Select Committee on Culture, Media and Sport Minutes of Evidence

Examination of Witnesses (Questions 160 - 179)



  160. It was proposed to reduce the funding in 2001-02 and then onwards. Only because of foot and mouth disease have they been given additional funding, which is obviously desperately needed.

  (Ms Anderson) That is certainly true. The additional £6 million has been in recognition of this particularly difficult situation. But we would always argue with our colleagues at the Treasury for better funding for tourism. We always have done so and we will continue to do so. That applies both to the English Tourism Council and to the BTA.

  161. As I understand it, the BTA were facing reductions in their budget. We also understand that the English Tourism Council has no budget for marketing, and that many of the regional tourist councils have no budget for marketing. Quite frankly, that is not good enough given the importance of tourism, and what you rightly said about its place in the economy. You have travelled around, you have seen not just what is going on in this country but you have been abroad, and I am sure you have made comparisons with the level of funding that is made available by governments abroad for their tourism agencies, both for domestic markets and international. What is the comparison? Do you not think there is much more that we need to do?

  (Ms Anderson) I would certainly like to do more if we can. That is why I very much welcomed the Prime Minister's announcement yesterday that there is to be additional funding, and we will hear what that is to be in the next few days. The reason for setting up the English Tourism Council without a marketing role was that when we reviewed the support for tourism in the country, there was a feeling, I think, which was shared by everyone, including the industry, that there was a need for a leaner, more strategic body, that would provide some much-needed leadership and research facilities for the industry. In tourism you cannot be complacent, you cannot sit still; you have to constantly re-invent yourself. That is why I very much welcomed, for example, the work that the ETC has done on our seaside resorts. They have produced a very helpful report on how we might do more to re-generate our seaside resorts. Many of them are facing quite difficult times, and it is interesting that those that have tried to re-invent themselves—Brighton, Bournemouth, Morecambe and Scarborough—are doing much better now. So there is a need for that constant research to help the industry understand what the changing consumer demands are and to take steps to meet them.

  162. There are lots of other problems that tourism in this country faces, and has been facing in the last year, other than foot and mouth disease: the high level of the pound, general costs, fuel costs, the cost of travel. One of the points that I made to earlier witnesses was that I understand now the cost of travelling on the train from London to the Lake District can range from anything up to £250, and for that you could have a couple of nights away in most European cities; you could certainly have a flight to the States. What is the Government doing to try to bring together all of these different organisations and agencies that could assist in trying to make tourism in the UK easier and more effective and more cost-efficient, given that 90 per cent of the market for tourism is domestic and not international?

  (Ms Anderson) We understand that very well, and when we produced our strategy for tourism, about two and a half years ago now, I think potentially the most important proposal in that, upon which we have now acted, was to set up a ministerial summit each year. We have now had two of those. The last one was on 6 March, rather aptly timed because it was by then that we began to understand the effect of the situation on the tourism industry. That brings together ministers from every other government department, including the Treasury, and we ask them to make sure that when they are making policy, when they are taking decisions in their own individual departments, they think about the impact on the tourism industry. As a result of the first tourism summit, for example, MAFF announced the enterprise scheme which made funding available to farmers to diversify. You have raised transport. That is a very good example. You can go to almost any resort or any tourist attraction and there will be some kind of transport issue. It might be that there is only one road going in and one road going out, and they get very congested in the summer months. It might be, as you say, the cost of rail travel. We use that ministerial summit all the time to emphasise to our colleagues in other government departments when they are taking decisions to think about the likely impact on tourism. It could be employment law it could be licensing, it could be all sort of things. Planning is something that comes up. One of the things that we achieved from this year's summit was a review of signage in DETR, because we get complaints from people all round the country that practices in terms of signage are inconsistent, that some people get signs to their attractions and others cannot. That is an example. We are talking about acorns rather than oak trees, but we are building on that. It is something that works very well, for example, in a country like Greece, where tourism is even more important than it is to us here.

Mr Keen

  163. My constituency of Feltham and Heston has no castles, stately homes, or beaches but people often forget the 55,000 permanent jobs at Heathrow Airport. My constituents suffer the environmental damage and noise but they are proud to contribute. Is BAA's income taken into account when calculating the tourism figures?

  (Ms Anderson) I am really not sure. I am going to ask Mr Leonard to comment.

