Tourism – My view

Wednesday February 1st 2017

Rachel Hamilton MSP

Rachael Hamilton MSP

Rachael Hamilton MSP for South Scotland and Shadow Spokeswoman for Tourism and Small Business writes for Midlothian View.

In December I asked Fiona Hyslop, Cabinet Secretary for tourism what action her Government is taking to support hotel businesses. She trotted an off the shelf reply reeling off a list of quangos that could be drafted in to support hotel businesses. Fiona Hyslop clearly doesn’t understand that decisions her government make on business rates will hit hoteliers, restaurants, bars, in fact all tourism related businesses hard.
On 6th December 2016, the Scottish Assessors Association released the latest draft re-valuations on their website. Hotel owners could hardly believe their eyes when they saw how the rateable value of their premise could increase by a staggering 10% to 117% with an average increase of 48%.

On 1st April this year, new business rates will come into play and they’ll only go one way – UP!

The burden of paying higher business rates on top of other cost pressures, such as wage increases and auto-enrolment have been met with deep concern throughout the hospitality sector.

The hotel industry has gradually got back on its feet after a long and painful journey following the economic downturn of 2008. Those involved in hospitality and tourism are sensitive creatures. They operate labour-intensive businesses with high fixed overheads that operate on low margins and have highly price-sensitive customers.

The Scottish Government must give every encouragement possible to businesses. Increasing their cost base will undermine the profitability of many hotels and bring into question the sustainability of others.

To add insult to injury Labour are now calling for a so called Tourism Tax. Within Labour’s “Vision for local Government” they plan to thrust a further tax on business and leisure travellers using accommodation providers as tax collectors. Figures have not been provided, but it is thought that this tax will cost more to administrate that it will generate. It is an ill thought regurgitated blunder buster from a desperate Labour party.

Hospitality and tourism has made a massive contribution to the Scottish economy in terms of jobs and growth. Recent figures from VisitScotland show that, in 2015, the number of people employed in the tourist industry rose by 11%. The sector made up 9% of the total jobs in Scotland making it a key employer for many areas. In Midlothian, for example hospitality and tourism saw a rise in job growth of 12%.

The Scottish Tourism Economic Assessment Monitor (STEAM) statistics show a significant improvement in key tourism performance figures in the first half of 2016, compared to the first half of 2015 suggesting that Borders Railway has contributed. It is also the first time in 10 years that every category measured has improved. No surprise as the industry boasts incredible hard workers.

Many private business owners would disagree with the claim that the company which produces STEAM data credits the Borders Railway as the most likely source for the rise in tourism activity. It may have much to do with their own efforts and decisions to market and promote their business.

There is a reported rise of 12.3 per cent in the number of visitor days in hotels and B&B’s compared with first six months of 2015. Visitor spend on food and drink in same period rose by 6.5 per cent. Overall visitor spend was up 6.8 per cent.

The number of day visitors stayed in Midlothian increased by 7.2 per cent and there is a 4.1 per cent improvement in employment related to tourism.
These jobs are spread throughout the country and make an important contribution both to youth and rural employment. The tourism industry is a star shining brightly and could help the Scottish Government reach their goal of cutting youth unemployment by 40% by 2020. However, it’s wishful thinking to believe the SNP will get behind hard-working businesses and actually reach a target rather than miss one.

The Federation for Small Business have claimed that the skills gap present within the workforce is having a major impact on productivity and growth.

Likewise, IPPR’s report: ‘Equipping Scotland for the Future’ highlighted funding as a challenge facing the skills gap in the future. To receive concerns over the same issue by two respected bodies demonstrates the urgency to address the skills gap urgently. However, the Scottish Government is obsessed with holding a second independence referendum and not addressing this issue that will drastically improve the tourism industry.

Scottish Tourism Alliance believe that hospitality should be treated as a career of choice, and this is only proved when we see the Scottish Tourism industry is a multi-billionaire pound industry. So much more can be achieved if we focus to skill up those entering the workforce and make it clear to all that this is a profession with great promise and a great future.

Scottish Tourism is threatened from increasing business rates, a growing skills gap, and Labour’s desire to see a Tourist Tax. It is currently Scotland’s fastest growing industry. The Scottish Government needs to get behind Scottish Tourism with action instead of prepared words and do everything they can to promote growth. Punishing an industry that has slogged its way back is anti-business. The Scottish Government needs to stop its obsession with a second independence referendum and start addressing concerns faced by one of Scotland’s most successful and promising sectors.

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