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I congratulate the noble Lord, Lord Pendry, on securing the debate and support virtually everything that he said in his opening remarks. This debate follows relatively closely that initiated by my noble friend Lord Glasgow on 22 January, which gives me the opportunity to challenge some of the points that the noble Lord, Lord Carter, made in responding to that debate. Much was made in the debate of the tourism summit in Liverpool, which was positively dripping with Ministers from the Prime Minister, the Secretary of State at DCMS, the Tourism Minister. However, in that debate I expressed cynicism. I said that,
- “the test will be what action the Government take. Will they take tourism seriously for the first time, because, at a time of rapidly rising unemployment, a very worrying economic situation and a weak pound, perhaps tourism’s time has come?”—[Official Report, 22/1/09; col. 1815.]
What has happened since that much hyped summit? It is true that the Tourism Advisory Council has been established, which I believe met on 30 April. When does it next intend to meet and how frequently will it meet? However, there has been no new funding for VisitBritain and no new funding for the Olympics, despite pleas, whereas billions of pounds have been spent bailing out our banks.
There was no mention of tourism in the Budget. However, buried deep in the Budget was the removal of a special tax break for holiday lets, which encouraged many to accommodate tourists. So much for the Government taking tourism seriously. I wrote to the Secretary of State on 27 April, asking whether the DCMS had been consulted before that decision was taken by the Treasury. I got a reply today which dodged that question.
I should like to challenge some of the points that the Minister made in winding-up the debate on 22 January. He said:
“I felt that a number of noble Lords rather flippantly criticised the Government for not including ‘tourism’ in the title of the department”.—[Official Report, 22/1/09; col. 1830.]
He then rather flippantly himself made a rather weak joke about the length of business cards or the time taken to answer the telephone if everything for which the department was responsible was included in its title. I assure him that there was nothing flippant in my or the industry’s anger that tourism—our fifth largest industry—is not included in the title. There is deep resentment about that.
The noble Lord referred to a joint ministerial committee that would look at issues that touched multiple departments. There is nothing original in that concept. Indeed, when I was Tourism Minister, we had just such a committee 20 years ago. But the problem is that that committee has to be chaired by a very senior Minister. It is not good enough to have it chaired by the Tourism Minister. I speak from experience. Will the noble Lord tell us the date of the next ministerial meeting on tourism and the frequency of future meetings?
I challenge the noble Lord on the whole question of double summer time, for which I and others strongly argue. Nothing would give a bigger boost to tourism than double summer time. The noble Lord said that,
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- “we are aware ... that while the tourist industry may favour this change, many sectors in our communities are strongly opposed”.—[Official Report, 22/1/09; col. 1834.]
Certainly, many bodies are in favour, as was said earlier; for example, those representing tourism, road safety and sport. Can he please list for me today, or perhaps subsequently in writing, the many sectors, which are strongly opposed?
As a massive supporter of UK tourism, I have been fortunate, over 50 years as a holiday maker, Member of Parliament and Minister, to travel the length and breadth of the country. Since we debated tourism in January, I have stayed in England, Scotland and Wales on short holidays, in many excellent hotels of quality. I agree so much with what the noble Earl, Lord Caithness, said about quality and about the rising quality of our industry to which the noble Lord, Lord Rosser, referred a little earlier. In England I stayed for a long weekend in the Yorkshire Dales at the Traddock Country House Hotel in Austwick near Settle, which gave an absolutely outstanding level of comfort, food and service. In Scotland, during a salmon-fishing week, I stayed at the Ednam House Hotel in Kelso, a magnificent location on the River Tweed and a very friendly, traditional, sporting hotel. Finally, over Easter, in Wales, I stayed at the St Brides Spa Hotel at Saundersfoot, which overlooks the harbour and has had £6 million of investment go into it. There was an outstanding welcome from the staff and an opportunity to walk the wonderful Pembrokeshire coastal paths.
It should be a very good year for domestic tourism in 2009, with the weaker pound and our economic situation. A great summer could put icing on the cake or, perhaps, sausages on the barbecue. Last week, I was reading an article that talked about the resurgence of the great British picnic. Yesterday, ALVA, the Association of Leading Visitor Attractions, had its council meeting. We had a reception at the Tower of London, a Thames boat trip down to the Olympic site and a dinner at Waterman’s Hall, hosted by two of our members, the Historic Royal Palaces and British Waterways.
