Tourism and Hospitality

Lord Shipley Excerpts

Thursday 12th June 2014 Lords Chamber

[Lord Shipley (LD)]

My Lords, I, too, thank the noble Lord, Lord Harrison, for initiating this debate. I have found the debate so far exceedingly helpful in identifying a range of issues that the Minister might be able to respond to. I am particularly pleased to have heard two references to the county of Northumberland, which is very close to where I live and which I know extremely well.

I thank the noble Earl, Lord Caithness, for posing a question which I think is likely to prove very instructive, about who is responsible for organising the celebrations of the 300th anniversary of the birth of Lancelot “Capability” Brown in 2016. As his birthplace was Kirkharle, it will presumably be the responsibility of Visit Northumberland, and Northumberland County Council may have a role in working with it.

However, there is a broader question, because Capability Brown worked on many gardens across the country. It will be very helpful to look at that co-ordination as a case study in whether all the different agencies are sufficiently integrated. I am clear in my mind about the role of VisitBritain and the roles of VisitScotland, VisitEngland, Discover Northern Ireland and Visit Wales. Those are pretty clear. Then there are all the destination agencies—there are a large number of them—which do an exceedingly good job in promoting their own local areas. As a tourist, I find that extremely helpful. So many private sector providers, transport organisations and voluntary and public bodies are involved in tourism and make a big success of it. As the noble Lord, Lord Harrison, rightly pointed out, it forms a key part of our economy. It is a success story. It is becoming even more successful, despite some of the doubts that have been raised—some of them understandably, but let us turn those into an opportunity.

I pay particular tribute to English Heritage and the National Trust for their major contribution to the experience that their visitors have. I am a member of both of them. I visited Osborne House on the Isle of Wight 10 days ago and I was really struck by the quality of the presentation of the history of the house and all the rooms, and the grounds, all of which were outstanding. The access arrangements, the signage, the knowledge of the staff and the catering were all of an exceptionally high standard. Those standards are replicated right across the UK. I think that they are very much higher than they used to be, which gives this country a competitive edge.

Does the system work well? I think it would help if the Minister could give an answer, either today or at a later date, about how all the different agencies work together. The importance of tourism’s economic contribution cannot be overstated. It is 9% of total UK GVA. It is 3.1 million jobs, almost 10% of the UK total. It is the third-largest employment sector, as we have heard. There are two key facts that we should not miss. First, 28% of those who are employed in tourism are aged between 16 and 24, compared with only 12% in the wider economy. Secondly, one-third of net new jobs in the UK economy between 2010 and 2012 were created by tourism. Those two statistics tell us that there is great potential in tourism and hospitality for entry-level training. Given the very high level of youth unemployment, it is important, as my noble friend Lord Lee pointed out, that the sector as a whole takes the opportunity to develop the skills of more of our young people.

Of course, to do that requires the growth in tourism to be closer to where the jobs are needed. There is an issue about the uneven growth across the UK, given the appeal of London to inbound tourists. We have to do more to persuade visitors to look beyond London so that tourism grows across the country as a whole. We should note that since 2008 the number of inbound trips to London has increased by 14%, while the number of inbound trips to other parts of England is still 4% lower than it was then. According to a recent PricewaterhouseCoopers report, there are signs that numbers will return this year to where they were six years ago, but that is still well behind the growth being experienced by London.

I believe that the success of the Plan for Growth adopted by the Government in 2011 is the reason why London is currently doing so well. It seems a well executed plan. It is worth £100 million overall. It plans to get 4 million extra visitors to the UK and it has undoubtedly driven up visitors numbers in the past couple of years; otherwise, it would have been a failure. Of course, most people, particularly those who are new to the UK, want to come to London to sightsee, I understand that. Given that most international flights land in London, that is where they are brought to. The result is that 54% of all money spent by visitors to the UK is spent in London.

That is a good thing for the UK economy, not least because it creates jobs and tax revenue. Crucially, it gives an opportunity for people who are coming to London to go somewhere else in the United Kingdom. The question is how we persuade more of them to go elsewhere in the UK. One simple way of doing this is to encourage greater use of entry and exit at regional airports to make use of their spare capacity, which in many cases is very substantial; for example, I understand that Manchester Airport uses only 44% of its capacity; Newcastle has even greater spare capacity than that, and it should be utilised. The noble Lord, Lord Harrison, made a very important point on air passenger duty as well as VAT. Air passenger duty has been a problem for regional, non-London airports. The Government recently did something about that. My view is that they need to go even further to encourage more people to land in regional airports.

Research by VisitBritain which I have seen identified a lack of knowledge of British destinations other than London as one of the key reasons why relatively few overseas visitors travel any further. I see that as an opportunity for the rest of the UK. The Growing Tourism Locally campaign is an example of best practice and how to fund awareness-raising activity. I am the deputy chair of the independent advisory group on the regional growth fund—although I was not on the growth fund for round 2 allocations. There has been a three-year campaign, between 2012 and 2015, part-funded by the £19.8 million from the regional growth fund which is being delivered by VisitEngland in partnership with destination management organisations and private sector partners. The campaign intends to generate £365 million of additional tourism spending over those three years and create 9,000—or more, it hopes—new jobs in the sector. From the first year, it seems that the project is on track to do that. Obviously the growth fund is dependent on objectives being achieved. Certainly that dual-key system, in which the government RGF is matched with private sector funding, seems a very worthwhile way of proceeding.

In the remaining couple of minutes available to me I should say something about the barriers. I hope that we have covered the question of who is responsible for what and that we are being absolutely clear. However, the document from VisitBritain that I read talks about “British image” and the experience available. It is not that the rest of Britain has a bad image, but people are asking, “What can you do outside London?”. A second area of challenge is said to be the product: does the tourism offer meet consumer demand at the right level of quality and price? Then there is the matter of working with travel agents and tour operators to sell Britain. Then there are access issues, particularly around air capacity and visa policy. We have heard those matters addressed, but I want to add another one.

In all the documents that I read in preparing for this debate the word “language” was hardly ever mentioned. There is an assumption that everybody can speak and read a high quality of English. Where English is a second language for an overseas visitor, we need to audit what we can provide—say to a visitor from Russia, Portugal or Greece. Can they press a button in an English Heritage property and be given a guide in any one of a wide range of languages? Similarly with hotels, the digital technology should exist to do that. We should then look at how complex it is to do things as an individual: how you buy a rail ticket, and which train you are allowed to be on without being fined because you got on the wrong train going out of the wrong station at the wrong time.

With those sorts of difficulties, are we certain that we are as visitor friendly as we really ought to be? I conclude that there need to be many more package tours. Indeed, VisitBritain’s Foresight report—No. 117 in July 2013—raised this issue. It is very clear that large numbers of potential tourists coming to London would like a package tour to go further into England, but somebody has to organise it. I would love it if the Minister could tell us who he thinks that responsibility lies with.

I have said enough. There is an urgent need to get more tourists travelling elsewhere in the United Kingdom out of London. In terms of finance, there needs to be a discussion about who is responsible for what between the taxpayer, the individual tourist and the private sector. At some point, there needs to be a further discussion about who has which responsibility for ensuring that we continue to have a vibrant tourist industry.