Access to Heritage
Table of Contents

4. Entry fees: arguments of principle

`This isn't a commercial building... I think the director referred to other cultural institutions... and that it was only the price of a packet of cigarettes or an ice cream. That's got nothing to do with it. It's a disgrace that our men and our veterans who have served should have to pay to go into it.'

objector to admission fees at the Australian War Memorial's museum galleries, 1991

4.1 Submissions put forward a variety of interrelated arguments. To give the following analysis some structure, we will separate them into arguments of principle and arguments of detail. They may be considered as two hurdles; both supporters or opponents of user pays must cross both to prove their point.

4.2 The arguments of principle apply without regard to particular places. They involve questions like: `Assuming it is practical to levy user charges, is there some higher policy reason why we ought not do it?' Or, to put the opposite bias: `Even if there are practical problems, is there some higher reason why we ought to try it anyway?' The arguments of detail involve questions like: `Accepting that it is undesirable in principle, are there practical reasons why we should or must do it anyway?' or `Assuming it is acceptable/desirable in principle, what are the practical problems or downstream effects?'

4.3 The arguments of principle relate mainly to entry fees, as distinct from charges for `value-added' services, special exhibitions and so on. Many submissions opposed entry fees but of these most accepted or advocated charges for the other things. This raises the question of where the boundary lies between them. Questions to do with `core activities' versus value-added activities are considered in chapter 7.

`Entry to public property should be free of charge'

4.4 The most basic argument put by opponents of user pays was `entry to public property should be free of charge'. This is put first and foremost as a value statement which seeks approval not by force of logic but rather as a fundamental `right':

`As a matter of principle, the public should not have to pay to look at public property.' (Trustees of the Tasmanian Museum and Art Gallery, submission 21 p178)

`Australia's beaches are free and this is a right which is traditional and unimpeachable in our nation. Would the government try to impose `user pays' here?' (National Parks Association of Queensland Inc., submission 24 p207)

4.5 This argument was put most strongly in respect of national parks, less strongly in respect of museums and galleries. The Committee suspect that some reasons for this may be:

4.6 1. different cultural attitudes to public land as such:

`There is a strong Australian cultural tradition of free public access to public lands, based on elements such as historic perceptions of a vast continent that needed to be occupied; rejection by many early settlers of restrictions on access to public land that caused bitter social division in Britain; an inherent belief in freedom of movement in a new land; and a belief that as public land already belongs to the public, the public should not be charged for entry to such land for non-commercial purposes such as recreation.' (Environment Australia, submission 46 p397)

Senator Lees: `I am just thinking of where I travelled in Europe. Beaches are now fenced off. Only those that pay get onto them. In Switzerland, I think it was, I visited a waterfall. Again, it was totally fenced off with almost armed guards on the gate making you pay as you go through the turnstile.'
Prof. Davis: `I do not think that that kind of scale of privatisation is acceptable to the Australian people.' (Prof. B Davis, evidence 7 March 1997 p5)

4.7 2. It may be that in the case of land more people object to paying for entry because it is harder to see the management costs to which they are asked to contribute. In museums and galleries it is much more obvious that the facility is an artefact with staff costs and building maintenance costs and services to visitors. Such perceptions were obviously a factor in the 1996 public controversy over increasing the Great Barrier Reef Environmental Management Charge, for example:

Senator Reynolds: `It seems that different standards apply to different areas of heritage around the country. What is your view about that argument? If you go to Uluru you will have to pay an entry charge. If you go to the National Gallery you will have to pay admission, certainly for particular exhibitions...'
Mr O'Shea: In those particular instances I am receiving some benefit... there is a painting I have not seen before or there are facilities such as toilets...There are no facilities out here. None. Zero. Zilch. There are a few moorings being put down in the Whitsundays - maybe - but there are no facilities out here, so I am paying for nothing.' S O'Shea, Independent Boat Owners Association, evidence 20 May 1997 p58)

4.8 Such objections raise the need for better public information and education about the management needs of protected areas and the uses that user charges may be put to.

4.9 3. Submissions on museums and galleries laid relatively less stress on this argument because they had other strings to their bow: they laid more stress on arguments about socio-economic barriers and the need not to discourage the poor from the educational and cultural enrichment that museums and galleries provide. As we noted in paragraph 3.10, the relatively less emphasis on these things in submissions about national parks hints a view that, compared with a museum visit, a national park visit tends to have a greater component of `mere' recreation.

`... and anyway, we've already paid for it through our taxes'....

