2016 08 09 - S&O Agenda - Item 8, Att 2 - AEC Noosa Convention & Performing Arts Centre Pre-feasibility Review

PRE-FEASIBILITY OF CONVENTION AND PERFORMING ARTS CENTRES



7.              ECONOMIC ASSESSMENT
7.1             APPROACH
The following sections examine the estimated economic activity supported through the construction and operational
phases of the proposed Convention Centre and Performance Arts Centre. The economic impacts have been
assessed at the Noosa Local Government Area (LGA) level.

An Input-Output model, including the development of a series of specific regional Input- Output transaction tables,
was developed to reflect the economic structure of the Noosa LGA. Input-Output modelling describes economic
activity through the examination of four types of impacts which are defined and described in the table below.

Table 7.1. Economic Indicators
    Indicator        Description
                     Refers to the gross value of goods and services transacted, including the costs of goods and services used
                     in the development and provision of the final product. Output typically overstates the economic impacts as it
    Output
                     counts all goods and services used in one stage of production as an input to later stages of production,
                     hence counting their contribution more than once.
                     Refers to the value of output after deducting the cost of goods and services inputs in the production
    Gross Value
                     process. GVA defines the true net contribution and is subsequently the preferred measure for assessing
    Added (GVA)
                     economic impacts.
                     Measures the level of wages and salaries paid to employees of the industry under consideration and to
    Income
                     other industries benefiting from the Project.
                     Refers to the part-time and full-time employment positions generated by the economic shock, both directly
    Employment       and indirectly through flow-on activity, and is expressed in terms of Full-Time Equivalent (FTE) positions.
                     One FTE job is defined as one person working full time for a period of one year.
Source: AEC

Input-Output multipliers can be derived from open (Type I) Input-Output models or closed (Type II) models. Open
models show the direct effects of spending in a particular industry as well as the indirect or flow-on (industrial
support) effects of additional activities undertaken by industries increasing their activity in response to the direct
spending. Closed models re-circulate the labour income earned as a result of the initial spending through other
industry and commodity groups to estimate consumption induced effects (or impacts from increased household
consumption). The following estimates consider the Type I flow-on impacts only, noting that Type II impacts are
commonly considered to overstate economic activity.


7.2             MODEL DRIVERS AND ASSUMPTIONS

7.2.1           Drivers of Economic Activity
The Convention Centre and Performing Arts Centre developments would be expected to generate net additional
economic activity in the Noosa economy primarily through three avenues:

      Economic activity generated through the construction of the facilities.

      Direct turnover generated by the operational activities that would not have otherwise occurred within Noosa.

      Additional tourism and visitation to the region that would otherwise not be expected to occur, resulting in
       increased visitor expenditure on goods and services.

The assumptions used for modelling the impact of each of these avenues are outlined below.

7.2.2           Construction
For modelling purposes, construction costs were broken down into their respective Australian and New Zealand
Standard Industrial Classification (ANZSIC) industries. This breakdown was developed based on assumptions by




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