  (Mr Leonard) One of the interesting things about tourism is that, while it is an industry in certain respects, as you have referred to it this morning, a hospitality industry, hotels, attractions, for example, it is also an activity which has fingers in all areas of the economy, such as in transport. We have been looking these last few months at the use of tourism satellite accounting, which would measure those kinds of figures. It is very much part of the Government's strategy to treat tourism not just as an industry in the sense that it has hotels and it has attractions that charge people, but as a whole range of what the economists call demand-side activity, which includes purchase of transport. That is very much part of the work we are doing strategically, and it is part of the reason why ETC was given a strategic role to look at these aspects. Malcolm Bell, who was before you earlier, has done some very good work in the South West to measure the amount of money spent in the South West on marketing every year by the public and private sector. It is £170 million spent in the South West every year on marketing, almost all by private bodies. It is the strategic capturing of all that expenditure which is very much part of the Government's tourism strategy.

  (Ms Anderson) If I can just add to that, if we could establish a tourism satellite accounting—and we do not do it in this country and it is, as Mr Leonard has said, something we are looking at in the Department—it would be very welcome to the industry because we need a proper, accurate measure of what tourism does mean to us as an economy. On your point about Heathrow, Heathrow is very important. Previous witnesses from the English Tourism Council mentioned a report produced by the British Tourist Authority called "First Impressions", and this was about the impressions that visitors get when they first arrive. Heathrow is obviously a very important port of entry, and I have set up a group in my Department with representatives from the public and private sector to look at that to see if we can do more to make our ports of entry more welcoming. For example, we some time ago persuaded the Home Office to make arrangements to be more welcoming to some of our visitors from overseas, so that when people come in on tours, which is particularly a problem with Japanese visitors, they can be got through the procedures more quickly in recognition that they are genuine tourists. We constantly look at this; it is very important. Heathrow is a very busy airport, and anything we can do to make it more friendly we will do.

  164. Because Feltham and Heston is not a mecca of tourism—it was a joke that the two best restaurants were the north and south services on the A4 at Heston, but the Minister knows that is not the case because when she came, though not in the same capacity, I took her to the Passage to India, which is where the Champion curry chef cooks every day. That leads me on to another point. A lot of my time at advice surgeries is spent trying to assist relatives of constituents of mine to get visas to come in for holidays to the United Kingdom. We are actually stopping potential tourists from coming in. I think that is a point worth noting. It is not really your Department's remit.

  (Ms Anderson) No, it is not my Department's remit, but that is a very good example, Mr Keen, of why I believe the ministerial summit, the tourism summit we hold once a year, is very important because it is exactly those kinds of representations that we can make to our colleagues at the Home Office, and we do.

  165. As the Foreign Secretary said the other day, Britain is a multi-cultural society, and that has an attraction for overseas visitors, I believe, and I think we should take account of that.

  (Ms Anderson) It certainly does, and the meal I had at Passage to India was excellent and I remember it very well, thank you.

Derek Wyatt

  166. Can I ask about the budget for the British Tourist Authority? I can give you the Hansard quote, but it does say that BTA was going to have a reduced budget for the year 2001-02 and subsequent years until the foot and mouth broke out. What is the story? Are they or are they not?

  (Ms Anderson) We are reviewing the BTA's position at the moment. As I have said, Mr Wyatt, I am very pleased that we are to be allocated more money for tourism, as the Prime Minister announced yesterday, and I look forward to hearing exactly how much that is in the next few days.

  167. But is it not remarkable that an industry that is one of the biggest in Britain should be seen to be getting a cut? It seems to me that if the turnover for tourism is £6 billion—is that what you said?

  (Ms Anderson) The contribution to the economy is £64 billion. It is three to four per cent of GDP.

  168. So a budget of £35 million is something less than 0.1 per cent to actually encourage one of the fastest growing industries in the world. It just does not add up.

  (Ms Anderson) As I say, we would always like to do better, and we are reviewing the BTA's position at the moment, but they use that money very effectively. They have 27 offices in our key markets abroad, and they also use the money that they are allocated by the Government—that is the grant in aid figure—to lever in a lot of private money as well. We think that they do an excellent job, but we are always ready to listen to requests for more, because we do understand the importance of the tourism industry.


  169. Mr Donoghue pointed out in his evidence that in our report on the tourist industry we cited the fact that the entire marketing budget of the British Tourist Authority for the whole of the Americas—north, central and south—is less than the tourist budget for the state of Virginia.

  (Ms Anderson) As I say, Mr Kaufman, we are always willing to listen to requests for more and we will always do what we can to help.

Derek Wyatt

  170. Yesterday I gather you met your counterparts from Scotland and Wales. I think this is the first time all the ministers have met. Is that right?

  (Ms Anderson) Yes, it is.

