Holiday Accommodation

Debate between Mike Weir and Anne Marie Morris

Tuesday 15th February 2011 Westminster Hall

[Mr Mike Weir (Angus) (SNP)]

I am pleased to serve under your chairmanship again today, Mr Hollobone.

I represent a largely rural constituency which covers more than 2,000 sq km from the fertile coastal strip of seaside towns to the mountainous and sparsely populated glens. What all parts of Angus have in common is their beauty, which has made tourism an important and growing part of the local economy. The latest Office for National Statistics classification discloses that almost 10% of jobs in Angus in 2008—the last year for which I can find figures—are tourist-related, which is significantly above the national average of around 8%. As well as the more traditional holiday tourism, my constituency also attracts a significant number of visitors from the UK and overseas who are attracted by field sports. It will therefore be no surprise that I maintain an abiding interest in tourism development issues, which affect the economic development of Angus and the prosperity and well-being of my constituents.

I should say at the outset that I am not here simply to lambast the Government for their attitude to tourism. I took a great interest in the furnished holiday lettings relief and its impact on the self-catering sector, and campaigned hard against the ludicrous proposals put forward by the previous Labour Government. I acknowledge that the present Government have introduced new proposals which, although still not ideal, are a significant improvement on what had been proposed, and last week I submitted to the Treasury my third response to consultation on the issue in less than a year. I do, however, wish to concentrate on a proposal which I believe could cause serious damage to this vital industry: the Minister’s proposal to do away with the current, widely recognised star rating scheme for holiday accommodation. He has suggested, in effect, that consumers instead look at private internet sites such as TripAdvisor.

I have pursued the matter through a series of parliamentary questions and have been somewhat perturbed by the answers, since it seems clear that the Government are moving towards self-assessment and feedback rather than the current star rating scheme. Incidentally, the Minister stated in one answer that tourism is a devolved matter for the Scottish Government. That is not the whole picture, at least at present, as VisitBritain is responsible for marketing tourism for the whole of the UK in significant parts of the world, including the crucial emerging markets of Brazil, China and India, under what I understand is referred to as the “quadrant model”.

Many tourists coming to the UK will be looking for a holiday that covers several centres, including Scotland. Therefore, the current hard-won system, with all the national tourist boards and the Automobile Association co-operating in a similar star system, has a great deal of merit. Allied to that, such a system is common overseas, so visitors from other areas will be familiar with the concept and be able to recognise easily what type and standard of accommodation is available for consideration in all parts of the UK. In particular, visitors from the emerging markets that I have flagged up are unlikely to fly directly to Scotland, unless arriving via charter arranged under an incentive scheme, or for a conference. In such limited cases, use of self-catering accommodation is extremely unlikely.

I cannot overstate how hard the tourist industry has worked to bring into being the common standard, which ensures that a three-star self-catering cottage will be of the same quality in Scotland, England and Wales. I cannot emphasise enough how much work was done by the tourist boards and the industry, which compromised on sometimes heartfelt positions for the greater good of the industry going forward. In a rolling programme, self-catering was the first sector to apply the common standard. Other sectors have now joined, but the self-catering common standard was the first to be reviewed as standards and visitors’ expectations have moved on.

I consider the mooted scheme to be a serious error. The star-rating scheme has built up considerable trust and recognition over the years as a robust scheme that gives us a good idea of the standard of accommodation we are likely to encounter, based on an objective assessment by an independent body.

[Anne Marie Morris (Newton Abbot) (Con)]

May I add to the hon. Gentleman’s argument? Will he consider that, whatever system we have going forward, we need to make it less onerous? The very small businesses in my constituency certainly find the current scheme difficult. If someone has a bed and breakfast and a cottage, the two assessments are separate, so whatever scheme we have, may we make it simpler and more affordable?

[Mr Weir]

The hon. Lady makes a good point. As I will explain in my remarks, the new proposals will make the situation even worse for self-catering small businesses.

