Examination of Witnesses(Questions 1-19)|
TUESDAY 5 NOVEMBER 2002
1. I should like to welcome the English Tourism
Council here today. You do not need me to tell you that this is
a slightly anomalous situation in view of the announcement which
has been made, but I am sure we can use this period very constructively
indeed before we move over to the British Tourist Authority. We
do not normally invite introductory statements; statements, beloved
as they are and deeply informative, can often be incorporated
(Mr Britten) I shall make mine very brief.
As you know, I am Chairman of the English Tourism Council and
we welcome the chance to meet today. The written submission you
have today addresses the subjects you asked us to focus on. Howeverand
this addresses your anomalous situationthe Secretary of
State's announcement came out last week and I imagine you will
have questions to those proposals as well as they affect us. I
do not want to start by apologising, but it is a fact that the
statement is very recent and we are working on what it involves.
I confess freely, however, that we do not have all the answers
yet. We shall answer your questions as openly and honestly as
we can at this stage. I am sure the questions you have will range
across the whole of the tourism spectrum, but I should like to
place two things in front of you. We have two key concerns in
all of this. The first one is the deficit in the tourism balance
of payments and that is as indicated in our submission and as
you pointed out in your last session with us and your report The
Hidden Giant. That has grown alarmingly and it now stands
at £13.6 billion negative. Since that is primarily the result
of British residents spending more money overseas, the re-introduction
of domestic marketing is an absolute prerequisite of getting to
grips with the tourism deficit. We believe that either by encouraging
more overseas visitors to come here or persuading British residents
to consider holidaying more frequently in this country, it is
the reduction of the tourism deficit which is the litmus test
for the success or failure of the tourism industry. That is the
first point. The second point is that although strong marketing
is certainly essential, tourism requires more than marketing.
We need to improve the total quality experience, which means focusing
on other things in addition such as support for those with disabilities,
the improvement of quality standards, ensuring that tourism is
sustainable as well as successful and to work with other national
bodies like the Countryside Agency and so on. Those are the things
which, in addition to marketing, we think are extremely important.
That is all I should like to say. Thank you for that.
2. In the evidence we have received and we have
received a great deal of evidence, all of which was of course
written well before the recent announcement came through, in virtually
every single document we have, there is a call for the English
Tourism Council to be given a marketing role, to become a national
marketing body for England. Interestingly, if you read the submissions
from Scotland and Wales, both of these underline the liberating
impact of devolution on the promotion of Scotland in those two
countries and draw into sharp relief the fact that tourism is
wholly devolved and they have a freedom to act which, by the fact
that England does not have a marketing role, it simply does not
enjoy. In your opening remarks you have brought up the importance
of domestic tourism, bearing in mind that four fifths of the English
spend is domestic tourism. In your own evidence, in section 6,
you very clearly underline the importance of the national role
and indeed the importance of having marketing. The response given
in the statement last week is effectively to abolish the ETC and
to create one new body, which is both to market Britain overseas
and to market and do all the other functions that you did centrally.
It is clear from your remarks that this has taken you somewhat
by surprise. Clearly whatever you put in and whatever has come
out are two quite different things. Do you really think that what
we are offered by the statement has a cat-in-hell's chance of
(Mr Britten) Thank you very much. It is no secret
that it was not our recommendation. We recommended a full service
English Tourist Board with marketing added to the work which the
English Tourism Council does already. We thought that was a clean
and effective solution with clarity for everybody. However, what
has been recommended by the Secretary of State does seem to us
to be workable. The English Tourism Council board met last week
and expressed directly to the Secretary of State their concern
that the English identity should not be submerged in this, that
it is extremely important that we continue to have a very strong
English identity in the new body. It does incorporate our primary
recommendation, and indeed the recommendation of your Committee,
that we must have the restoration of domestic marketing; it accepts
that point. What we have to do now is, working with the Chairman
of BTA and the Chief Executive, Mary and myself and the DCMS,
work out how we can make this as effective as it should be. I
think it has a chance; it is workable. I make no secret of the
fact that it was not our recommendation, but we have to work out
how the England role can be strongly promoted. I do not see why
it should not be.
