Tourist Hotel Accommodation (Hansard, 19 June 1995)

The Parliamentary Under-Secretary of State, Department of National Heritage (Viscount Astor)
My Lords, the English Tourist Board is conducting a review of the crown accommodation classification and grading scheme, which is a voluntary scheme. Our aim is to improve the scheme so that consumers are given adequate information to enable them to select accommodation of the type and quality that they seek. We intend to publish our proposals for the crown scheme for consultation with the industry this summer. Our final proposals will be announced by the end of the year.

§ Baroness Gardner of Parkes
My Lords, I thank my noble friend for that Answer. However, I am concerned about my noble friend's suggestion that it should be a voluntary scheme. Is he aware that most countries have an identifiable minimum standard and that tourists visiting from other countries are thereby assured? In view of the very high earnings of the tourist industry in this country and the present slow growth in London compared to other continental capitals, does my noble friend not think it is time to bring in a proper registration scheme?

Viscount Astor
My Lords, I have to say that the case for introducing a mandatory scheme for such regulation has not been made. Moreover, it is not supported by the industry. The Government do not totally rule out compulsion, but the clear message from industry is the less regulation the better so as to allow people to do the job, and not more regulation. It is important that there should be a scheme. However, what is really important is that it should be a scheme that consumers use and understand. In that way, it would also have the laudable effect of raising standards in the industry.

§ Lord Strabolgi
My Lords, is the noble Viscount aware that a registration system works very well in France and has done so for many years; and, indeed, ensures a good standard of accommodation, particularly in the more moderately priced hotels?

Viscount Astor
My Lords, the scheme in France is entirely based on classification with no grading. The clear message both from the industry and from consumers in this country is that they want to know about grading; in other words, they want to know about the quality just as much as they want to know what the accommodation is. That is where the scheme is different. It is also noticeable in France that the scheme is not used by industry as it might be because the rate of VAT that one pays depends on one's classification.

§ Baroness Oppenheim-Barnes
My Lords, does my noble friend the Minister agree that it is time that we had harmonisation of star ratings throughout the Community? It is not a regulation; it is something which enables consumers to make a choice and which provides them with information. At present there are so many conflicting star ratings across the whole Community which is especially bad for this country as a major destination for tourists. Therefore, surely we should have a level playing field in that respect.

Viscount Astor
My Lords, the star system is indeed used by the AA and the RAC in this country; and indeed by some European countries. Of course, it means entirely different things in each European country. We believe that the best system for the Government to back, through the English Tourist Board, is the crown accommodation classification and grading scheme. It is twice as popular, in terms of the number of hotels that have signed up to it, as the AA scheme and it is well used. However, we believe that it needs some improvement to make it more understandable for consumers. We also believe that a voluntary scheme which is backed and used by the industry is much more preferable than a statutory scheme imposed by government on an industry which is extremely important for our economy.

§ Lord Donoughue
My Lords, the Minister said that no case had been made for a statutory grading scheme. However, is it not the case that the McKinsey Report, as reported in the press, had as its first finding the fact that the hotel industry itself believed that the main solution to the problems of quality in the industry lay in having a compulsory grading scheme?

Viscount Astor
My Lords, the noble Lord, Lord Donoughue, ought to know by now never to believe everything that he reads in the press. But I have to say that his attitude is entirely to be expected from a party which believes that regulation improves industry and does not hamper it. That is why we believe that our deregulation initiative is so important in helping industry thrive in this country.

§ Lord Donoughue
My Lords, before the Minister sits down, regardless of what I read in the press, is it not the case that the first conclusion of the McKinsey Report 11 commissioned by his own department was, as I have said, that the industry believed that the main solution to its problems would lie in a statutory grading scheme?

Viscount Astor
No, my Lords. That is not the case. What is entirely clear is that the majority of people do not believe that there should be a statutory scheme for the hotel industry. However, some sections of the travel agency industry, particularly the incoming travel agents associations, believe that there should be a statutory scheme as that would enable their businesses to sue either hotels or members of the tourist board if the accommodation for their members did not come up to scratch. That is the danger of a statutory scheme. It is just a charter for lawyers to make money. We believe that it would be much better to devote energies to improving the industry. I am sorry that noble Lords on the Front Bench opposite no longer believe in industry.

§ Baroness Gardner of Parkes
My Lords, is it not a cause for shame that some people come to this country believing that they will receive reasonable accommodation and find that it simply does not comply with the lowest standards of health or safety? The noble Lord really should think seriously about this.

Viscount Astor
My Lords, I disagree with my noble friend. The tourism industry in this country is extremely important. It provides £33 billion in income for this country and 1½ million people work in the industry. It is an extremely successful industry. I do not believe that we should talk it down.

§ Lord Donoughue
My Lords, does the Minister agree that his department's own document on tourism entitled Competing with the Best states on page 9 that over 30 per cent. of all visitors to this country are very dissatisfied with the hotel accommodation they receive, and states on page 14 that our hotel industry is not internationally competitive? How can the Minister's own statements this afternoon be reconciled with the statements made by his department?

Viscount Astor
My Lords, the tourist industry in this country is growing at about 6 per cent. a year; the European average is 8 per cent. a year. Therefore, there is competition and we need to improve. I believe that the industry in this country produces good value for money. It is perfectly true that there are areas, particularly in London, where some hotels do not offer the quality of accommodation that they should for the price that they charge. That was clear in the survey in which 30 per cent. of visitors said they would like to see an improvement. However, 70 per cent. said they were happy with the situation.

§ Lord Molloy
My Lords—

Viscount Cranborne
My Lords, I know that this Question arouses a great deal of interest, but I am conscious that the noble Lord, Lord Desai, has been extremely patient. As always I am in your Lordships' hands, but I think that perhaps we should move on.