4.10 As put so far, the argument about a fundamental `right' of free access applies (if it applies at all) without reference to costs or contributions. It was often allied with the `we've already paid for it through our taxes' argument:

`...there is a long held belief in the community that, given that they pay taxes for the upkeep of public land, they should not be `charged twice' when accessing such land.' (Environment Australia, submission 46 p397-8)

4.11 Logically, this (like the points in the two sections below) is a fallback position: `We demand free access as a fundamental right [that is, as a value held without reference to the economic system]; failing this, we demand it as a fair consideration for our tax payments.' But the fundamental argument and the fallback position tend to run together naturally.

4.12 The short answer is that many public services are customarily funded by the community as a whole through taxes as well as by the direct users through a contribution at the point of use (for example: medical services, government schools, urban public transport... [1]). Other are not (public libraries, police, emergency services...). Statements like those just quoted beg the question of which group museum and national park `services' should belong to. As well, comparisons with things like beaches or urban parks gloss over the question of whether these other things are traditionally free of charge because of a principled decision, or simply because it is impractical to charge for them. The former supports the argument for free national parks, by analogy; the latter says nothing about situations where it is practical to charge.

`... and anyway, we're all “users”...'

4.13 A further nuance arises from the claim that the `users' (that is, beneficiaries) of museums, galleries and national parks are far more widespread than the direct users.

`I personally have still not seen some of Australia's great natural and cultural heritage sites, and perhaps never will, but I benefit enormously from the knowledge that they are preserved, researched, filmed and written about.' (D Chinner, submission 1 p7)

4.14 Such `non-use benefits' include both benefits to individual non-visitors, such as `option value' (`I may want to visit it one day'), `existence value' (`I like knowing it's there') and `bequest value' (`I like knowing that my grandchildren will be able to visit it'); [2] and benefits to the community as a whole (such as confirming cultural identity; the `intrinsic value' of biodiversity and environmental conservation).

4.15 That these benefits exist is not controversial, and this was the basis for the general position, among those who supported user charges, that user charges cannot and should not aim to cover more than a small percentage of total costs (since the place is maintained primarily for the sake of broader community benefits, it would be unfair or inefficient to charge its full cost to direct users). But opponents of user charges sometimes tried to extend the point to the limit, claiming that the existence of community benefits means that user charges should not be levied at all:

`... “users” of heritage areas are more widespread than those who physically access the areas, and therefore, the cost of resource management of Australia's natural heritage should be borne by the whole community through increased funding to conservation agencies.' [emphasis added] (The Wilderness Society (Sydney) Inc, submission 14 p118)

4.16 The argument depends on the validity of the `therefore'. It is not convincing. The obvious point that there are community benefits does not negate the fact that there are private benefits to direct users as well. The question is whether it is appropriate to charge at the point of use for the private benefits. Whether it is desirable in principle is considered in the rest of this chapter; whether it is economically efficient or equitable is considered in chapters 5 and 6.

`Unfair to charge some but not others'

4.17 Some submissions claimed that it is unfair to charge some users but not others (the argument is similar to that described just above if we think of `some' as correlating to `visitors' and `others' as correlating to `nonvisiting beneficiaries'). For example, in the case of the Great Barrier Reef Environmental Management Charge it was argued:

`To be fair and equitable, a charge should be applied to all users, not just the ones [commercial tourist operators] that can be easily made to conform and easily located.' (Mike Ball Dive Expeditions Australia, submission 51 p453)

4.18 A variant distinguishes visitors to different national parks, arguing that charging some is unfair to others:

`If it is not practical to collect the fees [in small or remote national parks] it is manifestly unfair to charge visitors to `popular' national parks and expect them to subsidise other national parks.' (National Parks Association of Queensland Inc., submission 24 p207)

4.19 But in general, deciding in what circumstances it is fair for some to subsidise what others consume is no simple matter. One can look not only at who pays what at the gate, but also at who pays what in their taxes. Seen from this angle, it can equally be argued that free entry for some is unfair to others:

Senator Hogg: `Why should people in Townsville have their taxes contributing to the maintenance of the museum in Brisbane? The likelihood of those people ever seeing the museum in Brisbane is reasonably remote....'
Prof. Bennett: `... you need a certain critical mass effect in order to produce institutions that can embody, that can exhibit and that can make available forms of heritage collections that are representative of the history of larger than local entities, be they of a state or that of a nation or, indeed, international heritage. That does not prevent those institutions from making that heritage available within the state through regional touring programs, or whatever. I think that is the answer to that question.' (Prof. T Bennett, evidence 21 May 1997 p82)

