ACCOMMODATION LEVY BILL
ELECTRICITY SUPPLY AMENDMENT BILL
STATE REVENUE LEGISLATION AMENDMENT BILL
In Committee
Consideration of the Legislative Council’s amendments.
Schedule of amendments to the Accommodation
Levy Bill referred to in message of 18 June
No. 1 Page 2, clause 4. Insert after line 15:
backpacker hostel means premises the principal use of which is to provide sleeping arrangements at low cost to backpackers and which include dormitories with communal and self-catering facilities and an emphasis on guest interaction.
No. 2 Page 2, clause 4. Insert after line 22:
youth hostel means premises owned, operated or affiliated with the Youth Hostels Association of New South Wales at which accommodation is provided for Youth Hostels Association members.
No. 3 Page 3, clause 7, lines 21 and 22. Omit all words on those lines.
No. 4 Page 3, clause 7. Insert after line 30:
(d) a backpacker hostel, or
Mr WHELAN (Ashfield - Minister for Police) [10.15 a.m.]: I move:
That the Committee agree to the Legislative Council’s amendments.
Mr DEBNAM (Vaucluse) [10.16 a.m.]: I take this opportunity to make a few comments about the Government’s budget and, specifically, about land tax. A few weeks ago the Government guillotined the budget through this Chamber. I did not get an opportunity to speak in that debate. There are a number of issues of grave concern to the community. The honourable member for Gosford talked earlier about a democratic Parliament and democracy in New South Wales. The people of New South Wales should be aware of what this Government -
Mr Whelan: On a point of order. The amendments deal with accommodation; they do not deal with land tax. The honourable member is referring to the wrong bill.
Mr DEBNAM: I would be happy to refer to the bed tax issue. Two weeks ago this Government guillotined the budget debate through this Chamber. I did not have an opportunity to participate in that debate. The definition of parliamentary democracy has changed dramatically under this Leader of the Government. The Accommodation Levy Bill introduces a bed tax on hotels in the Sydney central business district - a tax on a select number of hotels. This tax has caused outrage in the tourism and hotel industries in Sydney. It has embarrassed the Government and caused division between the Government and the Sydney Organising Committee for the Olympic Games.
Mr Whelan: On a point of order. The honourable member is restricted to talking to the detail of the Legislative Council’s amendments. He is referring to other issues. Mr Chairman, I ask you to request him either to speak to this issue or to resume his seat.
The CHAIRMAN: Order! The honourable member for Vaucluse will speak to the amendments.
Mr DEBNAM: Certainly. These amendments refer to backpacker and youth hostels. When the Government introduced this legislation there was considerable outrage throughout the hotel industry. Interests involved in backpacker and youth hostels were quick to point out that the Government was imposing a levy that those hostels could not afford. Similar complaints were made by hotel interests. This highlights the fact that the Government has not done its homework. It is obvious that a number of changes were made at the last minute before this budget was introduced. That has been the theme
Page 10524throughout the whole of the period that the Carr Government has been in office. The Government has backed down on one thing after another. It makes a policy announcement which it then changes the next day. That theme has been frustrating the community.
Ministers appear constantly on the front pages of newspapers and on television news programs explaining their policy positions. This is another example of last-minute changes to a government proposal - changes that could have been introduced before the budget was released if the Government had done its homework. That again highlights the incompetence of this Government. The one theme that has been apparent throughout the period in office of the Carr Government is that it tripped into office. It won the election but only by a bus load of people. It did no planning as it did not expect to win the election. From March 1995 this Government has been struggling to produce policies. Its policies are aired, they are opened to the public and there are various backflips within 48 hours. This is just another example of this Government’s incompetence.
Mrs CHIKAROVSKI (Lane Cove) [10.20 a.m.]: Sometimes the hypocrisy of this Government is breathtaking. Whilst the Opposition clearly supports the exemption that has been provided to the backpacker movement and the youth hostel movement in relation to the Accommodation Levy Bill, it recognises that the Government has realised that it is the younger section of the community that will be hardest hit by the accommodation levy and it has therefore decided to offer as a sop to that part of the industry and to young people an exemption from the accommodation levy. This is the same Government that is hitting young people by introducing this levy; it is the same Government that is undermining the growth of an industry that employs more young people than any other industry in Australia.