Many members reported welcome growth in visitors this year. English Heritage was up 12 per cent. The National Gallery was up 23 per cent. The Portsmouth Historic Dockyard was up 20 per cent and the National Maritime Museum up 16 per cent. Many reported an excellent Easter but that there was a negative on the corporate entertaining front, which is very difficult at the present time. Interestingly, the Natural History Museum found, in a recent survey, that 50 per cent of the public did not appreciate that admission was actually free. There is much to do here. The Olympic site was a hive of activity. There is considerable optimism that it will be completed something like a year before 2012. We hope that this does come to pass. It is obviously a great pity that the Government are not seizing the opportunity and putting more marketing spend behind the Olympics.
What would the industry like to see from Government? We would like to see greater funding for VisitBritain. I am pleased to say that we have a Lib Dem commitment to increase funding for VisitBritain. I should like to congratulate Sandie Dawe on becoming chief executive of VisitBritain. I wish her every success. We need
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We need to review the increase in air passenger duty, which presents a barrier to travel within the United Kingdom. We should review the phased withdrawal of the hotel buildings allowance that was referred to by the noble Viscount, Lord Montgomery, a little earlier. The Government should also tackle the expense and inconvenience of visas by introducing, on a trial basis, a Schengen plus scheme, or a bolt-on visa, in our core overseas markets so that visitors from these countries, who have already obtained a Schengen visa, can then apply for a UK visa at a reduced price.
A reduction in VAT should be considered as well. The UK is one of only five EU members that levy VAT at the standard rate on visitor accommodations. With regard to visitor attractions, the standard rate applied in the UK is significantly above the EU average. I also very much support the plea by the noble Baroness, Lady Valentine, for a major convention centre in London. We sadly miss this.
Finally, with 81 per cent of people who are likely to visit the United Kingdom saying that they are likely to visit an historic house or castle, the Government should acknowledge the work of the HHA. I pay tribute to the noble Earl, Lord Sandwich, for his work with it. There is something like a £1 billion backlog of outstanding repairs at listed places of worship. Charitable and privately owned heritage could play a major role if it had the resource. The Government should restore English Heritage’s grant in aid to 1997 levels and introduce fiscal incentives for maintenance.
I conclude with the words of the Tourism Alliance:
“The Government can either continue to make spurious claims that it is supporting tourism and squander this current opportunity, or it can take tourism seriously by developing and implementing a strategy that reduces the regulatory burdens, removes barriers to overseas visitors and provides the funding required for the national tourist boards to successfully compete in this global market”.
Dialogue with the industry is not enough; we want action.
3.51 pm
Lord Howard of Rising: My Lords, I, too, thank the noble Lord, Lord Pendry, for introducing this debate. As a number of your Lordships have pointed out, tourism is one of the major industries in this country, so it is appropriate that such an important subject is debated in this House. I must declare an interest as the owner of a tourist attraction which has between 30,000 and 40,000 visitors a year.
Predictably, there have been calls during this debate for more support to be given to tourism, with attention being drawn to its decline. I have some sympathy with the argument put forward by Her Majesty’s Government on a previous occasion that one of the causes of the decline is the market becoming more competitive, as other countries increase efforts to attract visitors. Cheap airline travel induces more Britons to choose to take holidays abroad, making further inroads into our tourist industry.
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While recognising that that there are certain things that for practical purposes may best be done by government—for example, advertising and marketing the attractions of this country overseas to promote inward tourism, the success of which has been commented on today—I believe that there would be enormous benefits for the industry in removing some or all of the government-created impediments to tourism. Her Majesty's Government should look at what can be done to further this.
For example, as has been mentioned today, the cost of a visa to visit the United Kingdom is £80. For £20, you can visit 12 European countries. I am told that in Russia, China and India applications for visas must be in English. Given the number of languages available when one applies for state benefits, it would surely be an easy exercise to provide visa forms in local languages. A simple action such as this does not cost anything but can make a big difference to potential visitors’ perception of the welcome that they will receive in this country.
When tourists, both from abroad and within this country, make their holiday plans, the first thing that they look at, and the deciding factor in the great majority of cases, is the cost of travel and accommodation. Her Majesty's Government should look at whether steps can be taken to influence people at this crucial stage of the decision-making process to plan their holidays in Great Britain.
Another matter that Her Majesty’s Government might consider is taking a better and longer look at promoting more consultation and co-ordination between different government departments. Little consideration seems to be given to the knock-on effect on our fifth largest industry—I heard it stated earlier today that it is our third largest industry, but I have also read that it is our sixth largest industry: whichever it may be, it is big—of the continuing stream of regulations that this Government are so fond of imposing. For small, and even large, providers of facilities for tourists the full focus should be on ensuring their visitors’ enjoyment. Several noble Lords, including the noble Earls, Lord Glasgow and Lord Sandwich, and the noble Viscount, Lord Montgomery of Alamein, alluded to this. Those providers should be looking after their visitors, rather than filling in forms to assist in promoting politically correct agendas.
