HC Deb 19 December 1986 vol 107 cc1541-8 1.29 pm
Mr. Conal Gregory (York)

It seems appropriate at this festive time that the House should debate a key element of the tourism industry—the difficult and sometimes thorny subject of hotel classification and registration.

I recognise the energy that the Government have devoted to maximising employment and other opportunities in tourism since responsibility for it has moved to the Department of Employment, and the determination of my hon. Friend the Parliamentary Under-Secretary of State to remove obstacles to its efficient management.

I declare an interest. In addition to being the elected secretary of the all-party parliamentary tourism committee and vice-chairman of the Conservative parliamentary tourism committee, I am consultant to Consort Hotels, which is Britain's largest consortium of independent hotels. Both locally and nationally, hoteliers contribute substantially to the economy. Indeed, it is Britain's fastest growth industry. It is expanding at a rate of over 50,000 new jobs each year. However, it is primarily the consumer aspect of the hotel industry that I wish to discuss today.

It may be helpful to consider the origin of that building in which are provided lodgings, meals and other services for the travelling public. The derivation from the French hotel or the old French hostel or ostel takes us to the Latin hospitale—a clear reference to an apartment for guests. The hotel has, and continues to take, many forms. It includes properties for travellers who expect superior amenities. That reminds me of Smollett's remarks in 1765: The expense of living at an hotel is enormous. The term encompasses simple hotels or boarding houses that supply breakfast known as hotel garni. In a letter in 1858 George Eliot considered this form of hotel to be rather spartan: He took us to two Hotels Garni—places where you get lodgings and attendance and coffee and nothing else In 1774 Horace Walpole expressed fear of such a location: I now live in dread of my biennial gout, and should die of it in an hotel garni Yet another form is the hotel academia—effectively a "hostel" in a university which is regarded today as part of the important world of the university conference market.

We have a tremendous range of accommodation and related services. The hostelries of the Roman era, sited principally along their roads, took on a commercial revival in the Middle Ages with the development of inns and hostels. Many were operated by religious foundations. Even in 13th century China, Marco Polo found in existence an extensive system of relay houses that provided accommodation for travellers. With the industrial revolution, innkeeping set a standard for the world in cleanliness, comfort and good food. The American innkeepers set a standard for size.

With Thomas Cook's development of travel for pleasure, the expanding hotel trade of the 20th century can look back on a history that has led to a tourist industry that has outgrown national boundaries and become truly international.

Today's consumer has a right to expect accurate and objective information. Such information about the hotel world is a minefield. There is a plethora of choice. The Automobile Association and the Royal Automobile Club have undertaken hotel classification for many years and their one to five star rating system is well understood. To a lesser extent, their system of "approving" accommodation other than of hotel status is also understood. However, it is a voluntary rather than a comprehensive scheme, the hotelier can opt to be considered or he may decide not to be included in the publications of the motoring associations. The criteria adopted by the AA and the RAC also differ.

The consumer can consult Michelin, or the Consumers Association's "Good Hotel Guide", the "Ashley Courtenay Recommended" or Egon Ronay. There is no shortage of published material—it is almost bewildering. Then, dependent upon the location, the traveller may encounter regional symbols—the hearts of the Heart of England board and the sea-horses of the Isle of Wight. Just imagine the size of the information board that my hon. Friend may encounter during his Christmas break—assuming permission is granted to the hotelier who wishes to inform the public of his hotel since we still do not have deemed consent—with RAC stars, AA stars, rosettes, crossed forks. The symbolism could be endless.

Mandatory hotel registration and classification is surely the answer. The Government have skirted around the issue for far too long. Yet the United Kingdom already has compulsory registration. Northern Ireland has managed such a system since 1948 and has no procedural problems. As each new hotel is built the relevant inspector is invited in and the information so published gives confidence to the traveller, respect to the Ulster hotel trade and a firm foundation for marketing the Northern Ireland Tourist Board.

In Britain there is a shabby mess. Eugene O'Neill, in "The Iceman Cometh", wrote: You know how it is, travelling around. The damned hotel rooms. I wonder how much better informed the visitor will be by the development of yet another symbol—the crown. That was devised by the Scottish Tourist Board and subsequently taken up by the national boards of England and Wales.

The new system consists basically of judging hotels on a one-to-five-crown basis. That will be seen by the public when it is revealed next month as a Government scheme. In essence it is, since the taxpayer is by far the major source of funding for the boards. It is incredible that a new scheme is to be introduced which has no market research foundation, lacks proper consultation with consumer and trade bodies, is inconsistent in its criteria, is late for the 1987 season and will have damaging consequences on our overseas visitor market.

The public will erroneously equate crowns with stars. There is no such equality. The Green Park hotel in Harrogate, with 44 bedrooms, has two stars but four-crown status. The Belvedere hotel in Bournemouth is AA two-star but has four crowns. The Terraces in Stirling has 14 rooms and two stars, but four crowns. The Fern Bank hotel, Shanklin, Isle of Wight, has two stars but four crowns.

