Month: October 2022
Correction
In yesterday’s update I said that Nick De Bois was presenting on the DMO review at our joint Tourism Alliance, Tourism Society and British Destinations conference on the 15th November. I had forgotten that in the process of postponement and rescheduling that Nick was no longer available to present on the 15th but that Drew Stokes VE’s England Director had kindly agreed to present in his place.
Given the timing of the event, this is on reflection perhaps particularly advantageous. Drew as the head of the VE’s executive and responsible for it s operational delivery is exceptionally well placed to brief the conference and answer questions on the emerging modeling, development plans and criteria for the DMO/ LVEP pilot scheme that is soon to be trialled for c two years in one competitively selected area in England. Apologies to Nick, Drew and to you all for any confusion unintentionally caused by my error. Less haste more speed.
In this week’s news
Two loosely linked items in this week’s tourism new and a linked reminder.
1. On Monday of this week (2th Oct 22) the DCMS Select Committee published their second report on Promoting Britain Abroad. The 36-page main body of the report is quite critical of certain Westminster Government policies and actions, inactions or delays and make a dozen recommendation most of which I think the majority working in tourism and destination management would be broadly if not totally supportive of. Areas highlighted include increasing funding and greater freedom of operational control for Visit Britain, ringfencing some of that additional funding for the promotion of regional destinations, the elevation of the Minister for Tourism to a “fulltime position” (rather than responsible for a much wider portfolio?) and of particular note for destinations in England: “We recommend that the Government should complete the pilot to a swift timescale and commit to implementing the de Bois recommendations in full”.
Before we allow ourselves to get too carried away, it is important to remember that Government, while duty bound to respond to a Select Committee report, usually within two months of publication, there is no compulsion for them to agree with, let alone act upon, any or all recommendations any committee makes. The typical response often takes the form of, we hear what you say and here is a long list of all the things we have done and or planning to do that relate, however vaguely, to what you said or recommended. Some committee’s recommendations will of course elicit positive responses and all, whether accepted or not, provide independent, cross-party support and ammunition for further lobbying activities. Good, positive end results are seldom won quickly or easily at the best of times and this isn’t in all honesty the best of times, particularly, when it comes to proposing additional responsibilities and/or explicitly or by inference corresponding additional funding to expedite them.
The report is well worth reading in full to get the context and the full sense of what and why the Committee is critical of certain recent policies and approaches to tourism. The one-page summary at page 3 and the conclusion which give a short summary of the rational against each of the dozen plus recommendations, at pages 33 to 36, contain the essential must read material for all UK destination management interests: https://committees.parliament.uk/publications/30452/documents/175898/default/
The Committee’s reference to “implementation in full” is interesting, especially as Nick was witness and gave evidence to the committee. Although the final DCMS published version of the De Bois report somehow managed not to specify beyond doubt the sum envisaged by the author, Nick himself has since made it crystal clear that his vision was based on £17m per year over the standard 3-year comprehensive speeding round (the maximum period any department can committee to). Or in the grand scheme of things, a very modest extra £51m over 3 years, with the aspiration that the funding should and would continue at a sizable figure, into future CSRs and resulting spending rounds. I would urge colleges to refresh their memories of what the De Bois report actually said and what was actually recommended. This doesn’t always match what some aspiring “tier One” or “LVEPs” destinations are touting to their potential partners as reason to comply and make potentially radical, irreversible changes that as yet may not bring with them guaranteed, replacement funding, for the myriad of locally evolved, local grown and often unique local circumstance driven arrangements that underpin most “tier two” destinations. In some instance the concept of and need for tier two destinations remaining in place and managing the multitude of day to day requirements of their destination seems to have been lost on some. Find a copy of the De Bois report here: https://britishdestinations.net/strategies-and-policies/tourism-industry-strategies-policies/review-of-destination-organisations-in-england/
2. On Tuesday, by happy coincidence, DCMS announced the appointment of the new VisitBritain (VB) Chairman. Nick De Bois has relinquished his appointment Chair of the VisitEngland (VE) Advisory Board, 9 months before his term ends and assumes the far more influential appointment as Chairman VisitBritain. He is replaced as interim Chair of the VE Advisory Board by Fiona Pollard.
