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Australia’s travel agency industry, a $45 billion business sustaining 3000 travel agents and 40,000 jobs, has not only stalled, it has been “thrown into reverse”, industry leaders have told the Senate Select Committee inquiry into the Covid-19 response.

Australian Federation of Travel Agents (AFTA) chair Tom Manwaring and chief executive Darren Rudd made a plea for continuing government support and for the opening of domestic and international borders. Both were crucial for Australia’s travel agents and 40,000 employees, they said.

Questioned by Senator Murray Watt about reports of overseas-based online travel agents going broke and leaving local operators out of pocket, Manwaring added: “Unfortunately, more defaults are probably due, and it’s a matter of that cash being tracked as best as possible. There’s no single-shot solution to this problem, though. We’re well aware of it.”

Tourism-focused organisations appearing before the hearing included AFTA, the Australian Chamber of Commerce and Industry, Tourism and Transport Forum, Australian Airports Association and the Business Events Council of Australia.

Manwaring and Rudd said priorities for travel agents included money flow and refunds. The “devastating revenue reality” underlined a critical need for international travel to resume and made a compelling case for tailored, ongoing financial support and business relief measures for travel agencies.

“The travel agency system, which is the start of the journey of travel, both domestic and international, has been thrown into reverse,” Manwaring said. “Last year’s bookings are now being refunded – some $3 billion so far this year – with no income coming in the door; the income is outflowing. The system wasn’t built for reverse.”

When Rudd was asked by the select committee chair whether he could estimate when the most critical period for agents was likely to begin, Rudd replied: “We are in that period now. We are looking at a range of mechanisms, in-house and through other experts, to help advise people on when to choose to sustain the business and when to choose to exit the business gracefully.

“We’ll be putting submissions to government in the budget process to help with funding and also to bring back legislation, like the Fair Entitlements Guarantee, to help people, if they have to go down that particular path, to exit their lifetime’s work gracefully and be able to afford all of the entitlements that their employees are due. That’s a harsh reality. My counterpart in the United States is advocating that 70% of travel agents in the United States will fold. People are calling us from Greece to make bookings, because the travel agent guild and craft in that country is almost extinct.”

In a statement issued later, Rudd confirmed: “This is a critical time for our sector and unless we all work together, there are many businesses which will not survive. We don’t want that to happen. This is a sector which has spent generations helping Australians get overseas for commerce and culture, family and friends’ reunions and now it’s time for our society to help them in return.

“I hope borders are open as soon as possible, not just domestic, but also New Zealand.”

Manwaring spoke of the frustration in travel agent businesses “because they are family businesses on the threshold of collapse and they need borders open so they can generate cash and business. Failing that it has to be government support. It’s a $45 billion business currently going in reverse and 3000 travel agents and 40,000 jobs depend on it.”

A copy of the Senate Select Committee on COVID-19 public hearing transcript is available here.

Written by Peter Needham