§ 3.47 p.m.
§ Mr. Michael Noble (Argyll)
Hon. Members will agree that the subject of tourism is one which is debated too seldom in this House, and yet is one of the major problems in which the country should be interested, and which we should more often debate. Throughout the length and breadth of the country those who are engaged in catering for the tourist industry, whether in hotels, restaurants, or any of the other parts of the service industries connected with tourism, have been gravely disillusioned with the policies of this Government, long before that disillusionment spread as widely as it has done, as we have seen in the last few days.
These people have this disillusionment because they realise very clearly that from the beginning of the time when the Government took office they have continually stated that the biggest single problem confronting them was that of the balance of payments, and that this was a first priority. No one working in this industry is able to reconcile that with the treatment that the industry has received during the last three years.
May I summarise a few of the figures relevant so that the House may fully understand. The number of visitors to Britain, and I am talking primarily about the export trade, so to speak, in 1964 was 2½ million. The number rose to 3½ million in 1966, which was an average rate of increase per year of 14 per cent. I have been able to discover from the British Travel Association, which keeps a lot of records of these visits, that in 1967 the figure rose to 3½ million, an increase of approximately 10 per cent. Therefore, the number of people coming to Britain from abroad and spending money here has been increasing at a very satisfactory rate from any Government's point of view.
867 The estimate of what those people spent in this country in 1966 is £219 million. I cannot give the figure for 1967, because it has not yet been calculated. This is a very considerable sum of money. When one adds to it the extra £138 million earned by the British carriers of tourists, whether it be B.O.A.C., B.E.A., Cunard, or any of the shipping companies, one gets an immediate impression of the value of the tourist industry to our balance of payments.
It is estimated that of the £219 million, one-third came from tourists from North America and approximately one-third from European tourists and tourists from overseas sterling countries. The figures vary a little, but they give, broadly, the breakdown of where the money comes from. Of the £219 million, rather more than half is spent on hotel accommodation and meals in restaurants and other places.
Perhaps it will help if I try to put the matter in some relationship with the export earnings of some of our other great industries. The whole of the textile industry brings into this country about £261 million—rather more, according to the figures for 1966, than tourism. The whole of the aircraft industry, including air frames and engines, brought in only £201 million in 1966. Car and chassis production brought in £234 million; commercial vehicles £138 million; and the whole of our iron and steel exports £215 million. Therefore, the export earnings of the tourist industry are very great indeed compared with any of the other traditional manufacturing industries.
I quote those figures to put into perspective what was said on Tuesday last week in Commitee upstairs when we were discussing tourism in the narrow context of Scotland. An hon. Member opposite interjected, But we do not want our nation to be a nation of waiters". It is that sort of attitude, expressed too often from the benches opposite, which gives the tourist industry a feeling that the Government are not sympathetic to people who earn their living by working hard, long hours and many hours overtime in an industry bringing vast resources to this country in foreign exchange.
868 Over the last two or three years, the Government have taken a number of actions which directly affect the tourist industry. They altered the tax allowances. They introduced the Selective Employment Tax. They disallowed entertainment expenses. They introduced special credit restrictions; a new Board of Trade loan scheme for hotels; special development area building grants; and new building licences. This year we have had announced a new hotel development incentive scheme and new S.E.T. reliefs.
It would be tempting, but I do not want to be tempted, to go into detail on the various measures which have been introduced by the Government and to analyse in each case whether they are a help or hindrance to the tourist industry. However, I am sure that many hon. Members interested in this problem have read the report which the "Little Neddy" arranged to have made by Cooper Brothers, a very distinguished firm of accountants, which looked in detail at the actions which the Government have taken and which issued its report, which is to be read by anybody who is interested, stating clearly and exactly where damage has been done to the industry by the Government's measures and making some specific suggestions of action which the Government could take to improve the position. I wish to select one or two of the points which I have listed and make a few quick comments on them.
It would be idle to pretend that this debate could run for five and a half or six hours without mentioning S.E.T. Therefore, I should like briefly, because many others will elaborate what I have to say, to set out the main reasons why S.E.T. is definitely doing harm to the tourist industry, as the "Little Neddy" concluded.
First, S.E.T. is a perfect example of the Government discriminating against the service industries, because it is less worthy to work as a waiter or cook, or whatever it may be, in the tourist industry than to make bits and pieces of a machine or work on a production line. The second point which needs making, particularly in regard to the new reliefs which have been announced, though not perhaps very clearly, is that the reliefs are based upon criteria which are them- 869 selves highly debatable and which in many cases make no sense, especially perhaps because they are based on employment exchange areas which have no relevance to the problem of tourists and where they want to go.
A number of instances have been quoted in our Scottish debates, and I am sure that my hon. Friends can quote many in England, of the employment exchange area making nonsense of this relief. It is of very doubtful value, at least immediately, because it does not come into operation until September, and, except for one or two favoured areas, September marks, if not the end, then very near the end of the tourist season.
Lastly, but by no means least, the reliefs are to be given for hotels if they happen to fall in exactly the right area—and nobody with hotels in his area will complain about that. But they are limited to hotels, whereas anybody who has studied the tourist industry, even shallowly, knows that it is made up of hotels, restaurants, and all the other service industries which join together to make the stay of the tourist satisfactory, or the reverse.
I should like to say a few words about the Board of Trade loans scheme announced about 15 months ago and which are meant to last for one year. It was said that £5 million was available and that the loans were particularly for those hotels able to cater rather narrowly for the export market—hotels which were of sufficient standard to take tourists from Europe, America and other places with plenty of money.
It is significant that up to January, I think, of this year—at least, that is what the Minister of State, Board of Trade, told us in an Adjournment debate—only rather less than £2 million had been taken up of the £5 million, and not a penny had been taken up in Scotland. So this particular form of loans was certainly not very acceptable to the tourist industry itself.
To move on now from this, which was the earlier idea which the Government had to help the hotel industry, in particular, and which, as I say, did not appear to have any success, to the scheme which has been announced in the last week or two and which I will call the new scheme, there are many questions which I hope the Minister of 870 State will be able to answer us and about which I would like, myself, to make one or two comments, so far as I understand them at the moment.
The new scheme envisages in the first place a 20 per cent. building grant to hotels; it is moved up to 25 per cent. if the hotel is in a development area; but it is limited, as I understand it, to a total of £1,000 per room in what one may call ordinary areas and £1,250 per room in the development areas. I am very much puzzled as to whether it is intended to be a reflection of what the Government themselves believe the cost of rooms in these areas is.
I will come back to this very point in a moment or two, but the limit is £1,000 per room, and, quite honestly, I do not know, because nobody has yet been able to tell me, what exactly "per room" means. Does it mean per bedroom, per public room, per room of any sort or kind, including toilets and housemaids' cabinets, and so on? I presume it means per bedroom, but this has not, I think, been made exactly clear.
§ Mr. W. R. Rees-Davies (Isle of Thanet)
If it be per bedroom, and I believe it to be, does that include fixed amenities such as a bathroom attached, and those other things one expects today?
§ Mr. Noble
This is certainly an important point. I am sure that the Minister heard that interjection and, I hope, will be able, when he speaks, to answer it.
There is also, of course, the problem whether, if extensions are made, the same applies to them as it does to a new hotel. There are innumerable questions which, the Minister must know, the trade is asking of the Ministry at the moment, and to which, to date, it has had no satisfactory answers.
I would like to go back to the point I made a moment or two ago and the cost. I am assuming that it is per bedroom. I had the fortune to discuss with one of our main hotel developers about 10 days ago the most recent figures for the cost per bedroom of hotels which he had most recently built. The answer which I got from him was this.
In the North of England, just outside one of our main industrial towns, he put up a hotel of the sort of standard which 871 nowadays is generally expected, where every room has its own bathroom or shower; it is not a top luxury hotel, but it is a hotel to which no tourist from any part of the world would be ashamed to go. The cost per room came out at just over £10,000. He then built an exactly similar type of hotel in a country district in Scotland; built by the same people to the same standards; and the cost came out at £12,500 per room.
These are immediately recent figures of cost per room. He is a reasonably astute business person, and I am quite certain he took the lowest tender, which was satisfactory for the standards which he wanted, and that was the figure. These are gross costs and nothing is taken out. We have a figure which is miles above the figure at which the Government grant of £1,000 per room will have any effect at all. He will be left with a considerable extra burden over and above the 20 per cent. which the Government have offered. I know perfectly well, and so does he, that if this particular hotel had been built with a very large number of bedrooms, if, instead of being a 78 or a 90 bedroom hotel, it had been built with 200 or 300, the cost per room would have come down and this would have made a difference to the figures I am quoting. However, the point surely is that in a large number of areas in the country, where we need accommodation for our tourists, it would be the most extreme sort of folly to build hotels with 100 or 200 bedrooms because they could not conceivably be expected to be full for more than a very short time in the year.
So it does need real skill in judgment as to the size of one's hotel, because what ultimately makes the profit in any hotel operation is the original cost, the price one can charge per bedroom, and the rate at which one has either room occupancy or bed occupancy, according to whether one has single or double rooms.
§ Mr. Emlyn Hooson (Montgomery)
I am following the right hon. Gentleman with interest, but I am wondering whether he is right about his figures, because £12,500 per room for an 80-bedroom hotel makes the cost £1 million, which is certainly about the cost of a luxury hotel.
§ Mr. Noble
Well, I do not think that I actually said it was an 80-bedroom 872 hotel; though it was in that region, it was a little less than that. I think that the hon. and learned Gentleman will find out, if he chooses to inquire in any country part of Wales, that the figures I have quoted will be applicable and will be about as low as he will get anybody to quote. They are not my figures. They are figures which have been given to me by somebody who has just completed a hotel in those circumstances.
On the other hand, it is equally true that the same person, whose firm has been, as I say, expanding in the hotel trade quite considerably, was able to build bedrooms in motels at a cost of about £4,000 in central Scotland, a little north of central Scotland in one case, and, where the cheapest possible materials and construction were used, for just under £3,000 in another. So that if one is prepared to come down to the really cheap range of construction and have the cheapest form of accommodation it is certainly possible to keep within a figure where the 20 per cent. grant will make the cost something below £1,000 per room.
The point I must make—and I do not want to take up too much time with my own speech, because I know that a great many of my hon. Friends want to get in—is this: if the Government, in their new scheme, are really interested in trying to get hotels built, not in the main industrial areas, but in the more scattered country areas, and are interested in trying to get tourists to come to Wales, outside the industrial part, to the Highlands, the Borders, and so on, then, while the 20 per cent. may possibly be enough to build a hotel in the London area or in Birmingham or Manchester or Liverpool or any of the industrial centres, it will not be anything like enough as an incentive to developers to build hotels in outlying areas, and particularly for these two extra reasons.
If one wishes to build a hotel, we will say in Edinburgh, Newcastle, Manchester or London, to a satisfactory standard, the sort of hotel which will attract any American or European, it will attract, if one is lucky, during the course of the year, 25 per cent. or 30 per cent. of overseas guests. The great bulk of people who will fill the hotel will be people who are on business in that city, and whose expenses are being paid by 873 the firm. There is nothing immoral in this. If an executive is sent to Edinburgh, Glasgow, Manchester or Newcastle, he is expected to stay in a reasonably comfortable hotel, and he receives his expenses for so doing.
In a hotel of this sort, quite clearly the amount that is charged for bed and breakfast is not particularly critical, since the person is not himself paying the bill. He may be physically signing it, but the bill is paid by the company which has sent him there with a job of work to do.
The picture is different if one looks at what I call the real tourist areas. In these areas probably 95 per cent., and in many cases 100 per cent., of the people who stay in hotels are paying their own bills out of their own pockets. In most cases, as they are holiday areas, a person is paying for his wife and children as well.
Therefore, if these hotels are to be full, they have to accept a considerably lower cost per bedroom per night than the hotels in what one might call the business areas, even though in certain cases, for instance, in Edinburgh, the city is both a business area and a great tourist centre.
It is a major problem. When one also considers that away from the main centres of population building costs go up considerably, then one can see the problem in its stark reality. A Government incentive that gives 20 per cent. or 25 per cent. to the main areas—the variation of 5 per cent. depends on whether it is a development area or not—makes it almost certain that the people with money to put into the tourist trade will do all the hotel building in the main business areas. They will not do what I believe is needed in a great many country districts, which is to put up the accommodation without which the tourist industry cannot survive and grow.
The Scottish Junior Chambers of Commerce have arranged to have a conference this week at Aviemore to discuss the problem of tourism in Scotland. Among the many papers that have been prepared for the conference was a paper, which I think will be discussed on Friday of this week, prepared for them by Mr. Gerard Colley, of the Battelle Institute, Geneva. I do not know Mr. Colley, or what is the 874 reputation of the Battelle Institute, but I know that the Swiss, for many generations, have been exceedingly good at catering for tourism, and I suspect that Mr. Colley and the Battelle Institute are expert in this matter.
I will tell the House the five rules that Mr. Colley said were important if we were to develop the tourist industry in this country.
The first rule is that one should never attempt to promote tourist traffic until there is somewhere to put the tourist. This is so simple that it ought to have been clear to everybody for a long time. I do not know what other people's experience has been, but mine in the county of Argyll has been that for the last few years, if the weather is favourable, we have a very large number of people wandering around in the evening trying to find somewhere to sleep. In some centres it is not uncommon to find 20 or 30 people who, at midnight, have failed to find anywhere to say and have to spend the night in their cars. This rule is certainly understood by many tourist areas. But it is not just hotels. I have spoken about the problems of producing enough beds for tourists, and the cost of it in the immediate future, but we have a number of other problems, too.
It may well be that it is satisfactory to a great many people to spend the night in bed-and-breakfast houses, which have been a great success story up and down the country. These people must have somewhere to eat their lunch, and often their supper as well, and there is no relief for the restaurants that provide the essential food for the large number of people who stay in bed-and-breakfast establishments.
There is also the problem of caravans. A great many people have decided that they will try to help to provide caravan facilities for tourists. They let out caravans by the week or by the day, whatever it may be. Here again, we run into the curious dichotomy with which the Government seem to be inflicted in their dealings with the tourist industry.
One of my constituents wished to set up a caravan site. I have sent the papers about this to the Minister of State for Scotland, who asked for them last week. My constituent wished to set up the site as part of his effort deliberately to help in the problem that 875 tourists have in one part of rural Scotland. As soon as he decided he would do that, he was faced with a letter from his solicitor saying, "Do you realise that if you do that there is a betterment levy that you will have to pay under the new Land Commission, and that this may be exceedingly expensive?" He wrote back at once and said, "How much is it likely to cost?", to which the answer was, "We cannot possibly tell you, because you must do the development first, and then, when you have done the development, we will tell you what it will cost."
This seems to be a crazy way to encourage people to set up proper accommodation for tourists. This is not a question of the Government raising the price of land by some new decree, for new towns, motorways, or anything like that. This is a person in a small way of business in the wilds of the West Highlands who is trying to help the tourist industry. He is faced with a betterment levy, and he has no idea what it will cost, as he cannot be told what it will cost until he has done it.
I suspect that very much the same thing will happen to people who decide now under the scheme that they will build new hotels or extensions, and so on. They will get from the Government 20 per cent. per bedroom up to £1,000. This they know, but when they have done that, what will the betterment levy be? Nobody has told them that yet. It may be that the Government, having given them 20 per cent. with one hand, will take 25 per cent. away with the other. How will that help? This is a point about which the Minister might well say a word or two.
Mr. Colley's second rule is that one should always provide the tourist with sufficient entertainment. This seems to be a very simple and straightforward thing to say, but in how many areas outside the well-known tourist centres has this been done? There are far too many places that I know of where tourists are regarded as summer visitors, and the only entertainment they are allowed is to stroll up and down at the side of the river and become midge-bitten. This may have been satisfactory for their parents and grandparents, but it is by no means satisfactory for the 876 modern tourist, who wants to travel with his family and expects them to have something to do.
The best single example I know of is the centre at Aviemore. It was started by Lord Fraser and two or three others in 1964, with the blessing of the Conservative Government. It was designed specifically to provide sleeping accommodation for 400 people and entertainment facilities for between 1,000 and 1,500. To my mind, it was the right sort of tourist development in a country area. Not only does it provide entertainment for people living at the Centre, but a great deal of entertainment for people living in hotels roundabout. It has been a remarkable success. I was up there a month or so ago when there was plenty of snow. People were motoring there from the North of England for the weekend to enjoy the ski-ing, in a way which would be impossible if that sort of entertainment had not been provided.
The Government have given a rebate of Selective Employment Tax to the people who work in the hotel. But the success of the operation does not come just from those who work in the hotel, but from those who work on all the ancillary features such as the ski-lifts, skating rinks and swimming baths. All of them have to pay Selective Employment Tax, and at a 50 per cent. increased rate. That is nonsense, because it is looking at only one small section of the overall problem.
Mr. Colley's third rule was to make sure that the police, Customs and immigration officers are aware of the importance of tourism and take positive steps to encourage it.
I was reading Which? at the weekend, and it said that it had made an inquiry into London Airport and that almost every letter commented upon the extremely courteous way in which the writer had been treated by Customs officers at Heathrow. So often, one hears criticisms. Although the reports were not specifically from tourists but, I imagine, more from our own consumers coming into the country, it was pleasant to see words of praise directed towards our Customs officers. Indeed, from what I have seen, police, Customs officers and others are very courteous to tourists, and 877 I do not think that we have much to learn from Mr. Colley on that score.
Mr. Colley's fourth rule was that, before one invests in tourism, it is important to do research to establish the viability of it. I am not certain what research is being done by the Government to establish the viability of schemes which are being discussed at the moment. A case in the Scottish context was where the Highland Development Board intended to set up five hotels. We were told last Tuesday that there was no possibility of any of them being viable, and that is probably true.
There are likely to be a good many repercussions amongst hotel keepers in any given area if it is said openly, as it was last Tuesday, that the Government are using the taxpayers' money to set up hotels which have no possibility of becoming viable and which will compete with existing hotels in the area.
The last rule by Mr. Colley was that the country's tourist industry should be co-ordinated by a Ministerial body with strong statutory powers. I am not sure that I agree with that, because I do not understand exactly what he means by it. However, I will say a word or two about it in a moment.
I turn next to the whole problem of costs. Today, tourism probably is the biggest single world growth industry that there is. All the evidence shows that the mass migration of tourists for periods of a week, a fortnight or a month grows year by year and is a matter of very great importance. For the greater part of it, I believe firmly that there has to be very close international competition on costs, and I was worried to read in the Sunday Express yesterday that holidays at home will cost more this summer. The article spoke of increases of up to 12½ per cent. on hotel and boardinghouse accommodation and meals which have been imposed at leading resorts, and there followed a story about the reasons for it.
This year, we hoped very much that we should get some advantages from devaluation. There were many other factors which we knew would operate against the tourist industry, but we looked to devaluation to work in its favour. I claim no knowledge of the statistics on which the article is based, but if we are likely to see increases of 878 up to 12½ per cent. it means that already we have lost practically the whole of the advantage that we have gained from devaluation. It is a serious matter.
In the world of package tours, it is possible for anyone living in the South of England to have a 14-day trip up the Rhine for a good deal less than the cost of spending a similar period in the North of England or Scotland. That is one of the dangers which have followed directly on the Government's imposition of the £50 travel allowance. It has made it essential for the people providing foreign package tours to bring down their prices and keep within the £50 limit. To that extent, it has made the Continent more competitive, which is exactly the opposite from what the Government intended.
As many of us know, in the past, continental countries have had great advantages in tourism in that they have cheap labour in hotels and in the construction industry. Those of us who have seen hotels being built in Spain and other places know that they are not very substantial. The cheapness of construction has helped towards the capital costs which have to be made good over the year's return on the capital invested. If our industry is to be successful, we have to keep down our costs. In their policy of taxation, and so on, I do not believe that the Government realise the importance of keeping down costs in the tourist industry. Everything that they have done has appeared to be designed deliberately to put up costs.
During the debate, I would like the Government to deal with the following points. I would like them to clarify the new scheme that they have announced in considerably more detail than they have so far. I would like them to rethink the whole Selective Employment Tax relief schemes, because I believe that they are nonsense as they are based at present. I would like them to consider what I believe to be the absolute necessity of some differential for hotel building in what might be called selective tourist areas and other parts of the country. The Government have to make up their mind and say clearly that where certain aspects of Government policy, such as the betterment levy, conflict with the need to provide more bedrooms for tourists, they will use their powers to see that the levies are not charged.
879 While I do not believe that a tourist board with statutory powers is necessarily the right answer at the present time, it is essential that there should be a Minister in the Cabinet who understands the tourist industry and the enormous importance of the country's invisible earnings. Too often the Board of Trade seems to be concerned with manufacturing and does not realise tthe importance of these earnings.
If the Government say that not enough money was spent in the past, and ask why they should be expected to spend more money when we did not, I would remind them that they are the Government who said that they intended to create an export-led boom, which is what tourism is. The Government have taken over £22,000 million extra in taxation from our pockets. Some of this money should go back to the tourist industry.
§ 4.30 p.m.
§ The Secretary of State for Scotland (Mr. William Ross)
The right hon. Member for Argyll (Mr. Noble) started by suggesting that we in this House have paid too little attention to the importance of tourism. I agree that this is one of the many subjects to which the House could well devote more attention. One of the troubles is that we tend to get it mixed up with regional development. Tourism spans the whole country and its development would give us help with our balance of payments, upon which the right hon. Gentleman concentrated. We should pay attention to places not for regional development, but for their attraction to tourists.
We start with London. When we talk about extending the tourist season for Wales and Scotland, we have to remember that the tourist season for London is all the year round. With the concentration of conferences, and so on, London probably has a bigger hotel problem than other places. There are lessons to be drawn from that.
The right hon. Gentleman was right when he referred to the importance of overseas earnings. One of the difficulties is to separate the overseas earnings from other aspects. If there were a hotel which dealt only with overseas visitors, it would be relatively easy. We have to 880 appreciate that the biggest customers for our hotels are our own people. The result of mounting the holidays-at-home campaign has revealed that 30 million of our own people had a holiday in Britain last year and that they spent £560 million. This is the biggest aspect. Therefore, in doing something, as we think, towards overseas earnings, we may not be doing that at all. We have to keep a reasonable balance. The right hon. Gentleman said that they were joined by about 3½ million overseas visitors. Actually it is probably nearer 4 million. They spent £245 million in 1967.
§ Mr. Norman Miscampbell (Blackpool, North)
I am grateful to the Minister for giving way. I was listening with interest to his point about holidays at home. I am sure he will agree that Blackpool and Scotland which accommodate millions of people every year, are often in direct competition with the Costa Brava rather than another holiday resort here. A holiday at home may save as much as bringing in someone from abroad.
§ Mr. Ross
This is why I am emphasising the point. We talk about the numbers who stay at home and who come here. I understand that about 5 million people went abroad last year. All the traditional resorts will have to change their outlook.
