Budget 2022: Inadequate airline capacity threatens to undermine new tourism campaign

Tourism industry leaders are concerned a lack of aviation capacity will thwart efforts to reignite the international visitor market.

Passenger numbers are easily keeping pace with airline capacity, prompting tourism industry calls for the government to do more to attract international carriers back to Australia. Picture: NCA NewsWire/Jeremy Piper

Rebuilding Australia’s international aviation capacity looms as the next major challenge for the tourism industry following the launch of the new campaign targeting overseas visitors.

Data released by the Bureau of Infrastructure, Transport and Regional Economics showed there were 45 airlines operating in and out of Australia in August, compared to 58 three years ago.

The total number of international airline seats was at 55 per cent of pre-pandemic levels, with passenger numbers also at 55 per cent indicating demand was easily meeting the supply.

John Hart, the Australian Chamber of Commerce and Industry’s tourism spokesman, said aviation capacity was one area that had been overlooked in the budget, despite a desperate need for attention. He said individually states were throwing significant money at airlines to restart operations but “cross government co-operation” was needed to deliver a balanced solution.

“On a federal basis, that’s not a lot of money for developing aviation capacity, nor is there a lot of money for some of the work that needs to go on in airports,” Mr Hart said. “We all know what the passenger experience is like at the moment and it’s those barriers to rebuilding international tourism that we’re most concerned about. That’s the number one issue we’re facing at the moment.”

Australian Tourism Export Council managing director Peter Shelley shared Mr Hart’s concerns, adding that inbound holiday visitation was still a long way from pre-pandemic figures.

“Monthly numbers are around 300,000 fewer than in 2019,” Mr Shelley said. “While indications show our air capacity will start to return as we head into 2023, our industry’s challenge will be to ensure we are able to facilitate the smooth conversion of inquiries into bookings.”

Budget papers show Tourism Australia allocated $214m in funding, including that rolled on from previous years, but there is a $36m fall in the next year.

Tourism and Transport Forum chief executive Margy Osmond said the funding should be revisited next year if Australia was to successfully compete with other nations.

“We’re pleased to see a modest portion of the money that was promised under the previous government flowing through to Tourism Australia to help market Australia internationally and entice overseas visitors to our shores,” she said.