Our man in Whitehall
Tourism and hospitality employs 6.4% of the UK workforce. At £64b, its revenues match those of food retailing. And, as a business, this sector is growing faster than retail.
Even so, without increased marketing effort by the industry, Britain may slip from its number five spot in the world tourism league table.
That may not matter. Britain's share of the world tourism market may be a proportionately smaller slice of a bigger cake, but that share is still growing.
The question is, does the Government's treatment of the hospitality and tourism industry reflect its significance to the economy? For years the industry's answer to that question has been "No". Ministerial responsibility for it was passed from the Department of Trade and Industry (DTI) to the Department for Employment and Education (DfEE), before it was taken under Chris Smith's wing at the Department for Culture, Media and Sport (DCMS), then known as the Department for Heritage, in 1992.
Wherever it sits in Whitehall, tourism and hospitality has felt uncomfortable, since no single government department can ever provide all the answers. Inevitably, recruitment, training and pay fall to the employment secretary; planning questions are answered by the Department for the Environment, Transport and the Regions; licensing falls to the Home Office; small business issues and e-commerce are found at the DTI, and so on.
Guy Hands, managing director of Nomura's Principal Finance Group, which numbers the Unique pub chain and Principal Hotels among its acquisitions, wants to see a cabinet minister responsible for the industry. He favours the DTI rather than the DCMS as the industry's proper home. At last month's Arena Savoy Lecture in London, Hands called for the industry's importance to be recognised and respected.
Janet Anderson MP, parliamentary under-secretary for tourism, media and broadcasting, is damned with faint praise in Hands' speech: "An excellent parliamentary under-secretary, and she resides at the Department of Culture, Media and Sport. Where do we come in the pecking order of government? Low. [We have] no minister. And [we are] not even in the Department of Trade and Industry, and this would seem to reflect the Government's view of the importance of hospitality to the UK economy."
Some industry operators undoubtedly support him, but whether it is realistic to hope for a secretary of state for tourism and hospitality is another matter.
It runs counter to recent government thinking, both in the last years of the Thatcher government and Tony Blair's first term. Two key things happened: the first was that the Conservatives brought in an industry adviser, Roy Tutty, to work with civil servants and represent the industry's views in Whitehall - and Labour kept that job alive. It was filled on Tutty's departure by Bob Cotton, now chief executive at the British Hospitality Association (BHA), and in turn by Stuart May (left), who is on secondment to the DCMS from tourism and leisure consultancy PKF, where he is non-executive director.
The second move, mainly by Labour, has been to apply the principles of "joined-up government" - whereby departments work closely together - to tourism.
The Tourism Summit, which first took place a year ago and is repeated this month, might be written off as a bit of political show business. Ministers from all the departments impinging on tourism roll up at Shakespeare's Globe for a meeting with the directors of the British Tourist Authority and the English Tourism Council, the chairman and deputy chair of the Better Regulation Task Force, and the chairman of the tourism consumer group set up by DCMS. Culture secretary Chris Smith chairs the summit, and the message from all parties is: there's lots to do and we're doing it.
Stuart May is on an 18-month secondment to the DCMS from PKF (beginning in July 2000). He is still a PKF director but the company recharges some of his costs and salary, half of which is paid by the Government, half by a fund paid for by several members of the BHA.
May admires civil servants, whom he describes as "very bright people", but he goes on to say they are "career civil servants, and they touch tourism for a period and that doesn't give them time to build up an in-depth knowledge of the industry".
May's key tasks are to:
Advise the Government on developing the themes of its tourism strategy, in a project known as Tomorrow's Tourism.
Contribute to the development of departmental policies.
Help take forward the Government's partnership with the tourism and hospitality industry.
Identify good practice and further develop the Government's understanding of the industry.
As well as working with the 20 civil servants in the tourism division of the DCMS, May regularly meets representatives from various industry bodies:
British Hospitality Association
HCIMA
The Restaurant Association
Business in Sport and Leisure
The British Institute of Innkeeping
The Joint Hospitality Industry Congress
The Hospitality Training Foundation
Springboard UK
The Confederation of British Industry
Directors of many of the bigger hotel and leisure companies.
The feedback he gets from them tells him that the main issues for the industry are better regulation and less red tape, greater support for the British Tourist Authority when marketing Britain abroad, and tackling the skills shortage.
The DCMS is also co-ordinating the government response to Lord Haskins's Better Regulation Task Force report, and May is a key player in this effort. The task force, made up of unpaid volunteers from a variety of sectors, was set up by the Government last year as part of a drive to get rid of red tape, particularly as it affects the service sector, including tourism.
"Ironically, the regulatory bodies involved were anything but DCMS," says May.
May is now a member of the monitoring group set up by Janet Anderson to check on the implementation of Haskins's report. And the Tourism Summit will be updated on that group's progress.
All this government activity begs a question: shouldn't the DCMS be spending taxpayers' money on supporting the industry?
"DCMS doesn't have discretionary funds that the industry can bid for," says May. "That has to come, for example, from the DfEE or the DTI.
"DCMS acts more like a clearing house - and, yes, it's a talking shop. The challenge for the industry is to link up the ideas promulgated at DCMS and get funding from those departments that do have the money, to put the initiatives into practice," says May.
This division of responsibilities was exposed uncomfortably at the launch of hospitality recruitment body Springboard UK's careers festival last October. Speakers at the opening conference commented that the DCMS had come up with just £10,000 to support a national initiative crucial to the development of a £60b industry. Had the industry called on the DfEE or DTI, bigger funds might have been available.
Despite his good working relationship with May, David Wood, chief executive at the HCIMA, challenges the view that the DCMS is necessarily the right place for the industry. He cites as an example the approach of both the Government and the media to the foot-and-mouth disease outbreak.
"Discussions are going on as to whether farmers are adequately compensated for the slaughter of cattle, and about consequential losses for slaughterhouses and butchers, but hotels and restaurants are not even on the agenda. Guy Hands was right - we might be better off as a small fish in the big pond of the DTI."
May disagrees: "We're better off getting 25% of a secretary of state's attention.
"Look around other government departments - you won't find a team of 20 civil servants looking after a similar-sized sector."
The civil servants are on a learning curve, partly through industry inductions organised by May. It has the help of friends in the business, such as Jonathan Orr-Ewing, general manager at London's Montcalm Hotel, who has agreed to be shadowed by May's DCMS colleagues. He is looking for other businesses willing to open their doors in this way.
As for Janet Anderson, she has recently confirmed that the DCMS will be the industry's champion in government.
This is welcomed by Teresa Graham, deputy chair of the Better Regulation Task Force. "I am pleased that DCMS recognises the importance of this sector, acknowledges that something needs to be done and is acting on our recommendations."
That's the thing about setting up task forces: they tend to come back demanding action.
British tourism and hospitality industry, 1999
| Number of businesses | 125,000 |
| Employees | 1.78 million |
| Annual revenue | £64b |
| Tax paid to Exchequer | £21.5b\* |
| Overseas visitors (2001 forecast) | 25.2 million |
| Expenditure by overseas visitors (2001 forecast) | £12.6b |
