Ministerial Group on Tourism
The next item of business is a statement by Frank McAveety on the outcomes of the ministerial group on tourism. As the minister will take questions at the end of his statement, there shall be no interventions.
Presiding Officer, I thank you for providing the time for me to announce the developments in the discussions that have been on-going since the new Executive was established, on the potential of the Scottish tourism industry, with specific reference to a number of key issues such as the present structure of the industry. Tourism is important to Scotland and I am delighted that a substantial number of members are present this afternoon to address issues relating to its future.
Some 215,000 people work in the industry and in related sectors. Since 2001, gross tourism revenues have grown by 6.5 per cent to £4.5 billion and further strong growth was experienced last year. The industry has shown a commitment to overcoming the difficulties that it has faced in recent years, such as the impact of foot-and-mouth disease and international terrorism and the ensuing uncertainty. The industry has to respond to the developing opportunities that exist in relation to world tourism, which has been forecast to continue to grow at more than 4 per cent a year. New markets, higher disposable incomes, cheaper travel and much easier access to information through the internet are all powering that growth. However, there is a wider challenge in that 180 countries are competing for that market share. That market will become even more competitive through the development of the European Union when the accession states join and people have the capacity to move throughout Europe much more quickly than previous generations could.
Scotland is well positioned geographically, with a huge domestic market in the UK right next to our border. With the aid of a route development fund, direct access from Europe and further afield is becoming increasingly effective. Across Scotland, in small and large tourism businesses and related businesses, and in the organisations that support tourism by developing the product, people are working hard to build on the revenue and employment growth of the past two years.
It is therefore important that we emphasise marketing, quality, the development of skills and the training of staff. Most of all, we must recognise the importance of integrated support for tourism. In the first session of Parliament, one of the key conclusions of the then Enterprise and Lifelong Learning Committee's report on tourism was that we had to find ways to ensure that support for tourism was much more integrated.
Through VisitScotland, the enterprise networks and other bodies, such as local authorities and Historic Scotland, the Scottish Executive invests more than £80 million a year in tourism. Another £10 million a year for tourism projects currently comes from European funding. That money has been put to good use, particularly with regard to the crisis that the industry faced in early 2001. It has focused on branding Scotland as a world-class destination by playing on its strengths—city breaks, active holidays and our strong heritage and culture package—and on developing visitscotland.com to ensure that we compete in the international market that is accessible through the internet. Combined with that, we have also given a substantial commitment to developing quality accreditation schemes that will prove the worth of the Scottish tourism product. It is important that we continue to emphasise that in the coming period.
We must all get behind the work that is being done on the establishment of VisitScotland. We must try to ensure that Scotland is marketed effectively so, in order to build on what has already been achieved, I am delighted to announce that the Executive will increase VisitScotland's marketing budget. We have added £5 million to this year's marketing budget of £20 million, £5 million will be added to next year's budget, and £7 million will be found for 2005-06. That is a 28 per cent increase in VisitScotland's marketing budget. Most of the new money will be focused on marketing Scotland in other parts of the United Kingdom where there are substantial marketing opportunities, and in the overseas tourism markets that have yet to be fully exploited. This is a response to a challenge that was made to the ministerial group, and to the questions that have been asked in the chamber on numerous occasions. We hope that it will be recognised that we are making a substantial long-term commitment to marketing investment in VisitScotland.
The investment will increase opportunities for urban and rural jobs and it will also be a challenge to the private sector. In my time as minister, I have met representatives of a range of private sector organisations. One of the key things that the private sector asks of the public sector is help with marketing and with identifying additional resources. The relationship that we seek should be joint and reciprocal. There is a challenge to the private sector, which is the dominant driver of the tourism product. We want those businesses to ensure that their contributions match, pound for pound, the joint marketing opportunities with VisitScotland. VisitScotland is currently working with many business leaders and innovators to ensure that they can rise to that challenge.
The role of the innovators and business is to create new markets, products and opportunities. We should be developing a genuine public-private partnership in order to enhance what is one of our essential industries. We believe that if that industry is properly developed and matched by the private sector, our investment will, during the next two years, help to sustain the growth in gross tourism revenues that we have experienced since 2001, so that they continue to grow and match global growth rates.