I accept that the current scheme is not perfect, and many hoteliers believe it too prescriptive, homogenising and sanitising accommodation with what some deride as its tick-box approach, which can penalise quirky, extraordinary or mould-breaking properties. Subscription to the scheme has been less extensive than was hoped, especially in England and, more particularly, in London. However, for all its limitations, it delivers an objective assessment based on published and transparent criteria. TripAdvisor and its like do not. Instead, individuals can register their views on holiday accommodation on a website, but their views are totally subjective and could be influenced by a huge number of the variables encountered.

The comedian Michael McIntyre has a funny routine based on someone using TripAdvisor to rate a holiday. Like all good comedy, it has a germ of truth. He notes that someone looking at the various comments on TripAdvisor is most likely to believe those that are bad. Indeed, often, only the disgruntled care to write up the experience—others simply do not bother.

Last year, I holidayed on the beautiful island of Seil, in self-catering accommodation found on the VisitScotland website and chosen on the basis of the star rating. My family and I had a great holiday, and we would thoroughly recommend it to anyone but, on returning home, with many things to do, writing a review on a website was the last thing on our minds. That is a danger for good properties.

That strikes to the very nature of the problem. There is absolutely no quality control over what may be posted on such sites. There is no effective way for the hotelier or holiday cottage provider to prevent someone with a particular beef—perhaps they did not get on with them, perhaps they were unreasonable, or perhaps they were simply vindictive—from commenting on the website. Yet such a comment could have a serious impact on the business. If the Minister has any doubt about the capacity of rival tradesmen who have lost in legal disputes, or of the plain malicious, to pursue vendettas in acts of cyber-sabotage, he could do worse than consult the website www.ihatetripadvisor.org.uk.

While in theory the small business owner might have redress in law, few would have the resources to pursue such an action. Has the Minister looked at the jurisdiction section in the terms and conditions on www.tripadvisor.co.uk—in case he does not know the website address? If he does so, he will find:

“This Website is operated by a US entity and this Agreement is governed by the laws of the State of Massachusetts, USA. You hereby consent to the exclusive jurisdiction and venue of courts in Massachusetts, USA and stipulate to the fairness and convenience of proceedings in such courts for all disputes arising out of or relating to the use of this Website. You agree that all claims you may have against TripAdvisor arising from or relating to the Site must be heard and resolved in a court of competent subject matter jurisdiction located in the state of Massachusetts.”

Despite the somewhat impenetrable English, that appears to give sole jurisdiction to the courts of the state of Massachusetts.

I am sure I am not alone in finding it strange that a Minister of the Crown will be recommending that consumers in the UK should consult, and that UK taxpaying accommodation providers should find themselves at the mercy of, an organisation that specifically seeks to exclude the writ of Her Majesty’s courts, as a supplement to and eventual substitute for a state-sanctioned system of quality assurance. For a Government that pride themselves on reducing the burden on small businesses, that seems a curious tack to take.

Should the jurisdiction barrier be laboriously and expensively overcome, the hard-pressed business which seeks to obtain redress for defamation also runs up against a comprehensive disclaimer on the website:

“TripAdvisor takes no responsibility and assumes no liability for any Content posted, stored or uploaded by you or any third party, or for any loss or damage thereto, nor is TripAdvisor liable for any mistakes, defamation, slander, libel, omissions, falsehoods, obscenity, pornography or profanity you may encounter”—

which makes it sound much more interesting than it probably is.

TripAdvisor will retort that it makes provision for management responses, but experienced practitioners whom I have consulted advise that that can too easily fall into an entrenched argument of “He says” or “She says”, from which there is no easy way out, and all in the public domain. Others have reported difficulties in accessing that right to reply, being told that any robust defence of the business breaches the user guidelines.

If that were not bad enough, there can be serious differences between how hotels and self-catering are treated on such sites. In a recent article in The Sunday Times, Adam Raphael, editor of The Good Hotel Guide, made the point:

“TripAdvisor, the best known hotel review site, carries millions of consumer reviews, but its usefulness is marred by its failure to screen out collusive and malicious reviews.”

He freely admits to having an obvious interest in the matter but points out that, in preparing his publication, his team track every review sent to them and know who the writers are, where they are coming from and how sound their judgments are. Tellingly, he adds:

“When our readers disagree, we send an anonymous inspector to spend the night at the hotel or B&B, at our expense.”

