road) would ‘open up service opportunities such as fuel and accommodation’, which would ‘present excellent opportunities for Indigenous enterprise’.
4.33
The Cook Shire Council described how some Indigenous communities in the far north Qld region had worked to gain ‘RV (Recreational Vehicle) friendly’ status to stimulate road tourism, and that Cooktown had been recognised as Australia’s RV friendliest town. The Cook Shire Council explained that RV tourists were looking for authentic Indigenous experiences and that becoming RV friendly was a ‘massive opportunity’ for cultural tourism.
Box 4.2: Aboriginal Communities on the Dampier Peninsula
The Cape Leveque Road, which runs from Broome to Cape Leveque on the Dampier Peninsula in northern WA, is currently in the process of being sealed. The Dampier Peninsula has the ‘highest density of Aboriginal-owned tourism ventures in the country’ and the road sealing is expected to increase the number of tourists that visit the area. Environs Kimberley stated that the sealing of Cape Leveque Road will bring tourism opportunities but also ‘significant threats’ to the environment, infrastructure and local communities.
4.34
Environs Kimberley recommended the development of a ‘social, environmental, cultural and economic impact assessment’ for the Dampier Peninsula, with the involvement of the community, to manage the opportunities and challenges associated with the sealing of Cape Leveque Road.
4.35
Kooljaman (a wilderness camp in Cape Leveque) and Goombaragin Eco Retreat made a number of suggestions to manage the expected influx of tourists following the sealing of Cape Leveque Road. These included:
rangers being given the authority to issue fines, or to make tourists move on, when they are camping or parking in prohibited areas;
clear signage stating there is no free camping on the Peninsula;
an access point, with a gate and rangers, to control the number of cars coming into the area (as accommodation and camping areas are limited);
the development of a tourist map to clearly show which roads and areas are accessible for tourists; and
a toll (for road, sea and air access), which would create employment for local people, with the takings to be invested into the local area.
Maintaining Adventure Routes
4.36
While in many cases the sealing of roads in Northern Australia can boost tourist numbers, some tourists travel to the north to drive on adventure routes. Australia’s North West Tourism stated that ‘the Gibb River Road is renowned as one of Australia’s great drive adventures … [and] the sealing of this road would take away that adventure experience’.
4.37
The CYSF explained that Cape York has been ‘known for its four-wheel drive experience’, but that this will be reduced following the sealing of the Peninsula Development Road. To retain the adventure drive market, CYSF identified a ‘loop road network’, which encourages tourists to venture off the main (sealed) road and onto less developed roads, and so visit a wider array of communities.
Road Upgrade Priorities for Tourism
4.38
Tourist roads which need sealing and upgrading are the:
Tanami Road, which runs across the Tanami Desert between Alice Springs, NT and Halls Creek, WA.
Outback Way, which is the main east-west highway spanning WA, the NT and Qld.
Savannah Way, including the Hann Highway and the Gulf Development Road between Normanton and Burketown and Borroloola to Burketown sector.
Bloomfield Track between Cape Tribulation and Wujal Wujal in Qld, to create a tourism drive loop and potentially a cultural tourism loop. Tourism Port Douglas and Daintree, however, stated that there has been ‘broad opposition from within the Douglas Shire’ to the sealing of this track.
Roads to and within Karijini, Millstream Chichester Murujuga and Mitchell River National Parks in WA.
Peninsula Development Road, Qld. The Cook Shire Council advised that the Cape York Infrastructure Package will ‘get [a traveller] two-thirds of the way to Weipa’, and that additional funding to complete the road had been set aside by the Australian Government, but not yet been released.
Major drive-tourism routes in North Qld, including the Overlanders Way, Matilda Way, Capricorn Way and the Great Inland Way/Great Tropical Drive.
Major drive-tourism routes in northern WA, including the Gibb River Road, the Canning Stock Route, the Warlu Way, Kalumburu Road, Cape Leveque Road, Marble Bar to Nullagine and Newman, and Mount Augustus to Paraburdoo. Australia’s North West Tourism, however, recommended maintaining Gibb River Road as an ‘unsealed 4WD adventure route.’
Upgrading roads to key attractions within Kakadu National Park. Parks Australia advised it is ‘preparing plans’ for the Parks’ roads.
Extending the National Highway to include the Captain Cook Highway from Cairns to Cooktown.
Bruce Highway, Qld, at points vulnerable to flooding, including Hamilton Plains.
Upgrading of road infrastructure at Coral Bay, WA.
Travel by Air
Airport Infrastructure
4.39
A number of inquiry participants recommended the upgrading of airport infrastructure across Northern Australia. This included upgrading and expanding some airports to facilitate international flights. The CYSF advised that upgrading airport infrastructure could also ‘facilitate fly in/fly out itineraries and extend the tourism season beyond the “dry” season.’
