Hospitality and tourism need joined-up thinking

06 July 2006
Hospitality and tourism need joined-up thinking

The 2012 Olympics has at last put hospitality and tourism on the Government's radar. Suddenly, ministers have woken up to the urgent need to address the chronic skills shortage in the industry and are willing to spend £3.5m on training between 2005 and 2008 - with more to follow.

So, a small victory for beleaguered hoteliers, restaurateurs, publicans and contract caterers?

Not quite. In the next breath, they are pledging extensions to the congestion charge area in London, which research says will cripple hospitality businesses in Chelsea and Kensington. A study by the Centre for Economics and Business Research suggests it will result in the loss of as many as 2,730 jobs, while others predict a £100m dip in revenue.

Government lip service

This is par for the course, says Grant Hearn, chief executive of Travelodge. "When this Government came to power, I was relatively encouraged by the noises they were making," he says. "But I became frustrated because I felt they were talking to the industry for the sake of it and weren't taking any action."

Worse still, it looks as if what the Government gives to the industry with one hand, it takes away with the other. The changes to the tronc system potentially remove from employers the burden of paying national insurance contributions on tips, yet the proposed bed tax will penalise the tourism industry in the run-up to 2012.

Peter Davies, adviser at tax consultant Vantis, says: "HM Revenue & Customs deals with tax and VAT, the Department of Trade and Industry deals with employment legislation, so if one department does something practical it doesn't always realise the knock-on effect on another department."

Martin Couchman, deputy chief executive at the British Hospitality Association, doubts the various departments are being managed effectively. "The system is incompetent and has got worse for two reasons," he says. "We have a more interventionist Government, and we have greater influence from Brussels."

David Tarsh, managing director of Tarsh Consulting, is even less forgiving. "The only thing joined up about government, both central and local, is a grab for our money to spend on badly thought-through schemes," he says. Tarsh slams the congestion charge as highly priced and ill-conceived - and, like many others, believes a bed tax would simply make the UK less attrative to tourists. "It's not helpful and there's no value being added in exchange," says Tarsh. "If it went into improving the offering, perhaps there would be merit - for instance, a brand new convention centre."

Tarsh is also concerned that tourism in the UK and Europe is losing market share, citing the fact that the rise in travel globally is not matched by the rise in visitor numbers here. He is also frustrated by the lack of tourism representation at senior Cabinet level, and the revolving door of tourism ministers.

minister for tourism

"Is that appropriate?" he asks. "World Travel & Tourism Council figures show that travel and tourism generates 10% of employment in the economy. They might want to take a minister with a tourism portfolio to a higher level. That's an initiative that might work."

Certainly, the hospitality and tourism industries could do with some support. Last year, the annual tourism deficit hit £17.9b, and this would be exacerbated if local government started to levy a bed tax or expand congestion charges.

Hearn believes there is real danger this could happen. The 2012 Olympic Games have not yet attracted much response in terms of sponsorship, and he fears the Government may target the hospitality industry as it could benefit from the games. The alarm was sounded by a recent comment from the new tourism minister Shaun Woodward, to the effect that "while we want to see the industry continue to grow, we have to balance the books".

So what is the Government up to? It is possible that, because the industry has grown since crises such as BSE, 9/11 and foot-and-mouth, the Government doesn't think it needs help. It's clear the administration is struggling with a lack of joined-up thinking - as evidenced in other areas such as immigration and crime.

But the Government is ignoring the opportunities that hospitality and tourism offer. The prime minister was recently taken to task by Lord Marshall of Knightsbridge, chairman of VisitBritain, for omitting any reference to the importance of the visitor economy within the remit of the Department of Culture, Media & Sport (DCMS).

Hearn sums up the situation. "I don't think we are close to the Government's heart," he says. "They are wasting opportunities. The DCMS is a three-way brief and they are more interested in their profile than in hospitality."

BOXTEXT: Legislation affecting hospitality and tourism

BOXTEXT: * Bed tax proposal.

\* Congestion charge.

\* Tronc.

\* Chip-and-PIN technology.

\* Smoking in public places.

\* Licensing Act reforms.

\* National Minimum Wage increase

\* Working Time Directive 48-hour opt-out.

\* Disability Discrimination Act.

\* Harmonised grading of accommodation.

\* Increased paid holidays.

The Caterer Breakfast Briefing Email

Start the working day with The Caterer’s free breakfast briefing email

Sign Up and manage your preferences below

Check mark icon
Thank you

You have successfully signed up for the Caterer Breakfast Briefing Email and will hear from us soon!

Jacobs Media is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.

close

Ad Blocker detected

We have noticed you are using an adblocker and – although we support freedom of choice – we would like to ask you to enable ads on our site. They are an important revenue source which supports free access of our website's content, especially during the COVID-19 crisis.

trade tracker pixel tracking