Economy, Energy and Tourism Committee

Meeting date: Wednesday, June 16, 2010

Official Report 480KB pdf

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International Trade Inquiry

Welcome to the 20th meeting in 2010 of the Economy, Energy and Tourism Committee. As we have six items on today’s agenda, time is a little on the tight side, so I request that all members keep their questions brief and to the point so that we can get through all the business. Let us have questions, not statements, please.

Agenda item 1 is the international trade inquiry. I am pleased to welcome to the committee for the first time, in his role as chairman of VisitScotland, Dr Mike Cantlay. I ask Dr Cantlay to make some brief opening remarks and to introduce his team before we move on to questions.

Thank you. It is a pleasure to meet the committee. The fact that this is the first time that I have given evidence to the committee—in fact, it is the first time that I have given evidence to any committee—makes it a particular pleasure. I am sure that you will be gentle with me.

I understand that the committee prefers not to take statements, so I will say only a few brief words. I introduce Riddell Graham, whom you have met before, who is the director of strategic partnerships. He is the specialist in the field, so I anticipate that when it comes to responses to your questions, I will back him up.

As you know, VisitScotland provides a platform for businesses across Scotland to break into international markets and helps them to sell their products and services across the globe. We do that through our international consumer campaigns, our work on business tourism, our activity in emerging markets and our events and exhibitions activity. It is those issues that we hope to touch on, in addition to updating the committee on the position regarding the national investment plan and the tourism development bank.

Thank you very much.

One of the focuses of our inquiry has been to investigate whether the various agencies that work to promote Scotland are working effectively together and with other United Kingdom agencies. In VisitScotland’s case, VisitBritain is the main such agency, but we also want to know how you work with Scottish Development International and UK Trade and Investment overseas to ensure that your message gets out as widely as possible.

I am happy to respond to that. The really important message to get across is that, although all our international marketing is tourism focused, we do not do that work on a stand-alone basis. In fact, every one of our activities is undertaken jointly with at least one other agency and several commercial partners. The opportunity to work with tourism businesses throughout Scotland is key. We have a particularly strong relationship with SDI and, as you mentioned, VisitBritain, from a tourism point of view. We also work with the Scottish Council for Development and Industry on international activity. We ensure that there is close co-operation with the Scottish Government team, too, in promoting Scotland internationally. We dovetail into those other bodies’ activities to ensure that, once they are developed, our plans match very much their aspirations.

The relationship with VisitBritain has developed over the years. We now have a concordat in which we identify the key markets in which we work alone, with activity direct to the consumer, the markets where we work jointly, and the markets where VisitBritain takes the lead because it has the people on the ground to do that job effectively. Strategically, our relationships with all the agencies that you mentioned are very strong. We work closely with them on an operational basis. I can reassure the committee that that is very much the way in which we do business.

Having been about in both Scottish Enterprise and VisitScotland back in time, having had a break, as it were, and now having seen the environment today, I have two observations to make that are worthy of note. The first is on team Scotland working together. In my first week in post, I was in Canada where I saw at first hand how the various Government agencies work together to deliver in Canada. They share support—indeed, they even share people—which I found refreshing in a very competitive environment.

My second observation is that VisitBritain has transformed almost totally from the body that I remember. Today, VisitBritain is a machine that sees itself very much as being there to service stakeholders such as VisitScotland. VisitBritain works very hard to do that. Its budgets are very hard pressed—it is going through a period of discussion with the new Government on where its priorities will be. However, I like its approach, which I think will serve Scotland well.

For the record, will you indicate the physical presence that VisitScotland has in overseas markets? I am thinking of staffing and so forth.

We have no physical presence internationally at all. As I said, VisitBritain is the agency that has people on the ground in all the key destinations, and we work through them. Clearly, we have a presence in those marketplaces when we do international marketing activity at exhibitions and trade shows. We have a long record of those. In physical presence terms, all our staff are based in Edinburgh.