In the past, when there were the traditional Lancashire Wakes and the Glasgow Fair, people moved straight to Blackpool from Lancashire or to Rothesay and down the Clyde from Glasgow. They no longer do that, so we are faced with completely new problems. Instead of going and staying for a fortnight at Blackpool, the North-West resorts, Llandudno, Rothesay or Ayr, as in the past, people tend to go for two or three days to the centre of an area from which they go out. It may be they will stay in that place, but they like to have a measure of freedom in case they wish to go on to another place.
We are faced with an entirely different problem. As a nation, we have been slow to realise the amount that we can earn if we get into the tourist attraction industry, first, from the point of view of overseas visitors, and, secondly, what we can save by ensuring that many 881 more of our own people take holidays at home. Some parts of the country have realised this, because, from a local point of view, it is a desirable way of building up employment, even though only seasonal. In Scotland, we were lucky to have men like Tom Johnston and Lord Rosebery who, over a long period, chaired the Scottish Tourist Board and tried to concentrate attention on many of these problems.
If we can satisfy the tourist needs and demands of our own people—the great bulk of our hotel users and holiday makers—we shall gain a fair idea about how to satisfy those from abroad. It is not only the visitor from France or Denmark who arrives in the north of Scotland, Barmouth in Wales or elsewhere and looks for something to do during the evening. We have to provide the right kind of accommodation. It may not be a hotel, as the right hon. Gentleman said. It might be a camping or caravan site. It may even be something much more rough and ready for the younger than what is demanded by older people.
We must be able to do something for everybody. The standards demanded are rising all the time. More and more people want the comfort of a hotel or caravan holiday in the remoter places where efforts are being made by commercial and local interests to see that some entertainment is provided. We have a great interest in seeing that this is a country where the standard for holidays is high. It means that we have a good standard of living. We have to try to get the quality right for our own people. If we do that, I think we shall be able to meet the needs of those coming in in greater numbers from overseas.
The figures of visitors from overseas in 1967 were surprisingly high. The right hon. Member for Argyll quoted 1966, but there was one particular event that brought hundreds of thousands of people to Britain at that time, namely, the World Cup. Yet, without that attraction in 1967, even more people came and spent more money. It may be that some who ventured as far as London and the areas where the World Cup ties were being played decided it was worth coming back and seeing more. It means a great deal to tourist centres like London and Edinburgh, but it means even more from the 882 social and economic standpoint in the remoter areas.
The right hon. Gentleman referred to what had been done at Aviemore. The other day my hon. Friend the Minister of State for Scotland made an appeal for more Aviemores. Other parts of Britain do not have the attraction of snow at the right time of the year, but it may be that by exercising our skill we could find other areas which offer particular attractions. Wales has its national music. Other parts of the country might have other attractions for visitors. I am thinking of such things as sea angling, sand yachting, and other activities to which people would be attracted for their holidays. The development of skiing facilities at Aviemore has given the area a 10-month holiday season. A small Highland village has been turned into an all-the-year tourist area, and all that has happened in less than 10 years.
I know that the right hon. Gentleman interested Lord Fraser in the project and got the scheme at Aviemore started, but local people had appreciated the value of such a development long before that. I admit that the developer came in at the right time, but it must be remembered that he did so with Government support, and I was sorry to see the stinging attack which Sir William McEwan Younger made on the Government's policy for tourism. He said that the Government had given no encouragement whatsoever to Aviemore. The mere fact that what was once a small village is now a thriving holiday centre shows that somebody must have provided a number of things, and perhaps I might give the House some idea of what has been spent on the area.
It is not sufficient merely to provide a hotel at a holiday centre. Water is essential, and it cost the public authorities £404,000 to provide water supplies at Aviemore. The provision of roads cost £607,000. Housing to support the area cost £313,000. Schools cost £148,000. Board of Trade grants amounted to £366,000. Grants by the Highlands and Islands Development Board for the ski lift and other facilities amounted to £96,000. The figures add up to a total of £1,990,000, which is no inconsiderable sum for the Government to spend on one area to support one development. The spending of that money has been well worth while because the area is attracting more and more people from this country, as well as visitors from overseas. It is 883 both a summer and a winter holiday resort, and we must have more Aviemores.
§ Mr. Noble
I do not think that the right hon. Gentleman realises the point which Sir William McEwan Younger was making, which was simply that since the decision had been taken to set up this centre at Aviemore the Government had withdrawn many of the financial advantages which people expected to have when they went here. I hope that the matter will be put right.
§ Mr. Ross
We have not taken away the financial advantage. On the contrary, we have given Aviemore solid support. The answer is to be found in the success of the project.
I now want to say something about the S.E.T., about which so many complaints are made. It is often referred to at Question Time because it is of considerable importance to Scottish Members. It was said that this tax would destroy the tourist industry, but it has not done so. Last year was an extremely good one for the industry, and there is every indication that this year will be equally good. The changes announced by the Government last year in the application of the tax helped the people in the cities as well as those in the rural areas.
I am, of course, referring to the provision about part-time workers paying only half the S.E.T. The Government's latest suggestion—which will be debated on another occasion—to give help to certain rural hotels in the development areas is an indication of their willingness to consider the effects of the tax. I think the right hon. Gentleman probably knows that an examination is being conducted into the incidence and consequences of the S.E.T.
Another thing which people often forget is that today the tourist is more mobile than ever before. This means that more roads must be constructed, and expenditure on the roads programme has never been higher than it is today. As a Scot, I welcome the fact that the great motor roads are sweeping north because they will bring to Scotland our biggest customers, the English, who will be able to spend more time in Scotland because they will need to spend less time travelling to and from their holiday areas.
884 Tourism is not just a matter for the central Government. We must provide facilities for people in the areas to which they want to go. In other words, we must attract tourists. We must make them welcome, and we must satisfy their holiday needs. That cannot be done by the central Government. It must be done by people in the localities concerned.
§ Mr. Peter Emery (Honiton)
The debate has been going on for an hour and ten minutes. Will the right hon. Gentleman leave the problems of Scotland and deal with the problems of the biggest tourist area in the country, namely, the South-West? A spine road to the area is vital, but the Government appear unwilling to make a decision about it. A crash programme is necessary to provide this vital link with the South-West.
§ Mr. Simon Wingfield Digby (Dorset, West)
Is the right hon. Gentleman saying that in deciding on the roads programme due weight is given to tourism and the extra traffic that it brings? I do not believe that it is.
§ Mr. Ross
That may be true in the hon. Gentleman's opinion, but it must be remembered that the more we improve trunk roads the more we speed people to a point of departure for their chosen holiday areas. In Scotland, we are very much concerned about the roads to Penrith and beyond. We want people to get up to Galloway, Dumfriesshire, Ayrshire, and so on. We must have good, fast roads. If, during the last three years, we had not spent so much money on main roads there would have been very much more to complain about.
The right hon. Gentleman spoke about the support that we are giving to hotels. This demand by the tourist industry for support for the hotels is nothing new. I remember the many debates when complaints were made about this when the 885 right hon. Gentleman was Secretary of State. I recall the plan for prosperity and the 1962–63 Report, "The Challenge of Tourism, Scotland's Fastest Growing Industry" A great demand was being made at that time for more Government investment because it was already recognised, as that Report stated, that…it is unlikely that private enterprise will be encouraged to provide all the finance required, the onus of responsibility will rest on the Government, and the Scottish Tourist Board would suggest that just as the Government assisted industry in the post-war years to overcome the initial financial hurdle by building factories throughout the country, the time has come when it should build hotels in rural areas like the Hebridean islands, and lease these out at economic rents to qualified operators.The right hon. Gentleman was carping about the Highlands and Islands Development Board. The Board will be doing exactly what that Report was calling for. It is now consulting with operators about the need that exists. Admittedly, this is being done in a particular area, but when we consider what is being done to meet the long-term demands of tourism by the Scottish Tourist Board—and I have no doubt that hon. Members who represent Wales will have comments to make about this, because the same demand exists there—I suggest that the right hon. Gentleman should be encouraging the Board instead of adopting a wet-blanket attitude to everything that is being done.
The provision of hotel accommodation is not the only sphere of activity. The holidaymaker and tourist requires other amenities. In addition to having somewhere to stay, he must have somewhere to go. It is in this connection that the Forestry Commission has done a wonderful job in welcoming people to the forests. Perhaps the Commission is taking a chance, but from reports I have been receiving I gather that people have been well disciplined in their behaviour. They are now able not only to go through our great forests but to use properly run caravan parks, to be welcomed and to be given ample facilities.
The right hon. Gentleman will recall his valiant efforts to do something to provide facilities of this kind. He introduced a Bill which got a Second Reading and which was designed to impose a levy of £2 10s. on each single bed per year in boarding houses and hotels, the 886 money to be devoted to the provision of these facilities. His Measure failed to get any further, but at least it recognised the need to levy money in this way and so provide developers—local authorities and others—with the money to provide these facilities for the tourist and holidaymakers.
The Government have gone further than that. We in Scotland have progressed further than the English in this matter because we already have our Countryside Act and Countryside Commission, with its headquarters in Perth. By that means we will be able to provide finance, and in turn, provide facilities and help local authorities to improve and organise new facilities. This will not only attract the tourists to the countryside but also preserve our Scottish heritage in the countryside.
We must attract, welcome and satisfy. More and more today in the regions the value of tourism is being appreciated. People are joining together to provide the necessary facilities to attract tourists. Tourist organisations are already well organised in many parts, including Yorkshire, the South-West—Devon and Cornwall—the Lake District, Northumberland and Durham and London. By meeting and discovering what is required in their particular areas to attract tourists, these organisations can ensure that adequate hotel accommodation is provided—providing the welcome that is needed—along with the right type of facilities, which ensure that the tourist is satisfied. I am sure that we will find the right answers and keep ahead in this matter.
I pay tribute to the National Trust for what it has done for tourism. Many bodies are involved in the provision of these facilities. Anyone who has seen what the Trust has done at Bannockburn and other historic places will agree that its efforts are contributing greatly to tourism. I gather that the English have tried to do the same, but that their efforts have not succeeded in quite the same way. The efforts of the Trust have resulted in a chain link being developed, with the provision of specially designed reception centres at which holidaymakers and visitors can learn of the things of interest to see and do.
Another link in the chain that has been forged is at Torridon, where the 887 Inland Revenue has, in part satisfaction of death duties, accepted an area and transferred it to the National Trust. Thus, one of the most attractive parts of the country will be available to the holidaymaker, tourist and climber. Operations such as this are not easy to organise and my right hon. Friend the Minister of Public Building and Works has a part to play in the support that is given to historic buildings and ancient monuments.
Few people appreciate the types of specialist tourists there are. I know several people who will gladly travel thousands of miles to see one painting. If a painting they want to see happens to be in the Kelvingrove Art Gallery in Glasgow, they will go there. Once we have adequate provision for displaying pictures in Glasgow, the Burrell Collection that was left to the city will be a great tourist attraction. Hon. Gentlemen opposite will appreciate the large sum of money we are spending on our national galleries and museums, and this, too, has an effect on tourism.
I assure the House that the Government are greatly concerned with the question of tourism. Some details have been given about the new hotel scheme. The first scheme was in the nature of an experiment and if it was not entirely successful, we should remember that it was of limited appeal because it was related to overseas visitors. If we have learned anything from that experiment, the results can be seen in the new scheme. We are concentrating on the tools for the job, as it were, in the provision of hotel and holiday centre schemes; and rural areas which feel they are being left out should remember the loans scheme under the Development Commission.
We have increased the grants to the British Travel Association and have vastly expanded the home holidays campaign. In addition, we have created the Countryside Commission. We are now turning our attention to the vital question of whether any organisational changes are required in our tourist effort in our endeavour to create a new spirit that will lead the country into realising the undoubtedly great potential of tourism.
My right hon. Friend the President of the Board of Trade will be supplying 888 further information about the hotels incentive scheme in a White Paper to be published shortly. That will state that the Government intend to pay increasing attention to tourism. Naturally, I cannot anticipate those proposals, but I hope that this debate will result in a number of constructive ideas being put forward, and we look forward to hearing the thoughts of hon. Members on this subject.
The debate will be worth while if we can have that type of constructive approach. But it is not all grousing and girning about S.E.T.: there is far more than that to the tourist industry. There is more than hotels and restaurants, and the sooner the House and the country realise that and get down to it, the better.
§ 5.0 p.m.
§ Mr. W. R. Rees-Davies (Isle of Thanet)
It is a great pleasure for me to speak again. I have had an advantage which, I think, would be a great advantage to every politician, in that I have recently been entirely deprived of my voice. I am not suggesting that one should be deprived of one's voice for over three months, as I have had to suffer, but it is very good for a politician. It has enabled me to read deeply and, particularly, I have been compelled to listen. That is a signal advantage, not only to me but to other colleagues both here in the Chamber and elsewhere in political life.
This opportunity has enabled me to do a study in depth of the problems of the tourist industry. I began it in the Caribbean, lying on the beaches of Jamaica in very pleasant suroundings and being able to listen to those concerned with overseas problems. I then did the same in Morocco and Spain and, just before my voice came back, I was able to whisper to colleagues throughout this country about their ideas. Finally, I am deeply indebted to the Irish, because I have absolutely no doubt that the way in which they deal with their tourist problems is the finest in the world.
I want to take a fundamentally different approach to that hitherto taken in the House. I hope that we all now recognise at last that the tourist industry is, first, the greatest single unit in world trade, not only here but in practically every other country, second, by far the greatest growth industry in 889 Britain and throughout the world, and third, tie only industry in this country which is not treated as an industry at all.
Undoubtedly the first principle is that we must in future treat this as a manufacturing industry—no less and no more—if we want to succeed. That particularly applies to the civil servants in the Board of Trade and the other Ministries who are no less at fault than the politicians of all parties have been for many years. Almost every European country has a substantial system of aid. This includes Belgium, Austria, Switzerland, Italy, Spain and Portugal and applies particularly to Eire and Switzerland, from which I derived the greatest benefit in my study, although I looked in general terms at all the other nations.
The Pope recently described the tourist industry as an industry…the contribution of which adds to the refinement of man's character and the enrichment of his understanding of others.That very quotation shows that we want to lift this debate and our approach right above the very "woolly" speech to which we have just had to listen. I call it woolly because it was petty and did not get to the deep problems confronting this industry and the nation.
In the Caribbean at present, and throughout the Commonwealth, there is a real opportunity for a partnership between Britain and those territories, our colonies and associated territories, to secure a large-scale investment by Britain in those territories in the tourist industry, together with a proper partnership with their peoples. It is interesting to reflect that, although the American Virgin Islands are one of the most highly-developed tourist centres adjacent to Puerto Rico, bringing considerable benefit and betterment to their people and a substantial return on investment to the Americans who hold their investment there, the adjacent British Virgin Islands began their investment only this year.
It is true that this is directed primarily to the Ministry of Overseas Development, but I hope that there is someone in the Board of Trade who has to liaise with that Ministry in these matters. It is interesting that Sir Geoffrey Crowther of Trust Houses is at present traveling 890 through about 40 or 50 islands there because his company is merely one of many among private enterprise which recognises the importance of overseas tourist development.
They have largely been driven overseas, of course, because of the shabby treatment which they have received from this Government, whose policy, far from being what the right hon. Gentleman called "attractive, welcome and satisfying", has been singularly unattractive, hostile and unsatisfactory in cutting the benefits which were hitherto obtained. Trust Houses alone lost £250,000 in one year in expected investment grants. Of course, it is not just S.E.T. but the burdens thrust upon the industry which have led to these difficulties, and they will have to be reversed very quickly.
Therefore, our businessmen have a real opportunity to go abroad and ensure that Britain has a real common wealth with these overseas territories by substantial investment now, before it is too late and the plums are taken by the Americans and Canadians, as will undoubtedly otherwise happen. I hope that this will apply not merely through the Caribbean but also through our Asian territories, and our former African colonies, where there is an enormous opportunity and where some of our leaders have already recently gone—in territories like Kenya and Tanzania, and elsewhere. One hopes that the politicians there will have the sense to recognise the importance of tourism and of therefore not taking measures inimical to the interests of the developer but working in partnership with him.
The proper instrument for our overseas policies is the well-tried and extremely effective British Travel Association, a first-class organisation, which is, however, in the difficulty of being a membership organisation, with no statutory powers. It is probably the right body to be given such powers. There are one or two other matters in relation to overseas which I hope it will stress in its work, because they are vital. The first is the need for regular travel agents' conferences here. The American Society of Travel Agents and all the other travel agents' societies must be invited to this country so that they know what sort of package their people will get—what accommodation, amenities and entertainment.
891 Second, it is vital to encourage the international conferences, and particularly what is called "incentive group travel". The Americans, wisely, believe that it is to the benefit of their large companies that employees of very large groups of companies should take their holidays overseas as a bonus incentive. The principal recipient country of this bonus can be Britain. I am convinced that I.B.M. and many other large concerns can be persuaded to come to Britain and confer in our major conference hotels or conference rooms. They can take the opportunity to see Britain as a whole, because there is no reason why their conferring should take place only in London. No doubt they would make arrangements to spend the balance of their time here in other parts of the country. It is essential that the Government and the G.L.C. give urgent consideration to providing proper conference accommodation, not only in the Metropolis, but in other major cities.
I turn now to the home front. There is no doubt that, for a variety of reasons, the political parties, the Government, and the Ministries have hitherto failed the tourist industry in Britain, despite the numerous speeches made in Parliament, and despite the fact that there is an all-party Committee on this subject, which I regret to say very few members of the Labour Party attend and no member of the Liberal Party attends.
§ Mr. Rees-Davies
Yes. I, as Chairman of the Committee, got in touch with the hon. Member for Bodmin (Mr. Bessell), who assured us that he would see the Chief Whip of the Liberal Party. We have never seen a member of the Liberal Party. Our Vice-Chairman is a member of the Labour Party and attends fairly regularly, but we do not see other Labour members often. There is a genuine reason for this. Nobody has yet been able to get it across to members of the Labour Party that tourism is the principal great industry of the future for Britain. The Labour Party believes in the horny handed sons of toil: what is done with the hands is manufacturing industry, but in some way or other tourism is not. I believe this view is changing, but very slowly. It is sympto- 892 matic of a debate of this kind that the President of the Board of Trade is absent.
§ Mr. Rees-Davies
I will not give way. I am about to reply to the intervention the hon. Gentleman was about to make. I regret to say that our shadow President of the Board of Trade is ill, otherwise he would undoubtedly have been present. That was what the interjection was to be, I take it.
§ Mr. Manuel
No. I wanted to intervene to take up the hon. Gentleman's assertion that members of the Labour Party are not interested in tourism as such. Many of us who come from Scotland have great problems in our constituencies. Though we are interested in tourism, we recognise that it will provide only part-time employment, with idleness in the winter months. We are concerned to get a more stable industry providing more security in Scotland, thus avoiding depopulation from our areas.
§ Mr. Rees-Davies
I appreciate that point, but it is better to have some employment of a trained nature than none. In Thanet we are delighted to have the benefit of a stable tourist industry.
On the home front we have not got the right authority at the moment. Governments composed of both parties have appointed committees to co-ordinate Departments. Dr. Charles Hill began this under the Conservatives many years ago. Nobody has succeeded. This policy has not succeeded because of the wide diversity of interests involved—the Ministry of Housing and Local Government on planning; the Ministry of Public Building and Works on historic buildings; the Department of Education and Science for museums; the Treasury; the Board of Trade, dealing primarily with the export angle, and so on. A decision must be taken quickly to give statutory powers to an authority and to secure Ministerial control over a co-ordinated tourist industry. It will have to cover entertainment, sport, the fine arts, and many other aspects.
How is this to be achieved? I have always been convinced—so has our Committee—that the first thing to be done 893 is to have a Select Committee on tourism. On 5th August last the Prime Minister, in reply to a proposal put up with the unanimous support of our Committee, thanked me for my letter of 26th July asking for a Select Committee and said:I cannot at present say precisely when we shall be in a position to have a firm decision about this but it will be soon after the Summer Recess.The Prime Minister went on to say that he thought that it was a good and constructive idea, although he made the case that we should not have too many Select Committees. I fully appreciate that point.
It is essential to get the right structure for the future of the tourist industry. To this end, albeit for a short time—say, a year—a Select Committee should be set up to decide the proper constitution, functions and structure of the industry. I do not believe that this matter should be in the cockpit of party politics. It would be advantageous to have a commitee composed of hon. Members from both sides of the House with power to call witnesses and to send for papers.
In Ireland there is a separate tourist board set up by Act of Parliament; it comes under their Ministry of Transport. It is almost entirely independent. That board has power for development, to ensure that the financial asistance which is necessary is provided. On the other side, it deals with marketing, marketability and administration. It deals also with the side of things which is at the moment covered in this country largely by the British Travel Association.
We need some organisation coming under the aegis of the Board of Trade—I believe that to be the right Department to have the overriding power—but which would be largely a separate corporation with statutory powers. We should set up a Select Committee immediately to get on with this urgent task if we are to attract the large number of tourists which Britain can properly accommodate.
I want there to be effective local authority, because Britain has recently decided to give 90 per cent. of local authority control to the Conservatives. Most of the people coming in are totally without experience of local government. None the less, they are keen that there 894 should be effective and dynamic local government. Tourism is one sphere in which local government can be of the greatest assistance. There must be a system of registering accommodation as soon as possible. Thus, we shall need a registering authority. I do not want the registering authority to be a Government Department. On the other hand, the authority will require inspectors. Eire requires only seven inspectors to inspect all its hotels and to see to the grading of accommodation.
Eire and many other countries—for example, Greece and the Greek Islands—have a supplemental list called a farmhouse list. Not only hotels and boarding houses, but also guest houses and farmhouses, can be registered. This, coupled with local bureaux, would be of immense value.
There is no reason why now local authorities should not of their own volition set up voluntary schemes to register and grade their accommodation properly and also have local bureaux particularly in places such as Blackpool, Thanet, Folkestone, Eastbourne and Brighton and other areas where there are considerable numbers of tourists. If an hotel or boarding house did not want to be graded by a local authority, it need not be. It would merely lose the publicity. There would be no need for penalties, because if an hotel quoted prices and charges and did not adhere to them, the deterrent would be not to publish its name in the register the next year.
It is simple to have registration and simple to ensure that it is carried out. It is done in practically every tourist country in the world except here. Unless and until we do it, we cannot assist the travel operators to operate package tours which are necessary and at the same time enable persons to obtain the quality sought. This House should decide the nature of the authority. Meanwhile, local authorities should go ahead with registration and grading. We could then get a good system. Inspectors—centrally controlled by, I suggest, the British Travel Association, or with powers deputed through whatever new authority is set up—would be responsible for examining and grading accommodation and seeing that it reached the necessary national requirements laid down in the criteria.
895 We should consider having resort special development areas. In the early part of his speech, the Secretary of State said that we get tied up with general trade development areas, but those are quite different. There may be an area suitable for the expansion of industry which is already a tourist area. At one time Thanet was such an area. We were graded and we obtained a lot of heavy and light industry as a result. The present Government took us off the list. I did not cavil about that at the time, but now clearly an area such as mine would be very suitable as a special tourist area, particularly as we are to open a new hoverport.
