The tourism sector’s relationship with the Labour Government was rarely harmonious, with industry leaders regularly complaining that the administration simply did not understand the economic benefits the sector could deliver if supported properly.
During Shaun Woodward’s reign as minister responsible for tourism (among many other sectors), the Department for Culture, Media and Sport (DCMS) issued 77 press releases of which only one was about tourism.
Little changed when Margaret Hodge took the reins, with the low point for the industry being when she described hotels as being expensive and low-quality in an interview in 2008.
It was no surprise, then, that the industry reacted with delight when, in a keynote speech in London last week, David Cameron stated that tourism had been viewed as “second-class” for too long and that it was essential to rebuilding the British economy.
“Tourism is a fiercely competitive market, requiring skills, talent, enterprise and a Government that backs Britain,” the prime minister said. “It’s one of the best and fastest ways of generating the jobs we need so badly in this country. And it’s absolutely crucial to us making the most of the Olympics and, indeed, a whole decade of great international sport across Britain.”
Cameron, who has appointed John Penrose as full-time tourism minister, said the coalition was now committed to building the “strongest possible tourism strategy” in partnership with the industry by the end of the year.
Sandie Dawe, chief executive of VisitBritain, said the tourism agency was “delighted” that the prime minister had declared so clearly that tourism is fundamental to the rebuilding of the economy. “We share his determination to use the coming decade to boost Britain’s international competitiveness in tourism and to take our industry to a whole new level,” she added.
Ufi Ibrahim, chief executive of the British Hospitality Association, was equally effusive. “It’s completely refreshing to see the prime minister speak so enthusiastically of the value of the industry to the UK economy, and its potential future contribution,” she said. “This is what the industry has been wanting to hear for many years.”
But while Cameron’s words were certainly welcome, industry figures were quick to point out that actions were more important, particularly against a backdrop of forthcoming cuts to the DCMS budget.
Patrick Dempsey, managing director for hotels and restaurants at Whitbread, described Cameron’s speech as “a good first step” but warned that “what we really need to see now from Government are these positive words put into action”.
“For example, we have one of the highest rates of VAT on hotel rooms in Western Europe, two or three times higher than our counterparts,” he said. “There is a debate to be had on the extent to which this is holding back the industry and whether Government action could be taken to rectify this situation. The Hotel Buildings Allowance was scrapped, too, under the last Government. Can this new coalition consider bringing it back in certain regions of the country, where investment is needed?”
Nick Varney, chief executive of Madame Tussauds owner Merlin Entertainments, agreed that Cameron’s comments would prove “little more than rhetoric” if the Government does not take practical measures to help tourism businesses, such as a special lower rate of VAT.
David Clarke, chief executive of Best Western Hotels, warned that any cuts in tourism investment needed to be carefully considered. “It’s certainly a real challenge to balance the national books but, as in all business, if there’s a sector or product that could make you money, you still invest even if you’re cutting elsewhere,” he said.
Guy Parsons, chief executive of Travelodge, said that while the budget hotel group was “very supportive” of Cameron’s aim to make the UK one of the top five destinations in the world, “they are, in the nicest sense, only words”. “Within a month, we would like to see some hard targets put in place so that the industry knows what it has to do,” he said.
Many commentators have been critical of the lack of visible marketing for the 2012 Olympics, and Parsons warned that this needs to be addressed soon. “In most businesses, if you had a major brand launch in two years’ time, you would have some firm plans in place,” he said.
HOW THE GOVERNMENT CAN HELP TOURISM
● Preserve the position of a full‑time tourism minister
● Address the disparity between VAT on hotel rooms in Europe and the UK
● Reinstate the Hotel Buildings Allowance
● Recognise the effect any cuts will have on a lucrative revenue source
● Encourage individuals into the industry
● Cut red tape and business taxes
● Present a joined-up national marketing effort
DAVID CAMERON’S SPEECH IN SOUNDBITES
“Which industry is our third highest export earner behind chemicals and financial services? Manufacturing? IT? Education? No. It’s tourism.”
“Tourism presents a huge economic opportunity: not just bringing business to Britain, but right across Britain driving growth in the regions and helping to deliver the rebalancing of our national economy that is so desperately needed.”
“The last Government underplayed our tourist industry. There were eight different ministers with responsibility for tourism in just 13 years. They just didn’t get our heritage.”
“For every half a per cent increase in our share of the world tourism market we can add £2.7b to our economy, and more than 50,000 jobs. At a point when our economy is coming back from the brink we just can’t let this sort of opportunity pass us by.”
“We’ve just not been working hard enough to celebrate our country at home and sell our country abroad.”
“We have, in the coming decade, an unprecedented opportunity to take our tourism industry to a whole new level.”
“I want us to have the strongest possible tourism strategy.”
“We’re going to bring a whole new approach – and a new attitude – to tourism, because we think tourism is one of the missing pieces in the UK’s economic strategy.”
“Tourism is a local industry. You can’t support local industry with national diktats from Whitehall.”
“Our tourism industry has been strangled by the endless rise of red tape. So we’re going to free our 200,000 tourism businesses from red tape and excessive business taxes.”
“Our Regional Growth Fund created an opportunity for the tourism sector to bid for support for its most creative ideas, with £1b available to kick-start projects that will drive private sector growth.”
“Today’s speech is an appeal to you to tell us the tools you need to finish the job.”
Watch the full speech at http://bit.ly/baamAu
HOW CAN THE UK TOURISM SECTOR BECOME MORE COMPETITIVE INTERNATIONALLY?
“The prime minister challenged our industry to go further and encourage more domestic tourism. Now that he’s set the objective our industry will respond by finding ways to do more and by continuing to provide top-quality, value-for-money customer experiences. We ask that the Government takes the lead and acts to do the same.”
Patrick Dempsey, managing director for hotels and restaurants, Whitbread
“The industry needs a three-pronged attack: firstly, to remove duplication in tourism that gets in the way of growing the business; secondly, to invest in people and, in particular, career development and encouragement of people to come into our industry; and finally, less red tape.”
David Clarke, chief executive, Best Western
“It is also encouraging to learn that John Penrose has been given more authority than previous ministers for tourism, making for a more ‘joined up’ approach.
“What tools do we need? I’d say a straightforward national marketing effort to present the British Isles as the marvellous destination that it is and to dismantle the crazy and overcomplicated disbursement of public money that currently goes into competing regional bodies.”
Peter Hancock, chief executive, Pride of Britain Hotels
“I think regional tourist authorities – or their equivalent – throughout the UK should have open and visible rationalised budgets and targets so that different areas of the UK can market to each other and not just the international traveller. The recession and economic turndown has created the age of the ‘staycation’ and yet there is no real evidence of the Goverment encouraging increased domestic marketing.
“The breathtaking diversity of landscape, culture and activities within the UK needs some serious promotion.”
Gordon Cartwright, business director, Regent Consultancy