Jun 8, 2012

Tasmanian recession? Not at David Walsh’s bizarre world of art

As eccentric art lover and professional gambler David Walsh steps up his battle with the taxman, the economic contribution of his Museum of Old and New Art to Tasmania's struggling state economy is mounting.

Tom Cowie

Crikey journalist

As eccentric art lover and professional gambler David Walsh steps up his battle with the taxman, the economic contribution of his Museum of Old and New Art to Tasmania's struggling state economy is mounting. Visitor survey results compiled by Tourism Tasmania from July 2011 to March 2012 show Walsh's $175 million s-x and death-themed museum has rocketed to become the second-most popular icon in the Apple Isle, sitting behind Hobart's historical Salamanca Market. Nearly a quarter (up 1.3% to 24.3% from December) of the 643,200 visitors took in MONA during their trip, while Salamanca attracted closer to a third of visitors. According to official figures, more than 400,000 people have visited MONA since it opened its doors in January last year. The numbers come as the local economy grapples with the possibility of recession. Growth figures released this week show Tasmania's state final demand fell by 0.28% in the March quarter, following a dip of 0.09% in the December quarter. Politicians are arguing how close the state might be to recession. But in Hobart at least local businesses have experienced an upswing thanks to the pulling power of Walsh's temple. Restaurants, hotels and bars are reporting increases in business. Katrina Birchmeier, co-owner of Hobart restaurant Garagistes, says on weekends the proportion of customers from outside Tassie is as high as 75%. The diner is regularly forced to turn people away. "We know from speaking to our customers that, particularly over a weekend, there is a large number of people coming down to visit MONA who otherwise would not be coming," she told Crikey, adding that locals were now coming in during the week instead of on weekends. Tourism is vital to the performance of the state economy. It contributes about about 9.4% to gross state product (the highest outside the NT) and accounts for 35,000 jobs, the equivalent to 15% of local employment (which is above the national average). Tourism Tasmania CEO Tony Mayell says MONA has been one of the key drivers in making Tasmania more visible on the national and international scene. Currently, Tourism Tasmania is running a "Save a Mainlander" campaign, which features MONA. "TV programs, glossy magazines, blogs are generally after 'what’s new' in a destination, and MONA has given us a great opportunity to capitalise on this," he told Crikey. A tourism survey from last year found MONA visitors spent an average of nine nights in Tasmania, often travelling to regions beyond the state capital. "For us that’s a good outcome for tourism and hospitality operators not just in Hobart, but around the state," said Mayell. Visitors spent $1.46 billion in total in Tasmania last year, according to Tourism Tasmania figures, a dip of 4% on the previous year. That it didn't fall further, with the Australian dollar at record highs, can in part be attributed to the intense interest in Walsh's MONA. "They don't say they're going to Tasmania, all year long people from all walks of life have said: 'oh we're going to MONA this weekend' and we all know where that is," Australia Council CEO Kathy Keele told Crikey recently. "It's put Hobart on the map." It's not just restaurateurs who are smiling. Another benefactor has been the local art scene, which has thrived around MONA. The Tasmanian Museum and Art Gallery has seen a boost in its visitor numbers as a direct result of MONA, with the Tasmanian government investing $30 million in a redevelopment of the gallery. Unsurprisingly, the locals are desperate to keep Walsh around. A week ago the Hobart Mercury wrote in an editorial that the Glenorchy lad had "helped rejuvenate Tasmania's image as an arts centre" and that he was one of a group of wealthy benefactors "willing to pitch in to help this state survive and thrive". "He is a remarkable and enigmatic man who has given a great gift to Tasmania and Australia generally," Giddings told Crikey earlier this year. MONA itself is an entirely privately-funded museum, with Walsh and a group of silent partners kicking in the majority of the enormous cost to maintain it. Higher-than-expected running costs have forced the museum to start charging an entry fee to non-Tasmanians. It's unclear what may happen to the museum should Walsh lose his tax battle. Walsh began court action recently over an audit by the Australian Tax Office, which revised its assessment for the 2004, 2005 and 2006 financial years. The exact size of the disputed bill is not yet known. The state government itself doesn't contribute anything to MONA. It does, however, chip in $350,000 annually to MONA FOMA, a music and arts festival held each January. Headlined by international acts PJ Harvey, The Dresden Dolls and Girl Talk in 2012, it's been one of the key drivers in the increasing cultural power shift from Melbourne and Sydney to Hobart. Walsh's estimated fortune is a well-kept secret, but he has said in interviews that he had run out of money opening MONA and was in debt to "banks, to friends, to everybody". The maths savant made his fortune gambling on thoroughbreds via complex computer systems. His business partner is fellow Tasmanian mega-punter Zeljko Ranogajec, who is also being audited by the ATO.