There are similar areas in the Highlands of Scotland and in Wales and it is vital that they should become special resort development areas. I think "resort" is a better name than "tourist". Those areas must be clearly defined. Again, there is a good precedent for this in Eire. Having defined the area, we must decide what grant it should have. Obviously the grant in such an area must be higher than elsewhere. The present grants are no good, any more than the experimental loans scheme was. That was a farce and we told the Government it would not work. Although £5 million was put up, only £1½ million was used and that related to only a few applicants, a dozen I believe.
The present 20 per cent. grant will not do. The cash scheme for new development must be up to 50 per cent. in what I call special resort development areas. The 50 per cent. would apply only to bedrooms and bathrooms because there must be different rates for amenities which are entertainment advantages and also for staff accommodation, kitchen improvements and matters of that kind. If a new hotel in a special resort area is a real improvement it should qualify for a 50 per cent. cash grant.
The money could be obtained on the Swiss lines of a credit guarantee scheme, which is excellent. There private enterprise provides the money on the usual criteria, but the guarantee and interest on the loan should be paid by the Government in cases which meet the Government's criteria. This part of the scheme could probably be worked out later in conjunction with the Board of Trade and the new authority. It could be worked 896 out by Parliament when the matter is dealt with in Committee. If, on the other hand, the Government insist on making this decision on their own, I greatly hope that at the very latest it will be made by the end of the year for we are losing time very fast.
I turn to the question of finance and assistance. The country must recognise that this industry must be treated in pari passu as a manufacturing industry. The effect would be that it would be entitled to reclaim S.E.T. I leave that to be argued by hon. Members who are better able to deal with it than I am. Hotel buildings should be defined in the same way as industrial buildings and should be entitled to the allowances which thereby arise. That is why it is important to treat this industry as an industry.
I emphasise that fixed plant should qualify as machinery and be free from Purchase Tax. Nowadays it is essential to put in new rooms, bathrooms or kitchens. They are not put in with separate furniture but with fixed furniture—fixed basins, baths and so on, attached to the hereditament. No one in Greece or Italy seeks to tax the fixed plant and equipment. Fixed plant and equipment goes into those countries Customs-free. Why should we treat our hoteliers in a way in which the Greeks would not dream of treating theirs? In Spain there is not only a loan for the whole of the building cost but also for all the equipment which goes into the building.
There must be financial inducement for new development and improvement. We must be blunt about this. The accommodation in this country, in the main, compared with post-war accommodation in other countries is ghastly. There are nothing like enough bathrooms. No American or Canadian, no one from the new world coming to this country, is prepared to stay in an hotel unless it has private baths—except the very poorest element. There must be a cash grant and interest-free loans repayable over a period of years to modernise accommodation and bring it up to required standards. It is said that we need another 50,000 bathrooms in two years. I believe that we could use double that number if we got to the real heart of the problem.
These ideas are not new. I do not claim to have done anything more than 897 read thoroughly and listen carefully to the leaders of the tourist industry in this country and elsewhere. There is not one original thought in what I have said, yet I venture to suppose that there are a good many hon. Members present who find a good deal of fairly new thinking in it. At least, I hope so. There are certainly a good many hon. Members opposite who, if they read what I have said, will regard it as new thinking, at least in part. But it is not.
I beg the Government to do something. They have a dismal record in almost every field, including this. They can attack the previous Tory Government, if they want to, saying that they did not do much better when they were in office. But we are not interested in that sort of thing. There are dozens of my hon. Friends here now who were not here five years ago, and there will be many more after the next election.
If we want to get the benefits of devaluation, let us be sure that we go straight ahead, with the right sort of authority having the right statutory powers, making certain that those who are in control have the right to be consulted about planning for tourism. In Thanet, there was the most appalling situation regarding the development of the new hoverport, and we had to wait 18 months for a decision. That is a scandal. The country should recognise the scandal for what it is, that we do not have a system which can deal quickly with vital problems of that kind affecting the nation. I do not blame any particular Minister for that delay. It is all part of the mumbo-jumbo of different Government Departments, higgledy-piggledy, with different rights and interests. Someone must cut through the red tape. The proper place to do it is here in the House of Commons.
§ 5.32 p.m.
§ Mr. Ednyfed Hudson Davies (Conway)
When talking about tourism nowadays, we grace it with the name of industry, and so it is, but it is treated as an underprivileged and poor relation rather than as a serious industry. None the less, it is an industry with enormous potential, particularly at a time when other industries, notably manufacturing industries, are doing rather badly. Our 898 internal domestic tourist industry should be at its highest point of potential when there are restrictions on overseas travel and economic restrictions generally affecting people's ability to pay for their holidays.
When the economic situation improves, with greater ease of travel abroad and a higher standard of living, people should in addition be able to have more than one annual holiday, so that the potential of tourism is by no means temporary. Just as important as its value in the domestic economy, however, is the importance of tourism as a direct contributor to our balance of payments. We are earning through tourism well in excess of £300 million a year both directly and through the travel services which we provide, and the rate of growth in the tourist industry's earning of overseas revenue has been three times as great in recent years as the average increase in physical export earnings. Moreover, there is in tourism little importation of raw materials to be set off against those earnings.
Often, the areas with high tourist potential are the very areas which have been neglected in the past from the point of view of other types of industrial development. Frequently, therefore, it is areas which have become depopulated and which our regional policies are concerned to stimulate which are precisely the areas which are suitable for tourist development. Our emphasis in the past has been wrong—this is certainly true of Wales—because we have been concerned more with the development and maintenance of manufacturing industry in precisely those areas which are not suitable for manufacturing and in which we should have done far better if we had devoted our incentives and effort to the development of tourism.
The great handicap in the tourist industry—this is why when we call it an industry, we put the words as it were, in inverted commas—is that it is by no means an organised and co-ordinated industry. It is highly fragmented, with many small units—boarding houses, hotels, the occasional chain of hotels, small villages and small seaside resorts—with the result that it is difficult to get concerted action from within the industry itself.
899 The industry is not very good at projecting itself. I had occasion recently to try to help a friend of mine who wanted to go on a riding holiday in North Wales, in my constituency. After many inquiries through the Welsh Tourist Board, and so on, she was told that there were two or three places which seemed to cater for a holiday resident who wanted to have a week's riding holiday. On arrival, however, she found that there were many places which had accommodation alongside riding schools. These places had never got down to advertising themselves in terms of a riding holiday although they were siuated in a part of the country which is highly suitable for it.
Our concern today, however, is not so much with what is wrong with the industry itself as with what the Government can do to organise and stimulate it. Here, in developing a point which has already been made, I take Wales as an example, though the argument applies equally elsewhere. There is a whole host of bodies and organisations, private and public, which are involved, but there is no cohesive organising force.
In Wales, thinking in terms of promoting tourism and considering what research has been done, what grants are given and how training is arranged, one finds a whole range of authorities involved—the B.T.A., the Welsh Tourist Board itself, the Rural Development Commission, the National Parks authorities, the local planning authorities, the Board of Trade, the Ministry of Agriculture, the Sports Council, and so on—all acting frequently not only with a lack of co-ordination on planning, but even with a lack of co-ordination of information.
It is most important, as has been said already, notably by hon. Members opposite, that if we are to take this industry seriously, we must break through and think in terms of one controlling body. It could be a private corporation, though I should prefer to see a Government body, but it must be responsible for planning the facilities and resources, for encouraging investment, for involving itself in investment, for training and for covering all the activities connected with tourism.
I had an opportunity recently to look at the development going on in Southern 900 Italy. I looked particularly at the Gargano Peninsula, a peninsula of immense scenic beauty, but which, until comparatively recently, had been hardly populated and had few public services. As a result of the work of the Cassa per il Mezzogiorno, the area has now been opened up and an infrastructure developed, with a road built along the whole Gargano coast through pine trees where previously there was no road at all. While I was there a little while ago, there was hardly any traffic save the traffic of contractors carrying materials for hotels, holiday sites and so on. All this is being done where previously there has been nothing.
On the whole question of the infrastructure, I feel that the approach of the Ministry of Transport to expenditure on roads, which is based on a formula depending on traffic accidents and delay, is quite inadequate for the tourist areas. What matters in many areas is the construction of promotional roads. We shall not get the development—this is true for tourism as for any other industry—without putting the roads there first. In the Gargano Peninsula, on the other hand, one saw the results of overall planning. The maintenance of standards and of co-ordinated planning was controlled, as was the granting of money and the raising of other revenue, by the one development organisation, the Cassa per il Mezzogiorno.
We need in Wales to think in terms of that kind of body. The new Welsh Council will have an as yet a somewhat undefined responsibility for tourism in Wales. There is hope there and I am pleased to see that my right hon. Friend the Minister of State for Wales is here this afternoon. I hope that we shall hear something later about what it can do to break through the medley of bodies and organisation involved in tourism in Wales.
But what are we doing now, and what is wrong with the kind of encouragement and impetus we are giving to the tourist industry? It seems to be a poor relation. Whatever another industry gets, tourism may get after a lot of campaigning and wrangling. Development areas were designated as areas where it was considered possible to stimulate manufacturing industry. That is the basic error. There is a myth that the 901 only important thing is the development of manufacturing industries, as though services were less important, whereas certain industries, such as tourism, are almost entirely service industries.
When we had the Industrial Development Act, which provided reasonable grants for manufacturing industries generally, and very good grants for manufacturing industries within development areas, but there was nothing for the tourist industry. There was very properly a tremendous clamour from tourist interests and after a while we got grants for hotels that could show they were particularly attractive to overseas visitors. But the whole point about making our hotels attractive to overseas visitors is that the development and the improvement should take place first, rather than the hotels' first proving themselves to be attractive. The standards in many parts of Wales are such that we cannot be attractive to overseas visitors without first undertaking considerable capital expenditure.
On 9th February this year we had an announcement of assistance for small hotels. That was fine, but again it was within development areas. This does not really meet the problem. We pay lip service to being out to help the tourist industry, but have confined ourselves to working through the framework of the development areas.
On 20th March there was the very welcome news of pretty good grants and loans for hotels—20 per cent. grants outside development areas and 25 per cent. inside them. I am glad that there was no more than a 5 per cent. difference between the two. This is coming nearer to sanity.
Then we come to the whole question of S.E.T. As with the Industrial Development Act, there was the assumption that the important thing to stimulate in the development areas is manufacturing industry. After a while it has been realised—we have realised it in North Wales—that one just cannot get industry into some areas—yet they may be areas which are tremendously suitable for the development of tourism. So the first stage was that tourism was excluded completely. Then we had the welcome news that certain areas within development 902 areas would be exempted from S.E.T., on the basis of their being important tourist areas, in other words, areas with a low percentage of manufacturing employment.
One sees in the Answer to a Question by my hon. Friend the Member for Berwick and East Lothian (Mr. Macintosh) last Monday about the percentage of people in manufacturing industries in each of the local employment areas that in many of them in the Welsh development area the manufacturing population is under 20 per cent. Yet one of them, Beaumaris in Anglesey, has 52 per cent. of the employed population in manufacturing industries, and yet it gets it curiously. I am of course very happy that it does get this particular exemption from paying S.E.T. and that Conway in my constituency gets it. But separate figures are not available. The Department does not know separately how many people there are in manufacturing industries, in hotels and restaurants in Conway, but it gets the exemption.
How does one get the figures for Conway? I approached the Board of Trade this morning and was told the figures are lumped together with Llandudno, but Llandudno is outside a development area and Conway is inside. So I get the figures for Llandudno, which is in my constituency but outside a development area and for Conway, which is just inside the development area. The overall figure is 21 per cent. working in manufacturing industries, which is fairly low. Taking Llandudno on its own, from my knowledge of the area, I can say that a large percentage of the manufacturing workers are in Conway and in Llandudno Junction rather than Llandudno. The ratio for Llandudno I would put on a fairly liberal estimate at about 14 per cent.
This means that of the 32 areas in Wales which are given this exemption, Llandudno has a lower manufacturing percentage than 19 of them. In other words, in terms of its dependence on tourism, Llandudno, which is outside a development area, has a greater reliance on tourism than 19 of the 32 areas within the development areas which were given exemption from S.E.T., which is pretty rough on the town of Llandudno and indeed on the whole North Wales tourist coast, which is outside the development area.
903 The original argument is sound. If one were after developing manufacturing industry it makes some sort of sense to say that Llandudno, Rhyl and so on do not want manufacturing industries. They are tourist areas. Give them all the incentives to set up industry and one may weaken their tourist position. But once one has gone a stage further and realised that in many development areas it is through tourism that one should stimulate them, one finds that one has left these places out on a limb, for they are just as dependent on tourism as are the other areas which we now see are dependent on it within the development areas.
The town of Llandudno is almost entirely dependent on tourism. Other hon. Members could mention many instances of their own. The N.E.D.C. report lists the profitability of the hotel industry as 2 per cent. lower than that of manufacturing industry. We can take that as being pretty average. Llandudno is dependent on an industry which is not as profitable as manufacturing industry. It has colossally high winter unemployment of over 10 per cent., although I grant that the summer employment figures are very high. It gives employment to an area which is largely in the development area. Many of those who work in Llandudno during the summer live in the development area, but their employers pay S.E.T. for them. There is a virtual close-down of the hotel industry in tourist areas during the winter, but key staff, such as chefs, must be kept throughout the winter, virtually unemployed, and S.E.T. must be paid in respect of them.
If we are to take seriously the development of this industry generally rather than merely in development areas we should examine this matter. Can the boundaries be changed? I am very doubtful. I do not think that it would make a great deal of sense to bring many more areas into development areas. That would give rise to many problems. This implies that if we are taking tourism seriously, our attitude to incentives and exemptions should not be confined within development area boundaries. When we look at the situation on either side of the boundaries, we see that inside people in manufacturing industry get the 904 Regional Employment Premium and tourism is helped. To them that have, shall be given. Outside those areas, from them that have not, shall be taken away by S.E.T. what they do have. This is a very serious situation. If we are to do anything about this Cinderella among our industries, which we call an industry but do not treat as one, the Government must act as Prince at the right time and convert it into what it can and should be.
§ 5.50 p.m.
§ Mr. Norman Miscampbell (Blackpool, North)
No one in this House, certainly not hon. Members opposite, will have much doubt that the balance of payments is the crucial political problem facing the country. Indeed, the political lives of hon. Members opposite and the life of their party may depend on the Government getting it straight in the next two to three years. Yet it is quite obvious that, in respect of the tourist trade, which offers far the biggest opportunity for increasing earnings, we are simply not coping.
The speech of the Secretary of State for Scotland was full of good will but did not offer much to tourism and it will not be read with much enlightenment tomorrow. I suspect that the tone of back-bench speeches from both sides will be very different. Judging by what has been said so far, there is obvious concern and a great deal of thought, and a number of interesting ideas have been put forward. Judging also by the nods I have seen from them at various times in the debate, hon. Members opposite, as well as my hon. Friends who will take part, will have something to contribute to the ideas for increasing our earnings, and increasing them quickly, in the years to come.
There is a great opportunity before us. At this moment we are turning tourists away in London, Stratford-on-Avon and Edinburgh—American tourists who could bring in valuable dollars. But they simply cannot be accommodated.
§ Mr. Miscampbell
I am referring to newspaper reports. I am not in a travel agency so I must rely on newspaper reports. I understand that the tourist industry was unable to provide accommodation for package tours earlier this 905 year. There is a growing need for rooms in the middle range and middle category hotels at reasonable cost all over the tourist areas—indeed, all over the country.
We have a rich country to sell—lovely countryside, the greatest theatre, wonderful castles and magnificent views. The opportunity is limitless. At the moment we get 3½ million tourists a year. It could go up to 5 million a year. But here again the Secretary of State was complacent. He said that the Selective Employment Tax was not really hurting, and he gave figures. But the truth is that we are bottom of the European league in tourism, which is a growing industry. We are bottom there as in so many other things.
We are failing to take the opportunities before us. As a Conservative, I cannot bring myself to believe, and I am sure that I should not believe, that it is for the Government alone to help. But the primary effort must come from the Government for certain reasons. Tax is of vital importance to the industry and this lies entirely within the province of the Government. Transport, too, is largely within the control of the Government. The law, in relation to opening hours, catering and wages, is also within the province of the Government. All these are vital features if there are to be changes in the tourist industry.
But the industry must play its part. It should make a sustained attempt—as there has been in many areas—to provide much more variety and better meals. We need far better services. For example, when one gets to an American city or lands at its airport, there is a battery of free telephones. One simply picks one up and is connected directly to an hotel. I believe that there are some such facilities at London Airport but they are on nothing like the scale one finds even in the smaller towns in the United States. In America, there is also a central booking bureau at an airport so that, if one cannot find an hotel room oneself, the bureau can put one on to other hotels which may be able to provide rooms. We need this sort of system not only in London but in all our great cities and towns.
Do we pay enough attention to the provision of proper language and trans- 906 lation facilities? Can one honestly say that the foreign traveller coming here will be greeted by brochures in his own language, giving him the information he needs about his hotel and the surrounding district and its facilities? The answer is that, with some shining exceptions, we simply do not provide such standards of facility. Nowhere will professionalism pay off more effectively in this country than a high standard of professional and managerial training by the tourist industry. But that is the industry's problem and the Government can help only in a small way.
We need also to help and develop the package tour, so common all over the continent and in the rest of the world. We have it here as well but on a much smaller scale than elsewhere. The British Travel Association has one person looking into the question of package tours and he has done great work, but the fact that there is only one person in the B.T.A. looking after this aspect is symptomatic of the general lack of effort in this direction.
There are other things which the industry can do to help itself. Resorts can provide amenities. I think immediately, of course, of Blackpool and the amenities which it provides in the lights paid for by the rates, and for conferences and all that goes to make it a great resort.
We should also ensure that we sell Britain all the year round and not just in the summer. We have plenty of opportunities for giving a great boost to our tourist industry during the winter months as well, but that will need warm, comfortable hotels if it is to be done.
What should the Government do? No doubt I shall be echoing much of what has been said and much of what will be said but there is no harm in the Government hearing it again. The whole thing comes down to money. It is no coincidence that Majorca has changed in 15 years from having 50 hotels to 1,500. It was not just because of the sun. It is due to the fact that the Spanish Government have poured money into the hotel industry in various ways.
We must not continue to treat our tourist indusry as the Cinderella of our export industries. If we are to profit from the position which exists, there must be a complete reversal in attitude by the 907 Government. Small grants while helpful and welcome are not enough. We need a complete change. It is remarkable that while hotels pay S.E.T., which is an increasing tax, at the same time out of another pocket the Government try by grants and loans to make these hotels viable. This does not make sense.
Are grants paid only in respect of the number of bedrooms in a hotel? For example, is it possible for a Victorian hotel to increase the number of bathrooms—and in so doing perhaps reduce the number of bedrooms—and qualify for grant? Whatever the position, any loans that are made for this type of work must be on terms very different from those offered under the old scheme. It seems incredible that while the new scheme started at the end of March—with the old scheme having been extended until that time—we still do not know what is to happen under it. We have been told that legislation is awaited, but in the meantime those concerned in the industry are being advised to keep all receipts in the hope that they will qualify under the scheme. One does not know if one will qualify under it and at present it is rather like working on the Income Tax principle of keeping all receipts in the hope that a few of them will be useful at a later date. This is not the way in which the Government should be seeking to help this great foreign currency earning industry.
What should the Government be doing to help the industry? A number of things require doing immediately. We now have an opportunity made all the more vital because of devaluation. I understand that it is now cheaper to stay in London than in any other European capital city. I should like to see a Minister whose sole responsibility would be the tourist industry. I appreciate that the Minister of State is keenly interested in the subject, but we see him so frequently at the Dispatch Box answering debates on various subjects and we know that he has a myriad of other problems with which to contend that it is obvious that he cannot, with the best will in the world, devote as much time as he might wish to the tourist industry. Why do we have Ministers for industries which lose money and none for an industry which could earn us a great deal of money?
908 I echo the words of my hon. Friend the Member for the Island of Thanet (Mr. Rees-Davies) when he asked for a greatly strengthened tourist board and suggested that the D.T.A. could be strengthened to provide what is needed. It is important that we have a board which is representative of the broad spectrum of the industry. It should have certain statutory powers of inspection and be capable of doing the necessary research. What is the use of trying to forward the industry without having the facts and figures on which investment can be based? No other industry would seek to carry on in that way. Nobody else would make investment uninvestigated. Why should this industry be left in this position? As with so many aspects of British industry, it would be helpful if we had some hard, well-researched figures, and such a strengthened board could conduct that research.
We have been warned off the subject of S.E.T., but I must comment on it briefly, if only to say that in this case a clear distinction should be made between industries in development areas and the tourist industry and S.E.T. should be completely removed from it everywhere. I suggest that the tourist industry should be treated as a manufacturing industry, and that is the crux of all the financial incentives for which I would ask. If it is treated in that way, S.E.T. would go, but more important other factors would come in. The industry would receive industrial allowances and these would be extended to cover hotel buildings, and I see no reason why depreciation should not apply in the ordinary way, as though an hotel was an industrial building. The same can be said of investment grants. Is it too much to ask that an industry which could be so profitable if it were not so taxed should not be given grants and enabled to generate its money? Investment grants for equipment and furnishings would be extremely valuable.
For the past 15 or 20 years hon. Members representing Blackpool have asked both Conservative and Labour Governments for Purchase Tax not to be applied to the equipment and goods used in hotels. This request has so far been turned down, but I urge the Government not to regard the tourist industry as a service industry but as a manufacturing industry and to give Purchase tax relief.
909 The Secretary of State said that it was difficult to distinguish between hotels which were high foreign currency earners and other hotels. While I entirely agree, one should not forget that, while many London hotels earn 40 per cent. to 50 per cent. of their revenue in foreign currency, while others produce very little by that means, even those which do not earn a great deal of foreign currency are directly concerned with currency saving because they provide holidays at home and so save our balance of payments. I hope, therefore, that as a result of this debate further thought will be given to the need for change in attitude on the part of the Government and the need for looking at the tourist industry, aside from the development areas, as a potentially great foreign currency earner which should be treated as a manufacturing industry and given the tax reliefs which go with such industries.
§ Mr. Kenneth Lewis (Rutland and Stamford)
On a point of order. I seek your help, Mr. Deputy Speaker. I did not intervene earlier, because I did not want to interrupt my hon. Friend the Member for Blackpool, North (Mr. Miscampbell) in his speech. On the Order Paper today appears a Motion in connection with a Bill on prices and incomes, which was presented after Question Time. Several hon. Members have been asking for copies of the Bill at the Vote Office and have been told that copies are not available and that they are not expected until tomorrow.
This is extraordinary, because at present there is on the tape an indication of precisely what the Bill contains. The House will be placed in an invidious position if the Bill and its details are available outside before the Bill is available to hon. Members. Could you expedite the availability of the Bill in the Vote Office, Mr. Deputy Speaker.
§ Mr. Deputy Speaker
That is not a point of order. It is a matter for the Government. However, I will have the matter inquired into.
§ 6.9 p.m.