Adam Raphael also makes the point that TripAdvisor and similar sites have no idea who is writing reviews and make only a feeble attempt to check that they are genuine. He cites one response to a hotel’s complaint that a critical report was planted by a competitor:

“Since reviews are posted by our members on an open forum, and we do not verify the information posted in this, we are unable to provide you with proof that this member reserved, stayed or actually visited [your] hotel.”

Perhaps the final nail in the coffin was when TripAdvisor published a list of its top 25 hotels in the UK—one of which was, in fact, in administration and closed. That sets out the problem. Adam Raphael was looking at it from a different, commercial angle, but surely a star scheme administered by the national tourist agencies within the UK is the best way to ensure that tourists—whether domestic or from overseas—know what they are getting and can trust.

Bad as matters are for larger hotels, however, a much more serious situation could be faced by holiday lets in more rural areas such as mine in Angus, or that of the hon. Member for Newton Abbot (Anne Marie Morris) in the south-west. Just to show my inclusiveness and to demonstrate that this concern is not just a Scottish one, I made some inquiries as to how many English self-catering properties were listed on TripAdvisor. I thank the chief executive of the English Association of Self Catering Operators for doing the spadework.

The Minister might be interested to know that in the whole of England there are 3,706 such properties—in Devon only 239, in Cornwall 362, in Norfolk 76 and in Dorset 167. He might agree that those numbers are very small for some of the principal holiday destinations in England. Clearly, that is a small fraction of total self-catering accommodation in England. My understanding is that to get listed, a business has to pay to get on such a third-party site or hope that a client nominates them. As Adam Raphael notes in his article, that has already led to allegations that some hotels are offering inducements for good reviews on the sites.

The main point, and the thing that concerns me most, is that most self-catering accommodation would get very few reviews on such sites, unlike larger hotels, and therefore the impact of one unreasonable review would be far more detrimental to a small business. Will the Minister consider the difference between the accommodation types and the business models that they operate? A self-catering property that is let out for 25 weeks a year—fairly good going in the current market—might see 35 bookings made. If an average of three people visit per booking, that gives 75 people per property per year who might leave feedback on sites such as TripAdvisor. That includes children and close family members. Contrast that with a 10-bedroom hotel. According to the most recent annual UK occupancy survey for UK serviced accommodation, published in 2009, room occupancy averaged 58%. An average of two people per room would give 2,117 bookings and 4,234 visitor nights that could result in feedback on sites such as TripAdvisor. Put simply, such sites do not work for self-catering. The allied system is called FlipKey, but it is expensive to use as there is no linked booking engine for self-catering to generate funding, as Expedia does for TripAdvisor. FlipKey take-up has been understandably low.

The internal systems in Scotland and the other nations of the UK are devolved, and I understand that VisitScotland is likely to continue offering a quality assurance scheme along the lines of the current star-rating scheme. It sees the scheme as offering opportunities rather than being a burden, and in answer to initial reports on the proposed changes it responded that Scotland’s star-rating quality assurance scheme is recognised as a world leader. VisitScotland has recently signed a three-year contract with the Swedish agency for economic and regional growth to develop a quality assurance scheme for visitor attractions and the accommodation sector. It has worked with Namibia and South Africa on quality schemes, and is currently in discussion with Norway, Finland, Estonia and Swaziland.

A huge amount of effort has been put in over the years between VisitScotland, VisitWales and VisitEngland to produce a common standard for those visiting all parts of the UK and, in the case of foreign tourists, those encouraged by VisitBritain. If the Minister goes down the road of self-assessment, that will render the common standard meaningless and tourists will have to deal with at least two competing systems. At a time when we need to work together to encourage economic development in our rural economies—of which tourism is a vital part—that seems a backward step.

The chief executive of Farm Stay UK wrote to me yesterday:

“As we position the UK on the world stage with the Royal Wedding, the Olympic and Paralympic games and the Rugby World Cup, now is not the time to be pulling away from a quality initiative.”

I would add the Commonwealth games in Glasgow to that list.

I will be interested to hear the Minister’s response. I urge him to reconsider this matter before it is too late, and to meet with the chair of the Federation of National Self Catering Associations, and the CEO of Farm Stay UK, whom I am sure can put the case for the self-catering sector more forcefully than me.

