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Did the Blue Mountains 'cry wolf' about bushfire losses?

By Robert Gibbons - posted Wednesday, 25 February 2015


The bushfires of October 2013 were devastating in the northern and southern ends of the Blue Mountains but did not affect – as it happened – the population and commercial spine along the Great Western Highway and rail line. Nonetheless the State Government gave warnings for visitors to stay away, at least in part to free traffic for essential vehicles, but extended that into a warning that the Upper Mountains' villages might have to be evacuated.

The Blue Mountains City Council's mayor, Clr Mark Greenhill, and others argued that great economic damage had been done to businesses and pushed the Federal and State Governments to make good on promises to give compensation and/or short-term loans to businesses along that spine that had lost customers during the crisis period.

The Mountains' business community argued that their sector had lost a lot of revenue. There was a succession of statements, starting with the views of the chairman of the tourism regional peak body (reduction of 80% in tourism and hospitality income), specific tourism operators and then the Council's economic arm (Blue Mountains Economic Enterprise), on to Federal and State MsP.

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The claimed "losses" rose from $3.5 million over 6 weeks for 4 major resorts, to $2 million a day to $100 million and 515 jobs. The "blunder" alarm was going off as $100 million is all of (100% of) "holiday/leisure" visitage for a whole year, or 2.4 months of all regional tourism revenue. 515 jobs is more than 25% of the number of regional jobs in BM tourism accommodation (2,001) which in turn is only 7th in size in the order of employing sectors in the LGA.

On 25 February 2014 BMEE published (Report 3, Economic Impact Report) being modelled projections of losses based on data from BMLOT and national surveys. The series of three analyses progressively increased the loss numbers. Separately, when the chair of BMLOT passed from Randall Walker to Clr Daniel Myles in February 2014, the former was reported as saying the region was on the way to doubling visitage by 2020.

The questions arising relate to (1) whether "modelling" that is presented as evidence bears much relationship to reality; and (2) whether an important region can rely on vested interests to produce "evidence" as opposed to say the professional work of (say) the Hunter Valley Research Foundation to the north of Sydney.

Generally there is no sign that professional economic trend and situational analyses have been published in this important tourism region. BMEE's readers had to work through such text as:

  • Gross Region Product is estimated to decrease by $46.774 million (2.12 %) to $2,162.175 million.

Contributing to this is:

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  • Direct decrease in output of $63.254 million
  • 371 fewer jobs
  • $15.455 million less in wages and salaries
  • Reduction in value-added of $29.023 million

Using published official sources, it has been found that comparing 2012-13 with 2013-14:

  • There was a normal seasonal decline in accommodation takings in Katoomba/Leura 3 months before the fires
  • There wasNOdecrease in takings over September to December
  • The post-Christmas trends were normal with stronger recovery than in 2012.
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About the Author

Robert Gibbons started urban studies at Sydney University in 1971 and has done major studies of Sydney, Chicago, world cities' performance indicators, regional infrastructure financing, and urban history. He has published major pieces on the failure of trams in Sydney, on the "improvement generation" in Sydney, and has two books in readiness for publication, Thank God for the Plague, Sydney 1900 to 1912 and Sydney's Stumbles. He has been Exec Director Planning in NSW DOT, General Manager of Newcastle City, director of AIUS NSW and advisor to several premiers and senior ministers.

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