HC Deb 30 January 1985 vol 72 cc261-2
1. Mr. Hicks

asked the Secretary of State for Trade and Industry whether he is satisfied with the operation of section 4 grant-aid under the Development of Tourism Act 1969; and if he will make a statement.

The Parliamentary Under-Secretary of State for Trade and Industry (Mr. John Butcher)

The operation of the section 4 scheme is primarily a matter for the national tourist boards for England, Scotland and Wales, which have authority to approve individual offers of assistance up to £200,000. I believe that the scheme helps to stimulate investment in tourism projects which would not otherwise take place.

Mr. Hicks

Does my hon. Friend agree that there is a strong case for making additional funds available for this purpose; funds which not only widen and improve the quality of tourist projects in this country but help to create employment? Is he aware that whereas the average cost of creating a new job in the tourist industry is £4,500, each unemployed person costs the nation £6,000 a year?

Mr. Butcher

There is no doubt that the tourism industry has made a magnificant contribution to job creation in the United Kingdom. In the hotel trade alone there was an increase of 14,000 jobs in the 12 months to September 1984. In that context, section 4 assistance has been cost effective. I cannot give my hon. Friend any reassurance on future spending under section 4, but he will be aware that our hon. Friend the Minister of State has said that he wants expenditure to continue over the next three years at approximately the 1983 rate.

Mr. Wigley

Will the Minister accept that, given the parity of the pound against the dollar, this is a particularly good time to try to attract tourists to Britain, in particular from the United States? Will he ensure that adequate finance is available — even more finance than the expenditure limits at present allow for the Development of Tourism Act 1969—to maximise that potential?

Mr. Butcher

There is no doubt that the current movements in exchange rates could provide a massive boost for the balance of payments through tourism. While the British Tourist Authority is doing its job very well indeed, we hope that it will take advantage, within its current funding levels, of the bonus that is being presented to it.

Mr. John Townend

Will my hon. Friend see whether changes need to be made so that seaside towns which are outside assisted areas and are not in receipt of tourist grants are able to make application for EEC grants?

Mr. Butcher

Section 4 is available, at the request of the tourist industry, on a national and sectoral basis, but it envisaged that the assisted area policy might result in some discrepancies which would not be wholly welcome to the industry. However, I note my hon. Friend's point on the European dimension and will convey it to my appropriate colleagues.