We have made a long-term commitment to trying to grow the long-term revenue in Scottish tourism by 50 per cent during the next 10 to 11 years, to more than £6 billion per year. Today's announcement is the first substantial step towards that. We want employment opportunities to grow significantly from their present levels of 215,000 and we have to do that in partnership with those who consume the service: the visitors. As people become more global in their attitudes to travel, destinations are being asked more questions about the quality of services that they provide, which is why we want to upgrade the quality accreditation scheme and extend its scope. I am also delighted to announce that VisitScotland is currently piloting the integration of skills and staff development provision in the quality assurance scheme. We will provide an additional £3 million to upgrade the quality accreditation scheme in the next two years.
The third key commitment is that we will work with staff to ensure that we provide the skilled people to the sector, which is vulnerable because of staff turnover. At the moment, the sector suffers because it has a high proportion of part-time workers and a substantial labour turnover that is double that of other Scottish industries of equivalent scale and revenue.
A high proportion of businesses report skills gaps; we have to identify ways in which we can address that. One of they key commitments in today's announcement is that we will work with the sector, the providers and VisitScotland to ensure that we address the skills gap. I am delighted to be in partnership with the Deputy First Minister and Minister for Enterprise and Lifelong Learning, Jim Wallace, because of the positive role that the enterprise network can play in addressing the problem of the skills gap.
The final key commitment that we make is that we will ensure that local and national strategies are integrated. We have developed VisitScotland's strategy in recent years by acknowledging the competitiveness of the global market and we recognise the importance of the area tourist boards and they role that they have played so far.
A consultation exercise was carried out as part of last year's ATB review, which revealed a wide range of opinion about what changes are needed. Some people argued for retention of the present structure and some for outright abolition of the area tourist board structure. The responses will be published today. However, the key theme that emerged from those discussions and the consultation, as well as from my discussions, was the need to integrate support for tourism throughout Scotland.
We have therefore concluded that Scottish tourism will be best served in the years ahead by the creation of an integrated VisitScotland network, which will be similar to the enterprise network so that it can deliver for the whole of Scotland. To do that, we will replace the existing ATB structure with an integrated Scotland-wide network consisting of local tourism hubs. The hubs will have responsibility for delivery of the national tourism strategy in their areas, but they will also have the ability to respond to local circumstances, as was strongly emphasised by some submissions, which highlighted the need to keep the sense-of-identity dimension that people feel exists in the local area tourist boards.
Setting up the network will require legislation and there are two key ways in which we will work to address how that might best be dealt with. We want to ensure that money is retained within local authorities, so local authorities will be invited to take part in the network through service level agreements. The agreements will allow local authorities to require a level of service in return for the resources that they provide. We want that change to take place over the next year or two, which we recognise will be a very sensitive period.
Through a two-stage process, we will replace the ATBs with 14 local tourism hubs that will be linked to VisitScotland. In the first instance, we will set up two new ATBs, which will act as stepping stones to enable the new network to be up and running by April 2005. We anticipate that another year of development work will be needed after April 2005. As minister, I give my commitment to lead that transition process in partnership with VisitScotland and providers in the sector. At the second stage, we will introduce primary legislation that will formalise the new network and replace the ATBs with the new model. I stress that we want to retain within the new structure the best that exists within the current ATB structure, and we want to ensure that that is tied into a national network strategy.
It is right that we have taken time to get the proposals right. People argued for marketing investment; we have delivered that. People argued for training and skills to be central to the debate and for quality to be improved and all those things are contained in my statement, which I commend to members. Scotland and tourism are inextricably linked. Given global change, our tourism industry will last longer than many other sectors of the economy, so it is our responsibility to get it right. I believe that my statement today is one step along that way.
I will allow 20 minutes for questions on the issues that have been raised in the minister's statement. After that, we will need to move on to the next item of business. I already have a considerable number of members who wish to speak and I will not be able to fit them all in, so it would be helpful if members were concise in their questions.
Four years on and four ministers later, many more questions than answers remain. The additional marketing funding is welcome, as are some of the directional changes, but I note that the funding is still less than it was two years ago and that VisitScotland will still be heavily outspent by Tourism Ireland, which is our major competitor. VisitScotland must become a lean marketing machine, not a tourism police force or tourism bureaucracy. The abolition of having to pay for the privilege of selling Scotland is long overdue. However, will the minister tell us who will sell Scotland abroad? Will that be done by VisitScotland or VisitBritain? In the absence of agreement between them, who will decide?
