Tourism
Good morning. The first item of business is a debate on motion S3M-6635, in the name of Iain Smith, on tourism.
09:15
In this short debate, I will not waste too much of the Parliament’s time outlining the importance of tourism to Scotland’s economy. We all know that tourism is one of the key sectors in the economy. It contributes more than £4 billion and employs more than 200,000 people, which represents about 9 per cent of the workforce. In some parts of Scotland, including my constituency of North East Fife, tourism is even more significant.
We all share the common objective of sustaining and improving the tourism industry in Scotland. Indeed, figures suggest that tourism in Scotland did relatively well last year. With a combination of the homecoming marketing campaign, favourable exchange rates and the staycation phenomenon, it appears that Scotland bucked the trend by increasing visitor numbers in 2009. However, that has to be seen in the context of a steady decline in visitor numbers in the previous three years. The then chief executive of VisitScotland made the frank admission to the Economy, Energy and Tourism Committee on 28 April that
“we are not on a trajectory to achieve 50 per cent growth”.—[Official Report, Economy, Energy and Tourism Committee, 28 April 2010; c 3586.]
The truth is that, despite its many strengths, Scotland’s tourism industry is vulnerable. Figures that were released last week by the accountants PKF show that hotel occupancy in Scotland fell by 4.3 per cent in April while the rate in the rest of the United Kingdom rose by 1.9 per cent. Even more worryingly, room yields were down by 7 per cent, and Edinburgh showed a drop of more than 10 per cent.
I wonder whether the member will concede that the ash cloud had a more dramatic effect on Scotland than it had elsewhere during that period?
I was going to make that point in my next sentence.
Extraordinary factors were at play, such as the ash cloud, but the figures demonstrate that Scotland’s tourism industry is vulnerable to outside influences and that there are difficult times ahead. The world economic crisis and the fragility of the home economy do not bode well for the tourism sector. There are clear signs that business tourism, which accounts for 20 per cent of tourism expenditure, remains under significant pressure. That is a particular concern for many of our cities, which rely heavily on business tourism, and as belts are tightened we are all likely to think twice about taking that extra weekend away.
Now more than ever, Scotland’s tourism industry needs clear leadership, but what does it get? Chaos at the heart of VisitScotland and confusion at the heart of Government. At a time when “steady as she goes” might have been the wise approach, we see instead the new chair of VisitScotland grabbing the helm from the captain and steering the organisation off on what is, as yet, an unknown course.
It seems that within days of being appointed by John Swinney as the new chair of VisitScotland, Mike Cantlay decided that the strategy had to change and the chief executive had to go. I find it hard to believe that he would act in such a way unless he believed that he had the full backing of his sponsoring ministers in taking that action. It now appears that despite failing to mention it in his statement to the Parliament on 3 June or his answers to the many questions on that statement, Mr Mather was informed about the decision to dismiss Philip Riddle on 22 April. Apparently, he was too busy mind mapping Dr Cantlay to take notice.
Several questions remain unanswered. Why did Mr Mather not think that he should bring the matter to the attention of the Cabinet Secretary for Finance and Sustainable Growth? Why did the sponsoring department fail to inform ministers that it was in discussions with VisitScotland on how to go about dismissing the chief executive? What exactly is the new, significant and urgent strategic direction for VisitScotland? The tourism industry needs to know. If there are to be significant changes to the strategy and to what VisitScotland does, tourism businesses need to know what those changes will be. Decisions were apparently taken by Mike Cantlay within 22 days of his being appointed as the chair and before the first meeting of his board. Surely the tourism industry needs to be involved and should not be kept in the dark, which is where we all are at present.
I will leave the rates issue primarily to my colleague Jeremy Purvis. Suffice it to say that the list of those who support a transitional relief scheme is growing daily. It includes not just the many individual businesses that are being stung by crippling increases but organisations such as the British Hospitality Association, the chambers of commerce and even the Confederation of British Industry. Indeed, it seems that the only people who support the Scottish National Party Government’s position are Conservative members of the Scottish Parliament.
Where are they?
Order.
I conclude with a brief comment on the gathering. The Auditor General for Scotland’s report on the gathering was published the day after we lodged our motion, so we could not refer to it in the motion as we had not seen it at that point. However, I am sure that the 103 private sector organisations that are owed a total of more than £300,000 by The Gathering 2009 Ltd will be as shocked as I am by the cavalier way in which the Scottish Government appears to have thrown public money at the event. The Audit Scotland report shows that ministers did not complete robust checks of the company’s ability to repay the loan or even seek information from other bodies on the steering group.
