Memorandum submitted by City of Edinburgh
Council
TOURISM IN
EDINBURGH
Edinburgh is the jewel in the crown of Scottish
tourism and is second only to London in the UK context. In 2006
Edinburgh attracted 1.33 million overseas tourists an in crease
of almost 20% on the previous year. This success is due in part
to the Edinburgh Tourism Action Group (ETAG)—a dynamic working
partnership between private and public sectors to co-ordinate
tourism in the city. ETAG has recently produced the city's tourism
strategy—"A Framework for Growth 2007-15." This
can be viewed: http://www.inspiringtourism.co.uk/components/docs/ETAG—framework.pdf
The Framework for Growth proposes a 63% growth
in tourism revenue in the city by 2015. This complements the Scottish
national ambition of 50% growth as published in the document Scottish
Tourism: The Next Decade—A Tourism Framework for Change.
Edinburgh recognises that for Scotland to achieve this ambitious
target, the capital needs to be even more ambitious.
Attached is a report on the current position
of tourism in the city to be considered by the Economic Development
Committee on 23 October.
GLASGOW AND
EDINBURGH COLLABORATION
Also attached is a summary of success to date
with Glasgow and Edinburgh collaboration initiative.
VISITBRITAIN
Edinburgh is promoted outwith Europe by VisitBritain.
However, the profile given to the city has been a source of concern.
In January 2007 Councillor Donald Anderson, the then Executive
Member for Tourism Culture and Sport, wrote to Tom Wright, Chief
Executive of VisitBritain in the following terms:
"I have been increasingly concerned
by the promotion provided by VisitBritain. Recent examples are
the alternative cities campaign which highlighted flyposting and
graffitti in the Edinburgh, hardly appropriate for a World Heritage
site. In the December" focus on Edinburgh", no mention
was made of the Winter Festivals, which include the world famous
Edinburgh's Hogmanay.
I would propose that there are regular meetings
between the Council and VisitBritain to improve communication
and prevent such occurrences in the future. I understand that
you visit Edinburgh twice per year. I would suggest that as a
matter of course, you visit the City Council on these occasions
and meet with the Executive Member for Tourism Culture and Sport
and relevant officials."
This invitation was accepted, though to date
no meeting has taken place.
AIR TRAVEL
Edinburgh is situated on the periphery of Europe.
As such it is heavily dependent on air traffic to maintain its
competitive position, particularly in the key Business Tourism
sector. A recent study for the Edinburgh Convention Bureau cited
direct air links as a key factor in the city's ability to attract
international conferences. To this end the Council and its partners,
Chamber of Commerce, VisitScotland, Scottish Enterprise Edinburgh
and Lothian and Edinburgh Airport have set up a Route Development
Group. This group focuses on identifying the key new routes which
will assist the city's business community. In addition it develops
proposals to support and maintain new routes through initiatives
to market Edinburgh in the new destinations.
In the year to August, a total of 8.89 million
passengers used the airport with international traffic growth
for the 12 month period up by 23.6%. More than 40 airlines now
fly from 90 destinations to Edinburgh, with 28 new services announced
for this year alone.
STRUCTURE AND
FUNDING OF
SPONSORED BODIES
The City of Edinburgh Council has been a major
funding partner of the statutory tourism marketing bodies since
it set up Edinburgh Marketing in 1991. These bodies have included
Edinburgh Tourist Board 1991-95, Edinburgh and Lothians Tourist
Board 1996-2005 and VisitScotland Edinburgh and Lothians. Most
recently the Scottish Government have announced a restructuring
of VisitScotland—reducing the Area offices to five. As a
result Edinburgh and Lothians will be joined by Fife Stirling,
Falkirk and Forth Valley. With each re-organisation the area covered
becomes greater and the ability to focus on marketing Edinburgh
becomes diluted.
Edinburgh is the "attack brand" for
Scottish tourism, and is a major player in UK tourism. It is therefore
of great concern to the Council that the city will not be provided
with the required marketing support.