4.40
In contrast, the Tourism Council WA stated that government policy has focussed too much on airport upgrades, and not enough on developing flight routes. The Tourism Council WA further commented that ‘no amount of laying down tarmac or building control towers is going to increase the number of leisure visitors.’
4.41
Qantas also cautioned that investment in airport infrastructure can lead to higher airport charges, which can increase the cost of airfares for consumers. Qantas further highlighted that some Northern Australian airports are expensive, stating that in the 2017 financial year, ‘11 of the top 15 most expensive airports for the [Qantas] Group were located in Northern Australia’, and that ‘airport costs in some ports in Northern Australia are more than five times the cost of the major airports in the southern states.’
4.42
Qantas recommended any airport infrastructure investment should be ‘fit for purpose’ and stated that:
Communities should not be burdened with infrastructure they may not need, for example, building international airports in areas where there is little demand for such a service, as the cost of building such infrastructure is often passed directly on to airlines and their customers utilising these ports.
4.43
NT Airports put forward a different view and stated:
[It has been] suggested … that airports are providing infrastructure that is not fit for purpose and that airlines have no capacity to resist such actions and the charges that flow from such investment. This is not the case. It should be understood that for smaller airports, what makes infrastructure "fit for purpose" is largely determined by aviation safety standards (administered by [the Civil Aviation Safety Authority]), security standards (administered by the Office of Transport Security) and building standards determined by the relevant Commonwealth or State legislation. Communities also have reasonable expectations as to the amenity of terminal buildings and indeed the International Air Transport Association produces standards for passenger terminal design … changes to these standards, especially in relation to security, have created unavoidable cost increases that [are] being passed onto airlines.
4.44
Broome International Airport similarly stated that, while flights from Broome can be expensive, only a small proportion of that cost is due to airport fees. Broome International Airport further stated that it is ‘very difficult for an airport to influence airfares.’
4.45
The NT DTC stated that Darwin International Airport and Alice Springs Airport have high security costs and charges, which ‘negatively impacts on the price competitiveness’ of these airports and ‘acts as an impediment to the wider economic development in Northern Australia.’
4.46
The NT DTC further stated that for Alice Springs Airport, high security costs ‘are a direct result of its proximity to the Joint Defence Facility at Pine Gap, which raises questions about why Alice Springs residents and visitors are paying for costs associated with this facility.’
Airport Infrastructure Priorities for Tourism
Minimise Airport Security Costs: Virgin Australia recommended the Australian Government consider amending regulations to allow for the use of risk assessment processes for determining security requirements at regional airports, to minimise security costs while still maintaining appropriate security. The NT DTC advocated for ‘a new way of allocating security costs across Northern Australia, such as:
an equalised pricing structure across the national aviation network with costs borne fairly by travellers irrespective of their airport of origin or destination (i.e. network pricing); or
direct funding assistance from the Commonwealth Government for airports in Northern Australia with high security costs.’
Maintain 24 Hour Capabilities of Northern Australian Airports: Virgin Australia advised that this will ensure airports can be used to their maximum capacity, and that land use planning in the vicinity of airports and flights paths should reflect the 24 hour capability of airports.
Regional Airports: the NT DTC recommended the Australian Government develop a plan to ‘address safety and security cost disparities that disadvantage the north and improve the Regional Aviation Access Programme to more effectively support airports in regional areas.’
Upgrade Rockhampton Regional Airport, Qld: The Livingstone Shire Council stated that upgrading Rockhampton Regional Airport to full international status would ‘facilitate and grow tourism.’
Upgrade Jabiru and Cooinda Airports in Kakadu, NT: Kakadu Tourism recommend upgrading the runways and facilities at these airports so they can cater to medium sized jet aircraft, enabling flights from major airports to travel directly to Kakadu National Park.
Upgrade Townsville Airport, Qld: Townsville City Council advocated for an upgrade to Townsville airport, to facilitate more flights to the region.
Upgrade the Runway at Connellan Airport, NT: Voyages Indigenous Tourism Australia, which operates the Connellan airport, stated that it had requested funding from the NT and Federal Governments to assist with runway upgrades, but had not received any commitment.
Expand Cooktown Airport, Qld: the Cook Shire Council advised it is considering expanding Cooktown airport to allow for more flights and operators, and is looking for federal support for the project (the Council and State Government are also providing funding).
Relocate the Helicopter Base at Broome International Airport, WA: Environs Kimberley stated that helicopters taking off from the airport are causing ‘visual and noise pollution’ that is ‘beginning to affect the Broome brand and tourism.’ Broome International Airport advised that it would ‘like to gradually move some of the helicopter traffic out of town’ and that ‘a site has been quarantined for planning purposes about 13 kilometres out of town.’