Ministers have a duty to come to the chamber and fully explain their actions, given that £180,000 of public money was given as an interest-free loan to a company that was, even at the time, clearly not going to achieve the financial objectives that it had set itself. That is unsatisfactory. It is not how public money should be spent. Irrespective of whether the gathering was an important event, ministers have a duty to safeguard the public purse. They failed to fulfil that duty, and they must come to the chamber to explain their actions.
I move,
That the Parliament notes that tourism is among the largest contributors to the Scottish economy and is defined as a key sector; believes that the industry needs clear direction and support in order to achieve sustainable, long-term growth; deeply regrets the current crisis at the head of VisitScotland over the role of the chief executive and the lack of clarity over ministerial involvement; further notes that the hospitality and tourism sectors have been particularly affected by higher rates bills following revaluation and that Scottish businesses are almost alone in the United Kingdom in having to face these massive increases; notes the British Hospitality Association Scotland, CBI and Chambers of Commerce criticisms of the lack of a transitional rates relief scheme, and calls on the Scottish Government to work constructively with these and other business organisations across Scotland to agree and deliver such a scheme.
09:21
The Lib Dem motion states:
“the industry needs clear direction and support in order to achieve sustainable, long-term growth”.
That is exactly what is being delivered. Increasingly, it is coming from inside the industry, with VisitScotland, EventScotland and the Government bringing the industry together in the shape of the Scottish Tourism Forum and the tourism framework for change leadership group, and with the appointment of a new chair for VisitScotland and a highly motivated, aligned and experienced board that has, in turn, attracted support and enthusiasm from an increasingly vocal and proactive group within the industry.
The new board is building on a sound transitional legacy and encouraging new, innovative approaches to destination management. VisitScotland is working with a management team that has delivered a mature alliance that includes the industry, economic development and other bodies, and the Government. Scottish Enterprise is delivering lots of valuable material in the shape of its “Listening to our Visitors” destination guides, and tourism intelligence Scotland is producing insightful documents on how to get the job done more effectively. The Scottish local authorities economic development group is heavily involved and is working collaboratively.
Everyone is coming together in the homecoming legacy. Creative Scotland, Scottish Natural Heritage, Historic Scotland and others are working together to ensure that the world-class offering that is Scotland—in terms of authenticity, attractions, assets, agile marketing and aspirations to improve quality—is all there. The homecoming legacy is now gaining immense traction. With the focus years of food and drink from 2010 through to May of next year, active Scotland in 2011, culture and creativity in 2012, natural Scotland in 2013 and homecoming again in 2014, we are building a real repertoire. No wonder that is bearing fruit in our latest results, with tourism up 2.7 per cent in 2009 against a global drop of 4 per cent.
We share the view that the industry should be commended for its success.
VisitScotland’s strategic direction was set by the Government in September 2007 with the review of the enterprise networks. If that strategic direction was so successful, why does the chair of the organisation believe that it needs to change, and what is the proposed change, which the Government now seems to support?
Having appointed a board, we choose not to second-guess it. We work with the board and we see the bigger picture. In the Liberal Democrats, we have a party that will condemn what we do and condemn what we do not do. VisitScotland is working and functioning well, moving forward, building on the strengths and looking to attract more visitors to Scotland.
Will the minister take an intervention.
No. I have taken one intervention already. I have six minutes, only three of which are left.
The issue is a political party that is willing to create a sense of uncertainty and make a mountain out of a molehill. This is an operational matter for VisitScotland. I was informed by Mike Cantlay that he was in dialogue with Philip Riddle about Mr Riddle’s future, but it was recognised that that could include Mr Riddle remaining in post.
The crisis and the chaos are a figment of Lib Dem imagination. Meanwhile, we are dealing with the reality and are looking to move forward constructively, including handling the issue of businesses that have been affected by the rates revaluation. We will roll up our sleeves in this Government to work with those that have been impacted to ensure that their excellent properties gain the maximum amount of leverage. We will bring together VisitScotland and all the other agencies and allies to maximise that. Meanwhile, we are in a maelstrom of further misinformation from the Lib Dems, which ignores the fact that in the revaluation process the rate poundage went down by 15 per cent and that Scotland is delivering—
On a point of order, Presiding Officer.