3. I frankly find it very significant that you
talk about it being workable but you make it very, very clear
that it is not at all what you would have chosen and that would
seem to be backed up by all of the evidence we have had from the
industry. May I ask you to make clear, because people will home
in on the marketing side of things, that bearing in mind ETC itself
has actually had no marketing remit throughout its existence and
some £5.5 million of your grant-in-aid goes directly to the
regions for them to promote and the balance of £6-odd million
you have been spending, and given that you have not been completely
wasting the taxpayers' money, I assume that you have been doing
a good and worthwhile English nationally required job? Can you
explain to us what it is that you have done and how that might
be carried forward?
(Ms Lynch) When the English Tourism Council was set
up, the brief was very much to think about the long term. We have
spent a great deal of time working with organisations like local
government associations on issues which are very important to
the industry, but not necessarily important for next week. For
example, preparing as an industry for the next phase of the Disability
Discrimination Act. The sorts of things we have been doing are
getting all the charities, the Disability Rights Commission, Scotland,
Wales and Northern Ireland together to agree on new standards
for the industry to welcome and accommodate disabled visitors
and then support that by designing new training programmes so
that the industry can equip their staff to have the right attitude
as well as the right facilities. We have worked with the Countryside
Agency on the development of a rural tourism strategy for the
countryside well before foot and mouth became an issue and we
are now into the second year of a joint programme in that area.
We work very much with small businesses to provide things like
this booklet, the pink book, which is a guide to all the legislation
which small businesses have to comply with. For example this is
a guide offering practical advice to tourism advisers in how to
develop micro-business initiatives. We have developed and worked
with many government departments in the area of transport policy,
such as on brown signs. Perhaps our biggest achievement and the
one I am personally proudest of is the work we have been doing
in relation to e-tourism and the pioneering creation of a project
called EnglandNet. I recall when we gave evidence to the Committee
last time during foot and mouth we explained some of the disadvantages
England faced; for example, a Tourist Information Centre trying
to get quick information about footpaths being opened or closed
was relying on an e-mail sent to an hotel which was written on
a piece of paper and biked round to the Tourist Information Centre.
We were not connected and we were not equipped to deal in the
modern environment. As a result of EnglandNet we now have 90 per
cent of Tourist Information Centres on line. In partnership with
the regional tourist boards, we are working with the regional
development agencies to have an England-facing website and a whole
range of extra services particularly for small businesses so that
they can compete. We have done a huge range of things. In addition
to our given remit, because of the sorts of crises which have
been in place for the last 18 months, we have actually been doing
marketing activity. We have run campaigns during foot and mouth,
we worked with the British Tourist Authority to organise welcome
campaigns for the Jubilee and we have worked alongside them on
the Million Visitor Campaign. For example, one of the things we
have done this month is that if you are an overseas visitor, as
you arrive in this country, when you switch on your mobile phone
you will be greeted by a message in your own language directing
you to a welcome telephone information line. The range of things
is enormous. In a way it is the hidden part of tourism. Marketing
is critical and we have been arguing very, very strongly for a
marketing role for England. However, we do all recognise that
marketing is the first step. It is the total quality of what people
experience, both the customer in what they experience and how
the business actually organises itself to relate to that customer.
4. You have very clearly articulated the immense
amount of work which a national body does and it is well accepted
within the industry that ETC has done that role extremely well.
Within the new organisation there is no real new money, or a very
small amount of real new money going in. It is largely about "synergies"
and lower overheads and all the rest of it. Is there not a very
clear danger that, given the pressure for marketing, all of this
kind of work will gradually be chiselled away whilst the one body
gets its synergy and puts more of its resources into the coal
face of marketing?