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12 thoughts on “Tasmanian recession? Not at David Walsh’s bizarre world of art

  1. Gavin Moodie

    Yes, MONA is a great attraction. You start at constitution dock, get a ferry to the museum, wander round the gallery more or less randomly, have lunch at one of the cafes or at the winery or brewery restaurant, wander around the outdoor sculpture gallery and winery and return to the city on the ferry.

  2. John Newton

    So let’s leave Walsh and his partner alone – if they have fiddled the tax books a little, they’ve given back in spades and have done far more for Tasmania than the scoundrels at Gunn’s

  3. Gavin Moodie

    I disagree that Walsh’s innovative cultural philanthropy should excuse him from obeying the law, including paying taxes. However, his philanthropy and other good works may lighten his penalty if he indeed did offend.

  4. dunph

    Walsh is to be commended for his unorthodox approach to all things.

    MONA is a sight to behold – the building itself is half the attraction as the “art” inside.

    Like the Guggenheim in Bilbao, MONA is a magnet for art-tourism and is world class.

    As a country who lauds Ned Kelly, Peter Lalor and tacitly forgives Alan Bond, the ATO would do better investigating Port Lincoln tuna millionaires than pursuing a maths-savant hippy in Tassie.

  5. mikeb

    Not so much that DW is avoiding tax as disputing whether the tax law captures gambling in his case. Having such a high profile makes him a target for testing tax law whereas the smaller punter maybe making a living out of gambling is not worth fighting over.
    As for MONA itself – it worth a visit just to see the architecture and attention to detail let alone the exhibits. Truly an amazing place even if you don’t like much of what’s on show.

  6. icer

    Am I the only killjoy here that has a problem with the mona funding coming from betting? I’ve come across a few people whose lives have been wrecked by gambling, and am not sure that MONA is really morally satisfying as an upside.

  7. Gavin Moodie

    I think the difference here might be that Walsh’s money came from being a gambler not from being a bookie or owner of a casino or pokies. That is, the argument is that gambling isn’t wrong in itself, but that exploitation is wrong in all its forms, gambling being one of them with drug dealing, people trafficking, etc.

  8. Andybob

    Dangerous waters for the ATO. Even if you accept that there is such a thing as a ‘professional gambler’ as distinct from a merely ‘successful gambler’, there will be a long line of people seeking deductions for gambling losses.

  9. AR

    Walsh did over the bookies at the track AND casino owners so that makes him OK in my books. That he then uses his OWN money for the common weal moves him into an entirely new category (for my personal pantheon) a hero!

  10. AR

    Is there something in the air or water in Tassy that results in so much philanthropy and concern for something other than self satiation?
    Jan Cameron uses her wealth from Katmandu for the benefit of animals, people and the environment.
    David Walsh – above, has pitted his wits against one of the toughest and most ruthless/amoral legal industries (apart from the arms trade) and laughed all the bank.
    Graeme Wood donates his WOT-IF profits to the Greens, the environment and attempting to break the media stranglehold with Global Mail.
    Well done sez I.

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