Upgrade the Monkey Mia runway, WA: the Gascoyne Development Commission advised that this runway needs to be upgraded to attract larger aircraft, specifically carriers that are part of the Global Distribution System.
Flight Routes
Current Arrangements
4.47
The DIRDC advised that Australia’s domestic aviation industry is largely deregulated, and that the Australian Government does not restrict foreign investment in domestic airlines other than Qantas, or regulate which routes airlines can fly. As a result, the DIRDC stated that ‘airline businesses are able to operate domestic services that reflect the level of commercial demand in Northern Australia.’ The DIRDC further advised that ‘international airline access to Northern Australia is largely unrestricted.’
4.48
To encourage flight routes outside of major Australian cities, the Australian Government has sought to include the ‘Regional Package’ in its bilateral air services arrangements, which ‘means unrestricted capacity is available for international air services to destinations other than … Sydney, Melbourne, Brisbane and Perth.’ Australia also has an open aviation agreement with China, which removes capacity restrictions from the air services arrangements between the two countries.
4.49
The DIRDC stated that ‘this policy framework has supported solid growth in Northern Australia aviation.’
4.50
Following the Australian Government’s White Paper on Developing Northern Australia, a Business Stakeholder Group was established, chaired by the Minister for Infrastructure and Transport, ‘to assist the Government in preparing a plan for improving aviation and surface transport connections to Northern Australia’.
Attracting New Services and Routes
4.51
Financial and other incentives are sometimes provided to attract airlines to a particular area. The Qld Government’s Attracting Aviation Investment Fund, for example, is ‘used to secure new aviation business and routes into Qld from identified priority markets and to enhance existing partnerships.’
4.52
The NT Airports also advised that it works with the NT Government to provide incentives to airlines, particularly to attract new international and domestic routes. The NT Airports advised, for example, that it was working with the NT Government to attract new services from Hong Kong and China. The NT Airports also stated that Tourism NT worked with airlines on marketing and promotional initiatives, but that its budget for this was much smaller than that of other Australian jurisdictions.
4.53
The WA Government has a State Aviation Strategy, which is ‘designed to provide a sound framework for policy setting, and future planning and investment in WA international and domestic air services and airport infrastructure.’ Australia’s North West Tourism advocated for the implementation of the outcomes of this Strategy.
4.54
When describing its involvement in supporting air route development to northern WA, Tourism WA stated that it is ‘pitching the destinations and where opportunities lie [to the airlines], though at the moment we haven’t managed to crack that egg.’ Tourism WA and Broome International Airport advised they were working towards establishing a route from Singapore to Broome.
4.55
Tourism Australia advised that some international air routes to Northern Australia have been secured on a seasonal basis, in order to test out the viability of the route. For example, Jin Air, a low cost Korean carrier, established a twice weekly flight from Seoul, South Korea to Cairns, Australia which ran over a four month period. Tourism Australia advised it partnered with Qld tourism organisations to advertise Cairns and stimulate demand in Seoul, in order to ‘make it worthwhile for Jin Air to come, and to make them consider broadening the season.’ Rockhampton Regional Council also announced it would trial international flights over a six month period in 2018.
4.56
In March 2018, Qantas began operating direct flights between Perth, Australia and London, UK. Professor Ross Dowling OAM, a Foundation Professor of Tourism at Edith Cowan University, advised that there were ‘kangaroo extras’ attached to this route, allowing passengers to add-on low‑cost flights to destinations including Exmouth and Broome. The Shire of Exmouth described this flight and the add‑on fares as ‘a game changer for our destination.’
Challenges and Suggested Improvements
4.57
Voyages Indigenous Tourism Australia stated that a lack of direct routes to the north is a significant barrier to future growth in the tourism industry. The Tourism Council WA raised similar concerns, stating that aviation access is the number one issue for tourism in northern WA, and that governments have not had enough of a focus on route development.
4.58
Concerns were also raised regarding the difficulty of flying between tourist destinations within Northern Australia. The Office for Northern Australia stated that, for example, ‘flying between Broome and Exmouth (two popular tourism destinations) means flying via Perth’. The Darwin Convention Centre commented that ‘28 per cent of [its] delegates had to take two or more flights to get to Darwin.’ The Northern RDA Alliance also stated that flying from Broome to Cairns may involve two stopovers.
4.59
Australia’s North West Tourism was of the view that federal and state governments should take a ‘more active role’ in developing new routes in Northern Australia, as ‘airlines are no longer in the business of route development on their own’. The Northern RDA Alliance recommended the federal, state and territory governments work together to develop new air routes, and commit financial incentives for the development of new routes to, and within, the north.