(Mr Britten) We must be frank and say yes, there is
a danger, but that is part of what we must address in structuring
this new organisation. The Government have said, and it is a reasonable
wish, that some of what the ETC does could be put to other people
who might do it better. What we have to ensure is that before
it moves, it is moving to a better place it does so. I do think,
as Mary has said very clearly, those things are fundamental to
the success of tourism. It remains to be worked out but the early
discussions, certainly with my colleagues in the BTA, show that
they are extremely aware of this and I am sure the new organisation
(Ms Lynch) At the moment we are not absolutely clear
about what the funding arrangements are going to be. We did have
the Secretary of State's announcement on Thursday but at present
neither organisation is absolutely clear about what the starting
budget will be for next year.
5. Do you think about twenty pence per head,
which is what is spent on the English to promote English tourism,
is enough or do you think it is an outrage?
(Mr Britten) It clearly is not enough and it will
not be enough in the future. I am not sure that per capita comparisons
are necessarily the best way to compare.
6. They help.
(Mr Britten) Absolutely; they are an indicator. What
is critical is to look at the absolute sums of money: you are
looking at £40 million now for Scotland and £11 million
for England. That is what does seem to me to be completely out
7. Do you think part of the reason for that
is because it is dealt with by DCMS and not perhaps a stronger
government department like DTI?
(Mr Britten) I find it very difficult to answer that.
Tourism is an industry which does not really have a "right"
department. There are people who argue it should be in the DTI
of course. Maybe that would give us stronger advocacy. The argument
against that is that we would then be in amongst all the rest
of the industries and get lost. There is no clear answer. What
tourism very clearly does need from government is strong advocacy
from whichever department it comes. It needs resources, it needs
investment to work with the private sector for the best of tourism
and it needs a tremendous amount of tenacious cross-Whitehall
8. How many civil servants do you interface
with or how many interfere with you?
(Ms Lynch) I believe the current number of staff in
the tourism division is 31 or 32.
9. Thirty-one or 32 civil servants to deal with
. . . What number in terms of industry ranking is tourism?
(Mr Britten) It's the fifth largest industry.
10. Thirty-one or 32 civil servants to bang
your drum throughout Government.
(Mr Britten) Yes, an industry worth £74 billion.
Mr Flook: It is pathetic.
Chairman: That is appreciably more than
the one and a half civil servants who dealt with the Commonwealth
11. You mentioned that you help small businesses.
What happened over the minimum wage? I saw a programme on television
and if it had been the Black Death about to descend on us it could
not have appeared more serious. Did it have a serious outcome
or did the tourism industry overcome that as most others did?
(Ms Lynch) There was a fair degree of nervousness
about the impact of the minimum wage. The tourism industry relies
very heavily on labour and that is a big part of the cost of running
the business. In practice, it has almost been overtaken by events
because in most parts of the country the key issue for the tourism
industry is that they cannot actually recruit enough qualified
staff and therefore it is very much the case that most tourism
businesses are paying more than the minimum wage now and are looking
very hard at increasing their training and upskilling what they
provide to people. In a way it is not surprising that businesses
worry about anything which is going to increase their cost, but
the key issue for businesses now is getting good quality people.
12. I have had a serious complaint from somebody
who went to Land's End who said it was obnoxious. I have not been
so this is second hand. Is that true and if it is true what influence
can you have on that? Seriously, I should hate to think that we
are not spending enough money on advertising our tourism industry,
but if Land's End is as bad as I am told it is, then it is going
to waste an awful lot of the good money you are spending on attracting
people to England.
(Ms Lynch) The feedback on individual attractions
will obviously vary. I have heard many people say that they have
been disappointed by their experience at Land's End, partly because
they do not feel they have the balance right between the enjoyment
of the environment and the commercial aspects of it. The way we
would work in relation to visitor attractions is that we have
a group made up of representatives of the 6,500 visitor attractions
to identify what customers want and to help them to change their
business to get it. In particular we have designed a quality assurance
scheme so that businesses like Land's End can invite an independent
assessor to come and walk through the whole experience a visitor
has and then get feedback on what was good, what was bad and how
it can be improved. That has been developed over the last couple
of years and has been a huge success. Many of the best attractions
in the country are saying that they are learning from the experience.