§ Dr. Hugh Gray (Yarmouth)
Few of my constituents would agree that Great 910 Yarmouth follows Blackpool, but certainly the two towns have many similar problems. I agreed with virtually everything said by the hon. Member for Blackpool, North (Mr. Miscampbell) although my constituency is not confined to Great Yarmouth in that it contains a portion of the Norfolk Broads, and the problems of this area are somewhat different.
There is a consensus between back bench Members on both sides of the House. I agree with the hon. Member for Blackpool, North that we should become professionals about tourism. We should have a Minister, I should say a junior Minister at the Board of Trade, who expressly concerns himself with this subject. We need a co-ordinating body with statutory powers, and there is a case for giving them to the British Travel Association and for greatly enlarging it. In the past, it has done excellent work, particularly in London. Its work of regulation has not been confined to travel but has extended, in conjunction with the Guild of Guide Lecturers, to guiding in London. A professional service in guiding is provided in London and many other cities.
I regret that the Association does not have provincial offices, and I look forward to the time when such offices are opened. That cannot be done without more money, and I see the point that this money should be tied to the earning of invisible exports. But we can be sure that if money is spent on promoting tourism more tourists will come to this country.
The British Travel Association still has much too little money to spend on advertising, particularly on the Continent. A thin stream of French tourists come to Great Yarmouth from Rambouillet, but that is as a result of the town being "twinned" with Rambouillet and not through any advertising effort made in the town by the Association. We have a trickle of tourists from Holland. The number will certainly increase once the passenger service which is mooted between Great Yarmouth and Holland is in operation and as a result of the "roll-on, roll-off" service which has been installed. Advertising in Holland of the tourist attractions which Great Yarmouth and the Norfolk Broads and the great City of Norwich can offer should be extended.
911 It has been said that there should be a sufficiency of entertainment. Nobody can grumble about the amount of entertainment in Blackpool and Great Yarmouth. There are in Yarmouth shows with the great stars of music hall and the theatre. There is a struggling repertory theatre, bingo, dancing and gambling. Many may think—and I sympathise with them—that it is going a little too far when the local council proposes that the Floral Hall in Gorleston-on-Sea should be made into an amusement arcade. But a council which engages in many municipal enterprises must consider whether they pay.
I welcome the suggestion that there should be at local level a registry of hotels and lodgings, which should be graded. Local authorities should be encouraged to develop the consumer's point of view. The weights and measures inspectorate in certain local authorities—Bristol, for example—actively invites consumer complaints. I should like to see local councils doing the same thing in respect of tourists and visitors who are dissatisfied with the lodgings which they are offered.
Steps towards regulation have already been taken by forward looking councils like the County Borough of Great Yarmouth. Because it controls the advertisement in the town guide, which is sent to thousands of people each year, it has insisted that discrimination on racial grounds should not be exercised. It refused to accept an advertisement from a private hotel keeper until he was ready to give an assurance that he would not exercise discrimination. This is very praiseworthy, not only because action was taken on that ground, but because it shows that a great deal can be done by local authorities in regulating what happens in their towns.
I add my voice to those of hon. Members who have appealed to local authorities to do more to attract tourists. I welcomed very strongly the Civic Amenities Bill of the right hon. Member for Streatham (Mr. Sandys). He has done much to preserve our historical buildings heritage in tourist areas such as the Norfolk Broads and to ensure that trees are not felled unnecessarily. But the Government should do much more about preserving wild life and nature. They should 912 reinforce the efforts made by local authorities towards this end.
I find the Good Food Guide overoptimistic in what it says about the restaurants in my constituency. I am sorry that many of our regional dishes are disappearing. For example, Yarmouth bloaters are famous, but I should not like to guess how many of those which are eaten are Yarmouth bloaters. In fact, many come from Scandinavia and other places outside my constituency. One reads "Norfolk turkey" on the menu of almost every restaurant, but these turkeys are frozen birds and do not have the taste which one expects to find in a Norfolk turkey which has been reared in a free-ranging way. Far too many vegetables are frozen.
It is almost impossible to find a restaurant to which one can take friends for good traditional Norfolk fare. It is practically impossible to find Norfolk dumplings. Norfolk cider is disappearing and can be found only at one or two country "pubs". If we are to interest tourists to come from France and other Continental countries, restaurant and hotel proprietors must realise that it is extremely important to offer regional dishes and to get rid of the myth that only breakfast and tea are worth eating in this country.
That brings me to the attitude of a few boarding-house owners towards holidaymakers. Incredible though it may seem, holidaymakers are sometimes required after breakfast, even on rainy and cold days, to leave their lodgings and are allowed to return only for high tea in the late afternoon. When I took this point up with a constituent, she said, "They are not staying in hotels. If they want to be in their room all day, they must go to a hotel. They cannot come to a boarding-house".
This is taking advantage of a very advantageous situation. Although I should not attribute this directly to Government policy, I am told that in Great Yarmouth bookings are greatly up this year on previous years and that more British holidaymakers are expected than last year or the year before. But we must attract foreign holidaymakers.
I was recently discussing those who come to seaside towns for their holidays with a psychiatrist. He said that they 913 fell into certain categories. He said that one group of people went to a town once and always returned to it. It was a traumatic experience for them even to venture away from their homes once and therefore they always returned to the same place and sometimes to the same hotel. Secondly, there are people who go to the same town but not the same hotel. Thirdly, there are people who change towns and countries. One reason why more and more holidaymakers go abroad is not only because they are Mediterranean addicts like myself, and want hot sun and cheap wine, but because they appreciate the cooking and the facilities offered. Proprietors in this country will increasingly have to compete and this is something which they must do for themselves.
However, in the broader aspects it is up to the Government, and I hope the Government will take note of the consensus which has appeared and from both sides of the House. I am very sorry to see that there are not more Ministers present for this debate. I have already mentioned entertainments which are offered in Great Yarmouth by both municipal and private enterprise, and I am very disappointed not to see here the Minister who is responsible for the arts, because one of her jobs should be providing more serious entertainment for those who live in the provinces.
I deeply regret that symphony orchestras are not required to tour, as part of their responsibility in return for receiving Government grants, and the same is true of theatre companies, ballet companies, opera companies, which should be out and about in the summer seasons, going into the regions where there is tourism, giving performances in the open air and in any buildings which are available. That is something which the Minister should give her mind to, apart from the university of the air, which we all welcome.
We must make this country vital and attractive from the point of view of those who are going to come here from abroad for their holidays, and also from the point of view of those in this country who think of holidaying here rather than going elsewhere.
There is, of course, also the regional aspect which is an inescapable one. I 914 hope the Government will move away from the dichotomy of development and non-development areas. I come from an area in which average earnings are extremely low—15 per cent. less than they are in other parts of the country. I come from an area in which male workers in manufacturing industry are paid less for a longer working week than is the case in any other region in Great Britain. Of course, like all other resort areas, we have a winter unemployment problem.
I do not wish to see the Government pouring money into tourism alone, and in Great Yarmouth the development of light industries as alternative sources of employment has been greatly welcomed, but I would reinforce what a previous speaker said about information. It seems to me that we must produce the statistics which apply to smaller areas. We must have statistics available for Norfolk as a county, not for East Anglia as a whole, which includes the north-eastern area of London and other prosperous areas so that the statistics give a completely false picture of average wages. We must have pictures of what is happening in particular towns. That is why I for one welcome strongly the Government action in setting up regional planning councils. These councils will provide such statistics, and then the Government could, if they chose, as I hope they will, to set up a tourist board with necessary statutory powers so that all the information would be available on which it would be able to act.
I did not enjoy what the Secretary of State said. It struck me as far too narrowly concerned with Scotland, his particular area. Of course, he is a Member of Parliament representing a constituency in Scotland, but he should have been speaking of Great Britain as a whole. He did not present the broad view of policy we had expected, and I hope very much that, when the Minister of State replies tonight, he will make good this omission.
§ 6.23 p.m.
§ Sir Frederic Bennett (Torquay)
I hope the hon. Member for Yarmouth (Dr. Gray) will not think me rude if I do not follow him into the wide-ranging and somewhat discursive remarks which he made, though I would join him in one thing he said, and to show my impartiality 915 I would go further and say a slight word of censure on both Front Bench speakers. I thought that, certainly for much of the time, it seemed as though we were taking part in a debate in the Scottish Grand Committee, and they did not deal as much as they might with those other parts of the country where the tourist industry is even more important than it is in those delightful places north of the Border of which we have heard so much this afternoon.
I say straightaway that I am concerned, as also is my hon. Friend the Member for Honiton (Mr. Emery) with the tourist industry down in the South-West, and for one quite overriding reason which I think most of my hon. Friends and hon Gentleman opposite, too, will understand, and that is, that whereas the tourist industry elsewhere in Britain is very often an adjunct to other means of livelihood, with the solitary exception of agriculture and a very small number of secondary industries, tourism is the lifeblood of the West Country.
There is one specific overriding issue which has not received nearly enought attention in the debate so far, and I am very glad that my hon. Friend the Member for Honiton mentioned it, and that is the need to improve communications. There were three methods of getting to the West Country. We used to have an air service, but, unfortunately, it packed up. One hopes that either a private company or B.E.A. will find it possible to open an air transport system down to the South-West, for I think that all hon. Members will agree that it is much needed.
Then it is fair to say, although I am not particularly a lover of nationalised industries, that British Railways have done a pretty good job in the South-West, particularly on the main lines down to Torbay, Plymouth and Exeter. If hon. Members have specific objections to raise about some local lines they will probably make them in due course, but, on the whole, and particularly with the new timetables, I do not think one can grumble too much about the way British Railways are doing their best to help communications in the South-West.
The story of the roads is really quite another matter, and it really is no good for the Minister, speaking earlier, to 916 dismiss this with just a flap of his hand, coming to the House and telling us what the Government are doing for the tourist industry and then, when my hon. Friend raised the one most important single feature for the country's prosperity, saying it is a broader issue. If the Government claim to give a high priority to the tourist industry why is it that roadworks elsewhere are going on much faster, even in a time of stringent financial conditions, than they are in the South-West?
I want to be very brief because it is only right that on a matter like this we should get a wide range of views from the whole range of tourist resorts, and not from one specific area only, and so I will come straight away to this point. The time has surely come for there to be a really serious appraisal by the Government of the tourist industry. Heaven knows, I am not pleading for the appointment of yet another commission or committee, but Departmentally there could be a reappraisal of the tourist industry as a whole and how we are to evaluate it.
Each hon. Gentleman who has spoken so far has made the perfectly fair point, so I need not repeat it in more than a sentence, and that is the importance above all of the dual need, first of all to earn more foreign currency directly, to help the balance of payments, and, secondly, to attract our own people to take their holidays at home in the various parts of the country and so save the spending of money overseas. Both these factors are important.
It is when we look at how the Government contemplate the tourist industry that we see that the lesson of these two factors has not been in any way appreciated. We were told at the beginning by the Secretary of State that it is not just a matter of S.E.T. No one has suggested that it is just a matter of S.E.T., but I am sure that the hoteliers in the constituency of the hon. Member for Falmouth and Camborne (Dr. John Dunwoody) are not wholly different from those in my constituency and that it is most unlikely that those initials have not been mentioned in his hearing in his part of the world.
It is not the be all and end all of everything, but it is fair to say that this industry to which the Government claim 917 to attach importance has been given a body blow by S.E.T., a body blow which was already bad enough before it was decided to increase its force by 50 per cent. in the last Budget, and though grants are given, in various amounts in different places, when this tax is the most noticeable fiscal burden which the industry has to carry, for the Government then to say that they are giving this industry priority and have done a lot for it is to try to make a fool out of this House.
If there is one single solution which the Government could apply to help this industry it would be drastically to reduce S.E.T. It would be better still to abolish it altogether in which case I am sure the industry would breathe a sigh of relief. Of all the items of taxation and Government policy of which the industry complains this is the greatest, and to get rid of this fiscal burden would be to achieve more for the industry by one act than could be achieved by any other measure.
Earlier on, both the shadow Minister on our side of the House and the Scottish Minister who replied expressed pleasure that our tourist industry is improving from the point of view of foreigners. Although it is satisfactory to see how many people are coming here and how much money is spent, if one looks at the league tables of what is happening in European and other competitive countries, then our performance is not so striking. Once again, we are not doing as well relatively as they are. It is no good talking about absolute figures. A given number of people go on tourist ventures, and at the moment our share proportionately is dropping off compared with some of our competitors.
We have a unique advantage for foreign visitors, which is not necessarily a permanent one. It is very advantageous for them, particularly for those from across the Atlantic, to stop off in London before deciding which continental country they wish to go on to. This is a bit of geographical luck for us, which is not likely to be permanent, since airlines go in for competitive ways of taking visitors from the New World directly to the place they want to go to.
I do not want to underrate the efforts which are made by the British Hotels and Restaurants Association, but the 918 league tables show that we are not doing nearly as well as many of our competitors, and there is no reason why this should be so.
I said that I would be brief, and 1 will therefore conclude my remarks with just one plea. I hope that it will not be said at the end of the debate that hon. Members on this side of the House keep coming back to S.E.T., but if the tourist industry is now regarded as playing such an important rôle in the balance of payments, there is no logical excuse for making it suffer under such a burden. If such a burden were to be imposed on manufacturers, there would be revolt throughout all the constituencies concerned, and we all know this.
Therefore, although it is too late this year, let us hope that before long the Government will come to their senses. Remember, looking back over 60 years, there is only one year when we have enjoyed a favourable balance of trade, without the benefit of invisible earnings as opposed to just direct exports. The most important invisible earnings are represented by the tourist industry. Although the Government are alive to the situation, they could do a great deal more than has been done up to now to ensure to the tourist industry success and prosperity for the future.
§ 6.34 p.m.
§ Dr. John Dunwoody (Falmouth and Camborne)
I am glad to follow the hon. Member for Torquay (Sir F. Bennett), because he has raised some of the problems of South-West England which I shall touch on, although I want to avoid making purely constituency or regional points.
Those working in the tourist industry in my constituency in West Cornwall certainly have mentioned to me the letters S.E.T. In agreeing with many things which have been said by the hon. Member for Torquay, I would underline the all-party nature of the approach of those of us who have a tourist interest in our constituencies.
I regret the strictures made by the hon. Member for the Isle of Thanet (Mr. Rees-Davies) on Labour Members of Parliament. I believe that every hon. Member of this House who has tourist interests in his constituency, irrespective of party, has over the years to the best 919 of his ability tried to further the tourist industry.
Tourism is a major industry. Although it is not a manufacturing industry in the true sense of the word, it is an industry that stands comparison with engineering and car manufacturing. It is also increasingly a highly competitive industry. It has become a professional business. A generation ago the tourist industry was a part-time occupation, and anyone could run a pub, a hotel or a boarding-house. This is not so today.
The industry is competitive in every town and in every county. There is considerable competition between the different regions. We have seen some indications of that during this debate. There is also international competition that exerts very considerable pressure on the industry in Britain.
Despite these considerable pressures, we now earn well over £200 million a year in foreign currency from foreign visitors. It is a figure that is rising steadily, and it underlines the economic importance of the industry, not just to certain parts of the country, but to the nation as a whole.
The opportunities of the tourist industry are enormously increased as a result of devaluation. Devaluation has made holidays in Britain cheaper for most visitors from abroad. It has also made holidays abroad a little more expensive for us in Britain. There is a marginal benefit to the British tourist industry from the £50 limit. The tourist industry does not particularly welcome the £50 limit. We have to stand on our own feet on merit alone, rather than as a result of financial measures that may be necessary from the economic point of view.
I do not go so far as some people in pushing the idea of holidays at home. Last year was the International Tourist Year, and it is very much in the interest of the tourist industry of this country that more and more people should travel around the world for their holidays, and that more and more foreign visitors should come here. This interchange is good not only from the economic point of view, it also has considerable social and educational advantages. We do not want to become xenophobic in this, any more than in any other matter.
920 Most of our discussion today has centred around the place of the Government, and on whether the Government are or are not doing enough. This is a very important part of our discussions, but it should not blind us to the fact that the industry itself must do considerably more to put its own house completely in order.
There is an enormously wide range of standards in the British tourist industry today. In certain parts of the country, and in certain parts of the industry, standards are phenomenally high. They are amongst the highest, if not the highest, in the world. Some luxury hotels provide a quality of service and accommodation which cannot be matched anywhere else in the world, and it is provided very often at a much cheaper rate than elsewhere. In the same way there is simpler accommodation in isolated parts of the country which is of a remarkably high standard, providing good food, simply cooked, and clean accommodation. But one does not always find these high standards.
Although there have been remarkable improvements in the last five or ten years in British hotels and restaurants, they still can on occasions plumb the depths, and one can get the most appalling and shocking experiences when travelling around the country. The worst British hotels are still over-priced for the service which they offer. Some supposedly luxury hotels are supercilious in their attitude towards customers, and one can still find accommodation which is not as clean or as satisfactorily equipped as it should be. One can find meals that remind one that we are only just coming out of the gastronomic gloom that settled on the country in the last world war. We find food that is nutritionally valueless and meals that are culinary disasters.
During the season an area is saturated with tourists and prices are increased. But they must eat and they must go somewhere. Prices are sometimes stepped up artificially. Although this may produce a short-term economic benefit to an area, in the long term it can do considerable damage to the British industry.
We must look at the kind of meals served. I am alarmed, when I go into a medium grade hotel at 8.30 in the evening, to be told that there is no food 921 available. If we are to become competitive in this international tourist market we have to mend our ways.
I do not want to go into the question of licensing hours, but I am alarmed when I go into a hotel for a meal on a Sunday evening in Mid-Wales, for example, and I find that the people at the next table are having wine with their meal, and I am not allowed to have any alcoholic refreshment because I have arrived by car and am intending to go on somewhere else.
We must also look at the attitude adopted by the tourist industry in certain cases to children. There are signs of change. One big chain of hotels in the last few weeks has announced that it will no longer charge for accommodation for children who share their parents' bedroom. In many hotels, not only is one charged for children but charged at least as much as for an adult, irrespective of how their accommodation is arranged. It should be remembered that it would be in the interests of the industry to reduce prices a little when a family with three or four children stay in a hotel. It must not be forgotten that the children of today are the hotel customers of tomorrow. In this respect, the contrast with some European tourist areas is quite sharp.
I believe that tourism is an industry with a considerable future, but we must do more to maintain and improve standards in British hotels. In that connection, I think that the Government could do a little more than they are at present. We hardly know what a hotel is. One almost feels that a person can put up a sign in front of his house announcing that he is running a hotel. It may not be quite as simple as that, but more attention should be paid to the definitions of such words as "hotel". In the last few years, motoring organisations and other groups have done a great deal in the way of classifying accommodation, but more still could be done. The Government could give a lead. The interests of the consumer are not always borne in mind as much as they should be.
The British Travel Association has an important part to play in all this, and a number of hon. Members have suggested setting up some kind of board with statutory powers to deal with tourism. We 922 have had suggestions about the registration of accommodation so that the tourist can be guaranteed the standard that he can expect to find. These are all areas which the Board of Trade would be well advised to look at for some progress.
Unlike some hon. Members, I welcome what I believe to be the real and positive proposals in the Budget, bearing in mind the economic situation which we face at the moment. In a Budget where over £900 million is raised in extra taxation, it is encouraging that it has been found possible to introduce measures which I believe will help the tourist industry. We have had hotel development incentives of one sort and another in the way of development grant and loan assistance. These will help develop new hotels and extensions to existing hotels, quite apart from other improvements.
I am pleased that they are to be tied to hotels providing adequate accommodation for the overnight, short-term visitor, who arrives without a booking. As hon. Members have said, tourism is changing. People do not want static holidays where they spend a week or a fortnight in one place. They want to move round and spend two or three days here and there. They do not want to have to plan an itinerary before leaving home. We have to provide the sort of accommodation which will match this changing trend because, if we do not, our Continental rivals will.
We are told that we are to have a White Paper and that legislation will follow. It is urgent that the White Paper should be published in the not too distant future, and that our large and important tourist industry should not be left in the dark too long. I hope that we shall be given some idea of when it is to be published.
I turn now to Selective Employment Tax, which has reared its ugly head in nearly every speech. I believe that there is a certain amount of exaggeration about the damaging effects that it is having on the tourist industry, just as there is exaggeration about the benefit that the S.E.T. concession will provide to the industry in the development areas. It is a welcome concession, but it does not help to exaggerate the benefit which will be derived from it. I agree that there is considerable benefit to certain limited 923 and more remote rural areas, but the greatest significance of the concession for certain rural parts of the development areas is that it brings to an end the rather rigid S.E.T. classification practice, and we have now an admission that what may be right in terms of classification for one part of the country is not necessarily right for another part. A precedent has been created which cannot be limited to just this one industry, of course, and we look forward to the inclusion of other industries where the same geographical distinctions can be made.
During our debate, we have perhaps tended to concentrate too much on hotels and accommodation. We forget that the majority of tourists tend to stay in boarding houses, in establishments offering bed and breakfast, or they have caravan or camping holidays. We have to look to the facilities that we provide for caravans and camping, because sometimes we compare unfavourably with our competitors. For the last six or eight years, I have taken camping holidays with my three young children, usually abroad, but not always. Generally, the facilities provided in this country are very poor, and there is a great deal of room for improvement.
We have talked about the registration of hotel and boarding house accommodation, but something along these lines is long overdue for camping sites. As the responsible Department, I would like to see the Board of Trade taking the initiative here. There is an international trend, towards this sort of holiday which will continue as hotel accommodation becomes more expensive. There are virtues in it for those with younger children who do not fit into an hotel environment quite as well as adults. It has another desirable feature in that it spreads the economic advantages of tourism. In this way, not only the hoteliers benefit, because the advantages are spread over a wider community.
I am glad that one of my hon. Friends mentioned the National Trust, which has done a great deal of useful work. Our National Parks could be tourist attractions to a greater extent than they are at present, although they would be even more attractive if we could get rid of some of the firing ranges and Ministry 924 of Defence establishments which clutter some of them. In that connection, I should like to see the development of more picnic sites along our main roads in tourist areas. Along the roads of our Continental competitors, there are picnic sites every few miles, with rough wooden tables and benches. In this country we tend to sit on wet grass and dirty newspapers when we picnic.
Then I come to publicity. One can have the most attractive country and the best hotels in the world, but people must be told about them. I often wonder if our publicity is adequate. We hear a great deal about the increasing numbers of foreign tourists visiting the country, but I am afraid that the vast majority confine themselves to limited areas. The great bulk of them go to London, Stratford-on-Avon and Edinburgh, and, although my right hon. Friend the Secretary of State for Scotland can speak justifiably of the virtues of a holiday in Edinburgh, there are areas outside this rather limited range where we would like to see more foreign tourists.
For example, the South-West of England is the most important tourist area of Britain in terms of the number of visitors, but it attracts the fewest number of foreign tourists. At present, only 2 per cent. of the total number of visitors from abroad go there. I am certain that the number could be increased considerably. We concentrate too much on putting forward the image of Britain in "olde worlde" terms, laying great stress on the existence of Beefeaters and Shakespeare. We do not publicise sufficiently the scenic attractions and beautiful beaches which we have to offer.