Minister, I am afraid that I have to take a point of order from Mike Rumbles.
I am having difficulty understanding the English that Mr Mather is using. I wonder whether you could use your good offices to ask him to explain in plain English what he means to do.
Your understanding of what the minister says is not my problem, Mr Rumbles.
I am grateful to have a native speaker in the audience.
I put it this way to Mr Rumbles: we are putting in £2.4 billion in relief over the next five years. The 60 per cent of businesses that are benefiting from the moves that we have made in Scotland are benefiting to the tune of £1,300 each compared with £600 or £700 for equivalent businesses in England, and the transitional relief in England mainly benefits London. We made those moves instead of providing transitional relief that would have hit businesses to the tune of £77 million, meaning that eight out of 10 rate payers—63 per cent of them hotels—would have been worse off or no better off, which would have been a major issue.
I will further develop that point as I move, in my closing remarks, to address how we intend, as never before, to help those who have been affected to earn their way to better outcomes and to make the most of their assets and attributes, and essentially create a situation in which VisitScotland, together with all the other allies—Scottish Natural Heritage, Historic Scotland, Creative Scotland and our local authorities—build on our ability to get to a better position, taking advantage of current exchange rates—
Will the minister give way?
I have about 24 seconds left.
I hope that the minister will use them on the gathering.
I am happy to mention the gathering. We have seen the bigger picture and engaged constructively with Audit Scotland, and we will consider its recommendations carefully. I remind Parliament that The Gathering 2009 Ltd is a private company and that we ensured that the event was the success that it was in respect of the totality of Scotland: it generated £10.4 million for Scotland’s economy—£8.8 million of that in Edinburgh—attracted visitors from across the world and helped to broadcast across the world what a great location Scotland is.
I move amendment S3M-6635.1, to leave out from “deeply regrets” to end and insert:
“welcomes the initiative of the industry to establish the Tourism Leadership Group as a positive step in working collaboratively toward growth and prosperity, and notes that extending the small business bonus scheme will mean that half of all businesses, including many tourism-related businesses, will receive a discounted bill this year and well over a quarter of business properties will pay no rates at all and that the introduction of a transitional relief scheme would increase taxes for small and medium-sized private companies by £77 million, meaning that eight out of 10 rate payers, including many in the tourism and hospitality industry, would be worse or no better off, which would be extremely damaging for Scotland in this period of fragile economic recovery.”
I am slightly relaxed about time this morning, as we have a little in hand.
09:28
The Liberal Democrats were right to choose tourism as a subject for debate. As Iain Smith pointed out, it is critical to Scotland.
So critical that none of your colleagues is in the chamber.
There is one MSP from the Conservatives versus 12 from the Liberal Democrats—we wanted a fair fight, and it would have been grossly unfair if I had brought along Derek Brownlee to assist this morning. We are happy to take on 12 Liberal Democrats and the four Liberal Democrats who could not be bothered to show up for Liberal Democrat business.
I should warn the Liberal Democrats that Gavin Brown has a black belt in tae kwon do.
I do not have a clever quip in response to that comment, so I will carry on.
Tourism is a critical subject, but the way in which the Liberal Democrats have tackled it is pretty disappointing.
We face a long-term issue with tourism in this country. In 2005, under the previous Government, the tourism framework for change was set up, which involved the Government and the industry. It set an ambition of 50 per cent growth over a 10-year period. In 2010, halfway through that period, we have not seen any movement, so there is an issue, which requires all political parties, the industry and Government, in particular, to get our heads together and figure out how we achieve that step change in tourism. There is probably agreement across the chamber on that.
The Liberal Democrats have chosen to focus on two unrelated specific issues pertaining to tourism, I think in an attempt to narrow the debate. Let me deal with those two issues.
What about your amendment?
My amendment is about furnished holiday lettings, the measure on which was, until the news about the gathering came out yesterday, probably the biggest tourism story of the week. The Conservative and Liberal Democrat Government introduced that measure, but the Liberal Democrats could not be bothered to mention the good news for Scotland in their own motion.
I turn to the two points that the Liberal Democrats have raised. I am happy to say on the record, as I have said both privately and publicly before, that I do not think that the Government has handled the issue at VisitScotland particularly well. The decision was strange. I formed the impression, from evidence that was given to the Economy, Energy and Tourism Committee, that the chief executive was doing a good job—he came across very well. In relation to the Government’s narrative on tourism, it was a strange decision. However, Mr Smith has described the situation as a crisis in tourism, which is plain wrong. Leaders in the tourism industry and people throughout Scotland will be slightly confused about Mr Smith describing the situation as a crisis.