It would be hard to think any other senior industry figure, currently better placed than Nick to oversee the work of VisitBritain and, to a degree oversee the position and work of the Visit England department within VisitBritain. Nor anyone who would be more knowledgeable about the strengths and weaknesses of the current VB/VE relationship and of VE’s roles and functions within that relationship and within England’s tourism landscape. It is also impossible to think of anyone better placed to understand what the DCMS Select Committee’s aspirations for full implementation of the De Bois report might actually means in practice. Clearly the Chairman VB can only act within the parameters set by the sponsor department but nonetheless his appointment may help to change the dynamics and understanding around international v domestic tourism in general and the currently, critically undervalued roles and functions of destination management, at least as it currently stands within England.
3. A closely linked reminder, Nick De Bois is one of a number of high-profile guests programmed to speak on Tuesday 15th November at this year’s joint Tourism Alliance, Tourism Society and British Destinations national one day, London based tourism conference. Nick is still programmed to discuss the DMO review, although it his highly likely that in current circumstances Nick and most of the other speakers will deviate towards or at the very least comment on more recent and immediately pressing issues for UK tourism, like the cost-of-living crisis and the resulting pressure on discretionary spend and on hospitality, leisure and tourism. There is still plenty of time and frankly ever increasing good reason to book, if you have not already done so. More detail and booking links at:
Latest updates including new research
1. It is difficult to say anything with certainty about the current unprecedented state of national affairs and in turn, to a lesser degree, the immediate and longer term impact on tourism and the visitor economy. September’s economic figures already looked bleak, with even greater shrinkage in the economy and higher levels of inflation that predicted in an already poor financial forecast.
Among the worst hit by shrinkage was hospitality and leisure, confirming our earlier assumptions that tourism, leisure and the visitor economy in general would be hit hardest and quickest by the cost of living crisis. Economic conditions, the resulting uncertainties and damage to consumer confidences has if anything got significantly worse since the 23rd September Mini Budget. A budget that has since proved to be both economically and politically disastrous for the UK. Regardless of the politics involved, the budget and its unintended consequence have essentially shredded the UK’s Government’s and by default the UK’s international financial and political credibly. Those who understand these things in detail (that’s not me) are talking in terms of years and even a decade or more to recover hard won international credibility, once lost to the degree it has now been.
Although the economy can be turned round, there is little prospect of it happening immediately and magically returning to where we were years, months or even weeks ago. Much national treasure has been expended in recent weeks and months on top of that already used up to counter covid-19. Additional deep economic damage has therefore already been done. Step one is to recover from that which, with an ongoing energy crisis and other internal and external influences from Ukraine through to the UK’s position on the Northern Ireland Protocol, isn’t going to be a simple fix, whoever’s job it ends up being to do it. The reality for us is that the prospects for the immediate Winter season and the coming 2023 tourism year remain generally poor, particularly for those majoring on domestic visitors and their discretionary, disposable expenditure.
2. In among the extraordinary events of the last 6 weeks we were unexpectedly promised a welcome return of VAT free shopping for international visitors. A promise that you may or may not have noticed was withdrawn last week, in among a whole raft of other generally much higher profile tax related changes. If the current Chancellor does get to present his budget on the 28th October (who knows, it may or may not yet happen) he isn’t going to reverse the reversal he made. It is a hunch but I am prepared to predict that any new Chancellor of any political shade or leaning who might takeover, is highly unlikely to risk venturing anywhere near anything associated with the September mini budget, unless it is utterly unavoidable. Granting tax concessions to overseas visitors feels like a potentially contentious issue that isn’t necessarily going to directly benefits the majority of UK voters and is therefore something that isn’t going to be considered, let alone acted upon for several years at best. I hope of course as ever to be proven wrong.
3. I have recently received a copy of the Norfolk Ethnic Domestic Tourism Market Report April 2022. The report was commissioned as part of an South, South Easter and Eastern England Interreg funded coastal area project that is looking at expanding out of season tourism. Although focused towards Norfolk and out of season tourism this report has great resonance for UK tourism in general and for tourism throughout the year. Among other things it highlights the porosity of robust research on ethnic domestic tourism in the UK and raises some frankly uncomfortable home truths about what many destinations do, or don’t do to extend a basic welcome, let alone embrace the social and economic benefits of an inclusive approach to domestic ethnic tourism. It is longish report at 125 pages and in places necessarily academic in its nature. I.E. often citing other research sources, some of that by necessity not UK based, due presumably to the relative lack of historic UK research in to the subject area. Nonetheless it is worth reading at leisure and if possible in full.
