Tourism satellite account

23.10    The Australian tourism satellite account (ATSA) is based on the international standard, Tourism Satellite Accounts: Recommended Methodological Framework 2008 (TSA RMF) (Eurostat, the OECD, the UN Statistical Division and the UN World Tourism Organisation) which is an update of the first version published in 2000. Along with other statistical agencies, the ABS contributed to the TSA RMF development, and helped ensure consistency with the 2008 SNA.

23.11    The TSA provides a means by which the economic aspects of tourism can be drawn out and analysed separately; however, within the structure of the ASNA. The ATSA is set in the context of the whole economy so that tourism's contribution to major national accounting aggregates can be determined and compared with other industries.

23.12    The key aggregates of the TSA are:

  • tourism consumption;
  • direct tourism output;
  • direct tourism gross value added (GVA);
  • direct tourism gross domestic product (GDP); and
  • direct tourism employment.

Scope of the TSA

23.13    The ATSA measures the direct impacts of tourism only. Indirect impacts are outside the scope of the ATSA; however, they are measured by Tourism Research Australia, using the tourism Supply and Use table and input-output multipliers.

23.14    A direct impact occurs where there is a direct relationship (physical and economic) between a visitor and a producer of a good or service.

23.15    Alternatively, the indirect effect of tourism consumption is a broader notion that includes downstream impacts of tourism demand. For example, a visitor buying a meal generates indirect effects for the food manufacturer, the transporter, the electricity distributor, etc., all of which provide the necessary inputs required to make the meal.

23.16    In the case of goods purchased by visitors, only the retail margin contributes to key tourism supply measures. This is because it is deemed that only the retailer has a direct relationship with the visitor and is, therefore, part of the tourism industry. The implication of this treatment is that the value added generated in the chain of supply of goods to visitors up to, but not including, the retail level will be treated as an ''indirect effect'' of tourism consumption, while only the value added generated from retail trade activities provided to visitors will be considered as a direct effect.

Concepts of Tourism

Tourism

23.17    An important conceptual distinction concerns the difference between travel and tourism, and consequently between a traveller and a visitor. The term 'tourism' in the international standards is not restricted to leisure activity. It also includes travel for business or other reasons, such as education, provided the destination is outside the person's usual environment. A person's 'usual environment' is defined by the 2008 International Recommendations for Tourism Statistics (IRTS) as:

    . . . the geographical area (though not necessarily a contiguous one) within which an individual conducts his/her regular life routines.¹⁰⁹

23.18    Travel is a broad concept which encompasses the activity of travellers and includes commuting to a place of work, migration and travel for business or leisure. A traveller is defined by the 2008 IRTS as:

    . . . someone who moves between different geographic locations, for any purpose and any duration.¹¹⁰ 

Visitors

23.19    The central statistical entity in tourism statistics is the ''visitor''. The scope of tourism in the international standards comprises the activity of visitors. A visitor is defined in the 2008 IRTS as:

    . . . a traveller taking a trip to a main destination outside his/her usual environment, for less than a year, for any main purpose (business, leisure or other personal purpose) other than to be employed by a resident entity in the country or place visited.¹¹¹

23.20    If a person stays in the one place for longer than one year, their centre of economic and social interest is deemed to be in that place, so they no longer qualify as a visitor.

23.21    The following types of persons are not considered to be visitors:

  • persons for whom travel is an intrinsic part of their job (e.g., bus driver, air crew);
  • persons who travel for the purpose of being admitted to or detained in a residential facility such as a hospital, prison or long stay care;
  • persons who are travelling as part of a move to a new permanent residence;
  • persons who are undertaking military duties; and
  • persons who are travelling between two parts of their usual environment.

23.22    Visitors can be classified into national and international visitors. National or ''domestic'' visitors consist of Australian residents who travel outside their usual environment within Australia. They include both overnight visitors, people that travel more than 40kms from home (staying one or more nights at a location) and same day visitors, people who travel over 50kms in a round trip, outside of their usual environment. International visitors are those persons who travel to a country other than that in which they have their usual residence.

23.23    The one-year rule for length of stay for an international visitor is consistent with the principle applied in determining residency which requires the length of stay in an economic territory to be less than one year to qualify as a non-resident. The ATSA includes as visitors all international students undertaking short term courses with an actual length of stay of less than one year. If a student stays longer than one year (ignoring short-term interruptions to their stay, for example at vacation break), their usual environment is deemed to be the school or university, and they do not fit the definition of a visitor. They are considered a visitor if they travel outside their usual environment.