Mention has been made of the language difficulty. It occurs to me to ask if enough of our tourist literature is translated into a sufficient number of different foreign languages. In which foreign languages do we produce literature and do we produce sufficient? The quality of some official publications that I have seen has disappointed me. They compare unfavourably with those of our competitors overseas. I question sometimes the content of some of the tourist literature which, again, is too closely linked to this "olde worlde" view of Britain.
We must not be defensive. We should be aggressive. We are defensive about so 925 many matters concerned with tourism. We are always bemoaning our climate, as though we never get sunshine and beautiful sunny days in the summer. I have been soaked to the skin on the Mediterranean many times, but nobody ever seems to talk about it. We do not talk enough about good English food. It is something worth remarking about. We do not talk enough about our scenery or our beaches. The beaches of South-West England are the finest in Europe. There is nothing around the Mediterranean to compare with anything in any of our tourist areas.
There are other problems. One is communications. This subject has been mentioned in the context of the South West by two hon. Members opposite. The South-West is an excellent example of an area where communications are of vital importance to the tourist industry. We are told that our roads are our arteries. If our roads are our arteries, the South-West of England is eternally suffering from thrombosis. One has only to see the Exeter by-pass on a summer weekend. This may be the extreme example, but it damages the tourist industry in that part of the country. A man has only to sit four or five hours in his car on the Exeter by-pass to decide that he will not be going to Devon and Cornwall for his holiday the following year. He will look elsewhere—probably to the Costa Brava or the Italian Riviera. This is the problem we are up against.
I endorse what was said by my hon. Friend the Member for Conway (Mr. Ednyfed Hudson Davies), when he spoke about promotional roads. Far too often we concentrate development on those roads where there is already a need. Let us also think of the results of improving roads. Taking the South-West as an example again, let us see a spine road not just as planned going to Plymouth, but right down into the far South-West, into West Cornwall, Penzance, and see it a great deal earlier than the present plan suggests. This will help the tourist and other industries in a region which has suffered from inadequate transport for far too long.
Mention has been made of the railways. Branch lines often have an important part to play in maintaining the tourist industry in isolated areas. Air links between tourist areas and the rest 926 of the country are also important. The Minister of State at the Board of Trade, who is to answer as Minister responsible for tourism is also responsible for air transport. I appeal to him in that capacity to try to do more to encourage the development of air services in areas like the South-West. Our communications compare inadequately with those in many areas in Western Europe which are our direct competitors. This could be said time and time again for many other parts of the country—Mid-Wales, Scotland and parts of the North—which are important to the tourist industry.
I now come to what is termed "the season", this very limited period of six or almost eight weeks, when all our tourist areas reach saturation point. During that time one cannot find accommodation. Hundreds sleep in their cars in lay-bys. Yet, at other times of the year—for instance, now—one can go to any tourist area and find any amount of empty accommodation. Could we not do more at national level to spread the tourist season? Are there not things that we could do?
For example, in terms of school holidays, could we not have a four-term instead of a three-term school year so that many more people could take their holidays in the early summer—May, June and the first part of July? Could we not do more to encourage people taking a second holiday—more and more people are taking two holidays a year—to take it out of season at Easter, Whitsun or in the autumn? This is something that the tourist areas should go for. People who take their main holidays abroad go to the Mediterranean in August for a fortnight or three weeks, but they may have another week at Easter to go to Wales, Scotland or the far South West.
This is an important subject and a useful debate. To this extent, I welcome the fact that the Opposition have selected it. It is essential that the tourist industry should thrive if we are to put our economic house in order. It is essential not only for the country as a whole, because of its contribution to ending our balance of payments problem, but to whole regions, on which it largely depends, and to certain smaller areas which are entirely dependent on the tourist industry, areas for which there would be no future if tourism were to 927 decline and where the only alternative would be depopulation. It is an important and essential industry because, when well run and efficient, it also gives pleasure, enjoyment and satisfaction to so many people.
§ 6.55 p.m.
§ Sir John Gilmour (Fife, East)
Having had a holiday in the South-West, I agree with the hon. Member for Falmouth and Camborne (Dr. John Dunwoody) that the communications need improvement. However, the South has the advantage of a very much longer season, so each area's interest in the tourist trade has its own problems.
One of the most important things we can gain from today's debate is further information about the figures on which the Government base their calculations for the aid that they intend giving to the tourist industry. My right hon. Friend the Member for Argyll (Mr. Noble) spoke of the cost of hotel bedrooms at about £10,000. I have seen surveys in the Financial Times and elsewhere taking figures of around £6,000. No doubt there must be variations in working out these calculations, such as how much one should take for furnishings and so on. I understand that the tourist industry and the Government have agreed that between now and 1970 we have to create somewhere between 30,000 and 50,000 extra rooms in this country as a whole.
We need an investment of between £150 million and £300 million in the hotel trade alone to provide these bedrooms. In view of the figures quoted by my hon. Friend the Member for the Isle of Thanet (Mr. Rees-Davies), the Government's proposals are not likely to produce these extra rooms and, therefore, do what is necessary for our economy in accommodating extra visitors from overseas and stimulating holidays at home for our own people.
The profitability of the industry has been quoted as being 2 per cent. below that of manufacturing industry. One knows the type of industry it is and the amount of manpower needed to run an efficient hotel. We talk about the hotel and catering trade being as important as a manufacturing industry. But it is not a mass production industry. It requires an individual approach by the hotelier and his staff if they are to pro- 928 vide a holiday to which people will return another time.
This brings me straight back to the perennial argument, which has gone through almost every speech today, about Selective Employment Tax. It is one thing to use this tax in an industry where men can be replaced by machines, but it is another when it comes to providing a personal service in the hotel, catering and tourist industry.
The Secretary of State for Scotland spoke about the money being put by the local authority and the Exchequer into providing roads, schools, and so on, at Aviemore, but he did not say that at the same time they are taking £12,000 out of the Aviemore Centre relating to people working outside the hotel and catering industry. If we are to provide attractive holidays we have to provide sports amenities, sailing, golf, riding, and hill walking. To provide these facilities on a seasonal basis, to provide the manpower to look after them and to provide them at a cost which holiday travellers can afford, is made very difficult by the addition of Selective Employment Tax.
This brings me to my last point. One sees advertisements every day about package tour holidays. This does not apply to just a few people as in the old days. It applies throughout the whole of the travelling community. Therefore, it is obvious that we must make greater efforts to develop this side of our tourist industry. I understand that in France a special company will help to nurse through the initial stages the setting up of new areas for these holidays.
In a pamphlet which I picked up today from a B.E.A. desk I see that one can have a 15-day inclusive holiday in Majorca for £38. When I see what it will cost someone to go from London to Aberdeen, I find that he will have to pay £21 for the return fare. Both trips are on night flights. That shows the measure of competition that we are up against. I am convinced that if a large number of people realise that they can go to the Mediterranean one year, to Portugal the next, to Spain the following year, and after that to the Adriatic, the outlook for our industry will be poor if we do not develop the same sort of thing.
There is a need for the type of hotel which the ordinary motorist can use. 929 There is a need to develop camping and caravan sites. The real burden, however, is how the Minister justifies the help which the Government are offering now to build up the tourist industry, knowing how vital it is to our balance of payments.
§ 7.1 p.m.
§ Mr. David Watkins (Consett)
In his short but very informative speech the hon. Member for Fife, East (Sir J. Gilmour) stressed the importance of expanding our tourist industry, and I think it fair to say that that has been the theme of all the speeches today. I want to develop that theme and to put a slightly different slant on it.
For all sorts of very good reasons the tourist industry has tended to be concentrated in certain areas. There are large areas of the country which have a tourist potential, but which have not been exploited, or are only just beginning to be. For a long time foreign tourists have tended to move on a London-Stratford-on-Avon-Edinburgh triangle. The picture is, however, changing, and foreign tourists are beginning to penetrate into other parts of the country. It is, clearly in the national interest to expand the potential of the tourist industry to its maximum.
We must develop the tourist potential of all the regions. My right hon. Friend the Secretary of State for Scotland made a passing reference to the travel associations which are springing up in various regions. One of those to which he referred is the Northumberland and Durham Travel Association. The interesting thing about it is that it is developing in an area which is not generally regarded as a tourist area.
I suppose that the vast majority of people who have no associations with the North-East are convinced that it is an area of industrial grime and slag heaps and nothing else. It has its share of these, but that is only one side of the picture, because in the area from Teesdale to the Cheviots there is one of the largest stretches of the most superb and unspoiled scenery anywhere in these islands, while the scenic beauty of the Northumberland coast compares very favourably with most other stretches of coastline.
930 I suppose that the North-East is known throughout the world as the cradle of the Industrial Revolution, and because it is so widely known as such it has a great tourist potential. The problem is how to harness that potential. There is a proposal to establish an open-air museum in the North-East—it will be the first of its kind in England—at Beamish Hall, near Stanley in County Durham. It is an historic mansion standing in nearly 300 acres of fine parkland, and at one time it was the home of the legendary Bobby Shaftoe. Both from an educational and a tourist point of view the proposal presents an exciting prospect.
This is not a proposal to establish one of those places where people walk around in a silent and musty atmosphere looking at dead items in glass cases all carefully labelled "Do not touch". On the contrary, it is proposed to make a living presentation of the history of the Industrial Revolution in the North of England. Visitors will be conveyed around the site in some of the original electric tram cars and early motor buses.
The hon. Member for the Isle of Thanet (Mr. Rees-Davies) referred to the importance of local authorities in developing tourist attractions. The proposal to which I have referred is an interesting example of public enterprise. It was first thought of by Durham County Council about eight years ago, and now has the support in principle of nearly all the local authorities in the region. Unfortunately, there is a danger of the project becoming bogged down, because while the local authorities support it in principle, for understandable reasons they are not able to provide the necessary cash to make it a reality. If it fails, it will be a tragic loss of tourist potential.
I would remind the House of the Skansen Folk Museum, just outside Stockholm, which was opened as long ago as 1890, and now attracts no fewer than 2 million visitors a year from all over the world. That is the measure of the tourist potential of schemes of the kind to which I have referred. I hope that the Government can give some financial assistance to projects like this. Every speaker has asked for Government assistance and these are valid points, but mine is as valid as any.
931 If our industrial heritage has a tourist potential, we must not overlook the attraction of our modern technological achievements. My hon. Friend the Member for Falmouth and Camborne (Dr. John Dunwoody) deplored the "Ye olde worlde" approach to British tourism. In the North-East, for instance, the advent of the Derwent Valley reservoir has provided a notable fishing and yachting centre. The construction of the Severn Bridge has provided not only a vital link between South Wales and the West of England, but also a major tourist attraction, which thousands of people go every weekend to see.
Anyone who has driven overseas visitors along our motorways knows that they are tourist attractions, but there is a need to improve the catering in the service stations, where, very often, the quality of the service does not square with the quantity of the price. Adequate catering services are one of the most important necessities. The extension of the motorways to provide easy access to the regions is obviously urgent. Every region of the four countries of the United Kingdom has some tourist potential.
In areas which are not traditional tourist spots, projects like the open-air museum which I mentioned have a great potential, but require special help to become established. It is surely in the national interest that, in expanding our tourist industry to its maximum potential, every region should receive all possible encouragement.
§ 7.14 p.m.
§ Mr. Emlyn Hooson (Montgomery)
I will not follow the hon. Member for Consett (Mr. David Watkins) in his remarks, as I do not know anything of his part of Durham, except that it has a good repute. I remember going to the Skansen Folk Museum a few years ago and found it an interesting place. However, the hon. Gentleman will find, in the Welsh Folk Museum at St. Fagan's, near Cardiff, the prototype of the museum which he wants in his area—
§ Mr. David Watkins
Being half English and half Welsh, I am well aware of and appreciate the value of that museum.
§ Mr. Hooson
I trust that the hon. Gentleman is Welshman from the neck 932 up. That folk museum is the inspiration for his own idea for Durham.
The old Victorian adage that "the customer is always right" has as great truth for tourism as for anything else. We all tend to think that we know what is right for tourists, particularly when Government Departments enter such an industry and try to decide what kind of demand the tourist will have. But the test of a holiday is whether it is enjoyable and different people enjoy different holidays. One never knows what their criteria are. With the evolution of industrial society in the West, particularly with more and more leisure time and increasing wages, there is a growing demand for holidays. People will not be draggooned into deciding how to spend a holiday, but want freedom of choice.
My first caveat for any Government's position is that the tourists, broadly, are always right and the Government must provide a balanced view of our tourist facilities, so that they suit a wide range of tastes. This raises the rather different question of standards, which we often confuse with standardisation. On holiday in France as a student, I was greatly impressed by the enormous advantage of the Guide Michelin, which, in an entirely detached way, is as accurate a guide as possible to the standard of accommodation, price and food of different hotels. We have nothing to compare with it and I would like to see something similar in Wales, preferably provided by an independent body—
§ Mr. Hooson
The hon. Gentleman takes an optimistic view, which is unjustifiable.
Such a detached report as the Guide Michelin could help to set standards.
I, too, pay tribute to the Irish Tourist Board. Two and a half years ago, when I was on a tour of Europe and visited 12 European capitals in as many days—it was not an American-arranged tour, by the way—I went into a number of B.E.A. offices and in each asked what information they had about Wales. Not 933 a single office had any tourist hand-out about Wales. There was an abundance of information on Ireland, and, the Secretary of State will be pleased to know, on Scotland, but none on Wales. This shows how the Irish Government have been concentrating on building up a tourist industry far more effectively than we have been doing in Wales.
Unlike an hon. Member who praised the English climate, 1 think that it is one of our drawbacks, whether in England, Scotland or Wales. We must recognise that, for this reason, we cannot compete with Portugal or the South of France in the number of sunny days in any holiday. If hon. Members are honest, they should ask where they would decide to go for a holiday and whether they would seek the sun or something else. If the former, then their minds would not move primarily towards Cornwall, Wales, Scotland, or England—or Ireland for that matter.
What the Irish Tourist Board has been able to do so skilfully is to present Ireland's attractions as a holiday with a difference. A holiday should not only be enjoyable but be different from one's everyday life. The tourist industry of any country is rather like the courtesan, who must first entice, then succeed in her enticement, then seduce and then satisfy to maintain her position. By enticing in the modern world, the tourist industry must put forward not only its obvious attractions—in this country they are London, Stratford, Edinburgh, Snowdonia, the Highlands of Scotland, and so on—but the hidden attractions which the Irish tourist Board has succeeded in doing for Ireland.
When we have excited the interest, we must provide the services to satisfy the tourist. It is no use having a good advertising campaign if the result is merely to entice a large number of tourists to an area and then allow them to return home feeling dissatisfied. We must also have abiding loyalty by ourselves agreeing that this is the finest holiday that any tourist could have.
We also need higher culinary standards in some hotels. We are far too prepared to pay a fancy price for a poor meal. Often one gets a better meal in a smaller inn than in a large hotel. We have nothing like the Guide Michelin to tell tourists where to get value for money. If 934 one wants to pay a lot of money for a meal in pretentious surroundings, one cannot tell from the A.A. or R.A.C. guide books precisely what one will get for one's money. One can judge the luxury standards, but that is all. The latest literarture of the Welsh Tourist Board is a great improvement on what went before.
We must also remember that the attractions of the tourist industry can get out of perspective. Although we attract large numbers of overseas tourists, their total number still represents only a small proportion of our total holiday makers. We are mainly catering for the some consumer and we must therefore provide him with the sort of holiday he wants. For example, we in Mid-Wales cannot compete with, say, the Adriatic coast. If a holiday-maker wants a fortnight in the sun, he can he sure of getting it there. On the other hand, we can provide a good family holiday, with plenty to interest all members of the family, with lots of outdoor recreations like fishing and sailing and pony trekking for the children.
Families can enjoy these pastimes easily and quickly, without the long journeys that are often involved in overseas travel. We should also remember that many people take two holidays a year, while others go abroad one year and stay at home the next. It would be a mistake to sell our poor points, as it were, and keep insisting that because we do not have the sunshine as much as some holiday spots we cannot offer equally good holidays.
Clywedog Dam, in my constituency, has become quite a tourist attraction. Each weekend many people sail and fish there. As a result of two Amendments which I tabled, and which received the support of the House when the legislation to establish the dam was under discussion, the dam is now almost entirely controlled by local organisations.
§ The Minister of State for Wales (Mrs. Eirene White)
As the hon. and learned Gentleman is so rightly appreciative of the Clywedog Dam, would he give his support to a project requiring another dam in his neighbourhood?
§ Mr. Hooson
I might. The project would have to be considered. There were disadvantages to having the Clywedog 935 Dam, but advantages as well. Many people lost their livelihood as a result of it. We must remember what is on the debit as well as the credit side.
Perhaps the Government could promote a hotel near the Clywedog Dam. I would be only too happy if the Welsh Tourist Board was given funds to do this and perhaps to also provide a sports centre. While I would not object to it being Government owned, I would rather it be let and run by outside people because Government financial considerations are not always propitious for enterprises such as this. Such a hotel could have a Welsh setting and I am sure that it would prove successful. It need not necessarily be sited near the Clywedog Dam. It could be near Bala Lake, or another equally attractive spot. The Government should set an example in this matter.
In rural areas such as mine a good deal could be done by the Forestry Commission to help foster pony trekking. This is an important pastime. Many small villages in Wales have started pony trekking associations. Because many people learn to ride for the first time on pony treks, they often become more adventurous and want to trek over longer distances. There might, therefore, be scope for pony trekking throughout Wales, starting at one hotel, continuing on to another and so on through the country. The Forestry Commission could do a lot to provide treks for this purpose and the Government, along with the Welsh Tourist Board, could promote schemes of this kind.
There is much to be said for providing Government grants for holiday developments. I am always impressed by the way in which agriculture is run in this country. Although probably the most efficient of our industries—its productivity has increased more than that of any other industry in modern times—it is run by a large number of relatively small farmers; relatively small in that while their farms are from 10 to 1,000 acres per farm, they are small compared with the size of the industry.
For many years the agricultural industry has been associated with the Government in many ways, but the Government do not try to run it but merely assist it by the provision of grants and 936 the giving of advice through the National Agricultural Advisory Service, and so on. This is an excellent idea—
§ Mr. Hooson
I was explaining what sort of help the Government could give for tourism without trying to run the industry. If the Government provided grants and advice there would be ample scope for individuality in the industry.
I have in mind the provision of camping and caravan sites. I would hate a camping holiday—I prefer greater comfort—but many people love camping. Last year the French Government sent £4 million on improving camping sites in that country. Nothing comparable has been done here. The hon. Member for Merioneth (Mr. William Edwards) lives in an area in which there is a great demand for camping and caravan sites. Much could be done if the Government gave the right type of grants and, through an advisory scheme, inspected sites before grants were given to ensure that adequate standards were maintained.
§ Mr. Ross
I did not say that it was done on the scale which is necessary, but there is power under the Caravan Sites and Control and Development Act.
§ Mr. Hooson
For hill farm improvement schemes one has to put in plans and have the advice of experts. There is a partnership between the entrepreneur—the farmer in this case—and the Government. This is quite apart from getting local authority approval. The same could be done in the tourist industry. A great deal could be done by the Government to promote tourism in this way.
I am glad that the Government have taken steps this year to provide greater help for the tourist industry, but I am sorry that Selective Employment Tax was introduced without any real consideration of its effect on the hotel trade. We have seen latter-day attempts to mitigate the effect of the tax on the industry. The tax should have been withdrawn and a new tax introduced which would not have the bad effects which this tax has had.
937 Tourism, which is an industry with a tremendous growth potential, must be developed very greatly in Britain as a whole. I hope that we shall recognise that different areas of Britain will be in competition with each other. That is a good thing. The tourist boards should not be all run together under the one umbrella of the British Travel Association. There has been loose talk about the Association being provided with statutory powers, but no one has suggested what those powers should be. I am extremely sceptical about this. I should like to see more independent bodies. I should like the Welsh Tourist Board to be more independent from the Government and in competition with the Scottish Tourist Board and others. In this way we could have a more attractive tourist industry.
§ 7.33 p.m.
§ Mr. William Edwards (Merioneth)
Normally I speak briefly and on this occasion I might speak more briefly because I also have to attend the sitting of the Finance Bill Committee and try to represent my constituents there and in this House.
I take a somewhat parochial view of the tourist industry and try to represent it in my part of Wales. I take the point made by the hon. and learned Member for Montgomery (Mr. Hooson) that we should consider the industry as many tourist industries in the country. Hon. Members opposite have said that we should give consideration to S.E.T. and give all hotels S.E.T. preference. I cannot agree. There are many differences in the make up of the industry. Certain hotels require assistance and some are working under very difficult financial conditions.
I know a little about the tourist industry in Wales and I agree with the hon. and learned Member that we should have an identifiable Welsh tourist industry working under its own board. If the board is to be strong and capable of improving the industry, it must do rather unpopular things in Wales. If we are to reorganise the Welsh tourist industry and to strengthen the board we should have some element of local democracy in the way in which it is run. It is no use in these days asking an appointed board to take unpopular measures in Wales because they will not be acceptable. They 938 will be unacceptable to such an extent that even praiseworthy efforts to reorganise sections of our rural economy will not work because there will be no co-operation.
We should recognise the importance of this industry in Wales. It may be a reflection upon us that so few hon. Members are in the House to listen to this debate and to show that we are interested in the importance of the industry. It is surprising that some hon. Members who speak most outside the House about the need to develop the new potential of Wales are not present to take part in this debate.
Why do we say that this industry is so important for Wales? We are a country which depends on old extractive industries which are dying. In South Wales the coal industry is a dying industry and nothing we say in this House will make it anything but a dying industry. In my area the slate industry is dying and agriculture is a declining industry. The rate of decline is very rapid indeed. However much we talk about these industries there is nothing we can do to revive them or to make them employ the numbers which they employed in the past.
The scope of the tourist industry in my part of Wales is shown by the figures published by the Tourist Board which shows that in my constituency alone there was an increase of about £1 million in something over 12 months. In an area such as mine if we could harness the industry to the aspirations of people in the locality we could do something very important. We could keep within our areas young men with initiative whom we are losing at present because we cannot offer them the kind of livelihood they can command elsewhere. Here is an industry in which young men can use their initiative and make money in the areas in which they were educated.
We can also show those who come to the area the attractions of living there. Some years ago it was impossible to attract industry to the area because key workers did not want to know about living in Mid-Wales. If they come to the rural areas of Wales on holiday and see the kind of amenities they can enjoy there—the golf clubs that they can join which would not be considered if they were living in Coventry or Birmingham, the yacht clubs they can join and the 939 fishing they can take part in—this would assist in the development of a complete society. This is the most important thing about the tourist industry in my constituency and in Wales.
We should have a board co-ordinating all the various efforts in Wales. I listened carefully to the very able speech of the hon. Member for the Isle of Thanet (Mr. Rees-Davies). If he were a little kinder in his comments to hon. Members of all parties there might be a better attendance on the all-party tourist committee which he chairs. He made some valuable points. We should recognise the importance of this industry and take a more organic view of it. When we are looking to its future we have to balance the importance of getting a short-term gain and developing the industry in the way the hon. Member suggested to deal with balance of payments, and also to safeguard the amenities of the area where we are hoping to develop the industry.