Is there any particular reason why you have chosen not to have any staff in key markets such as the United States or China?

It is interesting to note that we operate in very different ways in each international market. For instance, in some of our near markets, where Scotland is much better known and where the consumer is the key audience, our activity tends to be direct to the consumer through advertising, direct mail and other print media. In other markets, particularly emerging markets, we tend to operate through tourism agents. We now have 5,000 agents throughout the world who are specialists on Scotland. We get them to do the work for us. We launched that scheme several years ago and it works very well. The industry in those places tends to make its bookings through agents; bookings are not made by the consumer. We are always looking for new opportunities. Obviously, if the opportunity arises in a territory where having a presence makes sense to us, we will consider that.

Obviously, we have very limited funds for what we do in the tourism business, which is the most competitive business in the world—indeed, it is potentially the biggest business in the world. We therefore have to be opportunistic. We tend to seize the opportunities that are presented by, for example, trade missions. I mentioned the example of Canada, where we harnessed the opportunity presented by Scotland week activity.

To give members a feel for activity in Scotland week, in the week in which we focused on Toronto, we also focused on New York and San Francisco. A small team went out to hit those areas hard. If I remember rightly, that activity cost under £100,000. The public relations activity that we did in New York on the back of Scotland week events was worth more than $4 million at the rack-rate value of PR activity that harnessed other events. Often, the tactic is to seize on work in other parts of the Government and use that to best advantage.

Good morning. I am interested in the statement in your submission that you work with SDI and that you play

“an important role in supporting the investment agenda by providing intelligence on key markets and customer segments”.

Will you tell us more about that?

Through what we glean from VisitBritain’s detailed market intelligence and from our consumer insights team, which is based in our office in Edinburgh, we analyse what the consumer is looking for. As members would expect, no two markets are the same. It is important that we are aware of the best way to attack markets—we decide that through our consumer research.

We worked jointly with SDI on developing the national investment plan, to which we brought the tourism perspective. I will give an example of how that worked. We know how people arrive in Scotland, how they travel around Scotland and what they do when they are here. We extrapolated that information and asked what the position would look like in 2015 and whether gaps in the provision of tourism facilities would exist and would need to be filled, on the basis of a demand statement. Working with SDI, Scottish Enterprise and Highlands and Islands Enterprise, we formed the basis of our perspective on national investment needs in the future.

As the committee was told at a previous meeting, the plan has been passed to our colleagues in the industry, the Scottish Tourism Forum and the new industry leadership group. They have established a sub-committee on investment that will examine closely the public sector view of the world, on the basis of the research, and determine whether the industry sees the situation in that way and how progress can be made in a co-ordinated way. SDI was closely involved in that process. When we prepare our annual corporate plan and our operational plans, we ensure that our plans are clearly aligned with those of SDI, so that we have the best hit for joint activity.

Will you give us a couple of examples of the investment that you suggested to industry leaders?

The investment plan identified the need for investment in transport infrastructure. Our colleagues in our business tourism unit make it clear that one key constraint in attracting major conferences relates to ease of travel from the arrival point to the venue. Other investment needs were in new accommodation in cities, to meet business tourists’ needs, and in accommodation in rural parts, where country-house hotels could benefit from investment in the quality of the visitor experience. Activity holidays were a big area that was identified for growth in the next four or five years. If demand for such holidays were generated, a gap could exist. The plan contains a detailed précis of that.

The investment plan provides a key opportunity for Scottish tourism to move forward and to harness the growth that we have talked a lot about in the recent past. The plan will provide the opportunity to consider matters such as planning.

Planning is not a direct responsibility of VisitScotland, but it is clearly an issue for us. There is best practice out there—I cite the national parks, as convener of Loch Lomond and the Trossachs National Park Authority—whereby significant tourism development opportunities are highlighted through the local plan process, so that by the time that SDI and other partners bring potential developers in, the planning process is several years down the line and developers do not have to pick up at the start and work their way through a process that involves a great deal of time and, sometimes, frustration.