4.20 The conclusion intended by opponents of user charges is that the only `fair' course is to have no fees at all. But of course the argument cuts both ways: one could also conclude that more efforts should be made to extract a contribution from all - if it is reasonable in principle to do so:

Senator Gibbs: `Is it fair to charge people to go into a land based national park and not charge people to go on the Barrier Reef?...'
Mr Horstman: `I think there are practical differences between a land based and a marine park which make it more difficult to collect things like charges. Maybe the way to address people's concerns that they are being victimised or made scapegoats is to address all the users of the park....'
Senator Reynolds: `The Department of Defence is a user of the reef. At the time that the tax was introduced, it was suggested that perhaps Defence should be making a contribution for using the reef...'
Mr Horstman: `...Based on the kinds of environmental impacts that defence forces can create in that area, I think there is a clear case that they should be contributing to the management of the area as well.' (M Horstman, Australian Conservation Foundation, evidence 15 September 1997 p463-4)

4.21 And if in practice some visitors escape paying because it is impractical to collect the money, we can see this as a windfall gain to those who escape just as much as an `unfair' impost on those who do not.

`Unfair impost on local residents'

4.22 A closely related argument is that entry fees in national parks are unfair to local residents who may be frequent users.

Prof Hundloe: `I think the real difficulty is with local residents. Something that I am going to face in the Wet Tropics has been faced in the Barrier Reef. You have people living adjacent to these World Heritage Areas. They think, understandably I suppose, it is their right - and maybe God-given right - to access these areas.'
Senator Lees: `It is their backyard.'
Prof. Hundloe: `It is their backyard.' (Prof. T Hundloe, evidence 7 August 1997 p376-7)

4.23 Ticketing schemes can be finessed to minimise the impost. All national parks agencies that charge entry fees offer multi-visit passes. For example, in Tasmania a one-park annual pass is heavily discounted relative to a daily pass ($18 compared with $9 at June 1998), and `was designed specifically to satisfy holiday shack owners and local communities that hold a great deal of local `ownership' of particular parks.' [3] Entry to the Port Arthur historic site is free to residents of the Municipality of Tasman. [4] On the other hand, some argue that such concessions `raise awkward questions about equity in relation to tourists or other visitors.' [5]

Senator Hogg: `Should user pays fees be directed at tourists as opposed to local resident or should they both bear some weight?'
Mr Grey: `...I think there should be equality at the gate of the protected area...the point being that the tourist will say, “Why am I paying this when the locals aren't paying it? We are doing the same thing.”' (F Grey, evidence 15 September 1997 p430)

4.24 `Local residents' arguments were not raised in respect of museums and galleries. We surmise this is partly because of different cultural attitudes to land as such (`it's their backyard'); partly because there would be less sense of local ownership of the capital city institutions which were the major focus of submissions; possibly also because frequent repeat visits may be less common in museums than in national parks.

...versus `it is reasonable to charge for private benefits'

4.25 The basic answer to all the above, put in many submissions by supporters of user charges, has two parts:
1. Museums/galleries and national parks provide both benefits to the community at large and additional private benefits to direct users;
2. The community's contribution to management costs through taxes accounts for the community benefit. It is reasonable/desirable to charge the direct user for the additional private benefits. [6]

4.26 The extra premise which logically lies between 1. and 2., but which the submissions regarded as too obvious to need stating, is that in our society most private benefits are traded in markets for money, and there is no reason to treat the private benefits to direct users of museums/galleries and national parks differently. It is this premise that the Committee regards as the weak point, for two reasons.

4.27 Firstly, many people obviously have deep reasons for feeling that the benefits of education, cultural enrichment, joy of nature and so on, even if they may validly be called private benefits, are different in kind and warrant different treatment from the private benefits that are traded in day-to-day business. We take this point up from paragraph 4.41.

4.28 Secondly, the analogy with private markets is inapt because museums/galleries and national parks are to a large extent `public goods', to which different rules apply: charging at the point of use may lead to a net loss of community welfare. Specifically, the position that people should be charged for private benefits is inconsistent with the common statement of conventional economic theory that welfare is maximised when the price of a non-rival public good is set at marginal cost. [7] We take this up in chapter 5 (from paragraph 5.30).