I commend the report to you, even if it is only to look at and takeaway some of the headline and nationally relevant comments aired in the executive summary and covered within various parts of the report. The report left me as a white middleclass male of a certain age, somewhat embarrassed that I have not thought more deeply and sooner about, what in some case are with the benefit of hindsight and the report, fairly obvious omissions. My overall feeling is that unless the report is fundamentally flawed (which I doubt) many destinations, probably could and should be doing a lot more and much better when it comes to proactively welcoming and enabling ethnic domestic tourism. I would welcome your views.
Whilst we are no longer in a position to commission further research or to initiate initiatives directly, we are still in a position to highlight opportunities and challenges and encourage others nationally with access to greater resource to take mutually beneficial action, particularly, if it is deemed to be needed and wanted by sufficient member destinations and/or the wider industry.
The report can be found in the research library under the “Research & statistic – by year” and adjacent “+” Britishdestinations.net main menu tab or go direct to the page at: https://britishdestinations.net/research-and-statistics/
Domestic Sentiment Tracker: Profile Reported (Oct to Dec 2022)
I was intending to include the Domestic Sentiment Tracker: Profile Report, published 6 October, in yesterday’s general research update but belatedly thought better of it, as the research conducted by BVA BRDC on behalf of all the National Tourist Board deserves close examination and consideration in its own right.
Base on very recent consumer research, it deals with consumer sentiment over the immediate, critical 3 months October through to December 2022, or effectively the here and now. Given current circumstances it not unreasonably majors on the impact on consumer intent arising from the growing cost-of-living crisis. Although the research remit is to looks at both domestic and domestic outbound intent, this particular piece from VE is essentially about the UK domestic market.
These factors combined make this research report a particular valuable piece of timely intelligence for the majority of UK destination managers. It will almost certainly also have utility for your major businesses and for those businesses of any size or type that have a very clear understanding of their market’s socio economic and demographic profiles.
Much of the report’s detail will confirm what experienced destination managers and business owners will already instinctively know. However, unusually it provides credible, current, independent evidence immediately before the event which you can legitimately attempt to act upon now, resources permitting, rather than having the usual hollow pleasure of being able to saying “I told you so” after the event in this case, in a couple of month time.
While the report specifically asked questions around sentiment and intent up to 31st December, it isn’t unreasonable to assume that many of the findings or the conclusions that can logically be drawn from them, have continuing relevance into the normally much slower post-Christmas and New Year quarter. Although the research interviews were conducted very recently, it is worth noting that they still predates the even more recent mini budget and any increased economic pressures on disposable incomes arising from it. Unless there is any immediate marked improvement (unlikely), any conclusions drawn by the report or by you from it could/should perhaps be viewed as leaning towards best case?
As the report has an unusually short life span, I have not added a copy to our research library. The 50 odd page slide deck is both short and worthy enough to be scanned if not read in full. It can be accessed at:
Inbound and domestic tourism trends update
As ever VB/VE and the other National Boards continue to produce essential industry statistics down to Nations and regions level, in cooperation with ONS. As this is freely available on the National Board’s own websites, we tend only to highlight the annual summaries, when they become available, in arrears, c 6/7 months after the calendar year end. If you need them, we do include links to all the National Boards and National statistic agency’s tourism statistics at the head of our Research and statistics – by year main menu tab, to aid those seeking a central point of access to all major national sources.
The latest quarterly figures from VB for Q1 January to March 2022, released in September, usefully compare the 2022 detail against 2019. In order to do this, they have made adjustments to the 2019 figures to make them broadly comparable with the Q1 2022, that currently do not include Eurotunnel and cross Northern Ireland border travel, due to ongoing corvid 19 related survey issues. There are a number of important caveats included within all recent releases and these should be read and understood, before drawing any firm conclusion from some of the figures given. The overwhelming conclusion that can be drawn from the statistics is that, while inbound international travel had started to recover as at 31 March 2022, it still had some considerable distance to go before returning to anything like 2019 levels.
