Tourism Strategy: Industry Reaction to the New Tourism Strategy

The UK government has finally revealed its much-anticipated tourism strategy to mixed reaction from the industry.

In a landmark speech last year, David Cameron placed tourism at the heart of the UK’s economic recovery and urged the industry to put aside a substantial marketing fund.

The UK hospitality scene kept its side of the bargain … but the tourism strategy unveiled last week by Tourism Minister John Penrose has failed to hit the mark.

The New Tourism Strategy

Before we move onto reviewing the industry’s reaction, let’s first focus on the main points made in the report

The strategy, which looks to exploit the economic opportunities presented by the Royal Wedding, Diamond Jubilee and the London Olympics, builds on the marketing plan, launched in January, which aims to generate four million extra overseas visitors over the next four years. The increase in overseas visitors would bring an extra £2 billion worth of visitor spend and help to create 50,000 new jobs across the country over that period, securing tourism’s place as one of Britain’s biggest industries.

Key elements in the policy paper include plans to increase visitor numbers by:

  • Consulting on whether to lengthen the tourism season by moving the first Bank Holiday in May to create either a new St George’s Day holiday in England (St David’s Day in Wales), or a Trafalgar Day bank holiday in the autumn half term
  • Helping to improve staff skills in the sector through extra apprenticeships and courses
  • Making tourist visas simpler, faster and more convenient to get
  • Repairing market failure by modifying the existing, long-established Tourist Boards to become smaller, highly focused, industry-led partnerships between tourism firms and government
  • Broadening our tourism offer by creating alternative destinations which match London, the UK’s biggest and most successful single tourism destination to capture the spare tourism capacity and potential of other parts of Britain as well

Penrose Introduces the New Tourism Strategy:

Industry Reaction to the New Tourism Strategy

As reaction from some of the industry’s key figures demonstrates, the new tourism strategy has been broadly slammed by the industry.

Thomas Cook – chief executive, Manny Fontenla-Novoa:
“The government has let the travel industry down – again! UK tourism is not just about the inbound traveller and the government seems to have completely forgotten about the 38 million holidaymakers that take their tourism out of the UK to visit new countries, experience new cultures and take advantage of great weather – ultimately taking their hard earned annual family holiday overseas.”

British Hospitality Association – chief executive, Ufi Ibrahim:
“While the strategy is long on vision, it appears to be short on how that vision will be translated into reality. The government has given very little detail about how they will be structured and financed and how supportive of tourism LEPs will be. Yet tourism is the economic driver of many regions of the country. As a result, it’s very difficult to see how effective LEPs will be for hospitality and tourism, and that’s a significant risk to the industry’s latent potential for regeneration and job creation in precisely those areas of the country where it is most needed.

VAT has become one of the most pressing issues facing the industry. The present high rate is making UK tourism very uncompetitive. In the latest World Economic Forum Global Travel & Tourism Competitiveness Monitor, the UK ranks 133rd out of 133 countries in terms of price competitiveness.

So we are spending £100m on seeking to attract 4m additional visitors to the UK just at a time when the UK is bottom of the international price competitiveness league. This serious price disadvantage also encourages potential staycationers to vacation overseas.

This is completely counterproductive to the Prime Minister’s objective to grow domestic tourism from 36 per cent to 50 per cent of total tourism spend by UK residents – an objective which we heartily applaud. We need far more action on this issue than the strategy seems willing to deliver.”

ETOA – executive director, Tom Jenkins:

“The Prime Minister has previously talked about making the UK tax competitive. That idea must embrace tourism.

There should be no VAT on exports which are used abroad. Tourism is an export but the creation of holidays in the EU for visitors from outside the EU is subject to VAT under TOMS. That is different from every other type of export and it’s clearly disadvantageous to our inbound tourism.

If the Government is serious about encouraging more people to come here, he needs to go to Brussels and convince the other member states to reform TOMS because there is a massive disincentive on EU-based companies promoting EU-based holidays.”

VisitEngland – chief executive, James Berresford:
“A dedicated Government Tourism Policy for this country is a great step in the right direction. We welcome the mandate the Policy gives VisitEngland and its endorsement of our current strategy and we look forward to working with the Tourism Minister and the industry in a united partnership to grow tourism and ensure the success of one of the UK’s most important and dynamic industries.”

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