4.60
Recognising the need to stimulate demand for Northern Australian flights, Ninti One Limited suggested developing a tourism campaign focussed on increasing regional air travel demand, and the development of tourist packages that involve air travel from Northern Australia. The Tourism Council WA raised a similar proposition, recommending the development of new interstate and international routes to northern WA and the use of marketing to stimulate passenger demand.
4.61
In contrast to calls for direct international routes to regional airports, Virgin Australia stated that most international visitors are likely to arrive in Australia via a major capital city airport. As such, Virgin Australia advised that ‘the continued existence of strong local carriers, providing safe, reliable and competitive domestic air connections to/from the major capitals, is therefore integral to the Northern Australia tourism industry.’
4.62
Flight routes that could benefit the tourism industry in Northern Australia include:
International and Domestic Flights to Darwin: Nearly half a billion people are located within four hours’ flying time of Darwin, giving Darwin Airport ‘the potential to be a major international gateway airport.’ Specific international flights to Darwin raised included non‑stop European flights and direct flights from New Zealand. To attract more flights to Darwin, Kakadu Tourism suggested the Australian Government offer favourable landing charges, underwrite the expansion of peak season services and use marketing to stimulate demand.
International and Domestic Routes from Townsville Airport: Townsville Enterprise stated that flights from Townsville to Bali and Port Moresby with connections to Hong Kong have been established, and it would now like to see connections to New Zealand and Singapore, and more domestic connections with capital cities.
Flights from South-East Asia to Broome: Australia’s North West Tourism advised that a flight from Singapore to Broome, which would take less than four hours, would bring tourists from Asia and also connect to Europe and the United Kingdom of Great Britain (UK). The Broome Shire Council recommended the development of a Melbourne –Sydney – Broome – South-East Asia route, which could potentially reduce airfares on flights into Broome and enable international access to the Kimberley region.
Direct Flights from Melbourne to Kununurra: The East Kimberley Marketing Group advised that it is in discussions with an airline and potential distribution partners about this route.
Routes from the UK and Germany: the Western Australian Indigenous Tourism Operators Council advised that tourists from these countries have high levels of interest in Aboriginal tourism products.
International Routes to Alice Springs: Tourism Central Australia stated that following any potential expansion of Darwin airport, international routes direct to Alice Springs would be ‘required to continue visitation growth to the outback’.
Year-round international flights to Cairns: North Qld Airports stated that it had secured a year-round flight from mainland China, and would look to expand this to flights from other cities in China, such as Shanghai, other cities in Asia, such as Seoul, as well as Taiwan, the Middle East and North America.
Cost and Availability of Flights
4.63
The high cost of air travel was described as being an impediment to growing tourism in some regions of Northern Australia, with Kakadu Tourism describing flights to Darwin as having been ‘prohibitively expensive for leisure visitors’. As Australia’s North West Tourism explained, one reason for the high cost of flights in WA and the NT is that the flights are utilised by the resources sector. Australia’s North West Tourism stated:
… on the Pilbara routes from Perth during periods of peak resource sector activity, airfares are often very high for leisure travellers who are competing with a high volume of corporate travellers for available seats.
4.64
The expense of flights to Northern Australia may also make it challenging to attract domestic tourists from southern states, as flights to overseas destinations may be more affordable. To illustrate, Voyages Indigenous Tourism Australia stated that ‘it’s cheaper for people in Sydney and Melbourne to get to London or New York than it is to get to Kununurra.’
4.65
In contrast, Qantas advised that ‘Qantas and Jetstar have maintained very competitive fares on regional routes and especially in Northern Australia’, and that ‘data on domestic airfares confirms that, in real terms, all fare categories are lower than they were in 2003.’
4.66
Broome Tourism Leadership Group explained there is a perception that Broome is expensive to get to, but in reality there are some more affordable flights (such as $450 return from Perth to Broome). The Broome Tourism Leadership Group recommended the implementation of initiatives addressing ‘consumer perception issues around the cost and time’ of flights, such as a Broome flight scanner. In contrast, the Broome Shire Council stated that flights from Perth to Broome can be 50 to 100 per cent more expensive than Sydney or Melbourne to Cairns, despite being a shorter distance to travel.
4.67
Australia’s North West Tourism commented that while the Government cannot set flight prices, it can encourage competition between carriers which could serve to drive prices down, particularly if low cost carriers had a greater presence in Northern Australia.
4.68
Tourism WA similarly stated that introducing a low-cost carrier would ‘open up the whole of Western Australia, including the north.’ Tourism WA further advised that this was a priority for the agency, and that it has regular meetings with all air carriers.