At the moment we operate very much on persuasion and a key thing
which will make a difference in that part of the world is people
looking to the successful new visitor attractions like the Lost
Gardens of Heligan, for example. That is a good example of a very
good quality visitor experience.
13. My colleague has raised the problem of Land's
End. I spent two weeks during the summer at Blackpool for the
Trades Union Congress and the Labour Party Conference and the
problems there would be a lot more difficult to sort out than
at Land's End, certainly by persuasion. I want to raise two issues.
The first is the reorganisation and clearly your focus is on English
tourism. I understand that. I am a Scottish Member of Parliament
and you have quite rightly drawn a contrast with the money which
is spent in Scotland compared with what is available in England.
You said that an English identity should not be submerged. One
of the concerns across the borderand I am sure it is the
same in Walesis that the Scottish and Welsh identities
will be submerged; it will not be the English one which will be
submerged. Looking at it from the outside, there does seem to
be a clear conflict of interests that the body which is going
to be marketing Scotland and Wales abroad in very important markets,
particularly the American market for us, will be the same body
which has another responsibility, which is pushing the domestic
tourism market in England and Wales. How do you deal with that
(Mr Britten) That is one of the many things we have
to sort out. Coming from the English side, I am obviously determined
that the English side should be properly represented. The new
body will have to find ways of dealing with the Scottish and Welsh
dimension. It is not impossible to reconcile. You will be talking
to my colleagues in the BTA shortly and the chief executive there
will be running the new organisation. I imagine he would tell
you that the BTA has been reconciling conflicts like that for
some time and they will just have to manage it.
14. They do not have a direct marketing interest
(Mr Britten) I understand that; I understand that
is a problem. The things which attract us about the new organisation
are that, from an England standpoint, we have always been frustrated
by the fact that the BTA produces excellent material overseas
and we have not been able to use it in this country. We had one
example at the time of the Jubilee when we took Hidden Britain
and used that, but the opportunities from having two groups which
use each other's material are very high. The opportunity of having
a bigger and stronger organisation is why, in answer to Mr Thurso's
question, I said this is certainly workable. There are benefits
15. When we established this inquiry it was
to look at the effects on tourism after September 11. I am a bit
of a novice as far as the tourism industry is concerned but when
I did look at the papers and the previous Committee's report,
it did strike me that the response to the foot and mouth crisis
was a little bit patchy. It did not seem to me that there was
a strategic plan which was there to come into place if there was
a problem. Do we have a strategy for dealing with these sorts
of disasters which have direct impact on tourism? When we responded
to September 11, did we learn anything from the problems foot
and mouth had caused just a year previously?
(Ms Lynch) It is fair to say that the industry collectively
was not well prepared for foot and mouth. I would not say we were
alone in that and what we did was to react collectively very quickly:
within days we had put some proposals to Government about what
activity needed to be undertaken and also started doing some direct
marketing to try to get customers back and to restore confidence.
At the end of the summer, when we were actually coming to the
end of the problem of foot and mouth, we worked with the industry
to put together a set of recommendations of what we had learned
as a result of foot and mouth and the chairman, with a group of
industry representatives, collated all of those lessons and sent
them in a document to the Prime Minister and to the new Secretary
of State. In a way, those sparked the debate about tourism reform.
One of those recommendations was that the department needed to
work with the industry to create a long-term crisis plan. For
September 11, yes, we learned many lessons because we had very
recently experienced the need for a speedy response. We worked
then with the British Tourist Authority who set up a tourism industry
emergency response group modelled on what we had learned from
foot and mouth and used that to feed information both to government
and back to industry very quickly. They were very different crises.
