Enterprise and Lifelong Learning Committee, 18 Sep 2002

Meeting date: Wednesday, September 18, 2002

Official Report 306KB pdf

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Tourism Inquiry

We move to item 2, which is on our tourism inquiry. I ask the witnesses from the Convention of Scottish Local Authorities to step forward. We have received written evidence. Willie Dunn, who is the convener of COSLA's economic development committee, will lead the oral evidence. I ask Willie to introduce his team and to say a few brief words on COSLA's evidence.

Thank you for moving our time forward. It is somewhat ironic that I am leaving the country later today and that I do not really fancy using the videoconference link given the difficulties that we have had this morning. I am COSLA's spokesperson on economic development, tourism and planning. Some people think that Iain Gray has a huge portfolio, but COSLA's economic development committee's portfolio stretches even further.

Bob Christie on my left is an officer with COSLA, and David Valentine on my right is a representative of the Scottish local authorities economic development group; he is giving evidence on behalf of COSLA. SLAED and COSLA have worked together closely to produce the evidence that we will present today.

Local government welcomes this opportunity to present what it does in Scottish tourism. Local government plays an important role in the delivery of tourism. That is not just about the visitor attractions that local authorities provide; it is about roads, lighting and the cleanliness of areas. It also involves the licensing committees that license attractions and public houses. How many people here have been abroad and not returned to a place because the streets have not been cleaned or the lighting is poor?

We provide 33 per cent of funding to area tourist boards within Scotland and we think our role is vital. It is unfortunate that local government is not represented on the board of VisitScotland and we think that that should be addressed. If we want to create a true partnership for delivering tourism in Scotland, local government should have its place on VisitScotland's board so that it can represent the views of Scottish local authorities in the production and delivery of a tourism strategy throughout Scotland.

We welcome the opportunity to speak today. The committee has our written evidence and we are more than happy to take questions. If I cannot answer them, I will seek advice and help from my officials on either side of me.

I just want to tell the people who are operating the videoconference link that we can hear them talking. When we are hearing from witnesses it would be fair to them to have silence in the background. I am sorry to have interrupted you, Willie.

That is all right. I was just saying that we are more than happy to take questions on our written submission if anyone wants more information from us.

SLAED and COSLA both submitted evidence. David Valentine is here wearing both the COSLA hat and the SLAED hat. Do you want to say anything specific about SLAED's evidence?

SLAED is the Scottish local authority economic development officers group. Its members include the heads of economic development of all the 32 councils, whose staff also participate in the group. I am the vice-chairman of SLAED and head of its tourism sub-group.

We have a huge engagement with tourism in our day-to-day operations and we felt that before we could make a true contribution to the inquiry we would have to develop the facts and figures. My main role has been to prepare our report on the role of the Scottish councils.

I have a couple of questions. In the case studies and evidence that we heard, the following two suggestions were made. First, it was suggested that there should be a tourism tax—a bed tax—to fund additional investment in marketing Scotland at national and local area levels. Secondly, it was suggested that we should follow Northern Ireland's lead and have a more comprehensive system of statutory registration and regulation of the quality of the tourism product. What is COSLA's response to those suggestions?

You have caught us out a little, convener. I do not know the background to the suggestion that there should be a bed tax, but questions arise about who would collect the tax and the purpose to which it would be applied. The question of representation arises in the case of any taxation system; in this case, how would the interests of those who provide accommodation be met through the revenue from the tax?

The bed tax is a double-edged sword. You do not want to put in place a tax that could deter people from coming to the country and using the facilities. The issue is about balance. I know that a bed tax exists in other areas and countries and that a tax is applied on entry to airports in certain countries. The revenue from those taxes is put back into the tourism or airport systems.

Given that Scotland is trying to attract more tourists, the last thing we want to do is introduce a bed tax. To do so could mean pricing ourselves out of the market, particularly if the tax in Scotland was different to that in England.

Have you given any thought to the suggestion about more comprehensive regulation and registration of the quality of the tourism product?

I have not, but my colleague might have done so.

Local government already applies a range of regulatory and licensing regimes to ensure safety, quality and security in respect of premises and activities such as the sale of food. I am not certain what you meant by "quality".