4.69
Broome International Airport, however, pointed out difficulties associated with attracting a low-cost carrier to Broome:
… for a low-cost carrier to work … you need either a population base at either end of the flight of 100 000 or more or an airport at either end of the flight doing a million passengers or more … Broome is well short of the 100 000 base it needs, and the airport is well short of the million passengers it needs … It certainly will never work on a year-round basis. Perhaps on a seasonal basis it may, but we're yet to see that come to fruition.
4.70
Specific destinations that were put forward for lower priced airfares in Northern Australia included:
Christmas Island: The Christmas Island Tourism Association advised that ‘increasing the supply of lower priced airfares in shoulder and off peak times’ could stimulate tourism.
Alice Springs: Tourism Central Australia stated that a ‘discount domestic carrier into Alice Springs Airport is essential to visitor growth.’
Regional WA: The Royal Automobile Club of WA recommended the Government ‘consider opportunities to reduce the high costs of airfares to regional Western Australian destinations.’
Townsville, Qld: Townsville Enterprise stated lower cost flights from capital cities would support tourism in the region.
Passenger Movement Charge
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The Passenger Movement Charge (PMC) is a $60 impost for a person’s departure from Australia to another country. The PMC is administered by the Federal Department of Home Affairs.
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The NT Airports described the PMC as ‘an inequitable tax which has an impact on international tourism’. The NT Airports further stated that the PMC is the second highest charge of this kind in the world, and being a flat rate charge has the greatest impact on short haul and discount fares. North Qld Airports also outlined the impact the PMC may be having on international tourism, stating that ‘there is the perception that it is expensive to fly to Australia or to leave Australia’ and that the PMC is ‘seen as an impost on tourists.’ Darwin Major Business Group (DMBG) stated that the PMC was particularly detrimental to Northern Australia.
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The NT Airports and the DMBG advised that the PMC was introduced in order to ‘cover the cost of the border agencies’ at airports, but that it now generates revenue above what is required for cost recovery. As such, the NT Airports and the DMBG recommended the PMC be reduced to around $15, which would meet security costs. Recognising the budgetary impact of this proposal, the NT Airports and the DMBG made an alternative recommendation: that passengers leaving from Northern Australian airports be exempt from paying the PMC. This would ‘make Northern Australia more competitive for international tourism’ and ‘should not impact on budget repair’.
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North Qld made an alternative recommendation and stated that any profit generated by the PMC should ‘be invested in growing tourism and international trade in the region’. The NT DTC recommended the PMC be reduced to a ‘genuine cost recovery levy’, or that the profits be used to ‘reduce airport security and safety costs in Northern Australia.’
Cabotage
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Cabotage refers to ‘the right for foreign carriers to operate on domestic routes.’ Virgin Australia explained that currently, foreign airlines are not permitted to practice ‘consecutive cabotage’ in Australia, meaning foreign airlines cannot pick up domestic passengers and/or freight at one Australian airport and carry them to another. Qantas advised that it was ‘strongly opposed to any change to the restrictions on aviation cabotage,’ and that any relaxing of restrictions may have negative regulatory, employment, economic and strategic impacts on Australia.
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In contrast, Broome International Airport stated that ‘cabotage is another form of competition, which would be welcomed.’ Similar sentiments were expressed by the Broome Shire Council, which recommended the Australian Government ‘investigate opportunities for cabotage to be allowed … between Australian regional international airports and the four primary international airports in Australia.’ The Broome Shire Council further stated that a limited allowance of cabotage was needed to attract flights from South-East Asia and Hong Kong to Broome and Perth, as well as the eastern states. The Broome Shire Council explained that it was:
… not advocating full cabotage. It really is just to have flights from those locations such as South-East Asia through to your primary Northern Australian international airports—so, Broome, Darwin and Cairns—and then onto the major international airports within Australia. We're not advocating complete deregulation in that area.
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The DIRDC advised that the Government did not have any ‘immediate plans to make any changes to the cabotage arrangements.’
Box 4.3: WA Inquiry into Regional Airfares
On 30 November 2017 the WA Economics and Industry Standing Committee tabled its report Perceptions and Realities of Regional Airfare Prices in Western Australia (the WA Report).
The WA Report examined whether regional airfares in WA were high, what factors contributed to flight prices, the impact of flight prices on regional communities, and steps that the industry and government could take to address concerns and reduce airfares.
The WA Economics and Industry Standing Committee made 48 findings and 13 recommendations. In relation to tourism, the WA Report stated that high regional airfares can have a ‘debilitating effect’ on tourism operators, and that high airfares in, and to, WA may contribute to a tourist’s decision to holiday elsewhere. The WA Report also considered it unlikely that WA would attract a low-cost airline to service tourists on regional routes in the near future.
