Key promises cash for tourism industry on dollar-for-dollar basis

Trenz delegates have been told to expect an announcement on the funding by the end of the year.

Prime Minister John Key has promised more marketing money for New Zealand's $20 billion tourism industry by the end of the year but businesses will also have to come up with the cash if they want the Government to open its wallet.

Speaking at the industry's annual trade fair Trenz, Key, who is also the Tourism Minister, said the Government wanted to increase the marketing contribution for the industry over time.

In this year's Budget the Government cut back its tourism marketing spend by $6.5 million, dropping it from $75.5 million to $69 million.

But Key yesterday said there was good news on the way for the industry and he expected to make a announcement by the end of the year.

At the March job summit a figure of $60 million was suggested as an increase needed for tourism marketing.

When asked if that figure was still realistic in the current economic environment Key said it was "in the realm of possibility." But any extra money from the Government would also have to be matched by the industry.

That would mean businesses would have to come up with $30 million of their own to get access to the Government's $30 million.

Key said the Government was also working with Tourism New Zealand on funding for marketing to China.

Tourism New Zealand has had project funding for China over the last three years but that runs out at the end of June.

Key said he saw China as a long-term strategic market.

The Government had already committed $30 million to the Shanghai Expo being held next year and he wanted to ensure the market continued to be targeted in the run-up to that.

Tourism Industry Association chief executive Tim Cossar said the industry would be very encouraged to see some more money by the end of the year and if that happened it would perceive the first 12 months of the new Government as being very positive.

"We wanted tourism recognised as bedrock industry and the Government has done that."

But until it saw the money the association would continue to push for it.

Cossar said the industry needed to be open to joint venture marketing with the Government.

"We want the industry to contribute - we think that is a fair expectation."

But Cossar said it would come down to the ability of the big players to put their hands in their pockets as smaller tourism businesses just didn't have the cash in this environment.

Grant Webster, chief executive of Tourism Holdings which owns campervan rental companies Maui and Britz as well as the Waitomo Caves, said he believed the industry did need to front up with money for marketing internationally. "This is vital for New Zealand to maintain its market share."

Air New Zealand deputy chief executive Norm Thompson said the airline would applaud any decision for extra marketing money and would be prepared to pitch in. "If it makes sense we absolutely would be."

Thompson said it would depend on which market was being targeted but if it was a tactical fit Air New Zealand would be prepared to match spending by Tourism New Zealand on a dollar-for-dollar basis as it had done with the Australian campaign earlier this year.

Air New Zealand spends around $100 million a year on marketing New Zealand to international visitors.

TOURISM SPEND-UP

* $50 million over three years on a national cycleway.
* $2.5 million marketing to Australia.
* $250,000 scoping out a 4000 seat convention centre for Auckland.
* $440,000 skills training for 10,000 Rugby World Cup workers.
* Estimated $20 million plus to buy Auckland's Queens Wharf to enable it to be developed to offer a second cruise ship facility in time for 2011.