The Chamber of Commerce, with support from ETAG,
Scottish Enterprise Edinburgh and Lothian and the City of Edinburgh
Council have appointed consultants to lead a study into how best
to promote Edinburgh as a city to Live, Invest Visit and Study.
VISITOR LEVY/BED
TAX
Edinburgh Tourism Action Group has been at the
forefront of investigating the way forward in alternative forms
of funding for the industry. During the past 18 months, ETAG has
undertaken research to understand what cities and countries around
the world are doing to help fund additional tourism activity &
develop their destinations, into "must-see" choices
for the discerning tourist.
As we move forward in Scotland, considering
how best to develop and maintain successful tourism destinations,
many of the issues and ideas raised within the ETAG research will
be useful to those of us looking for innovative methods to fund
activity.
The group commissioned research into the use
of Visitor Levies—one form of funding generator—in
a number of cities which allows us a view of how both some statutory
(taxation based) and voluntary schemes work elsewhere.
Much needed customer research was then commissioned
to help us understand the views of the ultimate consumer on paying
a small, additional charge towards supporting and improving services
in their holiday destinations.
This research offers interesting and thought
provoking findings, some of which can be seen in a positive light—particularly
those suggesting that consumers do not mind paying a small extra
charge if the money raised, is invested back into tourism; is
used for "green activities" or is part of some form
of "reward scheme" where visitors receive, for example,
added value benefits such as a Destination Card in return for
their levy. (A Destination Card can be a simple added benefit
providing money-off local attractions; free transport etc to visitors.)
Key issues which need to be resolved before
any such levy is introduced include:
— Tax on Business or Levy on visitors
— Tourism Specific Tax—Airport
Departure Tax, Bed Levy, or Non—Specific Tourism Tax—Airport
Passenger Duty,
— Relationship of a levy to any B.I.D.
development.
— Industry involvement in any investment
decisions
— Competitiveness enhanced or damaged?
— How much could be raised?
Copies of original research are available if
required.
SUSTAINABLE TOURISM
A key action for Edinburgh Tourism Action Group
is to develop a Sustainable Urban Tourism Strategy.
Any strategy has to encompass the "triple
bottom line" of environmental, social and economic sustainability.
Environmental sustainability for Edinburgh includes
a reduction of air travel for UK visitors. A key aspect of this
will be continued investment in the East Coast Main Line and the
Cross Country routes. Rail travel is the best alternative to
flying—but it must be more efficient in both cost and reliability.
Within the city, the Council works with the
World Heritage Trust to protect the fabric of the city.
Tourism businesses are encouraged to join the
Green Tourism Business Scheme.
Social sustainability encompasses benefits to
residents, attitudes of residents to tourism and tourists and
employment opportunities.
The Council regularly surveys householders to
assess the effectiveness of its policies. Recently question on
tourism were inserted to this survey with the following results:
TOURISM IN
EDINBURGH 2005
To what extent do you agree or disagree with the
following statements about tourism in Edinburgh?
|
| Strongly agree
| Tend to agree | Neither agree nor disagree
| Tend to disagree |
Strongly disagree | Don't
know
|
|
| % |
% | %
| % | %
| % |
| a) Tourism brings cultural benefits to the city
| 45 | 41
| 7 | 3
| 1 | 2
|
| b) Tourism brings benefits to residents
| 21 | 36
| 17 | 17
| 4 | 4
|
| c) Tourism is a vital part of the city's economy
| 59 | 35
| 3 | 1
| * | 1
|
| d) Continued investment in tourism is important for helping to develop Edinburgh's economy
| 53 | 36
| 5 | 3
| 1 | 1
|
|
TOURISM IN
EDINBURGH 2007
To what extent do you agree or disagree with the following
statements about tourism in Edinburgh?
|
| Strongly agree
| Tend to agree | Neither agree nor disagree
| Tend to disagree |
Strongly disagree | Don't
know
| Agree |
|
| % |
% | %
| % | %
| % | %
|
| Tourism brings cultural benefits to the city
| 48 | 42
| 6 | 2
| 1 | 1
| 90 |
| Tourism brings benefits to residents | 30
| 32 | 17
| 13 | 6
| 2 | 63
|
| Tourism is a vital part of the city's economy
| 57 | 35
| 4 | 2
| * | 1
| 92 |
| Continued investment in tourism is important for helping to develop Edinburgh's economy
| 53 | 37
| 6 | 2
| 1 | 2
| 90 |
|
The improving trend in "brings benefits to residents"
is a result of efforts to promote tourism as everyone's business.
