Tourism:The opportunity for employmentand economic growth
Two key issues that face the UK in 2010 are maintaining
employment and generating sustainable economic growth.
It is therefore crucial that the new Government identifies and
encourages industries that are able to address these issues.
Tourism offers unparalleled potential to generate growth.
Tourism is something we do very well in the UK. In fact,
UK tourism industry is one of the largest in the world,
comprising some 180,000 businesses which generate
£19bn pa in foreign revenue for the UK economy (more
than North Sea oil) and employ 1.4m people across all skill
levels (twice that of the education sector). It also has a
number of attributes that make it ideally suited to providing
growth and employment – and doing this quickly.
Tourism:
economic growthThe 2012 Olympic and Paralympic Games provide a once-in-a-lifetime
opportunity to showcase Britain abroad. A 2006 PriceWaterhouseCoopers report
for DCMS concluded that a properly funded public/private marketing partnership
associated with the Games could provide the UK with an additional £2bn in
tourism revenue.
A similar partnership was established in 2001 in the wake of the Foot and Mouth
outbreak and 9/11 attacks, with £20m in Treasury funding being matched by the
industry to create a global marketing campaign. An analysis of this campaign by
the National Tourist Board, VisitBritain, found that it generated £500m in
additional overseas visitor expenditure, protecting 10,000 jobs and generating
around £80m in VAT payments.
3
Maximise the
Tourism Legacy
from the Olympics
The industry believes that much can be achieved through the more effective
utilisation of existing Government expenditure on tourism.
As a result of devolution, less than 20% of public funding for tourism originates
from DCMS. Of the remainder, around 60% is allocation by Local Authorities or
Regional Development Agencies, neither of which has a statutory obligation to
fund tourism development.
It is therefore important to ensure that Local Authorities are incentivised to invest
in tourism development, existing RDA tourism funding is ring-fenced and that
tourism development and marketing activities at the local, regional and national
level are co-ordinated in order to provide the maximum return on investment
for the UK.
2
Increase the
Effectiveness of
Public Funding
UK tourism businesses can successfully compete in the global tourism market –
provided that they are competing on a level playing field. However, because of
Air Passenger Duty and visa costs, they are not.
The tourism industry fully recognises and supports both the need for effective
border controls, and for aviation to pay its environmental cost. But increased visa
costs and Air Passenger Duty mean that, by the end of next year, a family of four
from growth markets such as India and China will have to pay a minimum of
£568 in government charges to come to the UK. For each family that is deterred
from visiting as a result of these charges, the UK economy forgoes around
£5,000 in revenue.
It is therefore crucial to exploiting the potential of tourism that, while maintaining
the proper entry and environmental controls, charging is based on the net benefit
that can be derived by encouraging visitors to come to the UK.
1
Improve
International
Competitiveness
Using tourism to create jobs and provide economic
growth does not require high levels of expenditure.
Mostly benefits can be generated simply by ensuring
incentive structures are in place that enable the industry
to utilise its available capacity to maximise returns from
the UK’s world class transport infrastructure, heritage,
sporting and cultural resources.
Achieving these benefits
While the vast majority of the tourism products and services provided to visitors
are of a high standard, the industry acknowledges that further improvements in
staff skills and product quality are required in some areas. A National Skills
Academy for Tourism, similar to the new Hospitality Academy, would provide a
major step forward in the provision of a high quality tourism experience, while the
implementation of a “Welcome to Britain” programme in the lead-up to 2012
would ensure that visitors receive the highest quality service by public and
private sector organisations at every stage of their journey.
Tourism is one of the true global growth industries, with expenditure increasing by an
average of 4.2% per annum over the last 20 years.
As source markets such as China and India develop, the potential for future growth is
considerable. By creating an environment that encourages visitors to come to Britain
and maximises existing resources and opportunities, the new Government can generate
significant economic and employment benefits at minimal cost.
5
Improve Quality
and Skills
While DCMS is responsible for tourism, the majority of legislation that impacts on
tourism businesses is managed by other Departments. As such, particular care
needs to be taken to ensure that any potential adverse impacts of legislation
generated outside DCMS are adequately assessed and mitigated against.
Reducing the level of poor regulation will significantly enhance the ability of
tourism businesses to concentrate their resources on maintaining jobs and
generating growth.
Current proposals where there has been inadequate consideration of tourism
impacts include the mandatory code for selling alcohol, anti-age discrimination
legislation for the provision of tourism services and repealing the Furnished
Holiday Letting Rules.
A cross-departmental simplification plan for tourism-related legislation is required
to identify areas where the regulatory burden on the sector can be reduced.
4
Reduce Regulatory
Burden
Tourism: a national opportunity