I meant in respect of accommodation, in particular.

Local government goes far enough in ensuring fire safety. We also regulate food safety, in cases where those who provide accommodation provide meals. I am not sure what the role of local government would be beyond that. If we were talking about statutory registration, that would have to be carried out by another sector.

As you know, we commissioned consultants to undertake work during the summer to examine Scotland's competitive position. One of the conclusions that the consultants reached in their recommendations was that we have to change the emphasis to marketing Scotland as an entity. The consultants found too many Mason-Dixon lines—so to speak—across Scotland. People are too worried about trying to market their own hamlet. If we continue to do that, Scotland and the Scottish product will suffer, although it is obvious that local authorities take pride in and want to promote their areas. Have you had a chance to look at the report conclusions?

I subscribe to the idea of thematic marketing for Scotland, in which we create golf and heritage themes—castles or whatever the flavour of the month is—to attract tourists from abroad. However, we need to balance that with the fact that many tourists do not come from abroad, but from within the United Kingdom. They visit specific areas of Scotland, perhaps to stay with friends, visit relatives or stay in a particular hotel.

I agree that, from the worldwide marketing point of view, it is better to market golf as an entity as opposed to marketing it in relation to individual areas. I must be careful about what I say, because David Valentine works for Angus Council. I was recently in Angus, where the Carnoustie golf course is located. If David started a worldwide marketing campaign to get people to come to Angus, a lot of Americans would think that he was marketing a steak house. However, if he said, "Come to Scotland to play golf", and Carnoustie was part of that campaign, people would be more likely to come to Carnoustie.

Once people are in Carnoustie, they can see more of the wonderful tourist attractions in Angus, such as the Pictavia centre, which we visited a few weeks ago. There must be a balance between the two types of tourism. From a worldwide perspective, reasons for people to come to Scotland should be based more on themes. Once tourists have visited Scotland, we want them to come back, and local government can play an important part in ensuring that people come back.

I would like to tease out a bit more information about your views on the area tourist boards. Paragraph 6.5 of your submission states:

"The centralisation of e-bookings at VisitScotland should lead to a greater link between VisitScotland and ATBs."

However, Greater Glasgow and Clyde Valley Tourist Board has decided not to sign up to that. Does COSLA have a view on the robustness of the area tourist board structure?

Area tourist boards work quite well in some areas, very well in some areas and not very well in other areas. There is no perfect structure. We are not saying that there should be six area tourist boards or what they should be like. We have yet to have that debate; the matter must be gone into deeply. Edinburgh and Lothians Tourist Board, for example, markets its area well because that area has a critical mass. However, the current structure of 14 ATBs is not sustainable, and we need to investigate further whether there should be 10, six, five or four ATBs. Thematic ATBs must also undertake cross-border working, for example, as between Fife and Angus—St Andrews and Carnoustie—on golf tourism.

We want to ensure that, whatever structure area tourist boards take, local authorities are properly represented on them. If local authorities are to provide money to the new structure, each local authority that gives money should be represented. I draw a parallel with the boards of local enterprise companies; the City of Edinburgh Council, East Lothian Council, Midlothian Council and West Lothian Council are all represented on the board of Scottish Enterprise Edinburgh and Lothian. There is no problem with that and the same should be the case for any new tourist board structure that emerges. If a local authority gives money to an area tourist board, it should be represented on that board.

I will add an ancillary point on the need for robustness of funding, which is also important. Greater Glasgow and Clyde Valley Tourist Board is among those that rely most heavily on revenue from local authorities. Local authorities provide three-year rolling funding for ATBs and, nationally, local government is the largest funder of ATBs. Nevertheless many ATBs face financial problems. In any review of ATB structures, we must consider the need for stability in their funding arrangements. We have managed to swat on the head any argument that local authorities are somehow at the root of the current instability. As well as governance, the buy-in from local authorities will be important in ensuring continuation of the links to all the attractions and services that we already provide locally.