Furthermore, some unstarred hotels now have several crowns. Consider the Mapleton hotel in Torquay. It is AA listed but has three crowns. The Kingswood hotel in Sidmouth, again AA listed, has four crowns!

Then there are the five crown properties. The Park Way hotel in Kirkcaldy has 40 rooms and three stars, yet it has that elevated status. The Crown hotel in Carlisle has 52 rooms and three stars, and the New Continental in Plymouth, to go to a different part of the country, has 76 rooms and three stars.

The overseas traveller will expect the facilities of a hotel with five crowns, such as the Inn on the Park, to be mirrored elsewhere. Unless corrected, this is a time-bomb. After problems beyond our control earlier this year when international terrorism knocked the United States visitor market, this ill-conceived scheme is of our own making.

Not surprisingly, many large hotel groups are refusing to put their hotels forward for crown classification. Crest, Rank and Trust House Forte have fundamental objections and Thistle has such strong reservations that it may well withdraw. Therefore, the giants of the hotel trade do not back the scheme.

Since qualitative assessment is so important in selecting a venue, Scotland intends to introduce a three-tier grading to add to its range of crowns—approved, commended and highly commended. The English Tourist Board has said that it will not go down that path—another inconsistency—although it no doubt keeps that option open for the future. Instead, aware that far too many hotels have been awarded five-crown status—over 200 in England alone compared with only 21 five-star hotels in the whole of England, Scotland, Wales and Northern Ireland—it intends to add gold topping. Like the cream on milk, the board will award a gold crown, no bronze or silver awards—but perhaps those symbols, too, will come later—but five gold crowns which means six different variations. One can recall Trollope's comment: It is because we put up with bad things that hotel-keepers continue to give them to us. It is essential that the small operators have just as fair a chance as the large establishments as they are the backbone of the industry. The tourist boards must develop a national scheme where the criteria are uniform throughout the United Kingdom, recognise improvements and are understood by the public. Grading is wanted by the industry and will be of immense benefit when it is introduced as it will give the customer a greater degree of confidence and help to improve standards generally. In spite of that, there is grading only in Scotland with a full-time inspectorate.

Already the regional boards have identified problems—and that is before the scheme is launched. Many consider that a tier needs to be introduced between listed and one crown and that standards at four and five crown level should move towards the four and five star ratings of the motoring organisations. The provision of meals and the introduction of en-suite facilities for two crown upwards will bring the crown classification much more into line with the star system.

I hope that the Department of Employment will ensure better co-ordination between the various Departments of State that have a direct interest in tourism. We were led to believe that that was taking place but at the very first test, registration and classification, it has failed. The answer is to introduce a joint industry-tourist board working committee that will review the situation and report directly to the Government with recommendations on how to implement a national system as originally planned. That would work to unite a system rather than continue the political football game between the tourist boards.

The scheme is now published in all tourist board literature but a delay in the public launch could be beneficial so that problems in the different schemes could be resolved. After such a review it can be announced to the public with a good public relations campaign. It is important that the English Tourist Board, which has by far the vast bulk of the United Kingdom bed stock, is not forced to accept the requirements of the other two national boards. There is not even a commonality of approach. Even the rates charged to the hoteliers differ between the national boards.

The aim should be to inform the public accurately and to effect a general raising of accommodation standards. If that is to be achieved, the unified voice of the industry needs to be harnessed and I hope that the Government's response will be a stimulating one in recognising the damage that can be done, halting it in time and turning their involvement to positive advantage through national criteria which truly help the visitor and assist the development of this great industry.

1.42 pm
The Parliamentary Under-Secretary of State for Employment (Mr. David Trippier)

My hon. Friend the Member for York (Mr. Gregory) has been ingenious in raising this matter on the Floor of the House on a number of occasions. The issue of classification of hotel and other accommodation is one that has commanded wide attention both inside and outside the industry over the past few years. Therefore, as the Minister with responsibility for tourism in England, I am pleased to have the opportunity of describing the progress that has been made.

Tourism, as my hon. Friend suggested, is one of the most important sectors of the economy in the United Kingdom and is a major source of employment. My hon. Friend and I believe that the potential to increase employment within the sector will gather momentum and we have no doubt that that potential is within the tourist industry.

There are about 1.2 million people currently employed in the industry and the prospects for growth are enormous. The providers of hotel and other forms of accommodation have an essential role to play in ensuring the success of tourism—after all, more people will come here if they have somewhere suitable to stay. There are in England nearly 17,000 hotels and motels and nearly 13,000 bed and breakfast and farmhouse establishments. In addition, England and Wales together have over 4,000 licensed private hotels and guest houses. In Britain the industry employs some 250,000 people and indications are that that number is set to increase significantly, as I have already suggested. It is essential that we provide a product that matches in quantity and in quality what the customer wants and expects. To that end, the tourist boards are laying great store on the need to improve and upgrade the standards of accommodation offered to meet the requirements of today's market.