The WA Report stated that some communities, including Karratha, Broome and Kununurra, had ‘innovated to improve the attractiveness of their tourism product (with differing degrees of success) and have experienced varying levels of engagement with airlines.’
As well as considering local and state government responsibilities, the WA Report discussed the role of the Australian Government and stated that ‘there are very few mechanisms that the Australian Government can implement to lower actual airfares in regional WA’. Nevertheless, potential Australian Government impacts on the price of airfares included:
Security screening services at airports, which can add a ‘significant cost [to] each passenger fare;’ and
Exemptions from the Fringe Benefit Tax for flights for fly-in-fly-out workers in the resources sector, which may make airlines less price sensitive.
Travel by Sea
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The cruise ship industry is one of the fastest growing tourism sectors in Australia. In Northern Australia in 2014-2015, passengers spent 265 000 days in port and contributed $116 million in direct expenditure to the economy.
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A challenge for the cruise industry is ‘limitations on the size of cruise vessels that can access a number of ports in Northern Australia’. Another challenge presented by cruise ships is ‘the shock-load of intermittent visits and the impact these can have on local infrastructure and services’. The Port of Townsville agreed and stated that it is ‘an ongoing battle to try to produce new product, and product that can take the volumes that cruise ships require.’
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The Port of Townsville also stated that there was a need for a ‘central resource to help destinations develop their cruise ship market.’ The Port of Townsville explained that currently:
… there is no strategy. There is nowhere you can go online and say, ‘Right, I’m Timbuktu and we want a cruise ship to come next year to see how we go. How do I make that happen? Who can I talk to? Who can I speak to that has connectivity with the cruise lines?’… That would be hugely helpful – a resource on how we make this work.
Port Infrastructure
Develop Darwin into a Cruise Ship Home Port
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The DMBG recommended Darwin become a home port for cruise ships, particularly for smaller expedition-type cruise ships with fewer than 100 passengers. To facilitate this, the DMBG recommended the Australian Government extend the exemption which allows large international cruise ships (over 5000 tonnes) with international crews to operate in Australia to smaller expedition type international cruise vessels (over 500 tonnes), as long as they operate in Northern Australia.
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The NT DTC also supported Darwin becoming a cruise ship home port, and stated that the private sector lessee of the Darwin Cruise Ship Terminal had proposed a $25 million investment for improvements to the terminal. The NT DTC recommended the Australian Government provide funding for terminal improvements and the wharf extension, and also ‘scale up border security services to meet demand coming from increased cruise ship traffic’.
Upgrade Ports in Broome and Exmouth, WA
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The Gascoyne Development Commission stated that ‘both Exmouth and Broome are currently considered unreliable port destinations.’ In Broome, cruise ship berthing times are tidally constrained, due to a large rock located in the port channel. In Exmouth, cruise ships have to anchor offshore and transit passengers to the Exmouth Boat Harbour, but strong wind conditions often make it unsafe for passengers to disembark. Tourism WA explained that as a result, many cruise ships have been forced to abort their visit to Exmouth and some cruise ship itineraries ‘exclude Exmouth to avoid passenger disappointment.’
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The Gascoyne Development Commission stated that Carnival Australia, a major cruise ship operator, had advised that 2017 was to be its last home‑porting season until Broome and Exmouth were ‘able to provide reliable berthing.’ On 8 October 2017, the WA Government announced it would dredge the Broome Port in 2018, to allow cruise ships to access Broome in all tides. As a result of this commitment, Carnival Australia confirmed it would return to WA in 2018.
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Professor Dowling stated that a short-term solution in Exmouth would be a floating pontoon. The Exmouth Shire Council advised this would have a cost of $35 million and the Gascoyne Development Commission recommended the Australian Government provide funding for this project. Over the long term, the Gascoyne Development Commission recommended that a land-backed deep water wharf be constructed. Professor Dowling estimated that this would cost over $100 million.
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The Exmouth Shire Council stated that a deep water port was its preferred option. While building a new deep water port would be costly, the Exmouth Shire Council stated that there is an existing Navy pier in the area which could be used for cruise ships. The Exmouth Shire Council stated that this asset is ‘hardly ever used’ by Defence, but that Defence had been resistant to this proposal in the past.
Other Port and Marina Upgrades
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In addition to Darwin, Broome and Exmouth, a number of other ports and marinas in Northern Australia need to be upgraded or established to support tourism. These include:
Cairns and Townsville, Qld: Sealink recommended these ports be upgraded to support the cruise ship industry in the region.
The TTNQ supported ‘the Cairns Shipping Development Project to expand the Port of Cairns shipping channel to accommodate “mega class” cruise ships whilst concurrently protecting the health of the Great Barrier Reef’.
The Port of Townsville advised that the Qld Government recently allocated $75 million to upgrade the Port of Townsville to accommodate ships up to 300 meters in length.