Theory: museums, galleries and national parks as `public goods'

4.29 Before commenting further we will briefly explain the concepts involved. In the typical textbook formulation `public goods' (sometimes called `collective consumption goods') are goods or services (in fact, mostly services) that are not supplied (or insufficiently supplied) in private markets because:
1. they are `non-excludable': once the service is provided at all, it is open to all: non-payers cannot be excluded (or, to exclude them would be prohibitively costly or contrary to community values); [8] and/or -
2. They are `non-rival in consumption': The service is provided to all in one lump: one person using it does not prevent others from using it (for example: streetlighting). [9]

4.30 Public goods are an example of `market failure'. A classic example is a lighthouse. Private enterprise will not build a lighthouse because there is no way (without the coercion that only government can enforce) of making anyone pay for its services. [10]

4.31 A `pure' public good satisfies both the dot-pointed conditions. Things that satisfy only one of the dotpointed conditions are sometimes called `impure public goods' or `mixed goods'. [11] These too will be underprovided in private markets. A non-excludable good will not be supplied, since payment cannot be forced. An excludable but non-rival good will be undersupplied (that is, supplied in amounts less than is optimal for total community welfare), for less obvious reasons explained in APPENDIX 3 (under `public good'). [12]

4.32 Many submissions described museums, galleries and national parks as `public goods' - either to argue for free entry, or to argue that user charges should not aim for full cost recovery. On the face of it they are not pure public goods as just described: nonpayers can be excluded (certainly in museums and galleries; often in national parks).

`Public goods' does not mean the same as `community benefits'

4.33 Why then did submissions speak of museums/galleries and national parks as `public goods'? There are two answers. Firstly, the term `public good' is often used confusingly in a way which conflates two different things: the way in which a service is provided, and who gets what benefits from it. The textbook formulation speaks only of the first: certain goods and services are provided collectively because of market failure; but this says nothing of who gets what benefits from them. `Public goods' does not mean the same as `community benefits'. Notwithstanding the confusing moral connotations of `public good', the benefits that textbook public goods provide may be completely private - that is, accruing to individual users without any reference to broader community interest (a motorist's use of a public road, for example). Or they may be called `community' benefits simply because they benefit all or most individuals. [13] Or they may be community benefits in a deeper sense - that is, where `community' is defined as a body corporate, a thing greater than the sum of individuals, whose members are conscious of having shared values and interests, and the community interest is in things that serve those values and confirm community identity. [14]

4.34 Or the benefits may be, and usually are, some mixture of these - and in any mixture the elements may be practically impossible to separate. In particular, when we say things like `There is a community interest in everyone having access to an adequate road system, being educated and culturally enriched, not succumbing to childhood diseases....', the interests of the community-as-the-sum-of-individuals and the values of the community in the deeper sense overlap closely - for the fundamental reason that we are moral creatures and are concerned about the welfare of others. [15] This casts doubt on the clear distinction between community benefits and private benefits which supporters of user charges relied on.

4.35 In the submissions, the term `public good' was mostly used loosely - not to argue that museums, art galleries and national parks are textbook public goods (though in most respects they are, as argued just below), but rather to argue that they create community benefits in the deeper sense - people's sense of history, their sense of cultural identity, a wonder of nature - things that as a community we hold dear. The Committee agrees. This indeed must be the reason why cultural institutions and nature conservation have wide public support even among people who are not direct users. [16]

4.36 The second reason for calling museums/galleries and national parks `public goods' is that although visitors can be excluded (that is, charged for entry) the direct private benefit to visitors is only part of the equation - perhaps only a small part. There are other benefits from which no-one can be excluded. These include the community benefits (in the deep sense) just mentioned, as well as some private benefits which accrue to individual non-visitors: for example option value, existence value, and bequest value (defined in paragraph 4.14). In relation to these other benefits museums and national parks are pure public goods (assuming they are non-rival in consumption - that is, not congested - which in Australia is usually true).

Types of benefits from public goods

4.37 To summarise: we may define five types of benefits created by museums, galleries and national parks:
1. private benefits from use: that is, the satisfaction visitors get from their visit; plus non-use benefits, which may be divided into:
2. fixed private benefits accruing to individual non-users from the existence of the place (option value, existence value, bequest value; environmental benefits to land abutting the park...) [17] By `fixed' we mean `not varying depending on use'. The value of these benefits may vary over time because of changing attitudes or other reasons.
3. variable private benefits accruing to individual non-users depending on the amount of use: (for example: spillovers from tourism to regional economies); [18]
4. a fixed community benefit from the existence of the place, which may be perceived even if direct use is small (cultural identity; preservation for future generations; `intrinsic value' of biodiversity; scientific and medicinal uses of plants...);
5. a variable community benefit depending on the amount of use: visitors' private benefits are regarded as creating spillover benefits to the community as a whole (as is commonly argued for education, for example). This category is implicit in statements that user charges should be modest so as not to discourage visitation. It is equivalent to saying that the place is a `merit good': society wishes to encourages use. The fact that users gain satisfaction is itself a source of satisfaction to society. [19]