Investment in the industry in the past decade has turned
the employment potential from a largely part-time opportunity
to a full time career option. ETAG has established a skills sub
group of practitioners to concentrate on all aspects of the workforce
from recruitment, through training to management development.
Currently more than 31,000 people are employed in the industry.
This workforce focus is directly related to the Economic
sustainability agenda. Maintaining or increasing market share
in a very competitive environment will assist the economic viability
of the industry. Edinburgh currently enjoys an occupancy rate
of 77% and a revPar of £81 (2nd only to London). These statistics
encourage inward investment and the city regularly plays host
to international hotel chains seeking to develop in the city.
In the past year one of the city's principal hotels—the
Radisson SAS, has employed an environmental officer. A key outcome
of this appointment has been to increase the hotel's profitability.
LONDON 2012
Opportunities for Edinburgh include:
— provision of training facilities
— promoting leisure tourism opportunities to sports
professionals, journalists, athletes and their families.
— sports conferences in the period between Beijing
and London 2012.
1. Purpose of report
1.1 Tourism is a key sector of the Edinburgh economy,
and the city contributes disproportionately to the success of
Tourism in the Scottish economy. This report brings members up
to date with recent developments.
2. Summary
2.1 Edinburgh is the jewel in the crown of the Scottish
tourism economy providing a gateway to the rest of Scotland. It
is the main tourism destination in the UK after London, attracting
1.3 million international visitors in 2006, and 45% of all overseas
tourists to Scotland.
2.2 Tourism is a key sector of Edinburgh's economy and
performs a major role in the promotion of the city's Live, Visit,
Invest and Study agenda. 31,000 people are currently employed
in the industry and in 2005, the most recent statistics available,
visitors spent £1.7 billion in the city.
2.3 However, Edinburgh operates in a highly competitive
and volatile global market place, and must continue to invest
in, and promote, the city in order to maintain its competitive
position.
2.4 The City Development Department is the lead department
and budget holder for grant funding VisitScotland, Edinburgh Convention
Bureau Ltd, Edinburgh Film Focus, Edinburgh's Winter Festivals
and Edinburgh International Science Festival.
2.5 The Council works in partnership with VisitScotland,
Scottish Enterprise Edinburgh and Lothian and representatives
of 1,000 tourism businesses in the Edinburgh Tourism Action Group
(ETAG) to co-ordinate tourism in the city. Earlier in 2007 ETAG
published the Edinburgh Tourism Strategy—A Framework for
Growth 2007-15. This strategy proposes an increase in visitor
spend of 5% per annum—an increase of 63% by 2015. This relates
to the national ambition defined in the Scottish Executive document
Tourism Framework for Change, which proposes 50% revenue growth
for the whole of Scotland by 2015.
2.6 Internally, the Council co-ordinates its activities
in tourism through the Council Tourism Team. This team is chaired
by City Development and produces an annual action plan, and an
annual report entitled Inspiring Tourism.
2.7 In light of the Scottish Government's recent announcement
of changes to the Enterprise Network and VisitScotland (15 area
offices reduced to six) City Development staff will begin discussions
with counterparts in these organisations to establish the implications
for Edinburgh.
2.8 City Development has a real concern that the strength
of Edinburgh's tourism promotion may be diluted by this new wider
regional approach, and the need for a strong voice promoting the
city is all the more important in these new circumstances.