I welcome the recognition of the substantial increase in marketing that lies underneath Kenny MacAskill's question. We want to try to ensure that Scottish tourism can compete with other nations throughout Europe. I know that different countries have different ways of calculating the investment that they inject into tourism, but a 28 per cent increase is probably higher even than the ambitious spending commitments that Kenny MacAskill has previously provided.
The key issue that Kenny MacAskill identified was about how we market Scotland. I assure him that VisitScotland is actively pursuing different markets, for example in north America, where Canada provides a substantial opportunity for generating tourism. We are also pursuing new product development through our route development fund for air flights and through our commitment to the ferry connection.
A key message both from the assessment that we have been carrying out and from the submissions is that there are substantial opportunities right on our doorstep, given that 50 per cent of those who reside in England have yet even to visit Scotland and to have the pleasure of the tourism product that our country has to offer. That is a reasonable ambition. With the new marketing money, I am sure that we will penetrate the English market to ensure that Scotland gets its fair share of that market as well as of the market across the whole UK and beyond.
I thank the minister for his statement and I welcome the increased funding package that he has announced today. However, I draw his attention to the effective partnership that currently exists in Fife, which has significant support from the population and from constituency MSPs. That partnership has resulted in a 10 per cent increase in tourism-related spending in the kingdom in the past year, and we now have 6,000 full-time equivalent jobs directly relating to tourism. What steps is the minister taking to ensure that those relationships in Fife, which are currently working to the benefit of Scotland's tourism industry, will be able to flourish under the new arrangement? What steps will he take to ensure that the local authority contribution—both in expertise and in funding—which has been valuable and effective, can be continued in a spirit of mutual partnership?
I assure Marilyn Livingstone that we value the substantial input that local authorities provide in their commitment to the existing tourism product, not just in the direct support that many authorities provide for area tourism boards, but in their commitment to the quality and range of facilities that they provide in visitor attractions. As we develop the proposals, one of the key opportunities will be in that service level agreements will empower those who are purchasing the service to be quite clear about what they want. That should give them clear direction about what they will get back in return. What emerged from earlier contributions to the debate was that there was a lack of clarity, with people feeling that they were putting some resources in without getting quite what they expected in return. The new arrangement will be service led.
If we continue the developing process that we want, the role of the tourism hubs will be to look at places where there have been good models of partnership. The hubs will recognise that if such a partnership has been successful in the promotion of Fife, it will be something that they should wish to continue. I give a commitment that I am willing to meet members and others to ensure that, if there are good practices that they want to see sustained as the new arrangements evolve over the next year or two, I will give what support I can as a minister in that process.
I welcome the statement because it is positive. I know that it will be welcomed in the Borders; there is much in the statement that was in Scottish Borders Tourist Board's own submission. Given that local authorities will continue to have a strong role, and given the positive fact that coterminosity between local enterprise companies, local authorities and the hubs will be maintained, will the minister ensure that there is a continuing democratic element in the relationship, especially in the supervision of contracts and service level agreements?
I will be happy to address those detailed operational matters. Next week, I shall be meeting representatives of VisitScotland to address how we move forward on that commitment. However, I emphasise what I said earlier—local authorities have a significant role to play. If they were to reduce the level of contribution that they make, that would leave a substantial hole which would, in fact, be equivalent to the level of additional resources that we have already injected. We are ambitious to ensure that local authorities work well.
Last week, I noted with interest a magazine article about Wellingborough in England, which said that
"councillors from Wellingborough Borough Council voted to shut the tourism information centre after they admitted they would struggle to name a single tourist attraction in the town."
It quoted a Conservative member in Wellingborough north as saying after that decision:
"We are not saying no to tourism."
I hope that the contributions this afternoon from members of different political persuasions will acknowledge that we are saying yes to tourism. We believe that tourism has a role to play at local and national levels.
I shall try to be positive. I am glad that the minister is putting another £17 million into tourism over the next three years, given that the industry generates £4.5 billion. I am glad that there appears to be no top slicing of the money for local authorities and I am glad that the new money will go mostly towards marketing Scotland in previously unexploited areas. I welcome the minister's emphasis on the importance of training quality staff. If he is upgrading VisitScotland's quality accreditation scheme, will he ensure that he considers what is available for tourists to do rather than just consider the colour of teacups or curtains? Will he bring in a body to replace Taste of Scotland, or will he resurrect Taste of Scotland?
