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Mr. Quinn: What is the hon. Gentleman's opinion of the proposed reduction in value added tax for tourism and hospitality? Does he support that proposal? I do, as I believe that it will free up resources for reinvestment at the grass roots of our tourism industry.

Mr. Butterfill: As I have made clear, the present disparity between our VAT rates and those of other countries is not sustainable in the long term. In a moment, I shall describe the other ways in which we ought to invest in the industry, especially at a local level.

The question of raising standards has been discussed already, as has the extraordinary nature of the so-called semi-official classification. That helps neither overseas visitors nor domestic tourists. We need to work to some internationally agreed standard, so that people travelling here from around the world will have some idea of what they will encounter.

An even more difficult problem is posed by the cowboys in the industry--the small unregistered establishments that I believe ought to be registered. Some of them get away with murder: they do not pay their proper contribution in taxes, they offer substandard accommodation, and they gain all sorts of other advantages. For example, landlords of holiday flats in my constituency came to me recently to query the requirement--imposed on them because they are registered--that water meters be installed in the flats. In contrast, the cowboys in that industry, who are not registered, do not have to install water meters. The landlords to whom I spoke therefore have to bear an additional cost as a result of being registered. I urge the Government to clamp down, through local authorities, on those who often give the industry a bad reputation.

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Other legislation has also had an impact. For example, there is no doubt that the minimum wage is causingjob losses in my constituency. An hotelier with three establishments in Bournemouth told me that the minimum wage will cause about seven full-time-equivalent jobs in his business to be lost. That is a great worry for him, as for many others in the same line of business.

Even more difficult is the working time directive. Very often it concentrates merely on the 48-hour maximum, but the real problem lies in the rigid shift patterns and break requirements that the directive imposes. All that sits uneasily with an industry that often operates on a 24-hour basis and must provide service to people who stay in hotels or visit clubs and restaurants. The industry works huge hours, and its shift patterns have been severely disrupted by the working time directive.

Bournemouth is one of the most successful seaside towns, and rightly so. Successive local authorities have invested in the town's future, building premises such as the Bournemouth International Centre, which can encourage different types of visitors from conference tourism. All local authorities must invest in the future if they want to survive and succeed. The country is littered with resorts that have not invested and have declined as a result.

At present, there is no real incentive for authorities to invest. There is no Government encouragement and there is no benefit. Authorities that do invest often face a disbenefit because the national non-domestic rate is clawed back in its entirety by the Government. Authorities end up paying for their investment, getting little or nothing back in return.

The Government might consider a mechanism under which local authorities could be rewarded for investment by being allowed to keep part of their national non- domestic rate, hypothecated for tourism. I appreciate that that idea falls outside the Minister's direct departmental responsibilities, but she may wish to consider it and to make representations to the appropriate Department.

The Government are obsessed with regionalism, but the existing regions unfortunately fail to reflect thetrue economic boundaries within which we operate. Bournemouth and Dorset are in the south-west region. We were moved there by a previous Conservative Government in an appalling act of vandalism. Bournemouth was snatched from Hampshire and thrust into Dorset.

We have no particular connection with the south-west. The road links from Dorset to the south-west are virtually non-existent, and the rail links are totally non-existent. All our connections are towards London and the central south coast region. My local authority and others along the south coast have developed the South Coast Metropole, which works together to market attractions and economic development. That is sensible, and we should have a central southern region that incorporates all the areas that sit together naturally.

Mr. Laurence Robertson (Tewkesbury): I am sure that my hon. Friend will recognise that the same problem exists in other parts of the country. For example, Gloucestershire has far more in common with Hereford and Worcester than with what is termed the south-west, for which Cornwall and Devon are given priority and Gloucestershire loses out.

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Mr. Butterfill: My hon. Friend makes precisely the point that I sought to make, although I was concentrating on my own constituency. Areas throughout the country feel that they do not properly belong to the region into which a Department of Government has thrust them. If the Government intend to pursue a regional policy, I hope that they will re-examine the regional boundaries to try to fix them on the basis of economic cohesion rather than by drawing inappropriate lines on a map.