Will the member take an intervention on that point?
I am always happy to take an intervention from Mr Rumbles.
I can tell Mr Brown that what is a crisis in my constituency is the situation for Ballater Business Association, as highlighted by Aberdeen and Grampian Chamber of Commerce. Many of my constituents are facing huge business rates rises, which the Conservatives had the opportunity to change, yet Mr Brown voted against business rates relief for members of business associations in Ballater in my constituency and across Scotland.
Mr Rumbles describes the revaluation as a crisis, so by definition he does not agree with his own front bench that the position at VisitScotland is a crisis for the industry.
On Mr Rumbles’s point about revaluation, the crux of the matter is that, if there were to be a transitional relief scheme, there would have to be a change in Government policy. That would mean one of two things, because there are only two ways to do it. It would be necessary either to take back money from the smaller industries in Scotland that gained from the revaluation—I wonder whether the Liberal Democrats are proposing to claw back money from the 60 per cent of businesses that gained—or to find the money to cover the cost of a transitional relief scheme. The Government described the cost as being £195 million. I have no view on the veracity of that figure, but I have not heard anyone else challenge it.
When the Liberal Democrats decided that there ought to be a scheme, they said that it should come from Barnett consequentials. The slight problem with their argument—as they well know—is that those Barnett consequentials were allocated to affordable housing, and every single Liberal Democrat in the chamber welcomed that expenditure. I look forward to hearing what Mr Purvis has to say on revaluation. I hope that he has a new idea and that the Liberal Democrats are not just rehashing their old ideas.
I move amendment S3M-6635.1.1, to insert at end:
“, and welcomes the UK Government’s decision not to repeal the special tax rules for furnished holiday lettings, as had been proposed by the previous administration led by Labour.”
09:34
A common theme to many of the big issues that have been raised in this debate is the need for greater transparency in the Scottish Government’s approach to many issues that affect the sector. The shocking treatment of a loyal and successful public servant has already, rightly, been raised in the chamber and at the Economy, Energy and Tourism Committee. The Government and the recently appointed chairman of VisitScotland still have many questions to answer on that topic.
The final questions that committee members asked of Philip Riddle when he was chief executive of VisitScotland were about another topic that is of huge concern to many people in the tourism sector: the Scottish Government’s decision to provide no transitional relief to hotels that have been hit by huge increases in business rates. Mr Riddle told the committee on 28 April that John Swinney had not consulted VisitScotland before making his decision to scrap transitional relief. He said that VisitScotland had been given the opportunity to provide feedback after the event and that he had taken the opportunity to make representations through Mr Mather.
Philip Riddle has not had the opportunity to tell us the outcome of the representations that he made. The chairman of VisitScotland, who gave evidence to the committee last week, did not acknowledge that such representations had been made when Marilyn Livingstone asked him about business rates. Perhaps the minister will tell us about the evidence that VisitScotland presented to him when it was still led by someone who was willing and able to reflect the concerns of the overwhelming majority of businesses in the hospitality sector.
It is pretty clear that ministers did not engage in consultation of any form with representatives of Scottish business, any more than they did with Government agencies such as VisitScotland. The price of ministers’ secret decision to scrap transitional relief is being paid by businesses throughout Scotland.
John Swinney has subsequently met representatives of chambers of commerce—as I understand it, from Dundee and Edinburgh, as well as Aberdeen—and I understand that he will meet a delegation from the Scottish Chambers of Commerce on Monday 28 June. However, he has made no concessions that would address the concerns that have been expressed. The view of the Aberdeen and Grampian Chamber of Commerce delegation, which was made public this week, is that
“the Minister has either not understood or not accepted the weight of evidence”
that it presented.
I remind Mr Mather of what the delegation said to Mr Swinney. It told him that the rates paid this year by businesses in Aberdeen city and Aberdeenshire have increased by more than £30 million, which represents a 15 per cent increase in income to the Scottish Government from businesses in that region alone. Research by Ryden into the liability of 189 hotels and guest houses in the north-east shows a 33 per cent increase in rates payable—that is the increase in rates, not valuations. Analysis by Aberdeen City and Shire Hotels Association shows that its members face an increase of more than 40 per cent in rates payable. As the Aberdeen and Grampian Chamber of Commerce told John Swinney again this week, the association’s view is that
“This will undoubtedly lead to some businesses closing or a reduction in the levels of service through having to reduce staffing levels in order to pay the additional rates.”