I cannot believe that it has taken three years to come up with this.
Do you have a question?
You have already heard two.
I would like another one.
I would like to answer those two.
Just a minute, minister.
Okay, Presiding Officer. Why has the review taken so long? Will the minister apologise to tourism operators for the fact that it has taken so long? Will the Executive realise that its control-freak mentality of bringing ATBs—under another name—under VisitScotland's wing is exactly the top-down approach that the industry does not want? When will the Executive understand that VisitScotland's job should be to market Scotland throughout the United Kingdom and abroad, and that the ATBs' role is to act as membership organisations that understand what is important in their own areas?
I think that we get the theme, Mr McGrigor.
Will VisitScotland produce a decent infrastructure that allows Scottish tourism operators to use their imagination—
Mr McGrigor!
—their pride and their passion—
Mr McGrigor, will you finish now, please?
—to get on with their jobs?
I have nearly forgotten what the first two questions were now. However, that is the first time I have been able to persuade a Tory to say "Yes, yes," which reminds me of the campaign for the Scottish Parliament.
The reason why we took our time was that, when I became Minister for Tourism, Culture and Sport, I recognised that the problem was about more than just the structure of area tourist boards. The matter is more fundamental than that and I am glad that Mr McGrigor has welcomed the substantial injection of new money, which has to be matched by a commitment from the private sector. Fundamentally, the drive of innovation comes from private sector businesses. VisitScotland is considering ways of addressing the issues around the Taste of Scotland campaign. I am aware that VisitScotland is in discussions to bring forward something that might address the concerns that Mr McGrigor has had on the issue in the past.
As far as the idea of centralisation is concerned, I have in front of me some views that indicate that many local tourist boards have welcomed the idea of integration as part of a national and local strategy of working better in partnership. One of the important questions to come out of the review, in relation to structures and the role of the national tourism agency, was about how we can reduce duplication on things that do not matter and maximise co-operation on things that do matter. The key message was about selling this country's tourism product, in comparison with those of other countries around the world, encouraging Scots to continue to choose Scotland as a holiday destination and ensuring that the range and scale of Scottish tourism may be markedly improved, which can happen only if we can penetrate the markets that are located right on our doorstep.
The network that I have announced today is about pulling those efforts together. I want to give an assurance that, working with the industry and with local partnerships, we can get the best of what is local and the best of what is national to create the best for Scotland.
The minister mentioned two new ATBs, which I think are to be temporary, but he skated over that part of his statement very quickly. Can the minister tell me the logic of that arrangement? Can he tell me where those two ATBs will be? It sounds like a short-term political fix. Can the minister confirm that a "hub" is just a nice name for a local branch office? It may be a good idea, but we should perhaps just call it that, if that is what it is.
I think that the minister implied that service level agreements for councils will not be compulsory. We know that many councils currently do not fund their local tourist boards very well. Is not there a great danger that, where the local district office—or hub or whatever—represents a whole lot of council areas, individual councils in the area will be reluctant to develop contracts with that office?
I would argue passionately that the opposite is the case. The great opportunity for local government is to demonstrate that, if people believe that there should be a tourism strategy at local level, in which a local authority can have a critical role to play, it will make resources available for that. If local authorities make such a commitment, they will want it to be demonstrated that they are getting services back in return. That is a reciprocal arrangement, which I want to be developed.
I did not want to be prescriptive because I believe in the autonomy of local government. I believe that local authorities should have the right to determine what the priorities for their areas are. I know that there have been some inconsistencies across funding packages for area tourist boards; that was one of the reasons for having the review in the first place. I hope that the new marketing money, the national strategy and our desire that tourism be one of the key industries in Scotland all send a strong message. There are enough good local examples for local authorities to be able to make their contribution.
I was asked about the definition of the word "hub". In my understanding, a hub is a place in which people come together. It is a thriving place of activities, ideas and enjoyment. I am sure that that will be part of the tourism product for the future.
I thank the minister for his announcement, and particularly for his comments on training and skills, which, as he will remember, are areas that were highlighted at the Stirling tourism conference.