4.38 The community/ non-use benefits are sometimes called `positive externalities.' [20]

4.39 The Committee will not try to detail exactly what the community/ non-use benefits are, and why they should be called benefits. They involve things like cultural identity, a sense of history (museums); the `intrinsic value' of nature conservation and preservation of biodiversity (national parks); intergenerational equity. It is sufficient to note that they exist (as all submissions accepted). Their value may be estimated by economic techniques such as the contingent valuation method (see paragraph 5.11), or we may simply assume that if the community is acting rationally their value must be at least as great as the public subsidies we pay to preserve them. [21] Our topic here is simply whether and how direct users should be charged for the private benefits of use. [22]

4.40 Henceforth we use `community/non-use benefits' to refer to the last four categories. Note that the variable community benefit goes hand in hand with private benefits: the one cannot exist without the other: the same good provides both inseparably.

Are cultural goods different from day-to-day goods?

4.41 Where does all this leave the `we've-already-paid-for-it-through-our-taxes' argument? On the face of it the argument is logically weak. Many community services are paid for both by taxes and by user contribution at the point of service. For example, capital city government-operated bus and rail networks are typically subsidised by taxes to the tune of 50-80 per cent, like many fee-charging museums and national parks; but few people object to paying their contribution at the farebox as well. [23] Why should museums and national parks be treated differently ?

4.42 Some possible answers (other than practical difficulties of exclusion) are:
1. different elements of `merit good': thus the community supports free access to municipal libraries for traditional reasons to do with `social improvement'; but not to municipal swimming pools.
2. some services have more obvious marginal costs attributable to the individual's use: people may be more willing to pay when they can see that their use of the service is putting the operator to some expense. [24]
3. charges may be more accepted when they have the effect of rationing congested services (example: the municipal swimming pool). [25]
4. charges may be more accepted for services that are similar to common private services (example: urban buses). [26]

4.43 The possibility that the Committee wishes to emphasise here is that different attitudes to different services may result from the perception of different types of benefit. In the case of the bus the benefits seem to be only a private benefit, a directly visible, personal and practical benefit. [27] In the case of cultural institutions, the private benefits of education, cultural enrichment and so on accruing to the visitor are intimately related to - indeed, perhaps inseparable from - community benefits (in the deep sense) which have the same names, and that association makes many people think that the whole area, as a matter of policy, should be outside the market.

`Access to memory, art, beauty, nature and wild places is a birthright not a commodity to be purchased.' (J Lennon, submission 13 p112)

4.44 In this view, the answer to `Why should museums/galleries and national parks be treated differently from buses and trains' is `because they are different, fundamentally.' They are to do with cultural identity, with wonder at the diversity of God's creation, not with day-to-day business. Thus we approach one of the other arguments of principle against user pays: that it changes us from participating citizens into mere customers. The Committee considers that this is the more important issue.

Are we citizens or customers?

4.45 Are the services of museums/galleries and national parks qualitatively different from the services of municipal swimming pools or council carparks? Is there some higher reason why we ought not to charge for them? Is the language of economics adequate for discussing these issues?

`It is a churlish and singularly uncivilised society which legislates to charged a tax on the entry to those places it regards as its temples.' (D Chinner, submission 1 p5)

4.46 With statements like these many witnesses opposed to user charges showed how strongly they felt that museums/galleries and (less often) national parks embody fundamental values which ought to be left outside the market.

`When you start talking about the introduction of access charging that, of course, represents something equivalent to the notion of charging entry fees to churches. It has an abhorrence for indigenous people.' (W Eldridge, Aboriginal and Torres Strait Islander Commission, evidence 6 August 1997 p228)

4.47 Such statements add a dimension to the `entry to public property should be free' argument discussed from paragraph 4.4. That argument and its relatives, as put there, were focussed on personal property rights: here the argument focuses on the place itself and the symbolic importance of free access as confirming that the place is a community resource and the visit is a social act. We do not pay to enter churches, just as we do not pay to view a Council meeting from the public gallery (though the seat may be comfortable and the show entertaining), because to pay, however little, would degrade the experience and offend our civic sense. The absence of payment symbolically distinguishes these transactions from the normal business transactions of daily life.