When the investment plan comes back from the industry group, which is the right way to tackle it, key features in some of the more difficult areas will emerge. VisitScotland will play its role in driving that work.

09:45

Thank you for your explanation. I am thinking about the sources for your evidence, because it is clear that we are considering an area for inward investment. How wide a range of groups or people elsewhere in the world are you talking to about accommodation and so on? What is the balance between accommodation, transport, attractions and activities? Is more attention paid to where people stay and how they get about?

SDI is probably best placed to respond to that. I understand that someone from SDI will give evidence later in the meeting. We tend not to be out there sending out the inward investment message; that is very much SDI’s role.

We were able to provide the tourism consumer perspective. The initial feedback that we have had from the industry has been positive. The industry has not identified areas in which we missed key aspects.

SDI has a separate tourism team, which does the inward investment messaging and speaks to a range of developers, particularly in relation to accommodation and activities. We work closely with the team to provide collateral to enhance its promotional activity.

Rob Gibson highlighted important issues, which I want to pursue. I want to get Mike Cantlay’s take on the big picture. What is your view of the relationship between VisitScotland and SDI? You said in your submission:

“While Scottish Development International has the lead role in attracting international investment to Scotland, VisitScotland plays an important role in supporting the investment agenda”.

Is the institutional relationship on such issues broadly correct?

The relationship is strong. A feature that attracted me to apply for my post was the ambition for growth. It is right that we should have such an ambition. We have been through the recession and we fared well. However, we have yet to see the scale of growth to which we aspire. You will hear me use the phrase “step change” again and again, because I hope that over the short to medium term we will be able to work together on a combined front and focus on identifying the step changes that will come out of the investment plan and which will drive growth and provide the biggest hits.

Let me give you an example of what I mean—it is one in the oven from the past, as it were. I was involved in Forth Valley Enterprise—Lena Wilson was also involved at the time. The enterprise company was performing well and there was an aspiration to get the Forth valley economy back on stream, at least in line with the Scottish and UK economy. To do that, we had to target big hits. Those big hits went beyond individual organisations’ responsibilities. They turned out to be, for example, securing the Kincardine bridge replacement, investment in petrochemicals, getting national park status for Loch Lomond and the Trossachs, securing the millennium canal—because the Falkirk wheel was on our patch—finishing the top of the town in Stirling and reopening the railway line to Alloa and Clackmannanshire. Those things were not the responsibility of Forth Valley Enterprise, but cumulatively—with partners—we focused on where those big hits were. Over a period of time, those have been delivered and have made a huge impact on the Forth valley economy.

In simple terms, that is the approach that I hope that we can adopt. As the investment plan comes through over time, I hope that we can look at where the priorities and biggest hits are that could drive real and sustainable growth in tourism. Obviously, I have spoken about that at length with Lena Wilson, with whom I previously worked on a similar project. However, that approach involves a journey. I have not turned up with a list of all the step changes. There are many potential step changes on the transport side, the investment side and so on. My aspiration is for a journey that is led by the industry. I want an open discussion that targets those biggest hits that will provide sustainable growth.

Within that overall approach, what is the proper role of VisitScotland?

The interesting thing with the leadership group that is currently considering the investment plan is that the industry is taking a hold of all aspects of tourism. That is a great thing. It is an exciting point in time. I think that the work of the leadership group, and of the Scottish Tourism Forum in particular, is excellent. For the first time, we have an opportunity to have an industry-driven initiative that galvanises the smaller trade groups in a membership forum, and I think that that is great. From the leadership group on the tourism framework for change—which is the aspiration that we all look towards—will come the step changes.

We can almost draw a line underneath which are issues that the industry can take hold of. Those issues—skills would be one example—might be driven by the industry itself or perhaps in conjunction with other agencies, such as local authorities. However, there are issues above the line—such as route development as a concept—that are really issues for Government in its widest form. My aspiration for VisitScotland is to remain very focused on where we provide the biggest hit and get the biggest return from our work, but I think that we also have a leadership role in ensuring that those issues are picked up, so that our work on, for example, the investment plan results in genuine actions in which Government as a whole plays its part.