Anecdotal evidence suggests that Q2 and Q3 in 2022, the key early shoulder and main summer seasons months, saw an increasingly stronger rate of recovery. Regrettably we will need to wait a further 3 and 6 months respectively for this to be confirmed by the official IPS figures.
It would be crass to suggest that current economic crisis and, in particular, the fall in the value of pound against the dollar was good news for international inbound tourism. Nonetheless, the weakness in the pound will have immediate impacts on the recovery of international tourism from key markets including the US which could on current political and economic performance persist well into 2023. Good new perhaps, but for all the wrong reasons; reasons that will almost certainly impact negatively on many aspects of all businesses, regardless of their potentially positive exposure, or not, to more international tourism.
Similarly, the tragic loss of the Queen in her 70th year on the throne will, if it follows previous Royal events, result in renewed interest in the UK and key Royal venues within it, in 2023. Unlike the weakness of the pound this should be viewed entirely as an additional positive draw, albeit in extremely regrettable circumstances. Any concerns that the undoubted draw of Royal family and Royal heritage under the outstanding direction of Queen Elizabeth II will quickly diminish, seem at this early stage to be groundless. Long may that continue under the direction of Kings Charles III.
The UK figure down to National level released on 23 September, can be accessed at (note the sample size caveat): PowerPoint Presentation (visitbritain.org) and of more immediate interest to destination managers the Nations and English Regions breakdowns released on 5 October: PowerPoint Presentation (visitbritain.org).
The ONS base data for the above and their assessments will also be of interest, not least because it also reports, at section 4, on UK resident’s outbound travel. The quoted headline for this is an 8.6m increase between Q1 2021, during the second peak of the pandemic and Q1 2022. Not explicitly stated but of far more relevance to adherents like me of the “Leaky Bucket Syndrome” is the 2022 Q1 total of 9.5m outbound trips compares with the 2019 Q1 of 18.1m (hover over the relevant graph intersections to obtain details) or give or take 50% of pre pandemic numbers.
A rapid return to, or towards 2019 levels of outbound UK residents’ travel might be good news for the outbound operators and the industries that surround outbound travel but it is not necessarily good news for the domestic market and the domestic and inbound international markets that are both reliant on what is essentially the same domestic industry infrastructure. HMG need to recognise that while there are benefits to the UK economy of outbound domestic tourism is does come at a significant cost to domestic tourism and, thus, to an important sector of the UK economy. Just like any other major “import” activity will have an impact on UK based businesses, manufacturing or trading in that commodity, outbound tourism impacts on the domestic alternative. Trying to ignore that uncomfortable truth helps neither side of the equation.
ABTA have recently released its annual ABTA Holiday Habits 2022 (publication suspended during the pandemic). This contains a lot useful information, principally around outbound travel which with the “right framework” is predicted to grow by 15% over the next 5 years. Critically the report confirms the view that for many the “main holiday” (overseas?) is increasingly regarded as sacrosanct. The finding in the section on “cost of living” at page 12 will make uncomfortable reading for UK destinations and, in particular, some of the component parts of the wider visitor economy within them.
The report appears to confirms our earlier concerns that in the fast-developing, economic crisis discretionary disposable income will not simply be reduced across the board but selectively reduced, with the more routine domestic/local spending taking a potentially disproportionately larger hit, than the already generally, big ticket, overseas holiday. In these circumstances not only are these holidays acting as an import cost to the UK, they are also doing so at a demonstrable cost to domestic spending across a raft of discretionary areas, including: retail, hospitality, leisure and domestic tourism.
Although it is entirely possible that HMG can still calm the financial markets, billion have already been spent/lost and considerable damage has already been done to the UK economy, well beyond that being done in parallel by a number of external circumstances. We are in economic difficulties next year regardless, it just how deep and for how long that is still in any doubt. UK destinations must plan and react accordingly for what is likely to be a very difficult winter 2022/3 and full new year or more to come thereafter.
The ABTA report has been added to our reports and statistics library accessible under the “Research and statistics – by year” main menu tab, or go direct to that page at: https://britishdestinations.net/research-and-statistics/
Changes at DCMS
Following Nigel Huddleston appointment as Government Whip (Lord Commissioner of the Treasury) on 20 September, Lord Syed Kamall was appointed last week to replace him, as Minister for Civil Society, Heritage, Tourism and Growth, our 7th Tourism Minister in the last 7 years.