`...it is difficult to see how an entry charge could be made to the Australian War Memorial, or indeed to Parliament House, both cultural assets which are seen as integral to our democratic society and our place in the world. Entry charges to either institution would make clear statements concerning the `value' we place on such institutions.' (National Campaign for the Arts Australia Ltd, submission 37 p308)

`If someone suggested that we should charge for entry to Parliament House or the High Court, I think that would be a ridiculous proposition.' (D Borthwick, Treasury, evidence 6 August 1997 p236)

`None of the national institutions in Washington [USA] charge... if you visit the nation's capital, you have a right of access to those national institutions. That is a very profound statement about the value places on the cultural assets.' (G Marginson, National Campaign for the Arts Australia Ltd, evidence 6 August 1997 p296)

4.48 As one objector said when entry fees were introduced at the Australian War Memorial's museums galleries in 1991:

`This isn't a commercial building... I think the director referred to other cultural institutions... and that it was only the price of a packet of cigarettes or an ice cream. That's got nothing to do with it. It's a disgrace that our men and our veterans who have served should have to pay to go into it.' (L Moore, 2CN Morning Show, 7 January 1991)

4.49 Although it was not much emphasised in submissions, the Committee thinks this is the most important of the arguments of principle. To enter a community facility free emphasises that it is ours, as a community; to pay emphasises that it belongs to `the government' - the government as business proprietor. The difference in attitude is fundamental.

`The imposition of an entry fee [at the Australian National Maritime Museum, Sydney] undermined one of the main rationales for the existence of museums - that of education to the population at free cost. In doing so, it also did away with the notion of “the public” as the main reason for the existence of museums... Citizens now became tourists... Rather than “the public”, a singular entity bound by a common identity, “museum audiences” are now described as “market niches”...' [28]

`Free access to museums in Australia arose from the evolution of the modern museum from 19th century policies of public education and social improvement. Museums have traditionally been seen both by policy makers and the public as a “good thing” of benefit to all citizens. Charging at the door emphasises a changed relation between the public and the museum - from one of citizen to one of customer.' (National Museum of Australia, submission 42 p360)

4.50 The negative connotation of `customer' here contrasts interestingly with the references to improved `customer service' put as a positive thing in several submissions. [29] `Customer focus' as a positive thing is implicitly contrasted with something like `bureaucratic focus'. We suspect that it coincides unconsciously with the view, all too common in Australian society, that `the government' is, not the elected representatives of the community, but rather an impersonal and vaguely hostile thing out there; and the citizen's most common relationship with `the government' is the passive role of a sufferer queuing at a public office counter.

4.51 This view is regrettable. `Customer focus', as an improvement on `bureaucratic focus', is good; but it is not necessarily the pinnacle. `Citizen focus' in the positive sense of true, active citizenship (that is, participating in community life), would be even better. To foster it we must, among other things, affirm the value of our public institutions, encourage wide access to them, and emphasise that their role is not simply to chase the private sector recreational dollar (more comment on the last point, in respect of museums and galleries, is from paragraph 7.70). [30]

4.52 The change from citizen to customer is a profound one. Perhaps this is why some people resent being asked to pay for what they see as public facilities to do with such deep and emotionally charged things as education and cultural enrichment, where the private benefits and the public benefits are so hard to separate. Perhaps this is why (according to the Committee's evidence), the civic acts of volunteerism and sponsorship tend to fall off in institutions that impose fees (see paragraph 7.81). Perhaps this is why the elasticity of demand for museums - the proportion of discouraged visitors - seems to be high at the change in price from nothing to something (see paragraph 5.69). Perhaps too many people, invited to be customers, think `If you want me to be a customer, I'll be a customer: I'll take my money to the movies!'

4.53 But if we should not charge for access to our civic `temples', this raises the obvious question: which places are they? Churches, parliaments, courthouses, war memorials (shown by the strenuous opposition to entry fees to the Australian War Memorial's museum galleries in 1991, which led to the fee being abandoned after a few months [31]); beaches - the fact that no-one tries to charge for these shows that the principle is sound. [32] But how far should the principle go?

4.54 There can be no objective answer to this question.

Senator Tierney: `I just wondered what the rationale underlying it [decisions on whether to charge] was. I thought at first, when you mentioned the bush example, it might be cost. But then you get to the [free entry] Botanic Gardens, and obviously it is not cost - because they are very expensive public assets to maintain.'
Mr Holmes: `I think, in large part, tradition and history are very significant factors.' (A Holmes, SA Dept of Environment & Natural Resources, evidence 2 July 1997 p138)

4.55 In the case of museums and galleries, some submissions suggested that at least a core of `national' institutions should be free, [33] but it was unclear how these would be defined. The Committee hesitates to makes detailed recommendations on this, not least because the circumstances of individual museums and galleries may differ widely.