Department for Business, Innovation and Skills (Performance)

Debate between Mike Weir and Anne Marie Morris

Wednesday 2nd February 2011 Commons Chamber

[Mr Weir]

I hope that is correct—but action is needed, not just talk. The situation has been going on for a long time, and many small businesses in my constituency and rural constituencies throughout the country are in serious difficulties and struggling to keep their heads above water. They need help now, and the Government have to move on that.

The motion mainly concerns growth in the economy, which I understand, and I wish to talk about some of the things that small businesses need in order to grow. Many of the points in the motion are specific to England, but I wish to mention two matters that cover all small businesses, including in Scotland.

The Minister may know that, just today, the First Ministers of all the devolved Administrations have issued a joint declaration calling for action to protect the economy. The second point made in it is about addressing access to finance, and it states:

“It is clear that securing affordable finance remains a considerable challenge for many of our companies. This is particularly true for many small and medium sized firms—the bedrock of the Scottish, Welsh and Northern Irish economies.

It is unacceptable that many businesses are being prevented from expanding or are faced with significant increases in lending charges and we need to ensure there is in place transparency and accountability in the flow of finance for SMEs. We must also ensure that the planned £1.5 bn Business Growth Fund is implemented now to support lending to viable companies.”

That is the vital point. Many companies in my constituency are finding it very difficult to access finance, and even when they can, it is at a high cost. At a time when the Bank rate of interest is 0.5%, probably the lowest in recorded history, it is ludicrous that small businesses are having to pay ever-higher charges to banks to get finance, if they can get it at all. It is worrying to small business people to read daily in the papers that the Monetary Policy Committee is being pressed to raise the interest rate to deal with fears of inflation, because that would hit small businesses seriously.

For all the talk of making banks pay more to small businesses, there is no sign of that actually happening. The mood music from the Davos summit, which the Prime Minister and the Chancellor attended, appeared to be that the banks are not interested in that any more. They seem to think that they have got through it all and can get on with business as usual, which is totally unacceptable. The issue has to be tackled now. My constituents do not understand why so much taxpayers’ money bailed out the banks yet they are unable to get finance and help local employment. The banks have a duty to help the people who helped them when they were in trouble.

[Anne Marie Morris (Newton Abbot) (Con)]

Perhaps I could draw to the hon. Gentleman’s attention the fact that I had a meeting yesterday with the business finance taskforce of the British Bankers Association, whose chief executive told me that its 17 initiatives to support lending are on track. Indeed, mentors are beginning to be recruited and the lending code is almost in place. The business growth fund is pretty much ready and just requires some changes in FSA regulation. I hope that that provides some comfort.

[Mr Weir]

Again, we hear, “It is almost there, it is coming”, but it is not here. Help is needed now. The Merlin process seems to have stalled—we were told that there would be announcements, but they have not come. If they do not come soon, it will be too late for many businesses.

I turn to the second point that I wish to discuss. I agree with the Secretary of State that it is ridiculous that there is no mention of the Post Office in the motion. I tabled an amendment to that effect, but Mr Speaker did not select it. I suppose that, to be honest, it is unlikely that the Secretary of State would have supported it even if it had been selected.

If we are talking about growth, we have to remember that a postal service is an engine of growth for many small companies. Many of them are very worried about it. This morning I chaired a session of the Westminster eForum at which we talked about Royal Mail’s universal service obligation. It was interesting to hear the Federation of Small Businesses say that when the Government initially talked to it about privatisation, it was given assurances that small businesses would be okay and that their interests would be looked after. However, it is becoming increasingly worried about what is happening. It points out that in April, first-class mail will go up by 12%, large letters by 13%, a 2 kg parcel by 8% and a special delivery by 8%. Worse still—I find this utterly ludicrous—a business that currently goes to a sorting centre to collect its own mail will apparently be charged £210 for the privilege of doing so. Where is the logic in that? What on earth is going on?

I urge Members to read, if they have not done so, Postcomm’s research paper “Business customer needs from a sustainable universal postal service in the UK”, which was published towards the end of last year. It makes very interesting reading about how small businesses see the postal service.