The funding element is critical. I worked in a community organisation in Wester Hailes, for which annual funding was a problem. We did not know whether we would have funding for our programme from one year to the next so, six or seven months into each year, our staff started looking for other jobs. Area tourist boards need to have security of funding so that they can plan for the long term. They need to know how much money they will have in years 2 and 3. That will ensure a much better delivery from the area tourist boards.

At the moment, ATBs rely on about £4 million annually from European funding, which will be reduced significantly over the next three years.

Would local authorities resist any attempt to remove the obligation on them to fund area tourist boards and to centralise funding in some way?

Yes. The buy-in depends on there being no taxation without representation. As well as funding the ATBs directly, local authorities put a lot of other money into tourism indirectly. Their role in the ATBs—in funding them and in ensuring that they deliver for the local areas—is critical. Therefore, the money for the area tourist boards should still come from the local authorities, so they can continue to play their part.

I represent a Fife constituency where the area tourist board does a very good job. The evidence mentioned considering a more integrated approach. You are talking about security of funding. What are the implications of community planning? How do you think it is all going to fit in? You are talking about looking at three-year budgets. How do you see the role of local authorities and community planning in the tourist boards? How do area tourist boards think that the local economic forums are working? How are they fitting in and how can they help? I know that is quite a big question. However, we are considering integration and I am asking how the two structures of community planning and the local economic forums are working.

I will answer those questions as best I can. On community planning, part of the SLAED submission comes to the important conclusion that tourism is considered holistically by communities. Tourism is a thread that runs right through a local economy whether it is considered from the point of view of amenities for tourists that also benefit local people, or from the point of view of building the image of a place to attract inward investment.

If I go to a meeting of business people in Brechin or Arbroath, for example, one of the most important aspects of that discussion will be tourism. They will talk about culture, heritage and all the things that make up the local product. Councils that offer so much of the Scottish product have a duty to promote and package local marketing and marketing of products locally. However, we also want to engage in the themed approach.

On community planning, we must use an holistic approach. Tourism runs through the whole economy.

After some initial fears, most areas of Scotland seem to be quite settled with the local economic forums and the way that they have approached the work. The Tayside local economic forum has a strategic tourism group that will meet twice a year to co-ordinate on important strategic issues such as transport, communications and marketing. It is important to note that that goes back to the ATB position. We need to get the relationship between VisitScotland and the area tourist boards right. I do not think that there is a problem with the local economic forums.

You have given us an example of good practice, which is helpful to the committee. You are saying that no one size fits all and that there should be flexibility. It is asking quite a bit, but if you have any more examples of good practice, I think that the committee would like to see them because that could inform the debate. If there were examples of how good practice is taken on board, I would like to see them.

Do you want to see those as follow-up evidence?

Yes. I am not asking to hear about those examples right now, but it will inform our debate if we have good examples. We heard how organisations vary from region to region, so it would be helpful for the report that we are compiling to have some examples of good practice.

That is not a problem for us. We can submit that information to the committee.

Thank you.

Paragraph 6.9 of the COSLA submission mentions that there are questions about how much influence core funding by councils has. Your submission also mentions how councils are obliged to seek best value when procuring services from ATBs. The ATBs must demonstrate that they are the best providers. Do you have any examples of tourist boards that are not providing best value? Do you have any examples of tourist boards and councils being in conflict?

We have done a local inquiry and we found very little conflict between the local authority and the tourist board. I would like to know whether that is typical or atypical and whether there is tension between the tourist boards and local authorities generally.

David Valentine can answer the part about tension.

I am not aware of any specific examples of tension. The situation to which Mr Macintosh refers is a variable commodity throughout Scotland. There are obviously tensions in some areas. In my case, there have been problems because of the role and remit that local authorities are said to have because they do not have a destination-marketing role.

Obviously, that leads to tension when we own so much of the product. For example, Angus Council owns eight golf courses, including a championship course. We therefore have a duty not only to manage and maintain the courses for local people but to present them as part of the national tourism product. That leads to tensions on roles and remits. Our submission makes the point that tourism is everyone's job, from the citizen to the national support organisations.

