Kingscote Airport Business Case Appendices - Kangaroo Island ...

Kangaroo Island Futures Authority Draft Economic Impact of Agriculture and TourismIn 2011/12 Kangaroo Island GRP was approximately $217m (Table 4.2). On this basis, theprojected GRP total impact would boost the region’s total by a minimal amount under Scenario1 and 0.3 per cent per annum for scenarios 2, 3 and 4.Table 7.4Economic Impact of the Kingscote Airport upgrade options, operation phaseScenario 1 Scenario 2 Scenario 3 Scenario 4GRP ($m)Direct 0.019 0.404 0.410 0.464Flow-on 0.018 0.216 0.221 0.267Total 0.037 0.620 0.631 0.731Employment (fte)Direct 0 7 7 7Flow-on 0 2 2 2Total 0 8 9 9Source: EconSearch analysisEmployment (fte)...The estimates presented in Table 7.4 show that direct employment on Kangaroo Island isexpected to be less than 1 fte for Scenario 1 and 7 fte for Scenarios 2, 3 and 4. Includingindirect effects (impacts on local businesses and service organisations) the employment effectis projected to be less than 1 fte for Scenario 1, 8 fte for Scenario 2and 9 fte for Scenarios 3and 4 (Table 7.4).Fte employment in the region was 2,330 in 2011/12 (Table 4.1). On that basis, the projectedemployment impact would boost the region’s total by minimal amount under Scenario 1 and0.4 per cent for scenarios 2, 3 and 4.ConclusionAnnual operating and maintenance expenditures for each scenario are relatively modestranging from about $54,000 to about $1.15m per annum. Despite the fact that 100 per cent ofthis expenditure is likely to stay in the Kangaroo Island economy as opposed to 5 – 17 per centin the construction stage, the impact on GRP of operating and maintenance expenditure is onlyestimated to be a maximum of 0.3 per cent of the regional total.It is difficult to make a case for the investment of public funds in an upgrade to the KingscoteAirport that is based solely on the positive impacts to the Kangaroo Island GRP and localemployment as a result of the direct investment in construction, operating and maintenance.However, the impact on the Kangaroo Island economy of an upgrade to the Kingscote Airportis not limited to the economic activity that results from the direct expenditure on the upgradeproject alone.The upgrade of the Kingscote Airport can be considered a milestone investment fordevelopment in other industries and in particular for tourism on Kangaroo Island. Theeconomic impact of potential future scenarios for Kangaroo Island tourism that include growthin visitation linked to the availability and cost of access to the Island should also be taken intoaccount when considering the economic and social impacts of an upgrade to the Kingscoteairport.e c o n s e a r c hPage| 29