Licensed Tour Operator Permit Reform
Victoria’s Nature-based Tourism Strategy 2008-2012 was developed in recognition of the opportunities that this sector presented to Victoria’s tourism industry and the economy more broadly.
The Victorian economy is gradually transitioning from reliance on traditional sectors such as agriculture to a more service-oriented economy. In regional Victoria, the ongoing development of nature-based tourism is a key part of this transition and also an important part of regional economic development. VTIC believes there are considerable opportunities to better manage and leverage the State’s natural assets, not only to realise the potential and vision set out in the NBT Strategy but also to achieve the best social, environmental and economic outcomes for key public tourism assets in the State. 
Whilst the VCEC Inquiry into Tourism presents opportunities for broader reforms, licensing of commercial activities on public land is a key area which was not within the scope of this Inquiry. The Licensed Tour Operator (LTO) regime is one enabling and management system within the overall public land management framework. The LTO system has recently undergone a lengthy reform process.
VTIC contends that, despite this process, little reform has actually been achieved. Reasons for this are outlined below, along with suggestions for further changes. This paper has been prepared in the context of the recently introduced legislation that aims to establish a consistent licensing framework for commercial tour operators and recreation providers on public land.
- Tourism Alliance Victoria was heavily involved in lobbying on this issue from the start of the reform process and has provided an industry perspective via the Project Control Board which includes representatives from the Department of Sustainability and Environment and Parks Victoria. This representation has been continued by VTIC.
- The Policy Statement for the Licensing System for Tour Operators and Activity Providers on Public Land, approved and signed by Gavin Jennings, was released in May 2008.
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Key points in the statement were:
- Longer licence terms (Objective 1.1)
- Ability to transfer licences under certain circumstances, subject to approval by the land manager (Objective 1.2)
- Review of the licence fee structure (Objective 2.3)
- Mandatory certification of 3 and 10 year licence holders in any one of a number of specified accreditation programs (Objective 3.1)
- Improved compliance (Objective 5)
- Implementation of the reforms was to commence 1 July 2009.
- In March 2009 the PCB was notified by DSE Public Land Services that Parliamentary Counsel had advised that it is no longer considered appropriate for a Minister or Dept. Secretary to set fees and that this must be done in Regulations. This requires undertaking a Regulatory Impact Statement (RIS) which requires a minimum 28-day public consultation period.
- At this stage it was also flagged that the Bill required to enact the proposed changes would not be passed by the end of June 2009. This was because the proposed changes affected five acts which subsequently needed to be reviewed.
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These delays to the fee increase were, at the time, considered to be of benefit to the industry in the light of the Black Saturday bushfires and the global financial crisis. However, it was also noted that the RIS process could also result in fees being set higher than those set out in the Policy Statement.
- The PCB was also advised that Parliamentary Counsel did not think it appropriate to allow for transfer of licences/permits because of property transfer issues. Also it was thought that transfer of permits had the potential to lead to a value being attached to permit which can potentially lead to profiteering. This was a considerable set back for the reform agenda pursued by industry.
- The RIS process eventually took place in April 2011 – six years after the original DSE directions paper was released, and three years after the policy statement was released.
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The new regulations and fees came into effect on 1 July 2011 and provide that:
- Public land managers may grant a tour operator licence for up to 10 years
- Public land managers must charge regulated state-wide fees for a tour operator licence
- Penalties apply for operating without a licence
Key Issues
It should be noted that the new legislation does not provide criteria for granting longer term licences. Whether to grant a tour operator licence, and the duration and conditions of a licence, still remain at the discretion of the relevant public land manager.
Further, The Victorian Government Policy Statement Licensing System for Tour Operators and Activity Providers on Public Land in Victoria (2008) states that longer-term tour operator licences should be conditional, amongst other things, on the applicant being accredited under a recognised industry certification program that encourages improved environmental, cultural and business management.
Obtaining accreditation under one of the recognised programs remains the preferred basis for considering applications for a longer term tour operator licence, as it enables public land managers to recognise and reward an evolving suite of industry-developed and regularly reviewed operating standards. However, demonstrating industry certification or an equivalent standard does not guarantee a licence will be granted. The decision to grant a licence, its duration and conditions all remain within the discretion of the public land manager.
Key Recommendations
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That security of tenure is essential: The purpose of advocating for longer term licences was to provide operators with meaningful security of tenure or access to the public land asset, which is essential for better long-term business, financial and investment planning. As the longer term licences will only be made available “subject to the discretion of the land manager”, this does not provide LTOs with any assurance that they will receive an extended term licence. Even if an operator meets the conditions and fulfils the criteria required for an extended term licence (such as undertaking recognised a certification or accreditation program), if the land manager does not wish to issue such a licence, the operator will be no better off under the new system, despite the lengthy reform process that has been undertaken to achieve the availability of longer licence terms.
- That the non-issuance of extended term licences occurs on an exceptions basis only. That is, if an operator meets the conditions and criteria required to obtain the extended term licence then that licence must be issued.
- That there be a clearly documented and publicly scrutinised ‘right of reply’ or appeal process for operators whose application for an LTO permit or competitively allocated licence is declined.
- Existing licenses systems across of range of sectors of the economy operate very successfully on the principle of ‘as of right’ issuing, based on attainment of minimum standards; price signals in the licensing system; cumulative impact ceilings; and robust enforcement of the need to be licensed and maintain ongoing attainment of minimum standards.
Details
Summary document - LTO Licence Reforms - August 2011
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