Let me add just a couple of points.

I am pretty clear that our role up until now, which I suspect will continue very strongly, has been to bring in the perspective of the consumer. At the end of the day, there is no point in developing something if there is no demand. In our work on the investment plan with SDI, our role has been to say, “This is what consumers, or visitors, are telling us that they need.” From the best research that is available and by looking at trends, we extrapolate forward to suggest where the gaps might be. First of all, our role is about providing the consumer perspective.

The second part of our role is about ensuring that tourism is on the agenda of other bodies. Quite often, tourism tends to be forgotten. Our role is almost that of lobbying to ensure that tourism’s importance to the economy is presented to partners in a compelling way. That is about the added value that tourism brings to the economy of Scotland.

Those are the two key roles that I see VisitScotland playing in that relationship as we move forward.

VisitScotland clearly has an important role in keeping a focus on what the consumer wants and what will bring people to Scotland. However, what about the outward role? In other words, what role does VisitScotland have not simply in identifying and responding to what consumers want but in proactively creating market opportunities and promoting Scotland?

Let us consider for a minute route development, which is a key issue. As members will know, we had a highly successful route development fund—in my view, it was an enormously successful initiative for Scotland—which has come to an end because of the situation with the European Commission. However, that does not mean to say that we do not continue to pursue that work.

Let me go back to the likes of Canada as an example. I cannot tell you the exact figures off the top of my head, but we lost something like 45,000 seats through the departure of Zoom Airlines and Globespan. It is vital for all who are active in Canada to tackle the issue and resolve it.

We are dealing with some very big players such as Air Transat and Canadian Affair as a client-managed arrangement at VisitScotland. We are working closely with them to see what can be done. There are other big institutions such as Air Canada. Something like 35 per cent of Canadians who come to Scotland use Air Canada, which they regard as their national carrier. In addressing the difficult challenges that we face, it is key that individual organisations work together to solve the problem. Combining what I have seen in team Scotland with the SDI team that is based in Washington and VisitScotland, we are still working to resolve the issues, although we do not have the mechanism.

That is a kind of horizontal working across agencies in different sectors but, going back to one of Riddell Graham’s earlier points, the vertical relationship with VisitBritain and the industry is important, too. How do you ensure that you get both?

Along with the chair of VisitScotland comes a position on the VisitBritain board, at a time when VisitBritain will transform again as a result of the funding position down there. I went to one session—a strategy session on where VisitBritain was going vis-à-vis the impending cuts and so on—and it was fascinating to see the partner organisations that VisitBritain is working with. VisitBritain has key links in some international organisations that we see less of—the airlines being a classic example. It is certainly my intention, on behalf of VisitScotland, to utilise the opportunity of sitting on the VisitBritain board to ensure that we capitalise on those links as much as possible. That gives us a great opportunity.

From an operational point of view, as well as our having that presence on the board our international marketing head regularly meets all the heads of the international markets that are relevant to us and we share our corporate plans. I sit on a group that looks at the corporate plans for Northern Ireland, Wales, England and VisitBritain. We share that intelligence up front when the plans are being produced, which ensures synergies. We can always learn from other people. What is someone doing well that we can learn from? What opportunities exist? That information is shared in detail on a market basis as well.

Do the other tourism agency models across the globe operate with staff in country or do they operate similar models to that of VisitScotland?

I do not know the detailed answer to that, but a number of national tourist boards have a presence in Britain. I can think of several that have a presence in London because they represent key markets. It varies depending on the importance of the tourism market. We can get that information for you. We constantly undertake competitor analysis and research, and we can give you a full comparison if you feel that that is important. We are always learning from others, and if there are examples of how things can be done better we will always seek to mimic them.