`The identity of the terms `museums' and `art galleries' should not blind us to the fact that they are very often quite different institutions depending on whether they are regional or metropolitan or whether they are special interest or general interest. They are quite different institutions; therefore... quite different polices may be appropriate in relation to them.' (Prof. T Bennett, evidence 21 May 1997 p78)

4.56 The Committee suggests that at the least, the key national and state museums and galleries - the flagship institutions in each state which most symbolise the cultural role of museums and galleries - should have free access.

4.57 In the case of national parks similar considerations can be raised. Outdoor temples house the wonders of nature, and we may hope that visitors' experience of them is something deeper and more lasting than mere `recreational use.' For many people this spiritual dimension warrants free entry to national parks as surely as it does to churches. As well, we acknowledge the `strong Australian cultural tradition of free public access to public lands.' [34]

4.58 Nevertheless, the Committee refrains from making a recommendation corresponding to that for museums and galleries just above. To suggest a category of `key' national parks creates too many difficulties. With national parks there is no obvious `first eleven': the circumstances of individual parks are too varied. To define `key ` national parks in terms of nature conservation may seem to undermine the goal of having a comprehensive and representative reserve system. To define them in terms of public recreation would suggest that `key' national parks are the most popular ones; but the most popular national parks are the very ones where, on economic and equity grounds, entry fees are least objectionable (see chapters 5 and 6). Entry fee policies for national parks need to be decided on a case by case basis.

4.59 We foreshadow that the economic and equity arguments in chapters 5 and 6 probably extend the desirable scope of free entry a good way beyond that which is suggested only by the emotional, symbolic and `citizenship' arguments discussed above.

 

Footnotes

[1] For the trend to increasing user contributions in government schools (with interesting analogies to this inquiry), see Senate Employment, Education and Training References Committee, Not a Level Playground - the private and commercial funding of government schools, June 1997

[2] `Bequest value' is the current generation's willingness to pay in order to bequeath; it it not a prediction of how much subsequent generations will value what they inherit from us. That we cannot know.

[3] Queensland National Parks & Wildlife Service & Department of Environment, Benchmarking and Best Practice Program: user pays revenue, report for ANZECC September 1996 p17,45

[4] A Piper, evidence 21 April 1997 p24

[5] Prof. B Davis, evidence 7 March 1997 p5

[6] The argument is present in the much-quoted Department of Finance discussion paper, What Price Heritage: the museums review and the measurement of museum performance, 1989, pp26-28

[7] `Community welfare' (also called the `social welfare') is here defined conventionally as the sum of the satisfaction of all individuals.

[8] It is often pointed out that, given enough ingenuity, few things are really non-excludable. One answer to this is, `Public goods problems arise not [only] when a good is non-excludable... but [also] when it is in fact not excluded, for whatever reason. Social mores may have as much to do with this as the awkwardness and high cost of exclusion...' De Jasay A, Social Contract, Free Ride: a study of the public goods problem, Oxford 1989, p61,128

[9] Some writers add a third condition `non-rejectability': once the service is provided, it is `consumed' equally and compulsorily by all (example: defence protection). Others equivalently classify public goods according to whether consumption is `optional' or `non-optional'.

[10] Intermediate states are `club goods' (which are excludable) and voluntary co-operation (for goods which are not excludable). We could imagine a group of shipowners banding together to build a lighthouse. This depends on having a small enough group of interested parties to allow negotiation and to avoid the problem of `free riders'.

[11] Some use `mixed goods' to refer to situations where a single commodity, inseparably, has both private and public good aspects in supply, or conveys both private and community benefits in use (these are conceptually distinct though they will tend to overlap in practice, since private benefits can be privately marketed). For example: inoculation against disease. The private benefits of inoculation (the patient is protected from disease) are rival and excludable, but the community benefits (others are also protected) are non-rival and non-excludable; that is, other people cannot be excluded from benefiting from the first person's inoculation.

[12] In brief: consumption is optimal (welfare-maximising) when the price equals the marginal cost of provision, which for a non-rival good is zero; but a private supplier, not being able to levy taxes to cover fixed costs, must charge something. This charge will discourage some consumers, so consumption will be less than optimal.

[13] Thus we hear statements like `There is a community interest in having an adequate road system'. This may be paraphrased as `everyone wants an adequate road system available to them'. In this sense the `community' interest here is simply the sum of private interests.

[14] Whether one accepts this category relates to whether one believes that `the social welfare' in economics can mean anything other than the sum of all individuals' welfare.

[15] The essence of community in the deeper sense is the consciousness of shared values. As a community we wish to save all children from disease, quite apart from the fact that as individuals we wish to save our own children. Concern about the welfare of others is implicit in the economic concept of `Pareto improvement', which assumes that as a community we approve of an action that makes at least one person better off without making anyone worse off. See paragraph 5.2, footnote 1.