By and large it is fair to say that foot and mouth had a huge
impact on rural areas and a disproportionately large impact the
further away from London you got. It was a coincidence that the
greatest number of cases in England were in the Lake District
and the South West. It did impact on overseas visitors and therefore
it did impact on London, but it was predominantly small businesses
which were affected by foot and mouth. September 11 was an impact
on the international marketplace most definitely and it took away
confidence in travel and therefore the impact followed where overseas
visitor expenditure is most important. So it hit London particularly
badly and historic cities like Edinburgh which rely very heavily
on overseas visitors' spending, but it did not have the same impact
on rural areas. In a way, on the positive side, everybody had
an opportunity to try to get some business back. On the negative
side, if the first crisis did not get you then the second crisis
16. So we have a long-term crisis strategy which
has experience from two different types of disasters which affected
the industry. How does that fit into a long-term strategy for
the industry? As an amateur looking through some of the papers,
it is difficult to determine that there is a strategy of any sort
for the future of this industry. At the moment we are looking
at reorganisation of the structures of the bodies which deal with
the industry but it could be said that that is shuffling the deckchairs
rather than determining a long-term strategy for the industry.
(Ms Lynch) The last strategic document published by
the department was Tomorrow's Tourism, which was published
a couple of years after the new Government came into power. My
expectation is that when the new body is created, one of its first
tasks and first priorities will be to look at a strategy. I am
sure the British Tourist Authority in their evidence will talk
about their work on strategy for the international marketplace.
17. May I just ask a small technical question
first about the tourism deficit? How do you count the flight which
is bought in this country to go to Spain? Is that part of spending
in this country or part of spending in Spain?
(Ms Lynch) We calculate the total amount spent by
people leaving this country on their holidays. We do not try to
disaggregate how much is earned in this country and how much goes
overseas. Part of the reason why we do not try to do that is that
there is no source, no proper data to go to. We can tell for example
what proportion is spent on package holidays, but a proportion
of what is spent on package holidays will stay in this country
paying the wages of the travel agents who book it, but to work
out the share of that cost is almost impossible.
18. It means that it is a slightly dodgy figure
then because a significant proportion of a holiday in Benidorm
is the flight which is probably with a British carrier and through
a British travel agent.
(Ms Lynch) The nearest I could relate it to is if
you look at the other side and look at the international passenger
survey which looks at inbound. My recollection is that of the
total earnings, which are about £15 billion, about £3
billion goes to carriers. So it does account for some of that
expenditure, but not a dominant amount.
(Mr Britten) We are talking here about £45 billion;
we may be flaky at the margins by £1 billion or so. The number
is so huge and the escalation in the last five years of £15
billion is so big that the direction is very clear. If we could
persuade just one in a hundred of those people who spend their
money overseas at the present moment to come back to this country,
we would make £450 million. Counting double this makes nearly
£1 billion difference to the balance of payments. If we are
slightly wrong it is still a huge sum of money.
19. As I understand the figures, something like
one in four British people go to Spain every year and I guess
that one of the reasons, as somebody who represents the Rhondda
and is therefore well acquainted with the weather, is the weather
and people wanting to go to a warmer place. I presume that part
of your role is trying to get people not just to go to the obvious
tourist destinations, but to go to the more unusual and perhaps
the more individually tailored holidays which would be in the
UK. Is that right?
(Ms Lynch) It is certainly true that we have never
advocated saying to people that they should not, if they choose
to, go overseas and have a holiday in the sun. It is up to customers
to vote with their feet. It is up to England to persuade them
that we have a huge range of things that they will enjoy and that
they can get access easily and they will get value for money.
On your opening point about what we are doing. In practice, because
we have not had an England marketing role, we have not actually
been targeting any customers, but we know in all of our research
that there are huge opportunities in the short breaks market,
in leisure and health breaks and sport related tourism. The range
is enormous. It is not just about the two weeks on a beach.