Let me give an example. We are often compared with Ireland, which takes a slightly different approach from us to some of the emerging markets. Different organisations do different things. I understand that Ireland has a presence in Canada and that for every $1 that we spend on marketing in Canada, Ireland spends in the order of $20. Ireland has a team out there, working that. However, if we look at last year, Irish tourism was down well in excess of 10 per cent, whereas Scottish tourism overall was up 2.6 per cent and the international trend was down something like 4 per cent. It is horses for courses, and different approaches in different countries. As a new chair, I have to say that the way in which VisitScotland deploys its resource to get the maximum return in international markets is regarded as clever.

10:00

Following on from that, I have a question about tying in with SDI. SDI provided evidence to the committee on target areas such as the far east and other emerging markets, and you mentioned the team Scotland approach earlier. Are there opportunities to have joint offices with, for example, SDI in some markets to promote Scotland more as a tourism location and, potentially, better assist SDI with inward investment for the country?

The roles tend to be quite different. Your point is on inward investment, but our activity in the emerging markets such as India, China and Russia is focused on building tourist traffic to Scotland. VisitBritain has also concentrated on that activity. On behalf of its strategic partners such as VisitScotland, it has concentrated on the emerging markets on the basis that much of its work in some of the places for which Britain is a more popular destination has been done. Our focus has been on using the opportunity of trade missions to go out and sell Scotland as a tourist destination and get the traffic flowing, because the opportunities will come about once the traffic starts to flow and more people from the emerging markets come to Scotland to see what the country is about.

We decide how to spend the £5 million or so that we spend on international marketing based on the scale of opportunity, whether there are direct tourism access links, whether Scotland’s strengths match the needs of the particular market, how good the travel trade is in that country—we glean that specialist knowledge through VisitBritain’s activity—and whether the products that we offer fit with the market.

I return to your question about whether we should have a presence in markets. Our approach is about making the appropriate officers from SDI aware of the opportunities in the markets that we see are important from a tourism point of view. It would not necessarily be more effective simply to have a presence in a country. We need to identify the priority markets for us—we have already done that through a scale-of-opportunity analysis—work closely with VisitBritain from the tourism point of view and then, where appropriate, work with colleagues in SDI to maximise the impact of our work.

For instance, if we go overseas on a trade mission, we always involve SDI in the planning to ensure that there is synergy between its work and our specific work on tourism. We can bring to the table specialist knowledge that SDI perhaps does not have but which it recognises we can bring alongside.

I will mention one other important aspect that links closely with your point on SDI: business tourism. We recently tried to ensure that Scotland appreciates the significance of business tourism within our portfolio. On average, business visitors spend 60 per cent more than traditional visitors, so business tourism is a huge business for Scotland. It is worth £827 million, and the ambition is for it to be worth £1 billion in its own right. Of that, £226 million comes from international markets, and the developing markets are key in that.

To give you a feel for just how important business tourism is, I offer a statistic: the business tourism unit of VisitScotland engaged in nearly 300 specific inquiries in 2009-10, which created a potential £100,170,767-worth of business. Business tourism from India and China in particular, as well as Russia, has huge potential.

Are you looking at the estimated retirement numbers in markets such as Japan over the next five to 10 years? It is estimated that 10 million people will retire over the next five years in Japan, which is very much a wealthy country and market. Those people will have a fairly large amount of money to spend. How can VisitScotland encourage some of those people to spend their money on tourism as well as assist SDI to get them to invest in Scottish businesses?

We look constantly at how markets are changing. Our current portfolio is different to the one that we had four or five years ago because the market has changed. The strength of the pound against other currencies has changed, the opportunities have changed and the strength of the economy in each country has changed. All that flags up opportunities. To reassure you, we look constantly at the markets, particularly the strongest and most mature markets for Scotland where we are closely aligned with their consumer activity. We also work through VisitBritain, which listens constantly to what is going on in each country. VisitBritain continually does detailed market analysis, which we buy into and share. We have the intelligence to respond to the needs of different markets as and when necessary.