23.24    The consumption of Australian residents travelling overseas (outbound visitors) is excluded for the purposes of measuring direct tourism gross value added and direct tourism GDP in the ATSA, except to the extent they consume domestically produced products before or after their overseas trip. This is because their consumption overseas does not relate to the value of goods and services produced within the Australian economy.

Tourism expenditure

23.25    Tourism expenditure covers actual expenditure by the visitor, or on behalf of the visitor, and is defined in the 2008 IRTS as:

    ...the amount paid for the acquisition of consumption goods and services, as well as valuables, for own use or to give away, for and during tourism trips. It includes expenditures by visitors themselves, as well as expenses that are paid for or reimbursed by others.¹¹²

23.26    As per the above definition, tourism expenditure also includes expenditure by visitors whose main purpose is business, even if this is totally or partly paid for by their employer. It also accounts for expenditure before or after the trip that related to the trip e.g. purchase of luggage or printing of photographs.

23.27    Some expenditure by Australians travelling abroad is also included in tourism expenditure. The purchase of these goods and services must be before or after the trip in Australian domestic territory. With the exception of inbound services provided by Australian international air carriers, anything that is purchased by an Australian whilst overseas is considered an import of a good or service.

Tourism consumption

23.28    Tourism consumption includes consumption by both domestic and international visitors.

23.29    It also includes imputations for consumption by visitors of certain services for which they do not make a payment. Imputed consumption in the ATSA includes:

  • services provided by one household to the visiting members of another household free of charge, including the value of goods such as food and purchased services provided by host family/friends;
  • housing services provided by vacation homes on own account (imputed services of holiday homes deemed to be consumed by their visitor owners); and
  • imputed values of non-market services provided directly to visitors such as public museums even though these may be provided free or at a price which is not economically significant.

Direct tourism GVA and direct tourism GDP

23.30    Direct tourism GVA and direct tourism GDP are the major economic aggregates derived in the ATSA.

23.31    Direct tourism GVA is measured as the value of the output of tourism products by industries in a direct relationship with visitors less the value of the inputs used in producing those tourism products. Output is measured at basic prices; that is, before any taxes on tourism products are added (or any subsidies on tourism products are deducted). Taxes on tourism products include the GST, wholesale sales taxes and excise duties on goods supplied to visitors. Direct tourism gross value added is directly comparable with estimates of the gross value added of ''conventional'' industries such as mining and manufacturing that are presented in the national accounts.

23.32    Direct tourism GDP measures the value added of the tourism industry at purchasers' prices. It therefore includes taxes paid less subsidies associated with the productive activity attributable to tourism and will generally have a higher value than direct tourism value added. Direct tourism GDP is a satellite account construct to enable a direct comparison with the most widely recognised national accounting aggregate, GDP.

23.33    While direct tourism GDP is useful in this context, the direct tourism GVA measure should be used when making comparisons with other industries or between countries.

Endnotes

  1. UNSC (2008) 2008 International Recommendations on Tourism Statistics. New York: United Nations Statistical Commission (UNSC), paras.2.21–2.25.

  2. Ibid., para.2.4.

  3. Ibid., para.2.9.

  4. UNSC, 2008, para.4.2.

Classifications

23.34    Not all products and industries in the standard national accounts product and industry classifications are related to tourism. Therefore, the TSA distinguishes between products and industries that are related to tourism, and those which are not. Tourism related products and industries are further classified into tourism characteristic and tourism connected resulting in three categories of industry and product in the ATSA.

Tourism related products

23.35    Tourism characteristic products are defined as those products which would cease to exist in meaningful quantity, or for which sales would be significantly reduced, in the absence of tourism. Under the international TSA standards, core lists of tourism characteristic products, based on the significance of their link to tourism in the worldwide context, are recommended for implementation to facilitate international comparison. International TSA standards also recommend that country-specific tourism characteristic products are identified. In the ATSA, for a product to be a country-specific tourism characteristic product, at least 25 per cent of the total output of the product must be consumed by visitors.

23.36    Tourism connected products are those products that are consumed by visitors but are not considered as tourism characteristic products. These products are not typical to the tourism industry only.

23.37    All other products in the Supply and Use table not consumed by visitors are classified as ''all other goods and services'' in the ATSA.