Wales realises that the tourist industry is likely to develop in two ways. First, it is likely to develop to cater for those who are searching for amenities like fishing, mountaineering and boating which they can enjoy over a long tourist season. There is also a tremendous demand for caravan and chalet accommodation.
The problem we shall face in my area is how to co-ordinate these two conflicting markets. If we take a short-term view and develop the short-term potential of the industry in our rural areas by allowing caravan and chalet accommodation to be provided indiscriminately in the short-term, we shall destroy the long-term market. The important market for us is the long-term one, namely, the provision of holiday accommodation for those who want a higher standard of accommodation.
This may sound strange coming from these benches, but I have to look after the long-term interests of my constituency and of rural Wales. However much we shout about the advantages of a holiday in "sunny" Britain, Britain is not sunny. More and more people realise this. Certain tourist associations which take photographs of bikini-clad models on the north coast of Africa and then advertise these photographs as being a 940 true representation of the climate to be found in British resorts are not assisting the British tourist industry. People soon discover that this is not the reality. Someone who goes to a resort to seek the sunshine which has been advertised but finds that it rains all the time there will never come again. This fact is now being realised.
The quick market, with large numbers of people flocking to resorts in cars, will be a declining market. We in Wales must be very careful not to go for this quick profit and thus destroy the kind of tourist industry which can provide employment over a much longer season than the short-term market will provide.
The type of co-ordination which is necessary can be provided only by a tourist board. It is remarkable that Wales caters for the kind of market which the Irish Tourist Board will not consider. The Irish Tourist Board advertises amenities which are no better than those which Wales can offer. The only difference is that a person who seeks those amenities in Wales does not have to pay £25 to cross a channel to get there. The Irish Tourist Board advertises in our market—in Birmingham and in London, where we should have a big market. We in the British tourist industry are advertising in declining markets and in an overseas market.
The British Travel Association has been very much praised. It is doing valuable work. It is valuable from the point of view of the Chancellor of the Exchequer to advertise and attract American tourists. But American tourists are of no use to hotels in Wales. To this extent, we must take a separatist view of the tourist industry. Nearly 95 per cent. of the tourists who come to my part of the world hail from Birmingham. It is a complete waste of money qua Wales for the British Travel Association to advertise London and Stratford-on-Avon in America and hope that Wales will get some fringe benefits.
I have seen the excellent advertising which goes out for Britain, but the advertising of Wales gives the impression that Wales is some kind of folk museum on the outskirts on Stratford-on-Avon. I am told by hoteliers in my constituency—incidentally, I have some very good ones, perhaps amongst the finest hoteliers in 941 Britain—that in their experience many American tourists come to London with the intention of including Wales in their itinerary. When the American tourists arrive in London on a short trip and discover that Wales is 200 miles from Stratford-on-Avon, they never turn up in Wales.
For this reason, hoteliers in Wales are now distinctly reluctant to accept bookings from American tourists. The American tourists are not being properly informed. Wales is not being sold by the British Travel Association as a distinct tourist entity. Until it is sold as a distinct entity, with characteristics of its own and with a whole ethos of its own, we shall not be able to get the market which now goes to Southern Ireland.
I hope that I have assured the House of the interest that is taken by my constituents in this industry. I ask the Government to show that they appreciate the importance of the industry. Incidentally, I have always been complaining from these benches about neglect in Wales. I want now to say how much I appreciate the assistance that has been given in the form of S.E.T. relief to hoteliers in my constituency. When I see, through my service on the Standing Committee which is considering the Finance Bill, the way in which we are penny pinching and taking £s off disabled people, and so on, so as to take £930 million out of the economy, I know that we should be grateful for small mercies such as S.E.T. relief. I should be even more grateful if all the hoteliers who complain so much about S.E.T. now had shown appreciation when they got relief.
However much we complain about the financial arrangements and about the penal nature of S.E.T., I do not believe that it is the financial arrangements which are damaging the Welsh tourist industry. What is wrong is the lack of organisation. We must organise the industry. We must give the Welsh Tourist Board sufficient powers. The tourist associations we have at present will not and cannot do the job. They all depend upon the fees they receive front their members. There ate conflicting interests. The resorts will never agree upon a common advertising programme. Hotels will 942 never agree upon common standards. Hotels will never submit themselves to a rigorous inspection system of the type that Ireland has. All this requires—this is where I disagree entirely with the hon. and learned Member for Montgomery—statutory powers. All these powers should be placed in the Welsh Tourist Board.
Finally, I repeat that the Welsh Tourist Board should come under the control of an elected Welsh council. It will not make it more effective government, but it will make it more acceptable government. Those who talk about devolution should realise that devolution does not mean that government is more effective. It means that it is more acceptable. It is the acceptability of government which is by far the most important aspect.
§ 7.49 p.m.
§ Sir Charles Taylor (Eastbourne)
I suppose that I should declare the interest which I have in tourism. For many years, as some hon. Members know, I have been associated with the hotel trade. I was a member of the British Travel Association back in the days of Sir Douglas Hacking, who was a Member of the House many years ago and who subsequently became Lord Hacking. I was a member of the management committee of the B.T.A. until the Government decided to give it some funds, and then it was considered that my position might be an office of profit under the Crown, so I became, and still am, only a member of the council.
In my view, the British Travel Association does a first-class job. If hon. Members go to its offices in St. James's Street—I have nothing to do with the management now—they will find there brochures in almost every language of the world extolling the virtues of the United Kingdom, including Wales.
I have here the latest figures for American visitors to the United Kingdom in the 11 months ended November, 1967. Perhaps the Minister has later figures, but the latest I have show that there were 808,000 American visitors, an increase of 81,000, or 11 per cent., over the same period in 1966. That is a good record. There were 1,555,000 visitors from Europe, an increase of 122,000, or 12 per cent., over the previous year. Again, that is good.
943 I do not agree with some of the comments about the "olde worlde" publicity in B.T.A. pamphlets. In my view, most of the Association's propaganda is first-class and it has just about the right proportion of "olde worlde" publications. A good many American visitors still come over here, to London in particular, to see the pageantry outside Buckingham Palace and elsewhere. In passing, I must make a comment about the National Theatre. One hon. Member referred to it as a tourist attraction. I do not know whether you, Mr. Deputy Speaker, have ever tried to get tickets for the National Theatre, but, if you have not, I assure you that, unless you are the friend of a friend of the director, you have no hope of getting a ticket for the National Theatre. So that is not much help to the tourist trade.
When the debate started, I thought it would be a Scottish debate. My right hon. Friend the Member for Argyll (Mr. Noble) and the right hon. Gentleman the Secretary of State both discussed Scotland at length, and it was not until my right hon. Friend mentioned Heathrow that I knew that the English interest came into it. They talked about midges in the river valleys of Scotland, they talked about Aviemore, and the rest. They talked about building costs in Scotland. I am glad to say that hotel building costs in Scotland do not compare with costs in England, and I can only think that Scottish contractors are taking the people who want to build hotels in Scotland for a bit of a ride.
It was said that there is not enough entertainment in Scotland, not enough for people to do, except walk down the river valleys, over the moors, and so on. But some people go away for a holiday hoping not to be entertained. They go away for a rest. Presumably, they go to Scotland because they want the Scottish scenery and the peace and quiet which Scotland can give. They do not want their holidays organised.
I am very glad that this debate is taking place because the tourist industry is one of the greatest dollar earners, both direct and indirect, that the United Kingdom has. If I may take the example of a hotel in London with which I am associated, I believe that that business earned more dollars, taking the size of the business into account, than any other 944 business in the United Kingdom—and that probably includes the whisky boys as well. Although the hotel is not a banker and only has a little cash desk, last year over £1 million was cashed in foreign currency and travellers' cheques through its little guichet for people who wanted to buy theatre tickets or go to restaurants and shops to buy whatever they wanted. And that had nothing directly to do with the bookings at the hotel. That is a good record, too.
Conferences have been mentioned. This same hotel has, at vast cost, dug underground in order to build a conference hall and provide all the associated amenities. Because of the enormous number of dollars and other foreign currency which we should earn thereby, I had the temerity to ask whether we could apply for the Queen's Award to industry. I was informed that, because they were not industries, hotels could not apply for the Queen's Award, and we were debarred from so doing. I did not think so much of that.
I must say something now about the Selective Employment Tax. With the rise in gas and electricity charges and everything else, the S.E.T. has more than counteracted the effect of last year's devaluation. Whereas everyone hoped that we should have more visitors from overseas after devaluation, we have not had the increased benefit we had hoped for. Moreover, the S.E.T. is a double-edged weapon. Not only do we pay the S.E.T. on our own employees in the industry, but we have to pay it indirectly on all the supplies and services, laundry, and so on, which supply the hotel industry.
I need not say much about what has been done to stop legitimate business entertaining. Foreigners coming to the United Kingdom like to see a few natives around the "joint". An American visiting England likes to think that he will see not only members of his own tour party in London, Stratford-on-Avon, Edinburgh and then back in London again; he likes to feel that there are a few of the locals about who can afford to go to de-luxe hotels in London. Businessmen as a whole never abused the business entertaining allowance. There were exceptions, of course, but as a rule they did not.
One hon. Gentleman suggested that there might be too few hotels in London. 945 For the de-luxe hotels, this may be so during three or four months of the year when they are full. But one cannot run a business, keeping on all the highly expensive staff, the chefs, sous-chefs and floor staff, if the hotel is to be no more than a quarter full during December and January. Although it may be difficult to find a bed in London during the months of high season, there are, generally speaking, sufficient de-luxe hotels in London.
If they could be built at anything like the pre-war cost, there would be a great case for some more first-class hotels or even second-class "A"-division hotels in London. There is perhaps a shortage of cheaper accommodation in London. Tourists from abroad, particularly from America, are not always the millionaires, and so on, but the many thousands of people who want to come and see what goes on in London, and sometimes in Scotland!
The standard of British hotels has gone up by leaps and bounds. Generally speaking, throughout the country the standard of British cooking and accommodation has been very good during the past year or so. I urge some hon. Members who have spoken disparagingly about the middle-class English hotel to go and see the improvements that have been made in so many of them. The middle-class hotel in the small town in England compares very well with any similar hotel in France. That is a great advance in English hotel keeping which everybody will be proud of.
I must come to the question of travel restrictions. It was Hitler and Himmler, with their financial adviser, Dr. Schacht, who first introduced travel restrictions in order to help Germany's balance of payments position before the war. In my opinion, it was the first step towards a police State. How we used to laugh at the Germans in those days when they said that they were allowed out of their country for only three days and must get back! We used to say that it was a great pity, with relationships getting worse in the world, that they could not stay for a few more days so that we could talk about conditions in their country and what went on there. Now the Germans are laughing at us because we are allowed out of the country for 946 only a few days on the £50 travel allowance. It is £50 plus £15 cash, which should make it £65, but because of devaluation it now amounts to £50 7s.
Before the imposition of the £50 travel allowance the average British holiday-maker spent only £40 a year abroad. When there was sweet rationing everybody in the country said, "That is my allowance, and I shall have the whole lot." Directly sweet rationing was removed the sales of sweets went down. The same would happen with tourism. The imposition of the allowance was done only to satisfy some of the Prime Minister's Left-wing friends so that the Government could say, "The rich can no longer spend £100 or £150 on their holidays. Nobody shall spend more than £50 on his holidays."
I was at Munich last year, at a meeting of the International Hotels Association, and was surprised to see so few British Travel Association posters around. I asked my German friends, "Why haven't you got some of our posters up?" The answer was, "Why should we? You have prevented English travellers from coming here to stay at our hotels and go round our country. We shall put up the posters of Switzerland, Austria, France and other countries that do not deter their travellers from coming to our country." On the whole, countries deal with travel on a reciprocal basis.
Package deals may be very helpful to many people, but there is a great element of danger here. I believe that it is cheaper to fly to Majorca with a fortnight's holiday thrown in than to buy an ordinary return ticket. That means that airlines, which are mainly owned or subsidised by Governments are subsiding holidays abroad. They say, "We shall give you 15 days in Majorca for, say, £50. The air fare is £50 and the hotel accommodation is being thrown in." That means that the airline must pay the hotel, and the whole thing becomes a racket. Package tours must be looked into, because they are ways in which foreign Governments and, I think, our own, are now indirectly beginning to subsidise some tourism.
§ Mr. James Dempsey (Coatbridge and Airdrie)
Could the hon. Member give some figures to indicate to what extent the numbers travelling to places like Majorca and Spain have fallen because of the present allowance?
§ Sir C. Taylor
I could not give those figures, but I should not think that they have fallen at all. I should think that just as many people are going abroad for their holidays, and probably spending on average £10 more per head than before the restriction was introduced.
I am all for holidays at home, because I represent and live in a seaside resort. In Eastbourne, there is every form of recreation—sea angling, bowls, cricket, football, theatres and dancing, bathing and boating. There are excellent hotels and boarding houses. I do not agree with my hon. Friend the Member for the Isle of Thanet (Mr. Rees-Davies)—and I wish that he were present now—because I do not believe that every boarding-house room in my constituency needs to have a bathroom or shower. Many people who would like to spend a holiday in my constituency want a reasonably priced room and obviously cannot afford either a private shower or a private bathroom to themselves. Therefore, there is still a case for not all hotels—or at least not all smaller hotels—having either bathrooms or showers for each room. It is simply not possible, and it would be nonsensical if it were.
The hon. and learned Member for Montgomery (Mr. Hooson) talked about the Michelin Guide. It is very good, but it would be completely inappropriate for any Government to produce such a guide. That would be strongly resented by the hotel industry, and it would also strongly resent its own industry producing a guide classifying hotels. It is not a bad idea to have it done by a completely outside source, but I do not think that the Automobile Association or the R.A.C. are necessarily the right people to classify hotels. I believe that the Automobile Association said that it would give five stars, or whatever it was, in my constituency only provided there was a children's playroom and a swimming pool. There is one absolutely first-class hotel in my constituency which has no room for a swimming pool. I do not know whether it has a children's playroom.
But the present Government—indeed, a whole series of Governments—have regarded the tourist industry as "playboy stuff". As has been said, the attitude is that, unless an industry means industry in the true sense of the word, in which 948 men and women are guarding machines and getting horny hands, it is not an industry but a sort of "playboy stuff". But what better thing can be done by a place like Eastbourne than to provide rest, peace and recreation and to restore the energy and health of those who work for 48 or 50 weeks a year in heavier industries? Eastbourne, I hope, will always be proud of the fact that it is able to produce such amenities.
I should not myself mind if there were a Minister of Tourism, but I do not think that the Treasury would give him any authority to do anything on his own. He would be powerless to do anything to help the industry. The only hope for the industry is what it asks for—fair treatment from the Government so that it can get on with its own job and do the best work it can for the benefit of Britain.
§ 8.11 p.m.
§ Lord Hamilton (Fermanagh and South Tyrone)
I shall be extremely brief, since at least three of my hon. Friends wish to partake in the remainder of this extremely important debate: I want fully to endorse the remarks made by my hon. Friends the Members for Eastbourne (Sir C. Taylor) and the Isle of Thanet (Mr. Rees-Davies) regarding the British Travel Association. In January of this year, I had the opportunity of visiting its Amsterdam and Paris offices and was immensely impressed with the tremendous drive, vigour and enthusiasm shown by the respective managers and staff.
I believe that the B.T.A. is doing a wonderful job on behalf of Great Britain. Although I am not aware of its annual budget, I hope and trust that the Minister of State, his civil servants and also the civil servants in the Treasury will study very carefully the tremendous economic encouragement given to Bord Fáille by the Eire Government. I understand that this year its budget is £4.7 million, which is highly realistic remembering that the population of Eire is only about three million. This is an enlightened approach to tourism and should be adopted here.
In the United Kingdom, we must adopt a new attitude towards tourists. The less prosperous nations, through sheer economic necessity, have been forced to develop their tourist potential. Unfortunately, there are still pockets of resistance who tend to treat the tourist as a necessary nuisance, whereas he is 949 an invaluable additional consumer, benefiting not only hoteliers but many different types of trade and service industries.
The relief that the industry can bring to the country's balance of payments must be publicised far more forcefully to the public by the Government, especially at the present time. As my hon. Friend the Member for Eastbourne rightly said, the status of the industry should be properly acknowledged by the introduction by the Government of a Queen's award for tourism, if the Government really recognise tourism as an industry.
The Government gave a shy recognition to the importance of the industry with the President of the Board of Trade's announcement of 20th March. But the Government braked far too sharply in its assistance to the industry. Capital investment allowances, which are available to comparable industries, should be reintroduced and the Treasury must agree that alterations carried out within the existing four walls of an hotel can be charged as revenue as opposed to capital.
The Government must also appreciate that tourist facilities and hotel standards form a vital concept of regional development. Not only are these facilities an important psychological part of management decisions as to plan location, but an area which is not rich in manufacturing or extractive industries can, by developing tourist potential, create not only employment but also much needed additional revenue. This is particularly applicable to my constituency.
Furthermore, tourism attracts vitally important secondary industries, such as the souvenir trade, which, I believe, in Scotland is worth £7 million per annum. The United States Department of Commerce stated in 1966:If a community can attract a couple of dozen tourists each day throughout the year, it will be comparable economically to acquiring a new manufacturing industry with an annual pay roll of $100,000.That is the equivalent of £41,000.
The Government must assist the future development of tourism in the regions of the United Kingdom by expanding the Regional Employment Premium to include the tourist industry, for it is a fact of life that the more the Govern- 950 ment assist this industry the more in turn this industry will assist our balance of payments.
We should also remember that the tourist industry, unlike others, is strictly limited in the amount of saving it can achieve in manpower through the introduction of labour saving devices. I believe that the advent of the electronic waiter or the computerised barman is still well in the distant future.
From experience, I find that small hoteliers are vague in financial management and I suggest that the Government should introduce a grant similar to the Farm Business Scheme to encourage hoteliers to implement proper cost and customer control and, of course, proper profit and loss accounts.
The first impressions of a country are of vital importance psychologically to a tourist. Alas, Aldergrove Airport in Northern Ireland is shoddy in design, structure and maintenance. In spite of a highly efficient and willing staff, there is no apparent managerial control of the building. Wedding receptions and celebrations are allowed to continue unabated. As a result, departing tourists are liable to be pelted with confetti. Again, blaring transistors have been known to drown last-minute business conversations. I trust that the Minister will look into this matter, since it is imperative that the airport should have a departure lounge segregated from the milling throng of spectators.
Northern Ireland has, even more than other regions of the United Kingdom, an ever increasing economic dependence on air travel. This is particularly applicable to tourist development. A total of 70 per cent. of all passengers are transported during the six summer months, between April and September. There is no doubt that during this period we need more supplementary flight services than we are obtaining. Last year the air fare was raised by an astronomic 60 per cent. If we are to develop further tourism in Northern Ireland we need to introduce, during the summer months, an I.T.X. fare in order to subsidise air transportation of tourists.
§ 8.20 p.m.
§ Mr. William Baxter (West Stirlingshire)
We have listened to a very thoughtful and sensible contribution from 951 the hon. Member for Fermanagh and South Tyrone (Lord Hamilton), and I would commend some of his ideas to my right hon. Friends. Like the hon. Member for Eastbourne (Sir C. Taylor), I am very much interested in the tourist industry, since I have an interest in a very small hotel. That does not confine my interest to that small hotel. I consider this, as many hon. Members have already said, to be one of the most important industries in the country. Its great potentialities have never been fully realised by succeeding Governments. As the hon. Member for Eastbourne said, they have looked upon the hotel industry and the tourist trade as being a playboy industry because it was not like engineering or some other industry.
It was never given its proper place, and we have never realised that by saving money on foreign travel by our own people we are contributing considerably to our balance of payments assets. To encourage people—as we have—to look upon our country, Britain as a whole, as a place where hotel accommodation is not up to standard, and weather conditions not quite what they would desire, and to suggest that all these things are available in some other country across the Channel is wrong. We have to some extent abdicated our responsibility for making people realise that if there is one country in the world which can give relaxation and comfort to tourists, from overseas and within the country, it is Britain. We have never endeavoured to sell the country and its assets to the fullest possible extent.
These assets do not merely include the natural beauty of our hills and dales and of our parklands, but also our great historic heritage. No other country has so much to offer. Succeeding Governments have not given the proper emphasis to the development of this important industry.
§ Mr. Dempsey
Would my hon. Friend not agree that one of the greatest, if not the greatest, disadvantage to holidays in Scotland is the lack of consistently good weather? Would he agree that this is the main reason why people go to Spain and to countries on the Mediterranean, in spite of all that the Government spend? What plans has he for improving the weather?
§ Mr. Baxter
That is outwith my control, as my hon. Friend should know. I am capable of doing many things, but not of controlling the weather. I would remind him that bad weather, or rain, is not a very awful thing. There is nothing very much wrong with rain if, on the following day or evening, one gets the beautiful sunshine that we very often get. I left Scotland this morning and it was a beautiful morning. When I got to the airport this morning there was a shower and before I left the sun was out again. I had never seen anything more beautiful than the spring flowers, the beauty of the countryside, the trees and so forth. No place that I have ever visited can compare in such compactness of nature with the great beauty that we have. This is due not only to the sunshine, but to the rain. This is our great asset. We should be trying to sell the beauty of Britain, even in the rain. What is wrong with some rain?
This has put me off my theme to some extent. Let me return to the main subject. This is an exceptionally important industry and it has never been properly sold. I know of no better places than the south coast of England, the Highlands of Scotland or the valleys of Wales to spend a holiday. I know of no better place, notwithstanding the type of weather we get. The Government and their predecessors have not seized the opportunity with the urgency required. True, they have suggested a scheme to give grants to hoteliers to improve their facilities, but this has been proven to be unacceptable to the industry.
In addition, the Selective Employment Tax is a very unfortunate tax in every way, but especially so for the hotel industry. It is not sufficient to say that it is being imposed for a good reason. The fact is that it should never have been imposed on the hotel industry. Whether it should have been imposed on other industries is not a matter for debate now. I have my own point of view. There is a scheme before a committee in another place, providing for lines of demarcation to be drawn throughout Scotland. It is suggested that hotels on one side of the line would not pay S.E.T., while those on the other side would. This form of taxation was indeed one of the worst features of the last Finance Bill.
953 I implore my right hon. Friends to give serious consideration to wiping out S.E.T. for all hotels in the country. There are ways and means whereby money can be raised without hurting an industry such as this, upon which the nation is coming to depend to an ever greater degree. If the Government adopt this scheme of demarcation, made up on the lines of area employment exchanges, there will be a great deal of discontent and dissatisfaction.