I cannot answer specifically about Japan, but I can come back to you on it. However, through the travel trade in Japan, we target those who are more likely to want to travel and those who have a propensity to visit Scotland in particular. We have a long history of working with the Japanese market over a number of years, so we know it well.

I can offer a good example from the US to give you a feel for the challenge and the opportunity. I understand that each state in the US spends something like £30 million on marketing its state to the US market, and there are 50-odd states, so that is a huge amount of noise and competition. In comparison, Scotland spends somewhere between £1 million and £2 million marketing Scotland in the whole of the United States. It was highlighted the other day that that figure is roughly the same as what Prince Edward Island spends on marketing itself to the United States. We have a small pot to play with, so we target.

In reference to the earlier discussion about potential step changes, we have not mentioned homecoming this morning, but it has been much discussed over the past few weeks. The discussion ranges around how successful the last one was, whether there should be another one and when it should be held. For me, turning the concept of homecoming, which is about the relationship with the diaspora, into a permanent legacy would be a win. We are set to have a further homecoming year with themed years in between. My objective is for us to turn that machine into something that works continuously. That is the real goal of EventScotland. We want to make individual events permanent so that we have permanent support for the relationship with a diaspora of 40 million people. That would link so well into the globalscot network, with SDI’s work and potentially with inward investment. It is about being targeted and using our opportunities to best effect.

A delegation from the committee has just returned from Catalonia, and more than one person we met mentioned the similarities and links between Scotland and Catalonia. Obviously, Catalonia is part of Spain and is a well-developed market. The point was made quite strongly that there are more opportunities to link Scotland with Catalonia. It was said yesterday that when most Catalans come to the UK they go to Scotland before they go to London or the north-west or north-east of England. What particular activities has VisitScotland undertaken and what will it do in the future to try to develop links between Scotland and Catalonia?

I mentioned direct access earlier. The most successful developments that we have had in the Spanish market relate to new direct flights to Scotland. Where we can work with operators to introduce them, there is a clear benefit. I remember speaking to the operator who is in charge of Edinburgh castle. One day, a lot of Spanish-speaking people turned up, and he had not realised that that was the day that a particular flight was coming in for the first time. There is a direct causal relationship between direct flights to Scotland and business for Scotland. Much more can be done and I am sure that that is very much on the radar of our international marketing team. We want to develop and enhance the direct flight links.

Thank you.

Your submission refers to the “total experience”. We have heard before that that is very much about the quality of our welcome and creating a reputation for Scotland.

We heard in previous evidence that planning was a significant barrier to Scotland moving forward. Have there been any changes and improvements in the sector following our report and the new planning legislation?

At the risk of repeating myself, I say that the national parks are a classic example of where we are using the local plan process to work with communities to find out their aspirations for future development and to get proposals through the process, so that they are comfortable with the aspirations for tourism growth. You can relate the local plan process in the national parks to the situation with the Trump development. National park local plans have been around for as long as the situation with Mr Trump, when he came and decided that he wanted to build on a site. The opportunity exists for local authorities and planning authorities to work up their aspirations and take them through the process with communities. Developers are also welcome to join in along the way, but it would be a huge step forward for Scotland if things were community and planning led, rather than necessarily development led.

I was really asking how far down the road we have moved towards that. You gave us an exemplar of best practice. We recommended all that in our report. We have done lots of lobbying of central Government and local government about the planning process being a barrier. How far down the road are we? How much improvement has there been?

10:15

We still get tourism businesses asking why, in certain parts of Scotland, it takes longer than it does in others to get planning permission for a development. The inconsistency has certainly been raised with us. However, I am out and about speaking with local authorities and tourism businesses throughout Scotland, and I find that that message is not as strong as it used to be. So to answer the question, we have moved in the right direction.

