Tourism in Yorkshire

John Penrose Excerpts

Tuesday 13th September 2011 Westminster Hall

[The Parliamentary Under-Secretary of State for Culture, Olympics, Media and Sport (John Penrose)]

It is a pleasure to know that you are here this morning, Mr Hancock, to provide a firm hand and make sure that we stay in order. I congratulate my hon. Friend the Member for Selby and Ainsty (Nigel Adams) on getting the debate under way. It is tremendously helpful to be able to mark the contribution that Yorkshire makes to tourism, because Yorkshire is one of our most important attack brands—I think that is the phrase that my hon. Friend used—and a potential alternative to established tourism honey pots such as London. Providing us with a chance to consider how to pursue that potential is a tremendously worthwhile and intelligent use of time.

Everyone in the debate, across the party divide, seems to agree on the importance of tourism overall to Britain’s economy. I shall not repeat the various figures that have been cited and points that have been made, but it is helpful and instructive to note that one of the Prime Minister’s main intentions in making his speech on tourism within the first 100 days of the coalition Government was to raise the profile of tourism as a sector of the visitor economy overall. The reason why he did that, apart from the fact that I was cheeky enough to ask him to, was his feeling that it was important to nail down the point that although tourism and the visitor economy as a whole have been an important part of the economy for many years, they have perhaps been slightly undervalued and under-appreciated. There was a need to raise their profile. That is also why the Prime Minister appointed, for the first time in many years, a dedicated tourism Minister—in the shape of myself—in an attempt to give the sector a fair crack of the whip.

All that attention, focus and constructive and helpful input, from all sorts of people around the industry and Members of Parliament on both sides of the divide, led to the tourism strategy that was published in March, which several hon. Members have mentioned. I hope that the strategy will create—again, for the first time in many years—a focus and sense of overall direction for our visitor economy and that it will give people something to get behind, a template to work to. However, it will be a slightly different kind of template from those that people have been used to in the past. The intention is to say, “Tourism involves a very large number of small and medium-sized businesses, and therefore it is wrong to try to treat the industry as a single organisation.” In fact, it would be counter-productive and destructive of value to do so.

There will not be a grand, centrally planned Stalinist master plan handed down from my office about how we shall pass investment between different parts of Britain and different sectors of the visitor economy. Instead, we must have a much more bottom-up, organic approach, through which local destinations can say, “This is what we need in our area.” What is right for Harrogate will be different from what is right for York or Scarborough. That is entirely correct, and the people best placed to understand the different responsibilities and priorities in each area are inevitably the businesses that operate in those local markets, which are trying to make their living in those local destinations.

[Mr Sutcliffe]

I understand the thrust of what the Minister says about small and medium-sized businesses, but it is important that there should be an overarching organisation. As I said in my speech, before the tourist board and Welcome to Yorkshire, areas competed against each other. There is a need for co-ordination. That is why we are concerned about the long-term future of Welcome to Yorkshire.

[John Penrose]

I completely agree; I am not talking about an either-or option. We need the bottom-up, organic, business-led approach, because that is what will give our management and marketing efforts to grow the local visitor economy in each destination more commercial edge and nous. The hon. Gentleman is right to say that the approach must not be at the expense of other areas or trying to do down neighbouring destinations, particularly those that could themselves be a vital attack brand or an overall destination. If he will hold his horses for a moment, I will come to the point about Yorkshire’s overall position as a potential rival to London, alongside the Peak district, Cornwall, the Lake district and others.

There is an important difference in the way that we are trying to approach things, in that local destination management organisations will increasingly become more business-led and commercially savvy but still be supported by local councils, local enterprise partnerships and all sorts of other public sector bodies, particularly where tourism is an important part of the local economy, such as in large parts of Yorkshire.

Tourism’s place in the pecking order will obviously vary from place to place, but there is no doubt, as we heard this morning, that the visitor economy is an extremely important part of the local economy right across Yorkshire, and local councils and other public bodies will naturally want to support tourism in whatever way they can. Again, however, we hope that they will be supporting and backing up a business-led organisation—one that has that extra commercial nous. In creating those organisations, I hope that we will have started to change the culture of the business and the way in which we approach the matter.

Before speaking about how we might create rival attack brands or alternatives to London, I should make clear that all the contributions made today show that Yorkshire has a great sense of place and of a shared culture and history. That is a huge advantage when creating an alternative to London and rival destinations. There is a huge sense of pride in a shared Yorkshireness.

My hon. Friend the Member for Harrogate and Knaresborough (Andrew Jones) said that in the past he and I have been prone to a little banter on the relative merits of Yorkshire and my county of Somerset. I shall not intrude on private grief by alluding too often to the Yorkshire cricket team, but I was pleased to hear the selfless offer made by the hon. Member for Bradford South (Mr Sutcliffe) to arrange a tour of the Yorkshire breweries. I am sure that many Members here today would be willing to assist him.