[16] `A market survey conducted by Roy Morgan Research for the Australian Heritage Commission in July 1996 showed that 72 per cent of respondents either agreed or strongly agreed with the statement that “it is important to spend public money on wilderness areas even if they are seldom visited”, with only 21 per cent disagreeing or strongly disagreeing.' Environment Australia, submission 46 p398. Roy Morgan Research, Wilderness and Wild Rivers Research: version 2, Australian Heritage Commission 1996, p51. In the case of the arts - `[our survey results show] an average willingness to pay [for arts subsidies through general taxation] that significantly exceeds current levels of government arts support in Australia.' Throsby D & Withers G, What Price Culture, Australia Council 1984, p18. See also McDonnell J S, Public Attitudes to the Arts 1994: report of surveys of public opinion for the Australia Council, Australia Council 1995, p6ff; Bennett T, The Reluctant Museum Visitor: a study of non-goers to history museums and art galleries, Australia Council 1994, p10.

[17] Some benefits from conservation of natural areas, received by persons other than direct users, may include windbreaks, improved pollination, improved downstream water quality, flood mitigation, fish breeding, and scientific and medicinal uses of plants. IUCN Commission for National Parks, Economic assessment of protected areas: guidelines for their assessment, no date [1996], p20-21

[18] A clearer example is one person's private benefit arising from other people's inoculation against disease. The more other people are inoculated, the more protection the first person gets.

[19] A `merit good' is one the consumption of which society wishes to encourage because society perceives some some `positive externality' (community/ non-use benefit) associated with the individual's consumption (or, because society takes a paternalistic view that some people don't know what's best for themselves). Without public intervention demand for such goods will be less than optimal (in terms of total community welfare) because individuals' consumption decisions will not take account of the community benefit, which they cannot capture (or, because individual consumers value the good less than they would if properly informed).

[20] Type 4 exists because of the consensus of many individuals who perceive option value, existence value and bequest value (type 2). If we regard the community welfare as nothing more than the sum of individual welfares, type 4 collapses into type 2. Similarly with 3 and 5.

[21] One purpose of independent techniques of estimation such as the contingent valuation method is to test the assumption that community funding decisions are rational.

[22] Submissions generally accepted that direct users should be charged (if at all) only for private benefits: their presence on site should not be exploited by forcing them to contribute to costs which relate to community/ non-use benefits and so should rightly be charged to the whole community through taxation. See chapter 7 on principles for charging for `core' versus `value-added' services.

[23] Industry Commission, Urban Transport, report no. 37, February 1994, p73

[24] This constitutes a significant difference between museums/ galleries and performing arts, where arguments over cost recovery and public subsidy also rage. Performing arts have more obvious marginal costs associated with each performance, while museums have relatively much greater fixed costs of maintaining the collection in perpetuity. See paragraph 5.90. For the problem of defining marginal costs see paragraph 5.22.

[25] This is really a subset of the previous point: the congestion imposes a marginal extra cost.

[26] If the public service was identical to a private service, one might well ask why it is a `public good'. Usually public services, on closer examination, are seen to be not identical. For example: public education is provided specifically so that no child should be excluded by price; government operated public transport services usually provide a network coverage, with cross-subsidy of smaller routes, that private enterprise would not find viable.

[27] This would probably be most people's perception. For the moment we disregard arguments about the external benefits of a person's public transport journey in reducing road congestion.

[28] Witcomb A, `From citizens to tourists: the new political rationality of the museum', Communicating Cultures, Museums Australia 1995 National Conference Proceedings, p126-7

[29] For example, Australian Museum, submission 30 p240; J Corponi & G Morris (Museum of Victoria), evidence 15 September 1997 p407ff

[30] Contrast public services of a more `housekeeping' nature, where `customer focus' may well be the pinnacle because considerations to do with citizenship are absent.

[31] Australian War Memorial, submission 23 p202. The charge always applied only to the museum galleries, not to the commemorative parts, but it seems that the two were too closely connected in people's minds for this to be acceptable.

[32] Note the situation of historic churches that solicit donations from those who visit as tourists but not from those who visit as worshippers. Both visitors, no doubt, gain satisfaction from their visit: distinguishing between them is an emotional and symbolic act. Worship is regarded as something that should be outside the market.

[33] National Campaign for the Arts Autralia Ltd, submission 37 p308; D Marshall, submission 19 p168

[34] Environment Australia, submission 46 p397