We are working with community planning partnerships and through our area tourism partnerships to ensure that tourism is on the agenda, so that when a planning application comes forward for a tourism development that has been identified as crucial to tourism in the area it is looked on more favourably. Our regional directors throughout the country are regularly asked to provide letters of support for tourism developments, and we are only too happy to do that. We have certainly moved in the right direction, although more can be done. Local authorities are much more aware of opportunities that are happening throughout the country and are learning from best practice. The committee’s work has certainly drawn that to the attention of people who in the past were perhaps a bit slow at moving forward.

My next question is on a separate issue, although it is another one that affects investment. You talked a lot about the need for investment in accommodation and the committee supported that in our report. One issue that I have picked up locally and nationally from hotels is about the increases in rates. Hotels seem to be particularly hard hit by that, which flies in the face of the need for investment. My colleagues and I are being lobbied significantly by hotels that say that the changes will increase their room rates beyond what is competitive, particularly in a global market. Will you comment on that?

I attend the British Hospitality Association’s Scotland committee meetings, which tend to involve the great and the good of the hotel and catering sector in Scotland. That issue was certainly brought to the table at the most recent meeting. Evidence that was submitted by the Edinburgh hotels group showed that there are significant increases in rates bills for hotels throughout the country. Clearly, hotels must take that into account when managing their business.

From a positive point of view, through our quality assurance scheme, which is how we intervene directly on quality, we have clear evidence of significant and on-going investment. Our quality assurance team goes into hotels and identifies opportunities to improve the fabric or the holistic experience, which Marilyn Livingstone mentioned. Businesses are not slow to make that investment. Research that we carried out last year in relation to the economic downturn suggested that several businesses were putting investment plans on hold or were not spending so much money, but there is still evidence that money is being spent.

We tend to hear the negative stories. Hotels have lobbied us on the increases in their rates bills, but many of the other costs in their overall operational activity have increased, too. It becomes more difficult year on year to find money to invest and to continue to improve.

One thing that concerns me about rates is that two sectors—the independent nursery sector and the hotel sector—are particularly hard hit. The evidence shows that some of the increases are hard hitting, but there is no transitional relief. That is a huge barrier for hotels that were considering investments. Are you having talks with the Government on that? Rates are independently assessed at local level. I have successfully lobbied Fife Council to get the assessors to reconsider the independent nursery sector in the area. What discussions have you had with Government? The issue is fairly big.

To return to the British Hospitality Association, a key partner round the table is the Scottish Tourism Forum, which is the voice of the industry and has been collating the picture on rates throughout Scotland. It has lobbied the Government on that, so I suspect that it would be good to get its input on the issue.

Thanks very much.

My final question is on skills and development. You talked quite a bit about the need to have a highly skilled workforce. We have a new skills agency—Skills Development Scotland. What is your relationship with it like? What impact has the fact that no modern apprenticeships are available to adults over the age of 19 had on training in the sector?

I will make two or three points in answer to that. We have an extremely good relationship with Skills Development Scotland, which sits on the strategic forum, so the chair and chief executive of the two bodies meet regularly. I am a member of the joint working group that feeds into the strategic forum, so I meet senior colleagues in Skills Development Scotland regularly.

A good example of that close relationship with regard to tourism and hospitality is the joint initiative that we are just about to launch with Skills Development Scotland that is targeted at school leavers. It will use the targeted pathways initiative that has been piloted highly successfully in other sectors, and which we believe has a great opportunity to play into the tourism and hospitality sector. I will meet the chief executive of the British Hospitality Association at lunch time to discuss the finer details of that initiative, which is a good example of the two agencies working together.

I am afraid that I cannot comment on the other part of your question, because I am not directly involved in that area of activity, but we can certainly find out from the industry bodies whether the issue that you raised has had a measurable impact on tourism and hospitality.

I can give you confidence on that point. It is not just that an initiative is being launched to help this summer’s school leavers. I will be interested to find out how you folks perceive the issue to be handled when you are out and about in the summer, but I have been impressed by the great speed with which the agencies have sought to deal with a potential problem and the enthusiasm with which they have worked together.