3. Main report
3.1 The International Passenger Survey results, published
in September 2007, showed that the number of international visitors
has risen by almost 20% from 1.1 to 1.3 million between 2005 and
2006. These figures were complemented by results from Edinburgh
Airport: in the year to August, a total of 8.89 million passengers
used the airport with international traffic growth for the 12
month period up by 23.6%. These figures show that in terms of
international visitors Edinburgh is second only to London in popularity,
and the city has increased its lead over Manchester, Birmingham
and Glasgow. It is important to note in this context that while
London has its own dedicated marketing bureau as well as the promotional
clout of Visit Britain, this is not the case for Edinburgh as
Scotland's capital city.
3.1 Annual average hotel occupancy is 76% with increasing
bedstock. There was a 6% year on year growth in July 2007 in revenue
per available room (RevPar) as recently reported by PKF. The current
RevPar figure of £81 is second only to London, and significantly
exceeds the UK regional average of £54. UK tourism statistics
for 2006 are expected to be published some time in October. However,
2005 statistics showed that 2.5 million visitors spent £676
million in the city. It is clear that the industry is performing
well and provides the city with a significant building block as
it promotes itself to inward investors in the international market
place.
3.2 In an increasingly competitive tourism market the
city needs, however, to continually invest in its product and
the physical infrastructure is an important component. A recent
Accommodation Supply and Demand Study, commissioned by Scottish
Enterprise, Edinburgh and Lothians (SEEL) and the Lothian Councils,
identified the need for a further 4,000 hotel rooms in Edinburgh
by 2015. CEC and SEEL are now producing a prospectus of appropriate
identified sites to assist developers to fulfil this need. Interest
from developers and hotel operators is at an unprecedented high
level and is reflected in the number of planning applications
being submitted in the city.
3.3 Business tourism is a key growth market of the sector.
The World Tourism Organisation predicts that Business tourism
will grow to represent 40% of the tourism market by 2020. In Edinburgh
this market is served by Edinburgh Convention Bureau Ltd (ECB),
Edinburgh International Conference Centre (EICC), the Universities
and private sector operators. The market is currently worth £200
million in revenue generation per annum to the city. There are
however key infrastructure issues facing the conference sector,
due to the delay in the development of additional function space
at EICC and the upgrade of the National Museum in Chambers Street.
3.4 Edinburgh Convention Bureau is funded by a combination
of core funding from its two partners, City of Edinburgh Council
and VisitScotland, and from income raised from membership and
commissions. However, the VisitScotland contribution is largely
re-invested from the Council grant. Any reduction in either the
direct support to ECB or the support to VS would impair ECB's
ability to promote the city. The total budget of £650,000
is considerably less than that enjoyed by competitor city Convention
Bureaux. A further report will be submitted to committee on business
tourism, including the infrastructure audit and requirements,
in the near future.
3.5 Events and Festivals are a key component of the Edinburgh
tourism product. Edinburgh is renowned world-wide for its Festivals.
The recent Thundering Hooves report pointed the way forward for
maintaining this competitive edge, through a combination of increased
investment and better co-ordination. The director of the new
organisation—Festivals Edinburgh—sits on the ETAG
Full Group. In this way the needs of the Festivals and the tourism
industry are fully understood by both parties.
3.6 Tourism is Edinburgh's shop window to the world.
With more than four million visitors staying overnight in the
city, there is a ready market for attracting further inward investment.
3.7 The City Development Department represents the Council
on the Client Group of a major review of City Promotion—"Promoting
Edinburgh as a Destination". This study is being jointly
funded by City Development and SEEL. The Task Group, chaired by
SEEL, is due to report in December. Key issues include how to
promote the city across the Live, Work, Invest and Study agenda,
and how to increase the effectiveness of the current investment
in city promotion. A report will be submitted to Economic Development
Committee in early 2008.
3.8 The city's tourism sector strongly supports the Edinburgh
City Region Brand—Edinburgh Inspiring Capital. The brand,
launched in May 2005, ensures a more joined up and effective approach
to city promotion by providing a cohesive marketing image which
highlights the strengths of the area as a place to live, invest,
visit and study. The City Development Department liaises closely
with the Brand team and is represented by the Interim Head of
Economic Development on both the Brand Working Group and the Steering
Group.