Dampier, WA: The City of Karratha recommended construction of a new marina at Dampier and suggested Dampier be added to cruise ship routes on the west coast, so visitors could:
… cruise in through the islands of the Dampier Archipelago, witness and learn about the industries that operate from the area and the rich European heritage, and experience the strong Aboriginal culture of the area.
Cooktown, Qld: Ninti One Limited recommended steps be taken to ‘ensure Cooktown can provide consistently accessible berthing for cruise ships’, to increase visitor numbers and support local businesses, including Aboriginal tourism operators. The Cook Shire Council stated that ‘there is a major need for the harbour to be dredged on a regular basis.’
Weipa, Qld: The CYSF recommended the establishment of a port at Weipa to boost tourism in the region.
Ports near Aboriginal and Torres Strait Islander Communities: Sealink stated that the cruise ship market is seeking unique cultural tourism experiences, which could be provided by communities in the Tiwi Islands, the Kimberley Coast, Broome, East Arnhem and North Queensland.
The Torres Strait: Ninti One Limited stated that the development of port infrastructure in key remote coastal areas, including the Torres Strait, could ‘support tourism operators to diversify markets and increase visitor numbers in remote areas.’
Port Douglas, Qld: The Port Douglas Steam Train Company stated that ‘port infrastructure, maintenance, dredging and harbour clearance are badly needed.’
Broome, WA: The Broome Marina Limited stated it was ‘the proponent and the facilitator of a project to establish a privately owned and operated world-class locked-gate marina in Broome’ and recommended the Australian Government support this project, potentially through the NAIF, and that the WA government facilitate access to land that is needed.
Shute Harbour, Whitsunday Region: Managed by the Whitsunday Regional Council, Shute Harbour was described by Whitsunday Island Camping Connection as having been in ‘a state of absolute decay for years’, despite being critical to some tourism operations in the Whitsundays.
Adventure Cruising
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True North Adventure Cruises commented that large international cruise ships, with international crews, were entering the smaller adventure cruise market in the shoulder season and undercutting local tourism operators. To address this issue, True North Adventure Cruises stated that regulations regarding adventure tourism and small cruise businesses need to be separated from regulations regarding larger marine transport operations.
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Tourism WA considered that there was a need to support both the cruise and micro-cruise industries and stated:
It is always a juggling act, but for us to open up the north to adventure cruising and open up that opportunity for a broader sector is a priority of our cruise-shipping area. We recognise that you have to be able to co-exist, so where there are issues we'd look to address them. It's not about closing a market down but opening up more markets.
Travel by Rail
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Tourists choose to travel by train in Northern Australia not only as a means of transport, but as a tourism experience in its own right. Qld Rail, for example, stated that people will drive thousands of miles for the experience of travelling on the Gulflander, known as ‘the train to nowhere’, in North Qld. The Northern RDA Alliance advocated for the continued support of existing tourism rail experiences, including the Ghan, the Gulflander, the Savannahlander, Spirit of the Outback and the Inlander.
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Beyond these rail experiences, the Northern RDA Alliance advised that rail transport for tourists is ‘limited to only a few key routes in Northern Australia’. The Outback Qld Tourism Association stated that it sees the ‘maintenance and growth of rail capacity to increase the experience of tourism by rail’ as a priority for regional Australia.
Rail Priorities for Tourism
Affordable Train Travel - Tourism Central Australia drew attention to the removal of the more affordable sit‑up service on the Ghan and recommended that ‘subsidies should be provided to ensure this crucial train service is accessible for all people’.
Mount Isa to Tennant Creek Rail Line - the Northern RDA Alliance suggested the feasibility study into this rail line should consider the potential opportunities for tourism that would arise through linking Qld and the NT via rail.
High Speed Rail from Perth to Northern WA - the City of Karratha stated that this would increase the accessibility of the north‑west.
Rail Connections into Darwin - Sealink advised that rail connections from cities into Darwin ‘must be supported and built upon’, and that improving the arrival experience into Darwin should be prioritised.
Concluding Comment
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In order for tourist visitation in Northern Australia to increase, visitors must be able to reach Northern Australia in a timely, affordable and reliable manner. Across Northern Australia, upgrading air, road, sea and rail transport is a major requirement of stimulating growth in the tourism industry.
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The Joint Select Committee on Northern Australia’s report Pivot North: Inquiry into the Development of Northern Australia (Pivot North) outlined key infrastructure projects to stimulate the north. While work has begun on some of these projects, others have yet to commence. The Committee strongly reiterates the recommendations of the Pivot North report regarding infrastructure, particularly those which directly support the tourism industry.