I would be happy if you provided the information that you mentioned about the lack of adult apprenticeships.

We will happily give you that feedback.

Gavin Brown will be followed by Christopher Harvie. Please be brief.

I will be very brief. What is the current status of the national investment plan?

It was signed off by the public bodies and passed on to the Scottish Tourism Forum and, in turn, the industry leadership group. The initial feedback that we have had from Bob Downie, who chairs that group, is that he is highly supportive of the plan’s content, to the extent that the plan and related financing activity will be discussed at the full meeting of the industry leadership group on 19 July, after which we expect to get a full response. The initial feedback has been highly supportive of the plan, but we are keen to ensure that the industry will buy into it and play its part in delivering it, as Mike Cantlay has said. Discussions are continuing. The initial feedback has been extremely positive, and a much more detailed response will be provided after the leadership group’s meeting on 19 July.

Has SDI been involved at every stage of that process?

Yes, very much so. We worked with the tourism person in SDI, who was involved in every meeting that we held. They brought their international perspective strongly to bear on the discussions that took place. There is no doubt that SDI has been tied in throughout the process.

I have two questions. The first involves comparing the Scots and the Irish statistics on the number of overseas tourists. The Irish claim that they get 9 million overseas tourists every year. What proportion of that figure is made up of tourists that we would claim as non-overseas visitors because they come from England and Wales?

The simple answer is that I do not know, but we can certainly find out.

Including visitors from England and Wales makes the Irish overseas tourist statistics look extremely impressive, but I think—

All I can tell you is that for the island of Ireland last year, the biggest change was that people from the south holidayed in the north and that the huge increase in Northern Ireland tourism in 2009 was almost entirely down to people from the south travelling north. However, we can get you the individual split on that very easily.

Fine. One is impressed on the continent with the ubiquity of the Irish presence in, for example, German-language and French-language magazines. There seem to be more hits at weekends than we get, proportionate to population.

You referred to planning. There tend to be questions about tourism projects, such as the Trump golf course. Could VisitScotland intervene in other aspects of planning that upset quite a lot of people who are trying to develop strong local tourism? For example, large supermarket projects tend to wipe out high streets, and people do not really want to come here to spend their time in malls. Is there any intervention there? The most recent planning decision affecting where I stay in the Scottish Borders—Melrose, which you will be aware is probably the bijou town in Scotland—has divided local opinion. The issue is whether its attractions will be bettered by having a crematorium halfway up the Eildons. That does not seem to me to be the most enlightened piece of local planning. Would there be a point in VisitScotland intervening when a plan would adversely affect tourism in an area where it is the major industry?

I am not going to do the Melrose bit, especially since Riddell Graham and I were born in Galashiels. However, I return to a point that I made before. We have mechanisms in place for planning authorities to take forward plans in the planning process on a top-down basis and to work through their plans and aspirations in their own areas. That top-down approach, which gives communities time to get a feel for what they like or do not like, is the way to go. It works for tourism developments and other developments. A bottom-up approach is almost inevitable, obviously, when a developer picks up a particular development opportunity. However, I would like to see a more top-down strategic direction through planning authorities taking the lead rather than waiting for a developer to turn up on a sand dune with his driver and start the process, only for us to find, many years afterwards, that we are still waiting for the revenue stream to kick in.

We always restrict our comments to tourism, because other bodies are much more competent than we are to comment on the impact on the natural environment, such as a water course. However, if we felt that linked to a planning application was the potential for a detriment to tourism in the area, we would always draw that to the attention of the planning authority. Ultimately, however, we do not make the decision, the planning authority does, although we happily play the tourism issue into the process.

I thank Riddell Graham and Mike Cantlay for their evidence on this agenda item, which I now conclude. We will come back to the international trade inquiry a little later this morning when the Cabinet Secretary for Finance and Sustainable Growth is before us. I do not know whether Riddell Graham is staying for the next item, but I suspect that he is not.

I will probably stay in the public gallery for it.