St Helena

Lord Collins of Highbury Excerpts

Wednesday 9th July 2014 Grand Committee

[Lord Collins of Highbury (Lab)]

My Lords, I, too, thank the noble Lord, Lord Shutt, for initiating this debate. Building the airport, which is scheduled for completion in 2016, will be a catalyst for change in the island. It provides great opportunities for growth and jobs, but without proper investment the cost of failure will be high. As is common to small islands, St Helena is dependent on importing even basic items. It has a limited economy focused on less than a handful of sectors, a large public service, and as we have heard, hundreds of Saints have left in the last decades to seek opportunities abroad.

As the noble Lord, Lord Jones, reminded us, there is no doubt that we need to support and develop sustainable enterprise if St Helena is to be weaned off that budget support of around £25 million to £30 million a year. This Government reviewed the postponement of the project when they came into office and concluded that, provided certain conditions were met, the best long-term solution from an economic and financial perspective for both Her Majesty’s Government and St Helena was to construct the airport.

The noble Lord, Lord Shutt, said the airport was on time and on budget, but I would be grateful if the Minister would update the Committee on the progress in meeting the specific conditions, not least on handling the risk of cost and time overruns. One other key condition in that decision was for the St Helena Government to implement the reforms needed to open up the island’s economy to inward investment and increased tourism. The opening of the airport, as we have heard, will clearly have a substantial effect on visitor numbers to St Helena, but in the absence of accurate data it is difficult to forecast precisely what the numbers will be. I know both Her Majesty’s Government and the St Helena Government have commissioned a number of studies into the potential demand for travel following the airport opening.

As we have heard, current tourist accommodation on St Helena is severely limited. Meeting the visitor targets relies on the expansion of island resources and hotel capacity, but the infrastructure required to maintain a vibrant tourist industry is not just reliant on hotel rooms—important as that is. I refer to the comments of the noble Lord, Lord Brooke, about the specific elements of what a successful tourist industry needs to be.

I also refer to Horatio Clare’s excellent article supplied in the Library brief for this debate. He highlighted that without the Caribbean’s beaches or climate, even locals are a little unsure about what a tourist might do on St Helena. One said:

“A mix of walking, fishing, diving, heritage, Napoleon and wildlife”,

which agrees with what the noble Lord, Lord Brooke, said. Even that mixture requires investment, with support to heritage sites and wildlife protection. It also means investment in skills to ensure that the island has people who are qualified to maintain its natural sites of scientific interest, which will be an incredible attraction to the sort of tourists that we seek.

Internet connections are also vital to develop new industries, especially in supporting tourism. As the noble Lord, Lord Shutt, said, the Government are investigating funding and construction options with the aim of completing a hotel around the time of the opening of the airport. We have heard about the development agency that is seeking to work with selected air providers to develop and implement a marketing plan. However, that is all difficult while we do not know who the air supplier is. It will be very difficult to square those things together.

From what I have read in the briefing, it appears that a game of chicken and egg is being played out between the development body and the group of investors with ambitions to build the hotel discussed in this debate. Enterprise St Helena wants the developers to commit to building their hotel so that it can attract airlines. The developers—Shelco—say that the agency should produce an airline before it begins work on the hotel. We have to break that cycle somehow. The Minister wrote at the end of last year that there is an expectation that an agreement will be reached with the airline in early 2015. Like other noble Lords, I would appreciate an update for the Committee on what progress is being made.

As the noble Lord, Lord Jones, said, time is clearly running out on this issue. In January, the Minister reported that passenger numbers for the airport over its first five years would be 14,000, of which 10,200 would be leisure visitors. In May, the noble Lord, Lord Bates, who I am pleased to see here, said that the UK Government expect tourism to be the driver of growth on St Helena once the airport opens. In June, the Minister said in a Written Answer that Enterprise St Helena, the development agency, is leading plans to develop the tourism industry and accommodation. In parallel, ESH is working with local businesses to ensure that the island’s tourist attractions are developed and accredited to international standards. I cannot stress the importance of the points that the noble Lord raised on this particular case.

However, it appears from newspaper reports that there is a little scepticism locally about the projected figures for tourists and the speed at which the necessary infrastructure can be developed. I thank the noble Lord, Lord Shutt, for letting me have sight of the report he referred to from last year’s CPA visit to the island following the general election. For me, an important element of that delegation was that it also embraced representatives from the Isle of Man, Guernsey and Wales. As a point of interest, my own family is from Bermuda so I am familiar with small, remote islands. Some are more beautiful than others, as they say.

When I was at the T&G—the Transport and General Workers’ Union—I also had responsibility for establishing a forum of union membership from the Channel Islands, the Isle of Man and Gibraltar. As I said, such territories have many challenges in common. Sharing experiences is important not only to address the issue of isolation—which is an important factor of development in St Helena—but also for looking at how to develop best practice and new opportunities, and see common ways forward, as we saw from the excellent report produced. I am glad it was produced. It highlighted a range of options, not least not to restrict yourself to tourism as other industries need to be built upon.

To conclude, could there be renewed focus in the department to encourage exchanges on best practice, support and information with other Crown dependencies, specifically—obviously, in the case of St Helena—on the development of tourism and new employment opportunities. Could such exchanges embrace the full range of stakeholders in those societies?