Having spoken about breweries, I mention in passing the contribution of my hon. Friend the Member for Leeds North West (Greg Mulholland), who was concerned about pub closures. I remind the House that the Government recently announced what I hope will be a valuable initiative, one that will help many more of those pubs that have been struggling to stay open. It is a strong consultation on deregulation and reducing the red tape on entertainment licensing. That will clearly be very important for a great many pubs that currently find it difficult, time-consuming and awkward to lay on music. I believe that that will make a huge difference to the future success of many pubs, both rural ones and those in city centres.

I speak next about establishing Yorkshire as an overall destination, as well as a place that contains many local tourism gems. As everyone else has done so, and because they deserve it, I add my congratulations to the people of Welcome to Yorkshire. It is a good example—I am boring the rest of the country with it—of a high-functioning, well run and effective local destination management organisation, and Yorkshire can be proud of it. The organisation will be at the front and centre in the drive to establish Yorkshire as an alternative destination, and an attack brand to attract people to other parts of the country rather than simply to London. It is important that we make the effort.

London is a hugely valuable tourism asset to Britain. It is the single most visited area of the country. However, we need to use London as a way not only of attracting people to Britain but of making it their first stop before they move out and visit all the other things that we have to offer. As Minister with responsibility for tourism, I do not much mind if that means Cornwall, the Lake district or Yorkshire, but we must have credible alternatives. That is why I was pleased to hear my hon. Friend the Member for Harrogate and Knaresborough talk about the importance of investing in the product and ensuring that the attractions and accommodation are kept up to standard. He is right to say that it is impossible to drive success in this industry without a product that is worth promoting.

Once we have created a high quality and good value product—I mean good value at all price points, from the cheapest to the poshest and most expensive—we must ensure that people understand that going for a weekend to York is fine but that they can spend longer there, perhaps spending an entire week visiting the whole of Yorkshire. That is the kind of challenge that we must get across; we must ensure that people understand the richness, breadth and diversity of the various things that can be done in places such as Yorkshire. It should not matter if people go to Yorkshire for a particular purpose; there are always other things to tack on the end. If one goes with the family, the children will not be bored. There will always be something new and different to do.

It is important that organisations such as Welcome to Yorkshire put across the message of a rich and diverse tourism offer. Destination management organisations are not the same as destination marketing organisations, and the difference is crucial. We need management organisations to act as the voice of the visitor when talking to local public bodies, be they local councils, LEPs or whatever. It is important that locally elected councillors and other politicians have somebody to remind them what visitors want because, by definition, visitors come from elsewhere and do not have a local vote.

We need somebody to stand up and speak up for the local tourism industry on behalf of its customers; when councils are considering how, for example, to renew or regenerate a piece of public space—perhaps an old market square—we must ensure that the needs of the tourists are considered at the same time as those of local people. Those needs can often be entirely congruent and aligned, but occasionally the needs of the visitor will be slightly different from or additional to what local people want, so it is vital that we have organisations strong and vibrant enough to speak when the moment strikes.

My hon. Friend the Member for Selby and Ainsty raised some important questions about funding. I wish to develop my argument in response to those questions, possibly wrapping up the various queries raised by others during the debate. My hon. Friend was entirely right to say that there are different levels of funding around the country, but we are in a transition period at the moment. The old regime of regional development agency funding is coming to an end, and new sources of funding are being found by destination management organisations around the country.

My hon. Friend was right to point out that DMOs take a different approach in Scotland. It is worth pointing out that domestic tourism in Scotland is a devolved matter; it is the responsibility of the Scottish Executive. Having taken the overall funding devolved under the Barnett formula, they may make decisions about the relative priorities for spending in Scotland that are different from those made in England. If they want a different trade-off between the health service spending and tourism, they are entitled to make it. None the less, and however those local priorities are assigned, we in England have to ensure that we make the best of our overall funding allowance.

My hon. Friend mentioned the efforts that we are making to promote Britain abroad and to attract more foreign visitors. That is going pretty well. I suspect that few Members will have seen our advertisements or marketing, because by definition they are being applied in foreign markets. They are being targeted at the top 20 or so most important markets for visitors to the UK. They include some of what I would call the near abroad, in western Europe, which may have been a little ignored in the past; it also includes some traditionally strong markets for the UK, such as the USA and Canada. It also includes some of the high-potential, fast-growing but historically small contributors to our visitor base, such as China, Russia and Brazil. Those are working well, and we are seeing strong levels of interest.

As will be understood, we also have a series of amazing and wonderful events to add to our existing attractions, not only in 2012 but in future years. Next year we have Her Majesty the Queen’s diamond jubilee. We also have the Olympic and Paralympic games and the cultural Olympiad, and in 2012 and 2014 we will have the two flavours of rugby world cup. We have the Commonwealth games, the Ryder cup and so on and so forth. There is a whole stream of wonderful opportunities that we can use to raise the profile around the world of Britain as a destination.