An essential prerequisite of a successful sale is that the customer shall know in advance what he or she is buying. Hence the Government very much welcome and fully support the initiative by the tourist boards to introduce a standardised classification system throughout the country. A further recent development has been the proposal by the European Commission for standardised information on hotels to be used in official hotel guides throughout the European Community. That measure has been extensively discussed by HOTREC, the body representing the hotel industry across the whole of Europe and on which the British Hotels, Restaurants and Caterers Association is represented. The Commission has proposed a series of self-explanatory symbols, which show the facilities that are available at hotels and which it is hoped can be understood by all. In agreeing those symbols HOTREC has also consulted representatives of the United States and Scandinavian industries. We hope to be able to put that measure to the Industry Council on 22 December, next week, for ratification that will lead to its introduction throughout the Community. That of course is not a classification system, but one that we hope will be a valuable aid to the promotion of tourism within the Community. My hon. Friend will recall, when we had the opportunity to debate that and similar matters only a few weeks ago on the Floor of the House, there was some misunderstanding—not in the mind of my hon. Friend but perhaps in the mind of some of our colleagues—about what the new Community system would do. I hope that we have now cleared up that matter.

As my hon. Friend said, the new crown classification scheme is to be launched by the English Tourist Board to the public in the new year through a media campaign and mail drop to several million households. The objective of the public awareness campaign will be not only to acquaint as many people as possible with the existence of the scheme but to make people familiar with the details of the classification system used. The scheme will apply to hotels and other serviced accommodation. It will be administered in England by the English Tourist Board with the help and support of the non-statutory regional tourist boards. In Scotland and Wales the scheme is being administered by the respective national tourist boards. Each national tourist board has adopted the same criteria for hotel classification, although the scheme in Scotland includes a qualitative grading of establishments, as my hon. Friend said. Although the charging mechanisms may vary among the national tourist boards, in each case the charges are designed only to enable the boards to break even on the costs of running the classification scheme.

The scheme allows each hotel to be placed into one of six categories, ranging from that of "listed" for establishments providing a more basic style accommodation, to five crowns for establishments catering for the top of the market. Under the scheme, managements are required to undertake to follow a specified code of conduct that lays down minimum standards of cleanliness, courtesy and information available to visitors. Establishments are classified according to the range and quality of facilities offered. The previous sytem operated by the English Tourist Board had not shown itself as fulfilling the needs of either the industry or the customer. It was complicated and not easily understood by the user, and it had become apparent that there was a need for something better.

I am sorry to have to say to my hon. Friend that the Government wish to make clear their view that we want a voluntary system of hotel classification. We have always believed, as my hon. Friend knows well, that compulsion and Government regulation would be wrong. My hon. Friend kindly said in his opening remarks that I had tried personally, whenever I could in the Department of Employment, to deregulate to ensure that those who were enterprising, not just in tourism but in small firms, had the air to breathe and were able to expand and develop. That is the Government's main policy.

Mr. Gregory

I am exceptionally grateful to my hon. Friend for giving way and I will interrupt only for a moment. In view of his enthusiasm for the open market in that respect, do the Government intend to withdraw, after so many years, the Northern Ireland scheme that has worked so successfully since 1948?

Mr. Trippier

My difficulty, as my hon. Friend will know, is that I am not responsible for Northern Ireland. I appreciate that that is the reply that my hon. Friend might have expected. I made it clear at the outset—as my hon. Friend will recall—that I am the Minister responsible for tourism in England. The less said about that, the better.

I was grateful to my hon. Friend for his earlier remarks about deregulation responsibility within the Department of Employment. That sits uneasily with the stance that my hon. Friend has adopted, which would impose compulsion and increase regulation. Regulation would be more costly to the industry and hence to the consumer. It would certainly be more rigid and bureaucratic and would require significant resources for its operation and administration. It would also be inflexible and unresponsive to changing needs and would have no advantage over a voluntary scheme in encouraging the upgrading of standards.

In an attempt to bring my hon. Friend and myself together on this point, he would be the first to admit that the Government try desperately hard to listen to the voice of industry. That is the major plank of my platform in addressing the debate today. I want to try to convince my hon. Friend that we have listened to the tourism industry. We did not want to introduce a proposal which the industry did not want.

The view that I have expressed is shared by the majority in the tourism industry in this country. I do not say this in an unkind manner because I know of the great enthusiasm that my hon. Friend has for the tourism industry and his particular interest and involvement nor least in his constituency, yet he would be the first to admit and acknowledge that in the debate on the European regulations on 26 November there was no support expressed on the Conservative Benches for a compulsory system—that is, for his proposals.