I turn to historic buildings which, as the minister knows, are one of the big attractions for tourists to Scotland. Does the minister agree that as well as existing buildings, such as the Wallace monument, and their maintenance, we need to consider how to get new projects to attract tourists? That would include projects like the Bannockburn heritage centre, which is the interpretation centre for the battle of Bannockburn, and which the National Trust for Scotland and Stirling Council are promoting. Does the minister accept that we need to be alive to such issues?
I welcome that contribution. After this meeting, there will be a substantial discussion on the role of the built environment, historic architecture and historic artefacts in Scotland and about the impact that they have on local economies. Stirling Council has been innovative in recent years and, under different leaderships, it has shown drive, energy and commitment to Stirling Castle, which is one of the jewels in the crown of the castle product that we have in Scotland. That was achieved through commitment by the local authority; I hope that there will be similar ambition in relation to the Bannockburn heritage centre. I have visited that centre repeatedly and I recognise that it requires substantial improvement to meet the expectations of the modern visitor. I hope that a partnership can be put together to enable that to happen, and I hope that the centre will be able to resource itself through the heritage lottery fund and other sources of funding.
One of the key facts that comes from the evidence that we have received and from our assessment of tourism is that heritage and culture are linked inextricably and that they are among the key defining and unique selling points of the Scottish tourism product. We would like to encourage them in Sylvia Jackson's area and in many other parts of Scotland.
Does the minister accept that the statement that he made this afternoon will be pretty incomprehensible to the average provider in the tourism industry in areas such as the south of Scotland? Will he put his man-of-the-people hat back on and explain to us in simple terms how his proposals will be industry led, as the tourism inquiry report suggested? Where will the small tourism provider fit into this brave new world?
I am happy to indicate that we believe that if we have service level agreements for local authorities, they will also apply to the small providers in the tourism industry. If people contribute, they should have a clear definition of what they will get back.
The second and most important point is on comprehensibility. Virtually all the submissions argued for an integrated network, but they recognised that there needs to be a local dimension. One or two articles have appeared in the local press in the south of Scotland claiming that the local area tourist board will disappear and that the capacity of the local area to influence tourism product will no longer exist; I understand that calls have been made about Jim Wallace in that respect. I hope that members have been reassured today that we recognise the role of the local area and, more importantly, that we want to work with tourism hubs, VisitScotland and the marketing money to make a genuine difference. I hope that David Mundell, as a Conservative who believes in economic growth, will welcome that in the local press next week.
I welcome many aspects of the statement, but I have three brief questions for the minister. First, his aim to harness the expertise and enthusiasm of the people in the ATB structure is excellent, but can he provide assurances on how he will do that, given the uncertainty that will hang over the tourism industry during the period of reorganisation? Secondly, does the minister have plans to build on the success of the green tourism business standard, perhaps by incorporating elements of it into quality accreditation schemes? Finally, I note his comment on the benefits of the route development fund and I would be grateful if he would tell me whether he has statistics to show that, since it was set up, it attracts more tourists into Scotland than out of Scotland.
I assure Chris Ballance that VisitScotland will be asked to lead the implementation of what I have announced this afternoon. I am happy to be working with VisitScotland to ensure that many of the key commitments that I have identified will be pursued. I recognise the fact that there will be a period of uncertainty as we move toward the transition stage. We want to minimise that uncertainty and maximise the opportunity within it. That will take time, and we must work with staff to ensure that we do that. The chief executives of the area tourist boards in the south of Scotland have taken two days to address those issues beyond today's announcement, and VisitScotland will be charged with developing that.
I recognise the role that Chris Ballance has identified. We met recently to discuss the opportunities for green tourism, and I attended and spoke at a recent green tourism conference. One of our key messages is that we want to triple the number of businesses and organisations in the accreditation scheme for green tourism. In terms of potential new markets—particularly the European and east European markets—there is a strong sense of trying to address that.
On the route development fund, I do not have figures immediately to hand. However, since its introduction, the air link between Prestwick and Girona has been responsible for a substantial influx of visitors from that part of Spain. We look forward to that being a positive experience, in the light of the footballing engagement this evening. We now have a balance between those who would visit the attractions of Catalonia and the Catalans who come over here. That is part of the measure. If the member wants me to provide further details on that, I will be happy to do so.