Tourism related industries

23.38    Tourism characteristic industries are defined as those industries that would either cease to exist in their present form or would be significantly affected if tourism were to cease. Under the international TSA standards, core lists of tourism characteristic industries, based on the significance of their link to tourism in the worldwide context, are recommended for implementation to facilitate international comparison.

23.39    In the ATSA, for an industry to be a country-specific tourism characteristic industry, at least 25 per cent of its output must be consumed by visitors. Whether or not an industry is classified as characteristic has no effect on total value added resulting from tourism. This is because the ATSA measures the gross value added resulting from the production of products directly consumed by visitors, not the total gross value added generated by tourism related industries.

23.40    Tourism connected industries are those, other than tourism characteristic industries, for which a tourism related product is directly identifiable (primary) to it, and where the products are consumed by visitors in volumes which are significant for the visitor and/or the producer.

23.41    Industries that do not fall into characteristic or connected industries are classified as ''all other industries'', though some of their products may be consumed by visitors and are included in the calculation of direct tourism gross value added and direct tourism GDP.

Tourism satellite account framework

23.42    The Supply and Use tables for the Australian economy provide the framework in which data for visitor expenditure (demand) and industry output (supply) are integrated and made consistent in the ATSA benchmark process. Moreover, they provide the means of calculating direct tourism gross value added and direct tourism GDP.

23.43    The Supply table is a matrix showing (in the rows) the basic price values of products produced by each major industry. It also shows the supply of products from imports, and the net taxes on products and trade and transport margins that are required to derive supply at purchasers' prices. The Use table shows the use of each product, both as intermediate consumption by industries and in domestic final demand and exports. The use table also shows the primary inputs (compensation of employees and gross operating surplus) required by each industry.

23.44    The Supply and Use tables are brought to balance so that the supply of each product equals its use. Some disaggregation of the products and industries shown in the standard tables is required, as the objective of the ATSA is to focus on tourism-related products, and the industries that produce them. It is therefore necessary to augment the standard Supply and Use tables. The non-tourism products and industries are compressed for operational convenience in constructing the ATSA, but the details remain in the underlying Supply and Use tables.

23.45    An important characteristic of tourism products is that they are not uniquely defined by their nature, but by who purchases them. Therefore, the consumption of each product has to be divided into the part consumed by visitors and the part consumed by non-visitors. This information is used to partition industries into their tourism and non-tourism components, enabling the derivation of direct tourism value added and direct tourism GDP.

23.46    An important part of the compilation process is to check the consistency of data for visitor expenditures on products with the total supply of products. Apparent inconsistencies are resolved by further data investigations and adjustment.

Sources and methods

23.47    The data sources and methods used to compile the Australian TSA are outlined in detail in the ABS publication, Australian National Accounts: Tourism Satellite Account.

23.48    The usual TSA methodology involves estimating a full benchmark every third year. The method for compiling benchmark estimates involves the use of fully balanced Supply and Use tables that underlie the ASNA. Further, the latest industry data in respect of tourism related industries is incorporated. In order for tourism output and value added to be derived, the satellite accounts need to be supplemented with data from the demand side, i.e. tourism consumption. Where there are extraordinary events, for example the COVID-19 pandemic, resulting in sudden structural change, the frequency and timing of the benchmark may need to be reviewed.

23.49    A number of steps are required to then compile direct tourism value added. These are detailed in the Australian National Accounts: Tourism Satellite Account. Very simply after removing product taxes and subsidies, margins and imports from internal tourism consumption (for each tourism product), it is possible to derive tourism product ratios to determine the output of each product consumed by tourists. Tourism intermediate consumption is then derived using relationships from the supply-use tables. Direct tourism gross value added is then estimated as direct tourism output less intermediate consumption required to produce this output, and sum for all industries in the economy,

23.50    It is not feasible to collect the detailed supply side data required to produce a timely full-scale TSA every year. Therefore, the key aggregates are updated annually using relationships in the benchmark TSA and demand side data that are available annually.

23.51    Where there is a structural change in tourism related industries or the general economy in the non-benchmark years, it is likely that there will be revisions when the next benchmark is compiled.

23.52    The main data sources are from:

  • Tourism Research Australia – the National Visitor Survey and the International Visitor Survey; and
  • The ABS – the Census of Population and Housing, the Household Expenditure Survey, the Balance of Payments and International Investment Position, the Economic Activity Survey, the Labour Force Survey and Overseas Arrivals and Departures.

23.53    Additional data sources are used in a benchmark year. They can be found in the ABS publication, Australian National Accounts: Tourism Satellite Account.