10.14 am

Mr. Ronnie Fearn (Southport): I am pleased that the hon. Member for South Cambridgeshire (Mr. Lansley) has given us another opportunity to debate tourism. At one time, I thought that tourism debates were taboo, but we have had three of them since then.

The Government's long-awaited strategy for tourism has been published. I welcomed the establishment of a tourism forum that included many sectors of the industry and employee representatives, because only through consultation with the industry can we progress. The forum sets high goals. I agree that standards must be raised, so we must invest in the people who work in the industry and in our attractions. We must market effectively at home and abroad.

If we are to increase the tourism yield without damaging the environment, quality must be the name of the game. I make no bones about congratulating the Government on their decision to make the tourism forum a permanent fixture. The forum and the Government will together monitor the progress and assess the annual achievement of goals at a tourism summit. Continued monitoring by those who have real enthusiasm for the industry, and a great deal of expertise, is essential if we are to achieve our goals.

A national body is the only group that can effectively monitor international developments, despite changes in Scotland and Wales. The forum must take care to assess the best achievements of our competitors abroad. I do not mean that we should duplicate what they provide, but we should learn from them and match the quality of their facilities and service.

Both the tourist and the business traveller are becoming ever more discerning, and they demand good standards. Many of our hotel prices--especially in London--are high in comparison with those of Europe, the United States and Asia. We must ensure, therefore, that our standards of service and the quality of our facilities are improved and kept high.

Visitors should also be entitled to clarity and ease of understanding. The new national grading system for hotels and guest houses must achieve that. It should be simple to understand, and it should be implemented without delay. Perhaps the Minister will tell the House when she expects the programme to be achieved.

The tourism forum is very much in line with the Liberal Democrat call for a permanent tourism commission. Nine months ahead of the Government's strategy, we called for a joint Government and industry body, headed by the Tourism Minister. Its role would be to propose strategy, set standards and monitor achievements.

It is of paramount importance that the tourism forum and summits do not disintegrate into talking shops. I seek assurances from the Minister that agendas for the summits

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will be wide reaching and that the Department for Culture, Media and Sport will give priority and vigour to implementing recommendations.

For many years, successive Governments neglected to recognise how much tourism contributes to the economy. Governments must never forget that the industry is worth £53 billion a year, employing 1.75 million people, or 7 per cent. of the work force. It is more important, economically, point of view, than all the Department's other functions put together.

I cannot join those who oppose the minimum wage. I recognise that the cost of living is much higher in London than in, for example, the north-west, and I should prefer a regional minimum wage. However, I also accept that the minimum wage has, for the time being, been set fairly. For far too long, businesses in the tourism industry have suffered excessively high staff turnover because of low wages and poor prospects for training. There has been a vicious circle. Many businesses have traditionally paid low wages not because they wanted to, or because they thought it right, but because they felt compelled to do so because their competitors did so. Now, forward-thinking businesses will be able to retain and train their staff. Training and skill retention are the key to much of the Government's strategy to raise standards and quality.

I suggest that the Government go further by considering a proposal that businesses should give training to their staff--an investment in education and training--through the introduction of a 2 per cent. levy on payrolls. The training could be provided in-house, or by approved training providers. Small and new businesses would be exempt. Some pioneering businesses already provide in-house training above that level, and their success shows how advantageous it is in the long term.

In other areas, Government policy remains sadly lacking. Transport is a major component in the tourism product, and the tourism document suggests that hotels, shops and restaurants should be built near main transport routes. Does the Minister intend to have Stonehenge and the lake district moved? The very nature of tourism is that tourism-related facilities must be placed very close to attractions if they are to be used and so be viable. Much of our tourism product is based on our landscape and existing heritage sites, many of which are located in areas that receive little publicity and have few public transport facilities.

One of the greatest problems facing our domestic tourist industry is that our traditional resorts are declining. Through funding from the lottery, special regeneration budgets and European grants, it is gradually becoming possible to preserve and upgrade some existing attractions and to create new ones at those resorts. The funding is currently only a trickle, but I hope that the regional development agencies will concentrate on meeting the pressing need for funds.

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