The current crown classification scheme is the result of lengthy and detailed consultations between the national tourist boards and trade, local authority and consumer interests. Organisations representing the industry as well as individual hotel operators were given the opportunity to make their views known either directly to the English Tourist Board, or at meetings organised by the regional tourist boards. I am confident that adequate opportunity was given to all concerned to contribute to the debate, but of course it was up to the industry to take full advantage of the opportunity offered. Account was also taken of the lessons learnt in operating the old scheme and of suggestions received from members of the public as to how the system could be improved. The scheme is designed to ensure that the customer knows what he or she will be getting when booking accommodation and to help in deciding whether what is being offered represents value for money. It will also provide a yardstick to hoteliers who wish to improve the facilities offered and an incentive to upgrade the quality of the accommodation stock to meet rising customer expectations. In addition, membership of the scheme will give hotel operators a marketing advantage over their competitors who have not opted for classification. The classification categories are designed to help both British and overseas visitors to select with confidence establishments that meet their needs. I believe that such a system is necessary if this country is to compete successfully in the international tourism market.

Since the announcement of the scheme in October 1985, over 12,000 establishments in England, Scotland and Wales have applied for registration under the scheme. That compares with an estimated 10,000 establishments participating in one or both schemes operated by the motoring organisations. I am aware that initially some parts of the industry expressed concern about aspects of the scheme, but I believe that the degree of positive interest so far shown in the scheme indicates that it is favourably regarded by a broad cross-section of the industry. A breakdown of establishments that have so far registered shows that the scheme is receiving support from all types of hotel. The number of establishments so far registered with the scheme in England falls only just short of the target numbers for the launch date.

As I have already mentioned, the three national tourist boards employ exactly the same criteria in classifying hotels, although the Scottish Tourist Board goes further and also grades establishments according to an assessment of the quality of facilities offered. I am aware that some siren voices south of the border would also welcome qualitative grading. I can see that there may be a case for suggesting that it would be advantageous if exactly the same scheme operated throughout Great Britain, but certain sectors of the industry have expressed strong reservations about grading and these have led to the English Tourist Board's decision to restrict the scheme only to classification of facilities for the present. However, the introduction of grading remains under active consideration—and so it should. The English Tourist Board is of the view that if there are sufficient indications of support from within the industry it will consider introducing qualitative assessment. I understand that the Wales Tourist Board is soon to begin an exercise to seek the views of the industry in Wales on the principle of quality grading.

Other voices have suggested that the public will be confused by the existence of the new crown classification scheme alongside other schemes such as those run by the motoring organisations. The AA and RAC have set up schemes designed to meet the needs of their members, which may not necessarily be the same as the requirements of the population generally. Additionally, they do not cover the full range of the types of hotel and other accommodation offered. The Government therefore believe that there is a need for a scheme to be set up which has national applicability and which provides a fully objective assessment of the facilities offered. The public awareness campaign to which I have referred should make everyone familiar with the crown system and avoid any confusion which might otherwise arise.

As I have said, it is now just over two years since the English Tourist Board originally began consultations on the form of classification. It has been an illuminating experience for the board and, I suspect, for many within the industry. Progress has not always been easy, but I believe that we now have the basis of a system which meets the needs of both the industry and its customers. At the request of the Government, the English Tourist Board is reviewing the classification scheme to see what lessons there are to be learnt in the light of the experience gained so far. I assure my hon. Friend that full account will be taken of all comments and criticisms in any future amendments made to the scheme and the English Tourist Board will give ample notice of any significant changes proposed to the classification criteria to give interested parties time to make their views known. The view has been expressed by some that the board's willingness to hold a review at this stage suggests a lack of confidence in the scheme, but needs change and we learn by experience. Indeed, since the inception of the scheme, a review was planned during its first year of operation, along with a continuous assessment of performance. In this context, a consumer research project will be carried out during 1987 to establish the public's reaction to and perception of the scheme. Any modifications will have the aim of improving standards and enhancing consumer confidence.

An example of the boards' responsiveness to comment from the industry is the recent decision by the English Tourist Board to introduce an additional superior or five gold crown classification category. This was agreed in response to reservations expressed by the industry that too many hotels were meriting inclusion in the top five crown category—the very point that my hon. Friend made. The five gold crowns will be awarded to those few hotels which offer the highest levels of service and facilities. It is expected that not more than 35 hotels in England will attain that classification, compared with more than 200 which have to date been awarded five crowns.

The country has long needed a national classification system which applies to all serviced accommodation, one which is not aimed at a particular section of the market but satisfies the needs of the whole industry and of all potential customers. The true test of the scheme will only come with experience of its operation and this is not to begin until the new year. We must await the verdict of the user, but I am confident that the scheme will be welcomed by all concerned.