How can UK tourism be promoted if the budget is slashed?

Culture secretary James Purnell ordered the UK tourism industry to review the way it promotes the country last week, just as the Department for Culture, Media and Sport (DCMS) announced that it was cutting the budget of tourism body VisitBritain over the next three years.

Despite criticising the DCMS for reducing its budget by 18% from £49.6m to £40.6m in 2010, VisitBritain has been asked to lead the review. The organisation had initially requested extra financial support to create a £20m global TV ad campaign (MW October 17).

The DCMS will slash overall tourism funding from £55.1m this financial year to £45.8m for 2010/11. It says the cutbacks are a reflection of the Government’s decision to invest more directly in the country’s infrastructure and cultural institutions – underlined by its injection of an extra £50m into the Arts Council over the next three years. It is also increasing grant aid to England’s national museums and galleries from £302m to £332m in 2010/11.

However, Merlin Entertainments chief executive Nick Varney says investment in the arts and museums is of little value if there is no one promoting them outside the UK. He adds that the decision to cut VisitBritain’s funding defies logic and is an example of the Government’s “apparent contempt for one of the jewel industries in the UK crown”.

The Government says the total amount it invested in the tourist industry in the last financial year was £350m, but critics dispute this figure, saying the actual amount spent on promoting the UK was much less.

Local drain
VisitBritain director of strategy and communications Sandie Dawe says the £350m figure includes money spent on leisure services, such as the maintenance of toilets, street cleaning and tourist information centres. She adds: “A lot of local marketing is aimed at residents and is ‘in region’. It doesn’t address international markets or global competitiveness.”

Many in the industry have welcomed the review. The UK tourist industry has a complicated structure, following the Government’s decision to disband the English Tourist Board in 1997 and devolve the nation into nine regions, with separate regional development agencies (RDAs).

The tourism structures of Scotland and Wales are comparatively simple because they have one tourism organisation each, which is run by the Scottish Parliament and Welsh Assembly respectively. England, however, has nine RDAs reporting to the Department for Business, Enterprise and Regulatory Reform (BERR). This is made more complicated by the fact that the UK tourism industry including bodies such as VisitBritain comes under the remit of the DCMS.

The RDAs have no obligation to spend tourism funds on promoting the regions and can at their discretion use the money to fund other initiatives such as the maintenance of infrastructure and public services.

Stephen Dowd, chief executive of Inbound Tourism, believes the Government has wasted millions of pounds of tourism money through RDAs since 2001.

He says: “Tourism cannot be devolved. It is all about brands and we can only market key brands like England, London and Scotland overseas. International visitors will just not recognise the smaller regions.”

Visit and Enjoy
The situation is further complicated by the overlapping remit of tourist boards in the UK. Bob Cotton, chief executive of the British Hospitality Association, questions the role of VisitBritain, which is also responsible for the Enjoy England brand. VisitBritain’s dual remit promotes England to four countries abroad and the UK globally, but Cotton asks how necessary the organisation is if Scotland, Wales and London already have strong tourism bodies.

Tourism contributes £85bn a year to the country’s economy and the sector employs 1.4 million people, but many experts believe the industry needs a major overhaul and that the latest review is a step in the right direction. However, others argue that central Government will have to invest significantly more if it wants to build a “marketing war chest” to promote the UK more successfully to the rest of the world.