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MBIE draws fire after wiping nearly $1bn off visitor spending figures

31 Jan 2018  By Paul Yandall

The Ministry of Business, Innovation & Employment has come under fire from tourism leaders after slashing its estimate of international tourism spending by nearly $1bn.
The revision has seen $910m wiped from foreign spending figures for the year to October 2017, with MBIE reducing its original assessment by 8% to $10.5bn.
The Tasman and West Coast regions have been hit the hardest with foreign tourist spending estimates dropping sharply by 15% and 14% respectively. The two regions often topped MBIE’s table of Monthly Regional Tourism Estimates (MRTEs) for spending growth last year.

Jim Little

Chief executive of Tourism West Coast, Jim Little, said MBIE had produced a disruptive revision that made it difficult for regional tourism organisations to plan.
“Quite frankly, the tourism industry is up the creek without a paddle as far as meaningful data is concerned,” said Little.
“The problem is, if your data is invalid or compromised like this then it is very hard to do any meaningful strategic planning. This needs to be resolved and it needs to be resolved quickly.”
Mark Rawson, chief executive of the Nelson RDA, which covers the Tasman tourism region, said the revision was confusing for the industry.

Mark Rawson

“We have to get this sorted out because we all use this information to assist building trust and confidence in the industry and it’s vital that it’s well understood,” said Rawson.
MBIE uses Stats NZ’s annual Tourism Satellite Account (TSA), which was last released in December, to annually revise its MRTEs figures, which are based on electronic card data.
However, the TSA’s foreign spending estimates are informed by MBIE’s quarterly International Visitor Survey, which Stats NZ is reviewing because of industry concerns over its accuracy. MBIE is also reviewing its Tourism Data Domain Plan, which was published in November 2011, to see if it can improve its tourism data collections.
In an Information on Improvements document released yesterday to help explain the latest estimates, MBIE conceded this year’s revision was a relatively large one and said it was “looking for ways to improve the methodology and accuracy of the MRTEs”.
“In the near future, our focus is likely to be on exploring options to minimise the disruption to users caused by large annual revisions, as has happened in this case.”

Charlie Ives

Charlie Ives, executive director of Regional Tourism NZ, said MBIE’s reduction of international spending estimates by 8% for the October year was “quite a drop”.
“We’re concerned because the MRTEs are what regional tourism organisations use when they report to their stakeholders and it’s usually local government that is the funder of most RTOs,” said Ives.
“When RTOs go back to their funders and say, ‘sorry, we got it wrong’, then that’s a cause for concern.”
Ives said it was important to note that international spending was increasing, just not by as much as MBIE originally estimated if its latest revision is to be believed.
In that revision, MBIE pushed domestic spending up by $540m or 3% for the year to October with the largest changes in the Auckland and Nelson regions – both up 4.7%.
The MRTEs are created using a base of electronic card transaction data.
“However, the raw data provided is only partial, and excludes many parts of tourism spend, such as cash spending and products that are purchased online before arriving in New Zealand,” said MBIE in its explanation of the revised figures.
“Because of this, we align the MRTE totals to the more complete picture of tourism spending in the Tourism Satellite Account. This allows the MRTEs to estimate total tourism spending.”
MRTEs from October 2017 onwards will be aligned with the latest TSA.
Revised regional international spending estimates:

Source: MBIE

Revised regional overall spending estimates:

Source: MBIE

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