Many people express the view that hotels are money spinners and that if people have a hotel they must inevitably make considerable profits. If my hon. Friends look at the Scotsman and the Sunday Times, both very commendable newspapers, they will find that there are dozens of hotels for sale throughout the land. The owners are selling them, not because they are profitable, but because they are on the brink of bankruptcy. There is no question but that the problem of S.E.T. is playing a considerable part in reducing the profitability of hotels. But another factor which must be borne in mind is that the cost of foodstuffs to the hotel industry has increased due to circumstances outwith its control, but principally due to devaluation. The importation of foodstuffs has markedly increased and is causing great concern to the industry.
Another factor which must be borne in mind is the difficulty of getting suitable staff, about which anyone with practical experience of the hotel industry must know. Proprietors must be competitive and they must keep down their costs. They cannot give as high wages as are being paid in other industries. People are attracted to the industrial towns because they can get good wages. In the hotel industry, hours can be uncertain. The employees, instead of enjoying themselves like other people, may be slaving in the kitchen or attending to the wants of visitors. There is not a great attraction to people to work in the hotel industry. We are therefore becoming dependent upon Continental people to work in the hotels. But this is a dangerous situation for the country. The hotel industry should be as viable as any other. It is one of the most important industries in the country. It should be able to pay good and competitive wages to its staff. It will not be able 954 to do that if burdens like the Selective Employment Tax are put upon it.
The Government must give serious attention to this situation. We have talked about the Tourist Board in Scotland. We give it a mere pittance to run its affairs. We do not try to encourage tourists to come to our land. This is bad. No doubt the Board does a remarkably good job. Dedicated people are associated with it. If they were not dedicated, they would not put up with the conditions under which they labour. If we want a good job done, we must pay for it.
§ Mr. Dempsey
Taking the southern half of Scotland, three-quarters of the population live in the west, yet the Tourist Board has no office in West Scotland. Its offices is in the east. Should not something be done about that?
§ Mr. Baxter
I should be happy if the Tourist Board had more offices, but it has not the wherewithal to provide the facilities. No Government, past or present, has give the Board sufficient resources with which to do the job it is called upon to do.
I said in the Scottish Grand Committee when this matter was being discussed that, like every other industry, the hotel industry must be profitable before we impose a tax upon it. I do not object in my business activities to paying a tax once I have earned the tax in profit. But I object to penalising any industry by placing a tax upon it before it has got off the ground. This is bad finance. Bad business techniques have been adopted by the Government.
§ Mr. Baxter
The right hon. Gentleman says "Hear, hear", but he knows full well that the only Bill which he introduced in connection with the tourist industry was one which proposed a bed tax upon every hotel in Scotland. Thank goodness it never went through.
What is required in Scotland and in parts of England and Wales is a national campaign, backed with a considerable amount of money, to clear away the black spots of ugliness of which we have too many throughout our land. They should be cleared away. There is no doubt about that. A great campaign should be waged for that purpose.
955 Next, there should be an arts body of some sort to scrutinise plans for housing schemes and housing schemes which we have and which are being set down throughout our land. It is a disgrace to our civilisation that our beautiful land is being destroyed by eyesores of houses devoid of any artistic value whatever or even good taste. It is fantastic that we should put so much public money into the building for our people of houses some of which are a disgrace to our civilisation and which it is a disgrace to leave to future generations to put up with. We are destroying the very assets which nature created in our land, and destroying them by man-made efforts. This is a question which succeeding Governments have not solved, and they ought to be ashamed. It is desirable and necessary that housing schemes throughout our land should be looked at from the artistic point of view, not just from the point of view of providing accommodation.
There are one or two other things which should be done. Special grants should be paid to the hotel industry to make the industry more effective and more profitable. The one basis of our prosperity must be profitable industry. This has got to be accepted by all. We cannot have an expanding economy unless it is based upon profitable industry. It was said by the hon. Member for Fermanagh and South Tyrone (Lord Hamilton) that the Regional Employment Premium should be paid. I should have no objection to that. I think it might be a very desirable thing to do. Anyway, it should be looked at.
I shall conclude now because many hon. Members want to speak. This question of the tourist industry is a very urgent matter which requires the most serious and grave thought by my hon. and right hon. Friends. It is an industry which can pay dividends in the future of our nation, if only we realise, as I have said, its great potentiality. I hope that my right hon. and hon. Friends will do something immediately to rectify the wrongs and mistakes of the past.
§ 8.37 p.m.
§ Mr. A. P. Costain (Folkestone and Hythe)
Like my hon. Friend the Member for Honiton (Mr. Emery), I have sat throughout this debate endeavouring to catch your eye, Mr. Deputy Speaker. To 956 enable him and others to take part I shall, unlike the hon. Member for West Stirlingshire (Mr. W. Baxter), who has just come in, keep my remarks short. I shall not repeat what has been said before, but I declare my interest in hotels, like my hon. Friend the Member for Eastbourne (Sir C. Taylor).
What interests me is the fact that no other Members have declared their interest. I would contend that every hon. Member in the House who has anything whatever to do with industry has an interest in the tourist industry, because there is no industry or profession, be it that of a doctor or of a churchwarden or of a shopkeeper, who is not interested in tourism.
The difficulty about it is that, generally, tourism is looked upon as being the business only of hotels. Hotels are only the advertising media which bring tourists to this country. So they should be the most encouraging item of the whole lot. Mention has been made of the fact that the Governments of other countries, like Spain, Austria, Switzerland, Portugal, encourage their hotels as important means of attracting visitors whom they desire to attract because they know that the visitors will spend money in their countries. My hon. Friend the Member for Eastbourne has referred to his well-known hotel and the £1 million which has gone over its counter.
Why should the Government decide that the hotel industry is the one industry which should be milked more than any other? For no other industry has to pay Purchase Tax as the hotel industry does on most of its raw materials. No other industry which has such an export record has to pay Selective Employment Tax. It is quite farcical that a woman who makes a bed in a factory gets a bonus, whereas a chambermaid who makes a bed in a bedroom is penalised.
§ Mr. Costain
This just shows the stupidity of Selective Employment Tax.
In my constituency of Folkestone we have a special contribution to make to the tourist industry, since we, like very few areas, are able to deal with day visitors. It is remarkable that 50,000 of 957 our fellow-countrymen cross the Channel every year on day-trips to the Continent, and only 5,000 people come here from the Continent. The potential there is even greater because of the greater population on the Continent. Why does it not happen?
People living on the Continent do not have the same love of the sea as we have, as a nation. Many of our people cross the Channel for the sake of travelling on a ship. Continentals do not cross the Channel, as they do not like the sea and think it is something to be deplored. The prospect of a Channel Tunnel makes it more likely that people would bring their cars over, and travel in this country. I have an Adjournment debate later this week when I shall be dealing with this matter.
The number of day visitors could be increased if the Government would make better facilities available at the ports. I know how well the staff at the ports work, and I know the conditions under which they work. For years I have been trying to get better facilities at Folkestone. It is altogether out of proportion that people who come for a day visit should have to spend half an hour out of their three hours in going through immigration. If we go to the Continent we are cleared through Customs and immigration within minutes; yet when they come to this country it takes half an hour or more. That is something which the Government could improve without incurring extra cost.
Some visitors come over for a shopping spree, and it is interesting to see the shops that they go into after coming off the ship. Some are well known, some are not so well known. There again, there is the difficulty over Purchase Tax. Now that it is illegal for a British citizen to hold foreign currency, surely it would not be too difficult for the Government to allow a visitor from overseas to pay for goods by traveller's cheque, or in foreign currency, free of Purchase Tax, if he signs a declaration to take the goods out of the country on the same day. There could be spot checks. Many shops in the area would do much better business if simple facilities of that sort were available.
Equally, many more short tours would be taken by overseas visitors if better 958 parking facilities were provided. With the possibility of a Channel Tunnel within five or six years, I visualise that many people will want to travel through the tunnel just for the novelty. They will want to come through in their motor cars, and we ought to be able to give them better parking facilities in the town.
I would add my support to the proposal for a hotel register. I accept that things of this sort should not necessarily be done by the Government. There should be encouragement to private enterprise to introduce such a measure.
Our facilities for visitors to this country are improving, and I accept all that has been said about the improvements in hotels and catering. I would like to see more facilities provided for visitors with yachts. Overseas, a great many facilities are provided for yachtsmen. At last year's Boat Show, firms from towns in the North of France had their own exhibits, which gives some indication of the interest in small craft on the Continent. However, we have not yet the facilities that they have, and one has only to travel to Holland or France in a small boat to see how they are welcomed. The harbour facilities at Folkestone may not be fully occupied once we get a Channel Tunnel, and I would like to see arrangements made there to provide marinas and other facilities for visiting yachtsmen.
I had intended to make a rather longer speech, but I will conclude my remarks on that point, because I have undertaken to be brief to enable two of my hon. Friends to contribute to the debate.
§ 8.45 p.m.
§ Mr. Peter Emery (Honiton)
I wish to thank my hon. Friend the Member for Folkestone and Hythe (Mr. Costain), because I know that he planned to speak for at least 12 or 15 minutes, but has been good enough to limit himself to six or seven so as to enable my hon. Friend the Member for Dorset, West (Mr. Wing-field Digby) and I to catch your eye, Mr. Deputy Speaker. It was most generous of him.
I, too, will be as brief as I can, but it would be wrong, however, not to comment that I considered the opening speech by the Secretary of State for Scotland to be probably one of the most unoriginal speeches on a really major 959 topic that we have ever heard from the Dispatch Box. It is not that the problem has not been stated. In the annual report of the British Travel Association, Lord Geddes said what I hoped would have been the basis for today's debate. Last October, he said that a national body with policy-making powers was necessary if the tourist industry was to develop its export-earning potential.
Lord Geddes continued:We are convinced that the time for advice and persuasion has passed and that there can be no lasting solution until the national tourist organisation of one of the world's leading tourist countries is given a more direct part to play in the development of our resources. Our board, with the advice of our management staff, have invited the Government to consider what further action might be appropriate.I hope that the Minister of State will address himself to that most important question put by the President of the B.T.A. and give us some of the answers which were woefully missing from his right hon. Friend's speech.
In my few remarks, I want to make four main points. First, it is imperative for the Government to treat hoteliers as industrialists. Too often, they are treated as rather nasty necessities in a business which is not officially recognised by the Board of Trade as being vital to the nation's economy. That is a situation which must be corrected, and the state of the industry will not improve until it is.
Then I must mention Selective Employment Tax. A number of hon. Members have suggested that it would be wrong for the debate to centre on it. That is correct, but let no member of the Government believe that Selective Employment Tax and the relief given to hotels is not the largest single issue affecting the industry at the present time.
In this connection, perhaps I may quote from letters that I have received from two associations in my constituency. The first of them is the Sidmouth Hotels and Caterers' Association which wishes me to make a strong protest at this further discrimination against the hotel industry. Its letter says:The increase of 50 per cent. in September will force many hotels to close during the winter months which have up to the present remained open, employing a large percentage of local labour. The consequent dismissal of employees would force them to draw unemployment money for about six months in the 960 year and in some cases, no doubt, National Assistance in addition. It seems grossly unfair that a resort like Looe (which is classed as in a development area) should be exempt from this tax, whilst a seasonal resort like Sidmouth should have to bear the full burden.I have a letter from the Exmouth, Budleigh Salterton and District Hotels Association also asking me to make representations to the Government? I am doing so today. Average unemployment in Exmouth, which is not a development district, is as high as, if not higher than, certain areas in the South-West which are classified as development districts in the matter of obtaining industry. Hotels in those areas will get direct assistance, thus creating considerable unfair competition with hotels in other areas.
It is important that the House should realise that in three years the Treasury has been allowed to soak hotel owners to the tune of about £20 million by the abolition of investment allowances and a further £20 million in Selective Employment Tax. Against this impost of an extra £40 million, it has "graciously" set up a £5 million loan scheme for the trade to draw upon. My latest information is that only £1 million has been drawn upon, so, on balance, one sees the hotel industry approximately £39 million worse off.
On the financial side, I suggest one original idea. In most speeches today hon. Members have asked for more money in one shape or another. We realise that in our economic situation that is difficult. Therefore, I will suggest a scheme to help the hotel industry without the Government having to find a great deal of money to finance it. Improvements in hotels and boarding houses—particularly the smaller ones—would do well if the Government would underwrite or back the necessary borrowing or overdraft to finance them.
This is not an entirely new method of Government action. It has happened in a number of instances previously—certainly concerning house purchase. The risk to the Government would be very small. Application could be made in the normal manner. Such a method would stimulate greater investment in improvement in the hotel industry, and the amount which the Government would be called upon to meet would be very small. It is a new idea. Will the Government consider it?
961 Concerning tourists and trying to save foreign exchange, will the Government provide counters at London and Manchester airports for incoming travellers to purchase their one bottle of tax-free whisky on arrival instead of paying foreign currency overseas to bring back their tax free allowance? Nearly everyone who goes abroad imports something. Why, for goodness' sake, give the foreigner the opportunity of making his profit on it? Why not let that bottle be purchased in the airport before going through Customs? Although it may be illegal, I buy a bottle of malt whisky going out, I have two nips while away, and I import it again. In that way I may be saving the country a bit of foreign currency. Why not have a method like that at airports?
I now turn to the beaches of this country. I believe that a great deal more stimulation has to be given to the hotel industry and to local authorities to emulate foreign countries concerning the running of beaches. This does not mean that we have to make private all aspects of our beaches. That would be a non-sense. But on many of the larger beaches it would be proper to allocate a small section to be run by the local authority or, if necessary, let out on a concession so that the beach can be properly staffed, cleaned and raked and where the numbers using it can be regulated.
There could be proper tents or cabanas for changing, tables and umbrellas for the sun, and, perhaps more important in this country, wind breakers behind which people could sunbathe. That is done in the Scandinavian countries. France and Italy have done a lot to provide amusements for the children. They have such things as the Hippo and Mickey clubs which have never been adopted here. I suggest that it is necessary for us to provide that kind of entertainment for children on the beaches.
I return to the most important need of the South-West, the spine road. The South-West takes between 20 per cent. and 25 per cent. of all the tourists in this country, and unless people can get to the area the tourist industry will not achieve the increase that it needs. The Government have gone wrong in believing that they can improve the situation 962 by providing the spine road in small stretches at a time. The Honiton by-pass is marvellous—and we no longer get traffic jams there—but jams occur at Gittisham Bridge, where the road narrows from four lanes to two. The Government should institute a crash programme to get the spine road completed by 1973. That is what the Tress Report advocated, and there is no reason why the Government should not provide that road if they want to do something for tourism in the South-West.
I hope that my short speech has not been too disjointed. I have tried to deal with the major points in the hope that one more of my hon. Friends who has also sat through the whole debate will get an opportunity to take part in it.
§ 8.57 p.m.
§ Mr. Simon Wingfield Digby (Dorset, West)
We are nearing the end of the debate, and I shall have to compress my remarks. There has been general agreement during this wide-ranging debate about certain things. One is that perhaps this country is not doing all that it can to cash in on the foreign currency of tourists from abroad. I am sure that we all have ideas about how that can best be done.
The tourist industry is the second most important industry in my constituency. It is next in importance to agriculture, but it is not the kind of grand hotel industry which has been mentioned today. It is a question of small hotels, the problem of caravan and camp sites, and the planning problems that arise out of that.
I must refer to the problems created by the S.E.T. and the fact that as we are not in a development area we do not receive any benefits. Immediately after the Budget I received a letter from a county councillor. He is an hotelier, and he has had a lot to do with those problems. He said:Once again the Government has dealt a shattering blow to the holiday and tourist industry in the South-West. This is the only real industry which Dorset has in addition to agriculture and it brought £14 million into the country in 1967.He went on to give a list of the extra costs which he would incur and which would have to be passed on to the customer.
We have a large and expanding industry in Dorset, but a large proportion 963 of it consists of holiday makers from this country. I am certain that a larger number of foreigners could be attracted to our part of the world. We heard earlier about open air museums. Dorset has many attractions. There is Maiden Castle, the Cerne Giant, and it was from Dorset that some of the earlier settlers went to America. Yet these visitors from America and elsewhere cover just a small triangle between Stratford-on-Avon, Oxford and Cambridge and do not penetrate to the South-West. Part of the reason is inadequate publicity and much more could be done to tell of the things which can be seen there. In Dorset this is partially because ours is a small county and we cannot afford to spend much on publicity, but I meet many foreigners who would like to explore these interesting things which we have to show them.
The time has come to accept in principle the idea, which exists in France and Italy, of holiday roads. There is a glorious coastline in Dorset which we have taken great trouble to preserve, yet there is not a decent coast road along it. If that had been in France, I am sure that there would be a spendid scenic road. I understand the reasons for economy in the road programme, but it is high time that we accepted the principle that holidaymakers need their own roads.
We have an enormous influx of population seasonally, creating all kinds of problems for local people, but we willingly accept those problems. We should like to see more foreigners coming to us and should like them better informed of what we have to offer. Not only are roads necessary for industrial development in the South-West: they are an absolute essential for the tourist industry.
§ 9.2 p.m.
§ Mr. Peter Blaker (Blackpool, South)
The debate has amply justified the Opposition's choice of tourism as a subject for a Supply day. Our previous debates on the subject have tended to be Adjournment debates just before a recess, which get squeezed into very narrow limits. I pay tribute to my hon. Friend the Member for the Isle of Thanet (Mr. Rees-Davies), who is the chairman of the all-party committee on tourism, for the fact 964 that he has so often initiated those Adjournment debates. The House will agree that he made a powerful speech today. It might cost a certain amount to implement all his suggestions, but I hope that the Government will, nevertheless, seriously consider them.
The great disappointment has been the speech of the Secretary of State for Scotland. It was a non-speech. It has been described as woolly, but that is a compliment. It contained no answer to any of the pertinent questions asked by my right hon. Friend the Member for Argyll (Mr. Noble). Would it not have helped our debate to have had some of those answers early, rather than—as I hope will be the case—in the winding-up speech?
The hon. Member for Falmouth and Camborne (Dr. John Dunwoody) suggested that our approach to tourism should be a non-party one. I wish that it could be, but I fear that that would be difficult to achieve. There have been a number of speeches from Labour Members today and this is something new in my experience of debates on this topic. The great problem in obtaining a nonpartisan policy is the fact that the Labour Government as a whole—there are exceptions—show no evidence of any understanding of the tourist industry.
This has been well signified today by the absence of the President of the Board of Trade, who, while I have been in the Chamber—and that is most of the time—has not even put his head into the Chamber, has not even attended, let alone spoken. That is a sorry reflection of his party's lack of interest in this subject.
The hon. Member for Yarmouth (Dr. Gray) referred to conversations he had had with a psychiatrist who had interviewed tourists to discover their motives for selecting various resorts. It would be interesting if the psychiatrist could interview selected members of the Labour Party to understand the reasons for their antipathy towards tourism. I have a few suggestions, one being that the basic formation of the Labour Party is Karl Marx, from whom one learns a lot about heavy industry but very little about tourism. I have the impression also that the fact that tourism is about hotels, beds, bathrooms and food is somehow felt by hon. Gentlemen opposite to be rather reprehensible.
965 I recall a vigorous intervention from an hon. Gentleman opposite a couple of years ago when we first debated S.E.T. He said that he would be delighted if the number of waiters, doormen and porters at the Savoy Hotel was reduced as a result of the tax. I conjured up a mental picture of wealthy visitors from abroad staying at the Savoy and making their own beds, cooking their own meals and cleaning their own shoes. I wondered how many of them would return to the Savoy.
It is this basic attitude of most hon. Gentlemen opposite which leads to the inability of the Labour Party to treat the tourist industry as an industry. In many speeches today hon. Members have pleaded for it to be treated as an industry on a par with others. If one's basic attitude is to give a lower priority to tourism—the attitude of the Labour Party—it is not surprising that hotel building is subjected to the same system of licensing as office building. I mention that as a small example from the early days after Labour came to office. It is not surprising if one deprives hotels of investment grants and imposes increased S.E.T. It is not surprising that the first hotel loans scheme should have been the colossal fiasco which it turned out to be. The reason is that the approach of hon. Gentlemen opposite is wrong. It is not surprising that it does not occur to them that the Queen's Award for Industry ought to be available to the tourist industry.
Hon. Gentlemen opposite are still living in the nineteenth century, when tourism was the preserve of the rich. They have not hoisted in the fact that in the twentieth century it is no longer the preserve of the rich but a mass activity for people of modest and even slender means. And now we are on the brink of a further revolution in tourism, because within two years the jumbo-jets will be carrying 350 people at a time across the Atlantic, and we must be ready for them.
Tourism is one of the world's fastest growing industries. In the 12 years after 1952 it quadrupled. Has another industry of this size had such a growth record? Hon. Gentlemen opposite may say that the growth in our tourist earnings has been so good in the last few years that nothing more need be done by the Government. The Secretary of State more or 966 less said this, when he declared that there could not be much wrong with S.E.T. because Scotland had had a good tourist year. It is this attitude among hon. Gentlemen opposite that we wish to see eliminated. The fact that we had a good year should make us want to increase the industry's earnings. It certainly does not mean that we can sit back and rest on our laurels. I want the Government to accept that the potential of this industry is beyond anything they have yet envisaged.
My hon. Friend the Member for the Isle of Thanet was a little unkind about the record of the Conservative Party in connection with the tourist industry when we were in power. I do not say that we fully appreciated the potential of this industry, but our charge against the Government is that owing to their basic attitude they have not had a policy at all on tourism. They have consistently and foolishly discriminated against it and against the nation's interests. Their efforts to correct their errors have come too late, have been piecemeal, and have created even more problems; and they still have a very long way to go.
What are the main needs of the tourist industry? First, more hotel beds. Hon. Members have said we shall need 30,000 more by 1970 and some even suggested that 50,000 will be necessary. Secondly, there is modernisation of existing accommodation. The British Travel Association estimated only two years ago that one quarter of the hotel bedrooms were seriously in need of modernising. Studies made by the "Little Neddy" in 1966 showed that the inadequacy of suitable accommodation was the main impediment to increased bookings by foreign travel agents.
One obstacle which stands in the way of new building and modernisation, as has been shown by recent investigations, is that the return on capital is inadequate. That emerges from the study by the "Little Neddy". Fourthly, the industry, while modernising and expanding, has to keep its prices competitive. Finally, it has to get staff to run its businesses. My information is that the industry is short of staff to the tune of 50,000.
With that background and these needs of the tourist industry, what have the Government done? Everything they did in the first three years made the situation 967 worse. As regards the rate of return on capital, the loss of investment allowance made the industry's interior assets 13 per cent. more expensive.
§ Sir C. Taylor
There is a shortage of staff in the hotel industry all over the world, so there is competition from every country for trained staff. The industry is doing what it can to train more people, but there is a shortage all over the world.
§ Mr. Blaker
I am grateful for the intervention of my hon. Friend, which reinforces considerably the point I made.
Another way in which the Government have damaged the industry is by rates of taxation. There is an extra £2,200 million a year on the general rate of taxation and this affects the tourist industry as much as any other. Thirdly, there is the S.E.T. I make no apology for talking again about Selective Employment Tax. I intend to talk about it a lot. It seriously damages the rate of return on capital. The report by Cooper Bros. saysThe impact of these measures",S.E.T. and loss of investment allowance—on the profits of firms in the industry and on returns on capital investment has been severe.That statement was made before the increase to 50 per cent. in Selective Employment Tax made by the Budget.