Roads
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Improving road infrastructure is an essential part of stimulating the tourism industry in Northern Australia and connecting areas of tourism interest. As more roads are sealed and upgraded, more opportunities will become available for towns and regions to access the tourism market, including remote communities. Further, improving road infrastructure and enabling access for tourists will create sustained employment and support the economies of remote locations. Creating sealed circuit loops will also encourage tourists to visit a number of tourist destinations by road and potentially extend their stay.
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Pivot North outlined a number of priority road upgrades to facilitate the development of Northern Australia. Of these, a number were subsequently put forward during this inquiry as still needing investment. These are the: Bruce Highway, Hann Highway, Peninsula Development Road, Tanami Road and Outback Way.
Air
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The majority of international tourists, and many domestic tourists from the east coast, will reach Northern Australia by air. Improving the affordability and accessibility of flights to Northern Australia may assist in attracting a greater number of visitors to the north. Another opportunity for tourism is to enable tourists to fly between northern destinations without needing to transit through a capital city.
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The Committee was pleased to see that some tourist destinations, such as Cairns, have secured international routes and low cost flights from domestic capital cities. In contrast, other tourist regions, such as Broome in Western Australia, may be viewed as unaffordable and time consuming to reach.
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This Committee reiterates and supports the recommendation put forward by its predecessor Committee in Pivot North, for the Australian Government to consider how to cost‑effectively provide customs, quarantine and immigration services at airports. This included recommending the Passenger Movement Charge be reduced. These reforms have the potential to stimulate tourism in Northern Australia by reducing airfares and consequently increasing passenger demand.
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The Committee considers that cabotage restrictions may be inhibiting tourism in Northern Australia, and that consideration of the impact of these restrictions in the Northern Australian context may be needed. Cabotage restrictions in relation to the Indian Ocean Territories is discussed in Chapter 6.
Sea
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The cruise ship industry presents a major economic opportunity for coastal areas of Northern Australia. Cruise ships annually bring hundreds of tourists to a destination. In addition, the cruise ship industry is already generating millions of dollars in tourism expenditure in Northern Australia.
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The Committee was pleased to hear that the port in Broome will be dredged in 2018, allowing all-tide access for cruise ships. The Committee is concerned, however, that many other coastal areas which could be attracting cruise ships or increasing the number of cruise ship visits are unable to do so due to insufficient port infrastructure. The Committee also reiterates the recommendation in Pivot North that the Australian Government consider upgrading the port in Darwin.
Rail
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Northern Australia is home to some iconic and scenic rail routes which showcase Australia’s outback. There may be opportunities to expand the rail experiences on offer for tourists in Northern Australia, and there is an opportunity to improve existing rail journeys in order to attract more passengers.
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The Committee recommends that legislation regarding the Northern Australia Infrastructure Facility be amended to allow for participation of the Indian Ocean Territories.
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The Committee recommends the Australian Government prioritise funding for roads which support the tourism industry, by sealing and/or upgrading the:
Roads to and within national parks (including Karijini, Millstream Chichester, Murujuga and Mitchell River National Parks in Western Australia, and Kakadu National Park in the Northern Territory)
Hann Highway and the Gulf Development Road
Peninsula Development Road to Seisa
Drive tourism routes in Queensland including the Overlanders Way, Matilda Way, Capricorn Way, Great Inland Way/Great Tropical Drive, the Western Queensland Inland Way, Peak Downs Highway, Dawson Highway, and the Savannah Way (which also extends through the Northern Territory)
Drive tourism routes in northern WA including the Gibb River Road, the Canning Stock Route, the Warlu Way, Kalumburu Road, Cape Leveque Road, Marble Bar to Nullagine and Newman, and Mount Augustus to Paraburdoo
Extension of the National Highway to the Smithfield Roundabout, which then connects onto the Kennedy and Cook Highways
Road infrastructure at Coral Bay.
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The Committee recommends the Australian Government work with state and territory governments to implement measures to reduce security costs at regional airports.
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The Committee recommends the Australian Government as a matter of urgency, in partnership with the relevant state or territory government, provide funding to expeditiously upgrade the:
Jabiru and Cooinda Airports in Kakadu
Connellan (Ayers Rock) Airport
Rockhampton Regional Airport
Christmas Island and the Cocos (Keeling) Islands Airports
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The Committee recommends the Australian Government conduct a cost‑benefit analysis of the impact of current cabotage arrangements on Northern Australian airfares, flight routes, and the tourism industry.
4.108
The Committee recommends the Australian Government work with state and territory governments to upgrade ports in Cairns, Darwin, Broome, Exmouth, Dampier, Cooktown, Port Douglas, Christmas Island, and the Cocos (Keeling) Islands (including Home Island) to facilitate access (including for cruise ships where possible).