Those are not idle words, and this is not simply a debating point. We are talking about real jobs and businesses in the tourism sector.
I know that ministers mean it when they say that they want the sector to grow. It might well be, as Aberdeen and Grampian Chamber of Commerce thinks, that ministers have miscalculated the overall increase in income to the Government from the increase in business rates. Ministers might well have underestimated the number of small firms that would cease to qualify for small business rates relief, through the revaluation of their premises taking them above the threshold, as Iain Gray said to the First Minister a couple of weeks ago.
If ministers have miscalculated in that way, there might be room for them to introduce some degree of transitional relief—if they are willing to look again at the evidence and take the right decision. That is what tourism businesses are asking ministers to do. That is no doubt what Philip Riddle put to Jim Mather and it is no doubt what the Scottish Chambers of Commerce will put to John Swinney next week. It is the single most important thing that ministers can do to address the competitive disadvantage that Scottish tourism faces. I hope that ministers will listen to the representations and act accordingly.
I move amendment S3M-6635.2, to insert at end:
"; regrets that the combination of increased business rates and increased VAT will put Scotland’s tourism industry at a competitive disadvantage, and believes therefore that there is even greater need for the Scottish Government to adopt an approach based on greater transparency and accountability, learning the lessons of the Auditor General’s report on the Gathering as well as other recent events, and to give renewed emphasis to training and skills".
09:39
I am pleased to contribute to the debate and to help to outline what the tourism industry needs from the Scottish Government to ensure that it plays a significant role in Scotland’s economy.
The most recent parliamentary debate on tourism took place in March. Many important issues that relate to the industry need to be addressed, such as local initiatives, which the Government must support; skills and training in the sector; business rates in the hospitality industry, which I have talked about on numerous occasions; and the need for transparency and leadership, particularly with regard to strategic direction.
My area, Fife, is a successful tourism destination, as Iain Smith said, whose appeal lies in its natural environment, particularly its award-winning coastline. Fife’s strong reputation for golf attracts visitors from international markets and elevates the area to its position as one of Scotland’s international destinations. The industry contributes more than £200 million a year to the local economy and supports more than 12,000 jobs—that represents 9 per cent of the workforce. Tourism is an important and growing sector in Fife.
If we are to achieve the national growth target of at least 50 per cent, tourism in Fife must grow from a £218 million industry to one that is worth £327 million per annum by 2015. That is a significant challenge, which the Scottish Government must help the newly formed Fife tourism partnership to achieve. If Fife is to meet the target and take advantage of tourism opportunities, such as the proposed hovercraft service from Kirkcaldy to Edinburgh and the potential for cafe culture along Kirkcaldy’s promenade, the Scottish Government must work to eliminate barriers to investment.
The minister will not be surprised that I want to talk about education, skills and training in the hospitality and tourism sector. The industry’s view is that the current system is failing. The Scottish Government must take urgent action. The further and higher education sectors have come under financial pressure and practical training has become a major challenge. I strongly urge the Scottish Government to ensure that the tourism industry is given its fair share of the 5,000 modern apprenticeships in five key sectors that the Government will announce during the coming weeks. The Scottish Government previously abandoned adult modern apprenticeships in tourism. That cannot be allowed to happen again. Such an approach would be nonsense and would deny people over 19 the opportunity to work in and bring much-needed expertise to one of Scotland’s key sectors.
The Scottish Government has dropped a rates bombshell on the sector, as Lewis Macdonald said. The industry has been hit hard and at short notice with significant increases in bills. Many businesses in the hospitality sector in Scotland face staggering increases of between 100 and 400 per cent. The hotel and hospitality industry has been badly affected. Most other businesses are valued on assessment of their premises’ notional rent value, but hotels are valued on turnover.
With government comes responsibility. The Government must not compensate for its unsustainable funding decisions by penalising the tourism industry with huge rates bills. The approach has put the sector at a huge disadvantage compared with its competitors in England, who were told months ago what their rates would be and have the benefit of transitional relief and a phased-in increase.
The tourism sector faces difficult economic circumstances. Many people are choosing not to go on holiday, because of the cost.