The point that I want make to hon. Members here and to the industry more broadly is that those events are not the main course. They are not the moment when we will see huge increases in the numbers of visitors, although we expect and hope to see influxes of visitors around the events themselves. The really big-value opportunity here lies in the fact that events such as the Olympics will probably attract the single biggest TV audience that this planet has ever seen, which gives us an unparalleled, historic opportunity to demonstrate all the wonderful things that Yorkshire and other parts of Britain can offer to the rest of the world. We want the people who cannot come to the Olympics or the Paralympics next year to watch the events on TV and think, “You know what, I may not have been able to get there for the games themselves, but I fancy going to see all those things that are available in Britain in 2013, 2014 or 2015.” That is the big opportunity that the international marketing campaign is aiming to use.

There are also some domestic funding opportunities and targets that we want to explore. Various Members, including my hon. Friend the Member for York Outer (Julian Sturdy), mentioned the reform of business rates. Those rates are tremendously important as a source of public sector funding. By reforming them and giving councils an opportunity to share in the proceeds of local economic growth by retaining some of the increased business rates that are generated, we change the mindset of councils about investing in local tourism. From being something that was not a statutory duty—it still is not a statutory duty—and was, in many cases, viewed as a cost and something for which local councils got very little return, it will hopefully be seen by local councils as an opportunity to invest in a successful local business. We expect them to say, “If we put some money into local tourism, either into marketing a local destination or into investing in infrastructure, we have an opportunity to drive economic growth very effectively.”

The figures that have been quoted in this morning’s debate show that tourism is an extremely rapid and financially efficient way of driving economic growth. It is also a way of driving economic growth that is not centred on the south-east or on one or two of our traditional sectoral strengths such as financial services.

Tourism, therefore, ticks a great many boxes. It is instructive to see what has already been done by successful organisations such as Welcome to Yorkshire. The local rates of economic growth in the sector far, far outstrip those of the economy as a whole. From the Treasury’s point of view, that has to be good because it shows that the tourism sector and the visitor economy as a whole has a huge potential and is already delivering on that potential to be a leader in the country’s economic recovery. The reform of business rates is crucial and will provide important incentives for local councils and other public bodies to invest in local tourism organisations.

It is also true that local tourism businesses are increasingly willing to get involved. If they contribute to local destination collective marketing campaigns, they will see positive returns to their businesses as well. It is important to draw a distinction here. In the past, in some parts of the country—there have been notable and honourable exceptions to this—local councils and local councillors have gone round and effectively twisted the arms of local tourism firms to contribute to a local tourism marketing campaign, which has never been a terribly effective system. It was driven more by the mayor’s desire to wander into the local tourism and information centre and see his picture and a foreword from him on the front of a leaflet rather than to put heads on beds or bums on seats and drive top line revenue for local tourism businesses.

If we move away from that and have business-led organisations, we will achieve our aims because those organisations will have an extra commercial edge. If we start running campaigns that genuinely make a difference to local tourism businesses, and make more of a difference to those that have contributed to a collective pot than the ones that have decided to free-ride, we will have something that is not an exercise in corporate philanthropy or council arm-twisting but makes good commercial sense because it justifies its own place in any local tourism companies’ local marketing plans. Equally, it will make more sense to participate than not to participate. Firms that participate in the scheme will do better that those that do not. Those are simple, clear incentives that will transform the way in which local tourism bodies work. They will also transform the incentives for local companies and local councils to get involved. What that means—this is already happening in many parts of the country—is that we will get locally organised, locally run and locally focused shared marketing campaigns that are funded by contributions from local businesses, and backed up by local tourism and marketing organisations, often with the support of local councils.

It would be remiss of me to pass over the issue of ongoing central Government support. There is the regional growth fund, into which a number of what I hope will be highly successful tourism-related bids have gone for consideration. Those bids vary in size from the small to the extremely large. We hope and expect that many of them will be compelling when they are being considered.

Yesterday’s announcement on the torch relay was also mentioned. We are using £3 million of central Government money to leverage local tourism money from different parts of the country. There will be a strong discount-led offer for anyone who wants to book a trip to a destination where the torch relay is happening. The trip does not have to take place at the same time as the torch relay, but it has to be booked while the relay is happening. We will use that unique event to highlight the wonderful things that visitors can do in York or in Harrogate or wherever the relay may be happening. It is a golden opportunity to leverage a lovely piece of Olympics-related public relations in a way that will stimulate local tourism demand. Therefore, there will be a series of central Government initiatives designed to drive Olympic-related tourism activity.

I hope that I have responded to all the points that have been raised and that it is clear that there is a great deal of commitment to tourism both in Yorkshire and elsewhere in the country, a high degree of pride in the kind of tourism opportunities that counties such as Yorkshire provide, and a huge excitement in the potential that places such as Yorkshire have to put across the breadth and depth of what they have to offer to potential visitors, thus enabling them to become rivals to London and alternative centres for extended stays rather just short breaks.

I am sure that hon. Members will agree that the opportunities for Yorkshire tourism are bright. The future looks very good indeed. We must understand that landing those opportunities will require huge amounts of hard work, but with the cross-party commitment and local pride that has been on offer today, I am sure that we will manage to do so.