The issue goes back to the possible need for more clarification of roles of Scottish Enterprise and the area tourist boards. We must also realise that local councils have a responsibility towards the product as well as a duty to take an holistic view by looking after their communities and integrating with what happens at national level. We realise that there needs to be a lot of change, but many councils have shown that they are willing to change.

I sympathise with your frustration that councils could do a good job if they were given charge of the services that are currently provided by the ATBs, but I want to establish whether, in addition to the need for clarification of roles, there is a fundamental problem with area tourist boards. Are you able to get on with them and work hand in hand with them? Do you work in partnership with them? Is there a workable relationship between councils and ATBs, or does the relationship need to be rethought?

To generalise, the relationship has the potential to be good. Apart from the tensions that I mentioned, many of the problems have come from underfunding of area tourist boards. The ATBs have been unable to do many of the things that they would have liked to do, which puts pressure on communities to take action through other means.

Do the area tourist boards have the right balance between elected local authority members, representatives of small businesses and representatives of large tourist business?

The council representation is right at the moment—obviously, I would say that—but area tourist boards should include a broad spectrum of people from different sizes of businesses. That is not the case in some tourist boards. Some include the classic two or three people who run small bed and breakfasts, but include no representation from the several large hotels that might exist in the area. The area tourist boards should be structured in such a way that they represent provision in the area.

I cite the example of the local enterprise companies, which include representation from local authorities, from education and from small and large businesses. The local enterprise companies have all those people to look after economic development for the area and area tourist boards should go along those lines. We need to ensure that ATBs include representation from all the facilities and groupings. That does not by any means require ATBs to have huge committees, but they need people with experience in different sectors rather than in just one or two.

I welcome your comments on the tourist information centres—I make that comment in passing—but paragraph 6.14 of your submission proposes that companies that pay membership fees to their home area tourist board should be able to get a service throughout Scotland. Is that opinion commonplace? I have not heard it before, but it sounds like a sensible idea.

My understanding is that that is a problem for many businesses. As well as having businesses that service a local market, we have businesses throughout Scotland that service national or even international markets. Those businesses need access to full support and should not have to go to different boards for different types of support on different matters.

Is the problem that the businesses need to make the same argument to each board?

Yes, but they are also required to engage in the different initiatives that are being promoted throughout Scotland.

I would like to make a point about the relationship between local authorities and the area tourist boards. There is no great will on the part of local government to take on the functions of the ATBs. The ATBs undertake necessary local functions but, in relation to best value, we want the review of the ATBs to equip them with a clear role to service the local authority and the local attractions and to market those attractions in an appropriate national and international hierarchy. If they have that clear role, I am sure that they will be the best-value providers to the local authorities. However, it is not necessary for local authorities to take on the functions of the ATBs. That would be the last resort.

I note that COSLA's submission is shot through with a plea on behalf of local government to be included in the process that we are discussing. As well as what it wants in relation to ATBs, COSLA wants to be represented on the board of VisitScotland. What value can COSLA add to the VisitScotland board in relation to essential strategies and initiatives, which we all agree need to be industry-led?

The process that local government is involved in with regard to tourism needs to be represented on the board of VisitScotland. It is true that strategies and initiatives need to be industry-led, but the industry relies on local government to deliver some of those initiatives and to provide an environment in which its products can be delivered. Local government could bring a different dimension to the VisitScotland board. At the moment, an elected member—Councillor Donald Anderson from Edinburgh—sits on the VisitScotland board, but he represents the Edinburgh and Lothians Tourist Board rather than local government.

We can find out what is happening in various areas of Scotland. Councils have different problems, so we can feed our knowledge of various situations into the process. More important, representation on the board would bind us together in a true partnership for servicing tourism throughout Scotland. As our submission says, local authorities play a vital role. We think that we have a right to be represented on the board because we deliver relevant services on behalf of the people of Scotland day in, day out. If we were on the board of VisitScotland, we could ensure that the views of local authorities were heard and that VisitScotland was aware of what local authorities are doing for the Scottish tourism industry.

Paragraph 6.4 of COSLA's submission says that

"links between councils, ATBs and VisitScotland need to be integrated to ensure that councils - who provide the major share of visitor attractions in Scotland - are fully involved along with business when looking at product development issues".