The Government, in introducing the accommodation levy, has taken the young people of this nation - the workers in a growth industry, an exciting industry, an industry that everyone recognises in the lead-up to the year 2000 and the Olympics will provide, or would have provided, massive opportunities for young people to embark not only on a short-term career but on a long-term career. On the one hand the Government says it will fix the problem for young people who use the services of backpacker hostels and youth hostels, but on the other hand it decides to put a levy on the luxury end of the market and in doing so undermine employment growth in an industry that is geared towards and caters for young people.
The Government is so hypocritical that it is beginning to take everyone’s breath away. I refer not to Opposition members, because they are used to it, but to the general community, which is starting to realise that members of the Government are so hypocritical in their dealings with the community that it is a wonder they can lie straight in bed at night. This Government said, "No new taxes." All we needed was the preface to those words, "Read my lips." As Leader of the Opposition the Premier did not say those words, but he might as well have said them because that was his intent. The Government has introduced another new tax in the budget and in the Accommodation Levy Bill.
I cannot believe that the Government is prepared to proceed with the bill and to ignore the community and in particular the young people, who were excited about the prospects that the Olympics would provide for them and thought they would have a future and would be working in the year 2000. The Government has betrayed them. It is not only the big end of town that the Government has betrayed; it is the young people who are looking for a future. At the next election an interesting combination of people will vote the Government out. It will be the big end of town, the young people and traditional Labor supporters who desert it at the next election, and the Opposition looks forward to the fact that those who have orchestrated this campaign will end up on this side of the Chamber, where they belong.
Mr PHILLIPS (Miranda - Deputy Leader of the Opposition) [10.23 a.m.]: The crossbenchers in the upper House have made a cop-out deal with the Government to salve their consciences because they were having difficulty with the bed tax. The Government announced that it was considering exempting youth hostels, so it told the crossbenchers in the upper House that if they passed the amendment it would make them look good to their constituency. That does not take away from the fundamental problem that Sydney now has a 10 per cent bed tax that will act as a major disincentive to visitors to Sydney.
The Government mistakenly believes that everyone wants to come to Sydney because it is a great place and that a 10 per cent surcharge will be absorbed. One of the reasons Sydney does so well in attracting business and tourism is its price advantage. It competes for the tourism market from Japan, but that is declining. Japanese tourists comprise the largest component of visitors to Sydney. Sydney also competes with Hawaii, Asian destinations, the United States and Europe. The
Page 10525Opposition, the tourist industry and the hotel industry are outraged about this tax, because it will make it hard to compete. It will cost thousands of jobs. The tourism industry offers tremendous opportunities for young people. There is a high unemployment rate among young people in this State, and they must be given an advantage. It appears that if an industry is doing well it is fair target for a tax under Labor. Remember the promise of no tax increases under a Labor government.
The bed tax on its own is one thing, but in two years there have been 13 tax increases, including three new taxes. That is an increase of $2 billion in taxes, or 18 per cent, in two years. I am sure no-one in this Chamber has had an increase of 18 per cent in his or her income in two years. That burden has made New South Wales the most expensive State in Australia in which to do business, and Sydney is the most expensive city in Australia to visit. The Government believes it will apply only to international tourism, but 50 per cent of the hotel market in Sydney caters to Australians visiting Sydney - people from country New South Wales and from other States. They will now holiday in other destinations or stay for shorter periods.
With regard to the amendments, the Government says it will exclude youth hostels from the tax, and it gives a definition of youth hostels as premises owned by, operated by or affiliated with the Youth Hostels Association of New South Wales at which accommodation is provided for Youth Hostels Association members. I predict that the tourist industry already is working out packages to take advantage of this exemption. To avoid the tax surprisingly high-quality youth hostels and packages to attract people to Sydney will proliferate. They will cost less than major hotels, so it will result in a lower income for Sydney.
More importantly, because of that product advantage there will be many more packages in the international market to attract young people to Sydney. There is nothing fundamentally wrong with that, except that it is a trade-off in the marketplace. The situation will change from one in which a significant number of middle-class and upper middle-class people come to Australia with money to spend at a high daily rate on restaurants, taxis, tourism and theatre. The marketplace will become warped. Sydney may have the same number of tourists but those tourists will have less money to spend in Sydney. They are backpackers; they travel on the cheap. It is tremendous that they get around the world and travel, but they are not bringing -
Pursuant to resolution progress reported from Committee and leave granted to sit again.