Whilst welcoming Lord Kamall’s appointment, it is disappointing that Nigel, who oversaw his Sports, Tourism, Heritage and Civil Society portfolio throughout the period of the pandemic, will not be in post to see us through the recover and, in particular, to press home to a successful conclusion some of more radical programmes started but not completed during his watch. Most notably among them, for destination interests at least: the DMO review and proposals on the potential accommodation registration scheme for England.
Destination management interests and others will now have to redouble their efforts to ensure that Lord Kamall fully understands why both are seen as essential developments. So that he in turn can persuade his colleagues in a much more: small government inclined, low tax, lower public funding, less regulatory leaning, new administration of the need for public funding support for a DMO network and for the introduction of an accommodation registration scheme, that results better application of necessary regulation within some or all parts of the accommodation sector in England. If the rest of Government don’t support the progression to full implementation, then the small scale 2 year DMO pilot now under development and further considerations around the nature of a potential registration scheme, will not progress to fully, funded fruition.
Although it isn’t uncommon for junior Minister to sit in the House of Lords and one or two of the 20 plus Tourism Ministers, we have had in the last c 20 year have done so, it can sometimes be regarded as reducing the clout of the Ministerial positions concerned. There are genuine practicalities involved with operating from within the House of Lords, rather than the House of Commons, not least of which is representing the entire DCMS portfolio in the House of Lords and not just those relating to their own DCMS Ministerial responsibilities. Personally, I think the effectiveness in role, is largely down to the standing and determination of the individual.
Lord Kemal a former MEP 2005 to 2019, ennobled in 2021, has served for the last year as Minister for Technology, Innovation and Life Sciences. He therefore has recent Ministerial experience, as a member of the upper house and should be well placed to deliver for us. As with all new Ministers it is incumbent on us all to offer our full support to him and to the existing Team within DCMS, to help him do so. Official details of his appointment are at:
https://www.visitbritain.org/lord-syed-kamall-announced-tourism-minister
The new Secretary of State for Digital, Culture, Media and Sport, Michelle Donelan appointed on 6 September chose to highlighted the reintroduction of VAT free shopping in her recent Party Conference speech in which on tourism she said: “Another area of growth is tourism, which we are also boosting, by re-introducing VAT-free shopping for overseas visitors. And we will replace the old paper-based system with a modern, digital system that will come into place very soon”.
This confirms previous statements concerning the intent to reintroduction of the VAT refund scheme, previously removed, UK wide by HMG in January 2021. Introducing a secure, digital system that can’t be easily abused, may prove to be an interesting challenge, particularly if it is genuinely to be deliver “very soon”?
Whilst an important factor in driving some international visits that should be broadly welcomed, VAT refunds to international visitor are not a universal panacea for tourism’s ongoing difficulties either internationally or domestically. Indeed they are all but irrelevant to much of the domestic market and those many places that major in it. Let us hope we can look forward to hearing more soon from the new Westminster Government on targeted support for tourism and hospitality; notwithstanding of course the welcome but more general support from the capping of business energy prices for the next 6 months, already announced. Although welcome, that too is not a panacea for energy crisis or indeed for a raft of cost and demand related issues now increasingly in play. More support will almost certainly be need to get many individual businesses through what is going to be a long, hard and dark winter season.
Senior job vacancies and new visitor attraction trends report from VE by BVA BRDC.
Moving on. Malcolm Bell the CEO of Visit Cornwall has announced his decision to step back from the role at the end of the year. I am sure colleagues would wish to join me in thanking Malcolm for all his effort in Cornwall and the South West over many, years and wish him well in semi-retirement. There will I am sure be opportunities to thank him in persons, before the year’s end.
Job and board Vacancies. The Board of the Visit Cornwall CIC are now seeking to replace Malcom. In parallel Visit Cornwall are also seeking to refresh membership of their Board. Applications for both close on Sunday 23 October 22. Details can be found under the “Jobs vacancies +” menu tab of Britishdestinations.net or go direct to the individual pages via the links given below.
Trend report. An interesting new report on Visitor Attractions trends in England 2021 has been produced for VE by BVA BDRC. The report together with a summary of the top 6 take outs can be found under the “Research and Statistic – by year” or adjacent “*” tab, or go direct below to both below:
British Destinations 