The future of the Brand and the Brand team, which is currently
entirely funded through the Cities Growth Fund (and currently
terminates in March 2008), is tied into the review of City Promotion—"Promoting
Edinburgh as a Destination" currently being undertaken by
the Communication Group on behalf of SEEL and the Council.
3.9 The continuing economic success of the tourism industry
is increasingly recognised as a benefit to the city as a whole.
In the recent Household survey by MORI, 63% agreed that tourism
brings benefits to residents, an increase of 6% in two years.
In addition 90% agreed that tourism brings cultural and economic
benefits to the city and that continued investment in tourism
is important for helping to develop Edinburgh's economy.
3.10 The success of the industry is founded on the twin
pillars of strong public/private partnership—Edinburgh Tourism
Action Group and continued investment by all the partners. In
the past five years more than £1 billion has been invested
in hotels, festivals and events, the airport, rail travel, retail
etc. While it has been calculated that a further similar sum
will be invested in infrastructure such as airport, terminal redevelopment
and hotel developments, transport, conference and events infrastructure.
3.11 Budget pressures on the Council and other public
sector agencies present a continuing challenge to support this
key industry. At a time when competitor cities are investing heavily
in their infrastructure and city promotion activity, it is vital
that Edinburgh maintains its funding support to ensure the city
retains its competitive position.
3.12 The ETAG growth proposal of 63% by 2015 is in line
with the national ambition of 50% growth by 2015. However, it
is clear that Edinburgh will need to grow faster than the national
average for the Scottish Government ambition to be achieved. Only
investment in Edinburgh—the driver of Scottish tourism—creates
the opportunity to achieve this national target.
3.13 The Edinburgh Tourism Strategy is supported by an
annual Edinburgh Tourism Action Plan. The Minister for Tourism
has agreed to launch the forthcoming 2008 plan. This will take
place on 4 December 2007.
3.14 This plan defines the actions to be taken by ETAG
partners in 4 key investment areas: City Centre, Waterfront, Festivals
and Events and Business Tourism. In addition there are five cross-cutting
themes underpinning all of the key strategic priorities: city
promotion, transport, tourism workforce, sustainability and collaboration.
3.15 The city is regularly cited as a top UK destination
in travel awards, winning the Guardian Observer Readers Travel
award as best UK city for the past seven years. In September
2007 the city came 2nd to Durham in the prestigious Conde Nast
award for best UK city. Edinburgh has been in the top three for
the past seven years and has won this award three times.
3.16 In September 2004 the Council calculated that it
invested circa £35 million per annum in support of the tourism
sector. This figure included support for events and festivals,
museums and galleries, sporting facilities and support for city
marketing activity currently carried out on our behalf by VisitScotland
and Edinburgh Convention Bureau. This Council-wide activity is
co-ordinated by the Council Tourism Team, managed by City Development.
3.17 The City's tourism industry plays a key role in
both the city region and the Glasgow—Edinburgh collaboration
agenda. Tourism is a key sector in delivering the ambitions for
the collaboration initiative with Glasgow, delivering several
projects over the past year—including the recent successful
Family Fun weekend.
3.18 The Area Tourism Partnership (ATP), chaired by the
Council Leader, co-ordinates the activities of the industry in
the four Lothian Authorities. With the recent changes announced
for VisitScotland it is unclear if the ATP will continue in its
current form.
4. Conclusions
4.1 Tourism plays a key role in the city's economy as
a generator of income, employment and international profile for
the city and Scotland. However, there are key funding, promotion
and infrastructure issues which must be addressed if the city
is to maintain its competitive position, and continue to be a
driver of Scottish tourism.
4.2 The City Council plays a lead role in the key partnerships
which are delivering growth and success in the industry. Tourism
is Edinburgh's shop window to the world. However, more co-ordination
of tourism and city promotion is required to market the city as
a key destination for talent, trade and tourism in a constantly
changing global market place.