For all the fuss made about cool Britannia and being modem, the anchor for our tourism, the main attraction, is, as my noble friend Lord Caithness pointed out, our superb and unrivalled heritage which gives Great Britain a huge advantage over other destinations. Any Government wishing to assist tourism should surely do their best to maintain to the highest standards that great lure for visitors to come to this country. It is regrettable that government support for English Heritage over the past 10 years has been reduced in real terms by £110 million at a time when the costs that English Heritage incurs, because of its extensive use of highly skilled labour, have increased way above the rate of inflation.
Sporting tourism is another important aspect of the industry but the tax treatment of overseas sportsmen performing in this country is a serious deterrent to top-class athletes coming here. It is the sporting stars
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The big names avoid the smaller events, which are the ones which need the star attractions to bring in the crowds. If Tiger Woods plays in a golf tournament the attendance multiplies, but the stars will not wish to come here if the penalty is ending up with a tax bill in excess of any prize money or winnings. A significant impediment to England attracting major football competitions is the reluctance of those organising the events to push players into being sucked into a tax net which can then attack their world-wide earnings.
With the present rate of exchange for sterling there is, as has already been pointed out by noble Lords, a superb opportunity for British tourism; but it may not always be thus. While we all enjoy contemplating the enormous advantage that has been given to Great Britain of not being in the single currency, I urge the Minister to use what, in spite of the reductions, still remains a substantial budget to maintain the competitive edge which the exchange rate has provided by addressing some of the impediments to the initial decision to take a holiday in Great Britain.
3.58 pm
The Parliamentary Under-Secretary of State for Communications, Technology and Broadcasting (Lord Carter of Barnes): My Lords, since I became a Minister I have had the pleasure of taking part in two House of Lords debates on tourism, and the significance of the sector has been made very clear to me. The contributions made today and back in January have all been eloquent and absorbing. As I think we all know, the world continues to change at a sometimes rather alarming and challenging pace. I would like to join other noble Lords in congratulating my noble friend Lord Pendry on securing this important debate. I know from my day job as a sectoral Minister how challenging it can be to ensure that a sector’s perspective is heard across government. Debates such as this one help to air the issues in a very constructive fashion.
Britain, like many countries, continues to battle the effects of the economic downturn, but the outbreak of swine flu and the associated media coverage reminds us all that the economy is not the only factor influencing the prospects for tourism in 2009 and beyond. 2009 is a very important year as the effects of the downturn become fully evident and today’s debate is a timely reminder that tourism—whether it is the third, fourth, fifth or sixth largest industry—is integral to the British economy and its recovery.
My noble friend highlighted that this year marks the 40th anniversary of the Development of Tourism Act 1969, and he rightly took the opportunity to underscore Anthony Crosland’s contribution in that legislation. This debate therefore presents an ideal opportunity to take stock of the developments in tourism over the past four decades and to see what lessons we have learnt and what more we need to do.
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I confess to being slightly chastised by the noble Lord, Lord Lee, on my flippancy in responding to the previous debate. But in listening to some of the contributions today I was reminded of Bill Bryson’s description of national character. He certainly knows more about travel and tourism than I do. When asked what the difference was between the United States and the United Kingdom, he said: “When you wander round the United States and ask people how they’re doing, they say, ‘Pretty good, thanks’. When you wander round the United Kingdom and ask people how they’re doing, they say, ‘Mustn’t grumble’”. The consensus view in today’s contributions has been that the Government have done little or nothing for this industry; that it is in a woeful position; that there is a crisis of marketing investment; and that something must be done to avoid a clear and present crisis. There were some exceptions to that consensus, such as the speech of my noble friend Lord Rosser. I was also reassured by the knowledgeable contribution from the noble Baroness, Lady Valentine, about the resilience of the tourism industry and the commitment and performance from London.
A number of noble Lords have outlined the contribution that tourism and hospitality make to the national economy: around 8 to 9 per cent of our GDP and 2.7 million direct and indirect jobs, some 8.2 per cent of the workforce. Those are remarkable figures. We have a world-class tourism product and that quality is now available, as many noble Lords have highlighted, for significantly less given the value—or competitiveness, depending on your perspective—of the pound abroad. As a number of noble Lords have highlighted, that product includes breathtaking scenery; our dramatic coastline; increasingly outstanding food and drink; our incomparable history and heritage; our museums; and our hosting of major sporting events, both currently and over the forthcoming decade, such as the Olympics and the Champions League.
It is right to say, as the noble Lord opposite did, that the tourism customer is growing ever more sophisticated and has ever more choices. The competition from overseas—notwithstanding the current position of sterling—and cheaper travel have developed a demand for a higher quality product and greater value for money. VisitBritain is responsible for promoting Britain as a world-class tourist destination. It has representatives in over 36 countries around the world and has recently expanded into India and China and throughout eastern Europe and south-east Asia.