  171. The other three are domiciled not in culture, media or sport. They are domiciled in economic or business areas in their own assemblies or parliaments. Given that, do you really think on reflection that DCMS is the right place for tourism to be?

  (Ms Anderson) I am bound to say yes, because it is my job and I enjoy it very much. On a serious point, yes, I do think it is the right place to be, and for this reason. I think it fits in so well with the other responsibilities in the Department: with culture, with sport, with our historic heritage. I think that is where tourism belongs.

  172. You do not feel that the DCMS is seen as a weaker department by the Treasury, and that tourism being in it, it weakens the position of tourism? As it is one of our bigger industries, it makes it much harder to argue for. I will give you an example. In Ireland ten years ago they halved the rate of VAT on accommodation and within four years they tripled the number of visitors. We have the highest VAT rate on bed and breakfast and hotel rooms, as you well know. It would be nice if that could be cut immediately, now, in crisis, to get B&B back. It is mainly British people who actually go for B&B. Because DCMS is perceived by the Treasury to be a weaker department, it means tourism is weakened.

  (Ms Anderson) We are the smallest department; that is certainly true, but I was very encouraged when we had what I describe as our "OFSTED". We were the first department to be "OFSTED-ed". That report said we were a department that punched above our weight in Whitehall, and I think that is certainly true. If there is one good thing to come out of this current situation, it is that people do now understand the importance of tourism. They understand that it is the fastest growing industry in the world and that we are going to have to compete very hard to try and keep our fair share of it, as previous witnesses have outlined. I am very sad that it should have happened in this way, but I think tourism is now much higher up everyone's agenda.

  173. Finally, we have this rural task force. I was in Aldburgh at Easter. Cambridge, Norwich, Colchester, Ipswich, Bury St Edmonds are destination towns and cities where people go for a day or two and then move on. These are not rural; these are large urban areas. Given that what has happened this year may have an effect on tourism for the next two or three years, so many people will think twice about re-investing; they might get through this year—or they may not—but they certainly will not come back if they are in the business, what we probably need is a tourism regeneration package, and that is millions of pounds, and that is needed tomorrow really. I do not feel that sense of urgency, that the Government understands this.

  (Ms Anderson) As I say, the Prime Minister said yesterday that there was going to be an extra allocation of funding, and he will be announcing how much that will be in the next few days. I have said many times, Mr Wyatt, that when this is over there will be a need for a marketing campaign. It is recognised by DCMS, it is recognised by ETC and particularly by the BTA, to restore confidence in Britain as a visitor destination. There is no doubt about that. Our greatest fear is that visitors may feel deterred, that our domestic market will be more likely to go overseas and our visitors from abroad will be more likely to go elsewhere, and once they have been displaced, it will be doubly difficult to get them back. So there is no doubt that we need to do some intensive marketing when we have the all-clear to do that.

Miss Kirkbride

  174. I am not sure you have really explained to this Committee why it was that, as the responsible minister, who fully accepts that there is a growing tourism market and that we do not actually get our fair share of it; we have a deficit, you were prepared to preside over a shrinking budget for BTA.

  (Ms Anderson) As I say, BTA for the present year are getting £35.5 million. We are currently in the middle of reviewing their remit and what they do. We have to reach a conclusion on that. They are now getting extra money, I am very pleased to say.

  175. Why did you plan to give them less?

  (Ms Anderson) I am not sure we ever did.

  (Mr Broadley) The plan is that they should receive £35.5 million in each of the next three years. That is the same in cash terms, but obviously with inflation...

  176. It is a real-terms cut. Why was that planned?

  (Ms Anderson) We felt at the time that that was sufficient for BTA to do the job they were doing, and it is a job they do very well.

  177. You have told us, Minister, that actually we have a shrinking market for tourism, yet it is growing worldwide. How could you possibly think it was right to have a diminishing budget?

  (Ms Anderson) It is growing worldwide. It is a global market. We are competing with all sorts of other countries. It becomes more and more competitive.

  178. So why cut the budget?

  (Ms Anderson) As I understand it, we were not cutting BTA's budget. They have now had additional money and they are going to get some more.

  179. Mr Broadley just said that it is a real-terms cut implied in the budget for the forthcoming years.

  (Ms Anderson) I think I can proudly stand on our record of the money that we have allocated to the support of tourism, and as I recall, when we came into government we were faced with a situation which had been left to us by the last Government which had reduced the funding for the English Tourist Board from something like £25 million at its height to less than £10 million. We have got that back up to £12 million, and I would like to do more, but at least it is being increased.

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