What sort of product development issues can you work on?

We have alluded to some of them already. Golf is a good example and has huge potential for Scotland. Figures in our submission demonstrate the impact that museums and galleries have in relation to tourism, accounting for 14.8 million visitors, which makes up about 45 per cent of all visits made to all attractions in Scotland. We also categorise caravan sites under the quality assurance scheme. We operate industry standards and are very much part of the industry when we market such products.

Our submission makes the point that, as well as providing infrastructure, licensing, planning and so on, we are a big part of the product. We have to engage with the industry; that should not be forgotten when new arrangements are put in place.

The table on page 2 of the Scottish local authorities economic development group submission demonstrates a striking variation in the percentage contribution that local authorities make to area tourist boards. Does the variation represent a differing level of commitment from some local authorities to the tourism sector, or is the contribution from the private sector, for example, greater in some areas?

Perhaps you could tease out that information for us. For example, the contribution that council funding makes to the total revenue income of Edinburgh and Lothians Tourist Board is 35 per cent, whereas the equivalent contribution to Greater Glasgow and Clyde Valley Tourist Board is 60 per cent. I notice that there is quite a discrepancy between the 36 per cent council contribution to Shetland Islands Tourist Board and the 19 per cent contribution to Western Isles Tourist Board. The contribution to Grampian Highlands, Aberdeen and the north-east coast is 27 per cent, but the contribution to Angus and Dundee Tourist Board is 44 per cent. There are huge discrepancies. What is the explanation for those discrepancies?

I agree with that observation. The discrepancies are largely historic. There is a huge variation. I do not know the reasons for that, but in Shetland it might be to do with the oil fund. Other funding might be available for different types of interventions and promotions. During the past three years, COSLA has tried to take stock of the situation and has asked local authorities to sustain funding at the same level for a period, to bring some stability. Most authorities, if not all of them, are signed up to that goal. I cannot explain why there is such variation—it is largely historic. Another possible cause is the availability of European funding in some areas but not in others. A complex combination of factors over a period of time is probably responsible.

In the SLAED paper, "The Role of Scottish Councils in Tourism", we argue that we must take stock of the position. In financial and budgetary terms, we must decide as a nation what we want to do and we must cost it. We hope that the implementation group for the "Tourism Framework for Action 2002:2005" will address that type of issue, because there is no rationale for the figures in the table that you referred to. I would be the first to agree with your observation.

We will need to explore that issue further.

I offer my apologies for arriving during the evidence giving. My point might have been dealt with, as I know that Marilyn Livingstone mentioned community planning. Do you agree that in many ways what local government does for tourism has the greatest effect at the most basic level—for example, in the provision of basic services, such as the maintenance of the roads and footways and the keeping of the hours that public toilets are open? In my experience, tourism does not often come into the equation when the resources that are allocated to such services are evaluated.

That observation does not fit in with my experience as an economic development manager. I have been in local government for 27 years. During the past 20 years, I have had considerable involvement in economic development. As manager of a medium-sized authority, I can inform the committee that tourism comes into play at nearly every meeting to which I go.

I attended several meetings yesterday. One of those meetings concerned the Angus ahead campaign, which is about a community being proud of itself and promoting itself locally, nationally and internationally. Some key players were round the table. We agreed to act together to do several things, all of which need council support in one way or another. Last night in Brechin, I was at a community meeting of the regeneration group. Most of the agenda focused on how the council could help the community to improve the product locally through festivals and events and by improving the Pictavia attraction in Brechin, which is a council-owned paid visitor attraction.

I could continue. I am sure that the pattern would be repeated in almost every authority—certainly in most of them. We have a hugely important role as far as infrastructure is concerned—keeping the streets clean, presenting our places properly and providing proper amenities. However, we are engaged in much more than that.

Let me make a slightly cheeky addition. COSLA would welcome a recognition by the Executive of the payback that the national economy would get from increased investment in those basic services that are provided by local authorities. We recognise their significance for tourism and we ask the Executive to take that on board.

We started with a plea; we finish with a plea. That evidence was very helpful. I thank Willie Dunn and his team.