UK travel operators enraged by Government's tourism review

Nikhil Kumar
Saturday 05 March 2011 01:00 GMT

Travel industry executives reacted with anger last night to a government initiative aimed at boosting tourism to the UK, accusing ministers of letting down the country's fifth-biggest industry.

They said the Coalition Government had failed to address travel companies' concerns, while the chief executive of Thomas Cook, one of the country's biggest travel agents, complained that ministers had simply refused to meet him.

The outcry followed the unveiling yesterday of a new tourism strategy by the Department for Culture, Media and Sport, which included proposals to simplify the UK's tourist visa process and to improve skills across the industry, which accounts for £90bn in direct spending every year.

The Government also said it would consult on whether to move the first May bank holiday.

However, Ufi Ibrahim, the chief executive of the British Hospitality Association, said the strategy's "passing acknowledgement of the high rate of VAT" was a disappointment. "VAT has become one of the most pressing issues facing the industry," she said. "The present high rate is making UK tourism very uncompetitive."

The Government's report acknowledges the calls for lower taxes, but says that, while it will keep the matter under review, "the financial position we inherited means we must give priority to our fiscal base".

The BHA's concerns were echoed by InterContinental Hotels, which has 264 properties in the UK. The group, which is aiming to open 30 more hotels in coming years, creating about 3,000 jobs, also pointed to the "damaging" impact of high aviation taxes. "This is about so much more than a September bank holiday," the head of InterContinental's European business, Kirk Kinsell, complained.

"Expensive visas, sky-high VAT and damaging aviation taxes are costing the economy tens of thousands more jobs." The plans published by the Department for Culture, Media and Sport are aimed at using the upcoming London Olympics and the Queen's Diamond Jubilee to bring an extra 4 million tourists to the UK over the next four years, attracting £2bn of spending and helping create jobs against the backdrop of sluggish economic growth.

Manny Fontenla-Novoa, the chief executive of Thomas Cook, the tour operator which directly employs some 15,000 people in the UK, also criticised the plans for overlooking outbound travellers, saying: "The Government consistently fails to see the benefits to the UK economy of a buoyant overseas holiday industry and the lack of it in [the] tourism strategy only reinforces this."

Mr Fontenla-Novoa added that, despite Thomas Cook's size, "the Tourism Minister has refused to even meet with us to discuss his strategy".

A DCMS spokesperson said that while the department was unable to accommodate all meeting requests, the Tourism Minister, John Penrose, had met with ABTA, the tour operators' trade association.

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