5. Financial Implications
5.1 None at present.
6. Recommendations
6.1 To note the contents of the report.
6.2 To note that discussions with colleagues from VisitScotland
and Scottish Enterprise are required to establish the implications
for Edinburgh of the Scottish Government's proposed changes to
these agencies.
6.3 To note that a further report on Business Tourism
in the city will be submitted to committee early in 2008.
6.4 To note that a report on "Promoting Edinburgh
as a destination" will be submitted to committee early in
2008.
6.5 To refer this report to the Culture and Leisure Committee.
GLASGOW AND
EDINBURGH COLLABORATION:
There is a three-fold purpose for Glasgow and Edinburgh collaboration:
— to close the gap with cities that currently boast
superior economic performance;
— to make a disproportionate contribution to improving
Scotland's economic performance.
— to keep pace with other cities already collaborating
to compete.
Tourism took the lead in this area with the first industry
collaboration workshop held in Glasgow in February 2006. Originally
devised by Councils and Enterprise companies in both cities, the
aim was to test areas for collaboration with the industry, generate
new industry ideas and provide a framework for future implementation.
The day was supported by 40 key private sector representatives
from the cities and the workshop was hailed a great success by
all involved, including the then Minister for Tourism Culture
& Sport, Patricia Ferguson MSP.
The event provided an opportunity for businesses to generate
ideas for collaboration and for the public sector to reinforce
its desire to support collaborative projects. Collaboration is,
and remains, an opportunity for all . . .
The workshops identified five key tourism themes from which
a list of projects for further development was captured.
One project from each theme was identified to be developed
beyond the outline description.
Under the Knowledge Sharing and Skills theme Twin
City People was developed to address an industry desire for
a method of broadening the knowledge of frontline staff about
the best tourism offerings in Glasgow & Edinburgh, the "Twin
City People" product knowledge tours have been developed.
This project was made possible with the support and involvement
of partners from venues in both cities. To date six local knowledge
courses have been delivered.
Events and Festivals make a significant contribution
to the economies of both cities. Under this theme a list of the
two city's major events and festivals has been generated to formulate
a Joint Events and Festivals Diary.
Connectivity, especially transport was something which
everyone agreed would add benefit to the overall visitor experience
and as a result, with the support of Scotrail, it was decided
to look at the current product offering and review what opportunities
there were surrounding this area in the form of a joint Rover
Ticket.
Product Development rose to the challenge of identifying
and developing new tourism products for the market.
A gap was seen in the families market and the project Family
Fun Weekend was created to stimulate the interest of parents and
children living in Edinburgh and Glasgow to visit the other city.
This has been made possible by the attractions in Glasgow and
Edinburgh offering a free visit to families from the other city.
This project has real potential to grow and become an annual weekend
in the diary.
Business Tourism is big business for both cities.
Under the theme of Business Tourism it was agreed on the
day of the workshop that Glasgow and Edinburgh should look at
the feasibility and opportunities to collaborate in the conference
market to mutual benefit. A study was commissioned to assess
the feasibility and opportunity to collaborate in this area.
In addition to the projects highlighted above a number of
other projects were initiated by the partners including;
— Collaboration project involving students from
both Strathclyde and Napier Universities looking at the long term
opportunities for Schools of Tourism & Hospitality;
— Tourist Information Centre Staff Swaps involving
staff from VisitScotland's busy TIC offices in both cities;
— Local Council magazine competitions were
run to "Win a family day out in your neighbouring city"
highlighting not only what alternative activities you can do but
demonstrating just how easily and quickly you can get there!
To date the initiative has been a success in bringing together
public and private sector tourism experts from both cities to
work together on projects which will ultimately grow the market
for both cities.
In the international market place, Edinburgh and Glasgow
account for half Scotland's income from overseas tourists (£600
million in 2005). The VisitScotland European Cities £700,000
campaign focuses promotion on Edinburgh and Glasgow. In 2006 the
campaign, achieved £11 million additional tourism expenditure
for Edinburgh and Glasgow and was named the best international
campaign at this year's Marketing Excellence Awards Scotland.
October 2007
| 
