Tourism industry reacts with dismay at prospect of funding cut

LONDON, England - Inbound tour operators have reacted with dismay at rumours that VisitBritain, the government agency responsible for promoting the UK as a tourist destination is to suffer further cut

Tourism industry reacts with dismay at prospect of funding cut

LONDON, England – Inbound tour operators have reacted with dismay at rumours that VisitBritain, the government agency responsible for promoting the UK as a tourist destination is to suffer further cuts to its funding.

ETOA understands that the Department for Culture Media and Sport (DCMS) has agreed to an 8% cut to its budget but tourism promotion, in the form of VisitBritain and VisitEngland, will suffer a 12% cut.

According to a study by Deloitte in 2010, Travel & Tourism represents 9% of UK GDP – £115 billion in value and 2.6 million jobs distributed over 200,000 companies. It is thus a very significant part of the economy. However, when it comes to government support, tourism receives just 3% of the DCMS budget.

The coalition government has previously recognised the economic potential of tourism. In August 2010, at a speech at the Serpentine Gallery, the Prime Minister pledged to lift the UK higher up the UNWTO rankings of tourism destinations (by number of arrivals) from 6th to 5th. But since that declaration of intention by David Cameron, the UK has fallen to 7th behind Turkey.

“The UK’s position as a tourism exporter is in a critical state,” said ETOA Chief Executive Tom Jenkins. “In our main markets, the UK has been losing share against other destinations in Europe. In the USA, according to the Department of Commerce, the UK attracted over 4 million Americans in 2000; by 2011, these had fallen to 2.4 million. Our market share has dropped from one in four US travellers coming here to less than one in five. The cost of this failure can be measured in billions of pounds and tens of thousands of lost jobs. The USA is just one market; there are similar falls in other origin countries“

“We recognise that savings have to be made, and that expenditure has to be paid for. But tourism is a cash-generating, export industry. As an industry, we are handicapped by Air Passenger Duty, a border that is perceived as hostile, the UK’s own visa process and a flawed VAT regime that punishes operators for selling Britain abroad. In this context, it seems desperate to cut funding to the one agency charged with helping British exports in this area.

Mario Bodini, President, JacTravel said: “Actions speak louder than words and when it comes to this government’s actions, I’d sum them up as “legacy schmegacy”. Money that should have been spent on sensible tourism promotion was diverted to funding the Olympic Games, which we all know now, was not good for tourism. Promises were made about investing in promoting the UK after the Games but abracadabra the tourism promotion budget has evaporated!”

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