Provisional figures for 2008 indicate that overseas residents made 32 million visits to the United Kingdom, down by just 2 per cent on 2007. But they spent £16.5 billion, which, before adjusting for inflation, is 3 per cent up on 2007. As a number of noble Lords have commented, when times are good, tourism is easy to ignore, and we sometimes take our successes in tourism for granted. Times are now immensely challenging for the industry, and despite the weakness of the pound, the latest figures that I have seen, from March this year, show that the number of visitors from the United States, the eurozone countries and the rest of world was decreasing comparatively, therefore increasing the importance of the domestic market.
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However, as my noble friend Lord Davies has highlighted, there are encouraging signs for the summer of 2009 that people will choose to holiday at home. Anecdotal evidence suggests that, for example, the holiday park sector is going to do well this year following indications of good visitor numbers in the attractions sector over the Easter period. So, all is not doom and gloom. The standard of our hotels and bed-and-breakfasts continues to improve apace, and the wealth of attractions that the British brand offers is second to none, but there are challenges. I know that many tourism businesses across the United Kingdom are doing outstanding work trying to compete in and combat the economic downturn. The Government understand that that is not easy, particularly as we face up to what will be a difficult fiscal period.
How should we combat those challenges and what is the role of the Government? In the first instance, effective management of Britain's tourism industry resources will help us emerge from the downturn in good shape, ready to take advantage of the recovery when it comes. As discussed during our previous debate and again today—I was pleased to hear the noble Earl, Lord Glasgow, endorse this—following the Comprehensive Spending Review, the DCMS asked VisitBritain to carry out a strategic review of British tourism. Strategic reviews often come in for a bad name, but I share the noble Earl’s view that that was a quality piece of work to ensure better co-ordination of funding, strategy and implementation of our approach to tourism as a sectoral industry and to try to identify ways of improving efficiency and effectiveness where the public sector touches the private sector for tourism.
That was published by VisitBritain on 11 February and set out recommendations aimed at better co-ordination of the significant public investments made centrally, regionally and locally. The review proposals also involve the fundamental restructuring of VisitBritain and developing the role of VisitEngland, which will market England in a more focused partnership at national, local and regional levels. In welcoming the review's findings, the Government emphasise their determination to forge a closer partnership with the tourism industry to minimise the impact of the downturn and to try to ensure that we are better positioned to exploit the opportunities offered by the recovery, when it comes. I am glad that the review proposed many things that the Government are already doing, and a number of things that we have subsequently implemented.
If I am allowed two observations, there seems to be an excessive, if understandable, focus on the unwillingness to move on the financing of marketing. As I said, in my day job, I am the sectoral Minister for Broadcasting and the Media. This will not come as a surprise to any noble Lord, but I can tell the House that for much of the past year, I have spent my life in meetings with media companies who tell me that today, advertising and marketing prices are cheaper than they were in 1992, and that the advertising and media market is currently suffering between a 30 per cent and a 45 per cent reduction, depending on which form of media you are buying. The value that you can extract from the marketing pound has never been more attractive, if you are a buyer, and less attractive, if you are a seller.
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On the specific question asked by the noble Earl about the digital divide—a subject about which he is right to observe that I have some knowledge and feel passionate—the Government have already committed to delivering a universal broadband service for the entire country, have already identified a universal service fund, and seek to deliver that by 2012, making us the leading country in the world in delivery of universal access to broadband at average-speed rates of 2 megabytes and above, which are attractive both to the domestic user and to the small to medium-sized enterprise looking to offer home or domestic-based connectivity and promotional opportunities.
To turn to the things that we are doing, the Tourism Advisory Council has recently been formed as part of the Government's commitment to support the UK's fifth largest industry. The noble Lord, Lord Lee, was right to say that the tourism summit in Liverpool was dripping with Ministers—although, I must confess, not me. The Prime Minister made it clear at the summit that he was extremely keen for a strengthened partnership between the Government and the tourism industry. That is why we set that group up. It will meet three to four times a year. I will be delighted to provide the noble Lord in writing with details of the forthcoming dates of those meetings.
The remit and purpose of the advisory council is to ensure that, during these times, we can receive timely and accurate information directly from leading tourism businesses so that we can identify areas that need action and highlight ways to move forward. As the noble Lord and others will know, the council is deliberately formed of a group of high-level industry executives, including members of organisations such as Virgin Atlantic, Eurostar, Travelodge and Center Parcs. The group is designed to provide direct and regular input into government and to identify how Ministers can support the sector.
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