The story of S.E.T. is the story of this Government. In 1964 Labour was:Poised to swing its plans into instant operationaccording to the manifesto. In 1966, so unready were the Government when they brought in the tax that they adopted for its application the Standard Industrial Classification, which was intended for something totally different. Then we had all the battles about charities, the disabled and the over-65s, in which the Government had to abandon their position in face of logic. In 1968, so well organised are they that when they give relief to hotels in parts of development areas, they adopt a classification again totally unsuited to the purpose it is intended to achieve.
Let us consider the significance of the refunds of Selective Employment Tax which are to be given to certain hotels in development areas. The Government 968 estimate the total value of the refunds at £1 million. They are taking from the industry in S.E.T. and investment allowances, as my hon. Friend the Member for Honiton (Mr. Emery) pointed out, £40 million. That puts the matter into perspective. The choice of areas for the refund is absolutely crazy.
The hon. Member for Conway (Mr. Ednyfed Hudson Davies) tore his own party apart in a most accomplished way on this point. The places which will not get the refund include Edinburgh. Edinburgh has only 700 hotel bedrooms with baths. That is all there are in the capital of Scotland, perhaps the second most important tourist place in Britain. Those hotels will not receive the refund. Hotels in Perth will get it. Hotels in Llandudno will not get it. Those in Conway will. The list of anomalies is unending.
The refund of Selective Employment Tax, in the way which has been adopted for it, does not correspond to any recommendation which has been made to the Government that I know of. The Bland Committee recommended that ways should be found to relieve industries which earn invisible exports of the burden of S.E.T., but it did not suggest a test for refunding S.E.T. which is based, not on export earnings, but on something totally different.
We are glad that the Chancellor of the Exchequer announced that he is appointing Mr. Reddaway to conduct an investigation into this tax, presumably—indeed, obviously—because of the many complaints which have been made about it and about its unsatisfactory results. Was it not curious that the right hon. Gentleman should choose the speech in which he announced that appointment to announce an increase of 50 per cent. in the tax? If a tax is so unsatisfactory that only two years after its introduction a very highly-qualified professor must be appointed to investigate it, I should have thought that that occasion should not be taken to announce an increase in the tax.
However, we on this side welcome Mr. Reddaway's appointment. We could wish that the terms of reference were a little wider, because it might have been useful if Mr. Reddaway had been asked to look into some of the arguments which have been used to justify the tax, so 969 far as any of them are still used by the Government, because many of them have been abandoned. There is the argument that the tax would somehow redress the balance of taxation, which formerly had been too heavily against manufacturing. This presumably was a reference to Purchase Tax. Purchase Tax is not a tax on manufacturing. It is a tax on the consumer. The consumer in this context is the hotel and the restaurant business. So Purchase Tax is a tax on the hotel and restaurant business. I hope that Mr. Reddaway will make that clear.
There is the argument that only 10 per cent. of the turnover of the tourist industry represents exports. That argument was shot down by the Bland Committee. I hope that we shall not hear that argument again, because the Bland Committee pointed out that the average import content of exported manufactures is 20 per cent. but that the average import content of all service exports is only 9 per cent. What is more, hotels and restaurants receive payment on the nail and do not have to wait for anything up to 10 years for payment.
I wonder if the Government have thought of this point in connection with exports. Twenty per cent. of visitors to Britain, the numbers of which have been mentioned, come here on business. They are business visitors, not just tourists. If they stay in a scruffy hotel with poor services, will they have a good impression of Britain's dynamic and up-to-date industrial performance? Hardly likely.
Then there was the argument that the S.E.T. would release employees from services who could be taken up in manufacturing. That argument was ably disposed of by the right hon. Member for Sowerby (Mr. Houghton) during the Second Reading debate of the Finance Bill. He was a member of the Cabinet when the S.E.T. was introduced, so who could speak with greater authority than he?
What are the results of all these misguided policies? First, the Government's policy for tourism, so far as they have one, is in conflict with their regional development policy. Second, the problems of the hotel trade have been aggravated. By 1970, to put it at its lowest, 30,000 beds will be needed. That is a high proportion, bearing in mind that, according 970 to my information, there are only 190,000 hotel beds in the country. What is needed, therefore, is the equivalent of 100 hotels each of 300 beds in 2½ years, and the actual rate of building of new hotel beds is 5,000 a year. On present form, we shall fall a long way short of the target.
Far from accelerating our rate of provision of hotel beds, hotel companies have been cancelling projects. I know of one company which has within the past two years cancelled or postponed projects for 420 beds. That is just one company, and the same is happening with many others. Where will all the visitors sleep, the 5 million or 6 million visitors who will be with us by 1970? Instead of building hotels in Britain, the big companies are investing in hotels abroad. One can run through the list—Grand Metropolitan, Rank, Fortes, Trust Houses—they have been turning to Sardinia, Barbados, Spain and France. One group has bought up three hotels in Paris. Why?—very largely because of the tax burden which hotel companies have to bear in Britain.
Thus the Government's tourism policy, so far as they have one, is working, also, against their overseas investment policy. Progress with modernisation also is being held up. Even if we can find accommodation for the millions of visitors we hope to have in 1970, one wonders whether it will be sufficiently good to persuade them to come back.
Now, the hotel development incentive scheme. One hon. Member spoke of the Government pouring money into the tourist industry. That is an odd phrase. There is no question of the Government pouring money into the tourist industry. They are grabbing it out of the tourist industry, and the question is how much is to go back of what has been grabbed away by discriminatory measures which penalise the tourist industry as compared with others.
There is to be a White Paper soon. It is a pity that we have not had it so far, but I hope that, when it does come, the Government will be prepared to give, if it seems suitable, a full day's debate on the White Paper. We on this side thought it right to devote today's debate to tourism, and it is very likely that we shall want to have a fairly substantial debate on the White Paper when it comes out.
971 Can the Minister of State at the Board of Trade tell us something about the scope of the grant scheme? Is it to be available not only for new building but, equally important, for modernisation? Will it be available, for example, for projects such as knocking two houses together to form a bigger boarding house? Will it be available for the conversion of rooms into bathrooms? Will it be available for the conversion of existing buildings into holiday flats? The holiday flatlet business is perhaps the fastest growing sector of the holiday industry at present, responding to a growing demand for self-service accommodation. Will it be available for things other than bedrooms, such as sun lounges, which are very popular in many parts of the country, or conference facilities? Are we right in thinking that the maximum contribution is £200 per bedroom? If so, it seems to me that this will not do very much more than offset the extra cost of building which has resulted from devaluation and other measures, the rise in S.E.T. and the rise in Purchase Tax.
In the new scheme will the Government avoid interfering in the businesses of the hotel companies in the way which seems to have caused a good deal of trouble in connection with the previous hotel loan scheme? I believe the degree of intervention which the Government have sought to exercise has been one of the reasons why the previous loan scheme was a fiasco.
I should also like the Minister to deal with the question raised by one of my hon. Friends of what the present situation is. Do we understand that the previous loan scheme expired at the end of March but that there is no statutory authority for the future grant and loan scheme? I understand that legislation will be introduced, but not until the next Session. Are we right in understanding that we are now in a situation in which people doing work, which may or may not qualify for grant, will have to wait for about a year, holding on to their receipts and hoping that when the legislation is ultimately passed the expenditure will be eligible for grant? That seems to me to be a very curious situation.
I cannot understand why the Government were not ready to introduce a new 972 scheme by the end of March. Is there any reason why they could not have been ready at that time?
§ Mr. Blaker
I hope that the Minister will deal with this point. It was my impression that he had given a reply which suggested that next Session was more likely.
To reinforce my hon. Friend's point, the "Little Neddy" Report said that action was urgently needed. What about some of its other recommendations? What about the suggestion that the new loan scheme should have a moratorium on repayments of capital and interest for the first three years? What about the recommendation that the Government should apply in full development area legislation to the hotel industry? What they intend to do is nothing like that. What about the suggestion of the "Little Neddy" that industrial building allowances should be granted to the hotel business? Why have not the Government adopted any of those sensible recommendations?
Although they have taken a step forward with the new scheme, the Government are a long way off accepting the recommendations which have been made to them. As my right hon. Friend the Member for Argyll said, if this scheme is right, with its level of 20 per cent. grants, for the generality of hotels in the big cities and towns—London, Birmingham, Edinburgh and so on—it cannot be right for the purely seasonal hotels, for reasons set out in the report of Cooper Brothers. This is no doubt why the British Travel Association has recommended in its document, "Development of Tourism 1968", that in addition to the general incentive scheme which it recommends, and which I suppose is reflected by the Government's proposals, specific help should be given to hotels in seasonal areas.
There have been many interesting suggestions in the debate—for example, about ways to lengthen the season, about 973 fixing a date for Easter, about local authorities issuing lists of accommodation with gradings, and about registration. Perhaps the hon. Gentleman will be able to say something about the Government's own proposals for registration. It has been suggested that Britain is eminently suitable for more active holidays. A convention centre in London has been proposed. There have been many more such useful ideas. I want to add three points.
First, the Government should pursue the idea that the personal exports scheme should be adapted, if possible, in such a way that visitors are able to buy goods free of Purchase Tax over the counter. How far have Government studies gone on that?
Secondly, the "Little Neddy" should make a special study of the catering industry, because the Cooper Bros. report was devoted principally to the hotel industry. They said that the information they had on catering was inadequate. But this is an important aspect which should not be neglected. Thirdly, what preparations are being made to improve immigration procedures in preparation for the introduction of the jumbo jets?
Some of these suggestions for improving the tourist business are important, some are of lesser magnitude. Let us now consider the most important thing we are asking from the Government. First, I do not ask the Government to appoint a Minister for tourism. It seems to me that it is more important to have a Minister in the Cabinet who understands tourism and is energetic on its behalf than a Minister exclusively devoted to it who is of lesser rank.
Secondly, we do not ask the Government to give the tourist industry more protection. We are not asking for an extension of the duration of the £50 travel limit but for its abolition. Of all the O.E.C.D. countries, only Yugoslavia has a lower foreign travel allowance than we have. That is a disgraceful situation. The £50 limit is a breach of the I.M.F. rules, at least in spirit. It calls the law into contempt and it has done nothing to help the home holiday industry, which last year had its worst season for some time and which depends on the general level of prosperity in the country.
I ask the Government to take a step forward. The new régime in Czechoslo- 974 vakia—still a Communist Government—have declared as part of their programme that foreign travel shall be a right and not a privilege. It is not asking too much of the Minister of State to say that his party also subscribes to that view.
What we are asking for is a revolution in the attitude of the Labour Party to the tourist industry—a revolution which will give the industry equal treatment with other modern and growing industries. We are asking it to get rid of its out of date mental attitude, which sees tourism either in terms of Claridge's and caviar or of out-of-date small hotels in back-streets with broken bed springs. We ask the Government to see tourism as a big modern industry with a tremendous export record, capable of contributing to the life of the regions and costing very little in imports.
It is necessary to change the attitude of the country as well, because I do not think that most of our citizens sufficiently understand the importance of the industry. But before that can happen, it is necessary for the Government to change their attitude. If they will do that, the other problems will fall into place. The problem of roads will receive proper priority, and my hon. Friends have shown the importance that they attach to that. The problem of taxes will receive proper treatment and we will have no more stupidities like S.E.T. Hon. Members on this side of the House have shown by their speeches that they understand these things. What I am asking the Minister is this: will he bring the rest of his party—because he understands these matters, I believe—into the twentieth century?
§ 9.35 p.m.
§ The Minister of State, Board of Trade (Mr. J. P. W. Mallalieu)
The hon. Member for Blackpool, South (Mr. Blaker), like one or two other hon. Members, made considerable reference to the Scottish flavour which flooded into this Chamber earlier. As an Englishman, I am an avid reader of the debates in the Scottish Grand Committee. Having read the most recent, and then seeing that the right hon. Member for Argyll (Mr. Noble) was to lead for the Opposition on this important subject, I not unnaturally suspected that a considerable part of the debate would deal with Scotland. For that reason I was delighted when my right hon. Friend the Secretary 975 of State for Scotland dealt with the opening of the debate.
I shall resist the temptation to deal in detail with Scottish questions, and I shall also resist the temptation, which most hon. Members, with the exception of the hon. Member for Blackpool, South, resisted, to be aggressively party political. I do not give a rap about the past in this industry. It is not profitable to say, "We are doing better than you did", or, "You did worse than we did". It does not matter. What matters is to try to get all Government policy on the right lines.
While resisting the temptation to be party political, I will also resist the temptation to be complacent. From figures quoted there are signs of growing development in this industry and we welcome it. That does not mean that we can sit back and imagine that all is well, because it is not. While I shall resist these things I shall refer to such things as S.E.T. and the performance of the British Travel Association, to which the hon. Member for Eastbourne (Sir C. Taylor) paid a very nice and well-deserved tribute.
No one would suggest that the S.E.T. is welcomed by the industry, or directly benefiting it. It does not, no tax ever does. A number of hon. Gentlemen on both sides have been unduly alarmist about its effect on the industry. The yield from the industry has been about £20 million. That represents about 1 per cent. of turnover. I do not say that it is pleasant, that it does not cut profit margins, but it is not critical. It is serious to some, but not critical, and we ought to get that figure in our minds, to get a sense of proportion about the effects of this tax.
The industry does not bear the whole of the burden. It has dealt with some part of it—and this is not a development which I relish very much—by increased charges. So far as we can see, it has dealt with part of it by increasing productivity and a better use of manpower.
§ Mr. Rees-Davies
I do not see how the figure could be 1 per cent. of turnover. In the average luxury hotel, it is, beyond doubt, 5 per cent. of turnover. In the ordinary run of hotel, it is at least 3 or 4 976 per cent. The figure of 1 per cent. means that there must be virtually nothing in respect of the small hotels.
§ Mr. Mallalieu
The figure will vary from hotel to hotel, but the tourist industry is not composed solely of luxury hotels. Luxury hotels are a very useful part of it, but there are many one-man or two-men hotels. The yield represents about 1 per cent. of turnover over the whole field.
§ Mr. Ednyfed Hudson Davies
But does not my hon. Friend feel that in deprecating the significance of the S.E.T. when it is fully applied he is indirectly demoting the degree of advantage given to hotels within selected parts of development areas which are boosted now as a result of being relieved of this tax? My hon. Friend makes the relief almost trivial.
§ Mr. Mallalieu
I did not intend to suggest that the relief is trivial, but it is not a large amount. The result of the reliefs under the latest proposals of my right hon. Friend will be to increase the yield, not by a half, but by about one-third.
My duty as a Minister responsible for tourism is to do all I can to ensure that actions by other Departments do as much good and as little harm as possible to the industry with which I am concerned. My duty is to see what alterations it is necessary for me to urge upon my colleagues. But when we make a change—and these reliefs are a small change—instead of people saying, "Thank you for small mercies", we are attacked sharply about demarcation lines, and so on.
§ Mr. Emery
The figure of 1 per cent. which the hon. Gentleman gave is causing some concern among us on this side of 977 the House. If one takes the figure of £10 million a year from S.E.T., which is approximately what it is raising, that would put the turnover at over £1,000 million. If it is £20 million over the whole period, the figure would be £2,000 million. What does the hon. Gentleman estimate to be the turnover of the whole industry?
§ Mr. Mallalieu
The figure of yield which I gave was £20 million. Therefore, the hon. Gentleman can work it out from that. If there is any doubt about this, I will look into the matter.
As the House is aware, the whole subject of S.E.T. is being considered by Mr. Reddaway. When his report will come out I do not know, but I hope in the not too distant future, and when it does it will, again, be my job, under the pressures from the House and from the industry, and from my own inclination, to urge upon my colleagues whatever changes seem desirable for this industry.
One or two hon. Members—I think the hon. Member for Fermanagh and South Tyrone (Lord Hamilton) was one of them—were asking about the amount of grants to the British Travel Association. Here, referring to what the hon. Gentleman the Member for Blackpool, South was saying about the attitude of the Government to the tourist industry, I would say, without going back on my wish not to make party political points, that the fact is that the grant to the Association at the moment, for this year, is £2,950,000, and this is just three times what it was in 1960. I doubt very much whether it is yet enough, but it is a tremendous advance.
§ Mr. Noble
I am grateful to the hon. Gentleman for giving way but I do wish that he would not try to mislead the House in this way. The Government have taken an extra £40 milion out of the industry, and yet he says he has given back £1 million here and £1 million there and that that is a great advance. Do not let him say that to the industry, because it will tell him the truth.
§ Mr. Mallalieu
I am dealing specifically with the British Travel Association, as a symptom of the attitude of the Government towards tourism. I think—indeed, I am sure—that the right hon. Gentleman will say that money spent on the Association is very well spent indeed. 978 If I have got to make the point, it is very much more money under this Government than it was under his. But it is a trivial point.
Various hon. Gentlemen have talked about the need for devolution, especially in terms of the British Travel Association, and, indeed, the Association itself, as the hon. Gentleman will well know, has been following a policy of devolution. It is not only for the establishment of the independent boards in Scotland and Northern Ireland and Wales, but regional bodies are now being developed—Yorkshire is one example; that was the very first one; I think the latest is that for the Lakes counties—all with the idea of getting the regions to take an active part in their own development.
I was asked whether there should be competition about publicity. I am not myself in favour of competition internationally to any great extent about publicity, because I think that would be duplicating, and might be wasteful, but there is real virtue in competition internally between the various regions, and that is going on in a substantial way.
§ Mr. Rees-Davies
Will the Minister, at long last, come to the point? Who is to have the authority for running the tourist industry—he, the Board of Trade, the British Travel Association, or who? No body has got statutory powers. Come clean. Who in the Government will deal with this industry? Let us have an answer.
§ Mr. Mallalieu
This is one of the difficult things. The hon. Gentleman made a long, and, I thought, extremely interesting speech, very much longer than I have time to make, He might have condescended to understand that I shall come to that very point.
§ Mr. Mallalieu
I shall not have much time, given the interventions which are so frequent.
The right hon. Gentleman the Member for Argyll and a number of other hon. Members asked about the new hotel incentive scheme. In particular, they asked about the meaning of the £1,000—not £200 as an hon. Member suggested—per bedroom limit. The grant on new building is for 20 per cent. 979 of the cost of construction and fixed equipment, excluding the cost of land. This covers the constructional cost of all rooms, whether they are bedrooms, bathrooms, kitchens or lounges. The bedroom comes into it in this way: the total expenditure is divided by the number of bedrooms provided. If the total expenditure on a hotel with 100 bedrooms is £500,000, the grant, as opposed to the loan, will be £100,000, which is £1,000 per bedroom.
The reason for setting that sort of limit is that, by and large, subject to correction, the luxury hotels are the most viable at the present time, but they are not necessarily the ones that are most important to the tourist industry, especially in terms of package tours, which are now becoming a major feature of the industry. The package tour trade is in the medium priced hotels, and it is to them especially that the grants are aimed.
The right hon. Member for Argyll quoted a number of figures about the cost per bedroom. The £12,000 per bedroom must be for a highly luxurious hotel. I have information from a chain of hotels that in the slightly above-medium range they reckon that bedroom costs are from £4,500 to about £6,000. This is in the medium range, but it is a range that covers the country reasonably well.
§ Mr. Mallalieu
I do not know whether or not they have one in the Highlands. The difficulty about hotels in the Highlands, and indeed about all hotels outside the major industrial areas, is that the trade is so seasonal, and I will come to that point later.
I am delighted that the hon. Member for the Isle of Thanet (Mr. Rees-Davies) has regained his voice, and I hope that he enjoyed the sun in the Caribbean; but his reading is deficient. He was urging upon us a scheme of hotel registration, but my right hon. Friend had already announced that this is precisely what will be done.
I should add, in terms of the new hotel incentive scheme, that we hope that the White Paper, which will include a reference to registration, will be published on the 21st of this month. Admittedly, after that there will be a delay before 980 legislation, but we hope that, by publishing with the White Paper the details of the scheme, and by telling the industry that terms will be on offer which are not worse than those in the White Paper, it will be possible for them to begin preparations and planning, and, indeed, the early stages of construction.
My hon. Friend the Member for Conway (Mr. Ednyfed Hudson Davies)—
§ Mr. Rees-Davies
Who will inspect the hotels? How will they get a grading? Will this all be in the White Paper?
§ Mr. Mallalieu
We are still having discussions with the industry and with the British Travel Association, who are interested parties, on the exact mechanics of the registration scheme. But we hope to be able to go ahead at an early date.
My hon. Friend the Member for Conway was anxious to get more co-ordination of tourist activities in Wales. He suggested the establishment of an entirely new body. However, I doubt whether that is really necessary with the existence of the Welsh Council which can draw together all the interests concerned—
§ Mr. Mallalieu
Well, it is drawing them together, and I will come in a moment to the problem of organisation.
However, before doing that, I want to turn briefly to the subject of camping sites. The House will be aware that, in the near future, it will be possible for England and Wales to follow in the steps of Scotland and provide grants of up to 75 per cent. for the development of camping sites. Although hotels form an important part of the tourist industry, as many hon. Members have said, they are not the only part. An increasing number of people prefer to camp.
In the past, our facilities have not always been comparable with those that one finds in Italy and France. The Countryside Bill provides for the substantial improvement of facilities and, the moment that they are ready, I hope that the British Travel Association will begin advertising on the Continent that Britain is very much in the market for campers.
In the debate, a great many questions have been asked. It has been suggested 981 that the Government should look at the possibilities of extending the holiday season so as to get over seasonal difficulties. Suggestions have been made about improved Governmental organisation. Some hon. Members would like to have a Ministry of Tourism. Others have suggested setting up statutory bodies. Clearly, the present set-up is not satisfactory and it is for that reason that, for months past, serious and detailed work has been done on finding out exactly the right way to organise the Government machine is so far as it is concerned with tourism. Before long, I hope that those deliberations and consultations will be concluded. I could not set a date, but we shall publish our views and proposals as soon as we are ready.
The hon. Member for Blackpool, South suggested that what was needed was a change in attitude in the Labour Party. However, I think that a change in attitude is needed throughout the country, and it is something that is beginning to take place. The importance of tourism is becoming realised everywhere now. But it is not only an attitude of Government or of parties. It is an attitude of individuals who have the privilege to serve their fellow countrymen and visitors to our shores. That is where there must be a change of attitude. Just as it is essential to get Government policy right, so it is essential that people who serve the public should get their attitudes right. If we can induce such people as waiters, barmaids, and so on, to be as pleasant to their customers as they are to their friends, we shall have performed a useful service.
The industry has been very much boosted as being of tremendous help in the battle for the balance of payments, and rightly so. That is a vitally important point. Equally important is the fact that through this industry our own people and people overseas can come and enjoy the wonderful facilities that this country can offer. I hope that everybody concerned with the future welfare of this country will do everything they possibly can to make this great growth industry an even greater success in future.
§ It being Ten o'clock, the Motion for the Adjournment of the House lapsed, without Question put.