If Marilyn Livingstone thinks that transitional relief should be provided, will she explain how we could have unleashed a cost of £77 million on small businesses at such a crucial time in Scotland’s recovery?
With government comes responsibility, as I said. The Government has made unsustainable funding decisions.
The increase in rates for hotels and restaurants will lead to job losses and force many small businesses out of business. Hotels, restaurants and other businesses in the hospitality industry make a valuable contribution and must not be punished for their success. Like Lewis Macdonald, I urge the Scottish Government to revisit the situation and introduce a system of transitional rates relief.
Scotland depends on tourism to generate investment. In difficult times for the sector, local tourism businesses need openness and transparency from the Government and VisitScotland, which is the national organisation that provides strategic direction for the industry.
The uncertainty over VisitScotland’s chief executive and the board’s confidence in Philip Riddle undermines the hard work that is being done to promote tourism in regions such as Fife and creates a leadership vacuum. When giving evidence to the Economy, Energy and Tourism Committee, Dr Mike Cantlay confirmed that the board unanimously agreed on the change in strategic direction. However, the change was made without consulting the Minister for Enterprise, Energy and Tourism, the Cabinet Secretary for Finance and Sustainable Growth, the committee or anyone. The speed and the secrecy with which the decision was made without informing the Scottish Government or holding discussions with the Parliament are cause for great concern and undermine VisitScotland’s role in guiding our local tourism industries. The minister needs to answer that point.
The Scottish Government must commit to working with the industry during and beyond the current uncertainty, improve the provision of much-needed skills and encourage investment in tourism at a local level. More important, the minister must look at business rates and show confidence in and support for the sector by providing the necessary investment, and show leadership, openness and transparency in government.
09:46
The danger of this debate is that there has been so much hyperbole and such a lack of evidence from across the country that, if some facts are not injected into it, the picture that we will glean will be skewed.
Let us look at business rates. An additional 3,600 Scottish business properties are eligible for relief during these challenging times. Many independent hotels, bed and breakfasts, guest houses and self-catering properties qualify for the small business bonus scheme. In addition, the thresholds for the targeted rural relief that supports key services in rural communities, including hotels, have been uplifted. That relief offers many hotels bill reductions of up to 100 per cent. We need to see a whole-Scotland picture before we can decide whether the charges in relation to the north-east of Scotland, or wherever, stand.
Valuations reflect room rates, occupancy levels, and sales of food and alcohol. Overall sector rises are due to properties with increased occupancy and higher turnover. The impact varies because of location, hotel type and turnover that has changed since the last revaluation in 2005. I note that the Liberals said that only Tory MSPs would support the SNP’s position, but the Federation of Small Businesses, the Scottish Grocers Federation and the CBI supported the Government’s position in February. I inject those facts into the debate during the short time that I have available.
On 10 February, the CBI said:
“There are a number of welcome measures on non-domestic rates in this announcement, such as the enhanced rates relief for small and rural businesses and new relief to encourage renewable energy generation”,
among other things in which businesses in the countryside can take part.
Will the member take an intervention?
I do not have the time; I am sorry.
The previous speaker raised the issue of skills. It is a fact that investment is being made. The Burghfield House hotel school in Dornoch, which the Cabinet will visit this summer, is training more chefs and hotel staff. People 1st and the Scottish Tourism Forum say that it is still difficult to recruit trained chefs; 37 per cent of businesses that recruited chefs in 2009 found vacancies difficult to fill. However, colleges such as North Highland College have set up schools to do that training.
Will the member give way?
No, I will not.
Members should recognise that such initiatives should be taken in other places, which might fill the gap. It is not down to whether the Government provides money for apprenticeships. Colleges are doing the work, and members should listen to the facts.
On rates relief, have the Liberals or anyone else asked about the basis on which that is calculated? Are we going to have a debate about the realities and whether we need to change the way in which that happens? That is my personal view, but some members need to reflect on it.
On the gathering, did the Liberal-Labour Executive look at the business case of the private company that set up the operation in the first place? The Government of the time dealt with that company as if it were a private company and took a hands-off approach. Now the members of that previous Government accuse the current Government of doing the same thing. Frankly, that is two-faced.
On the leadership changes at VisitScotland, yes, there has been a change of chair, and the board has assessed the way forward. Mike Cantlay called it a step change. I quote the wise words of my colleague Chris Harvie, who, after attempts to implicate John Swinney in the micro-management of VisitScotland, said:
“I understand the separation of notions of personnel from notions of policy, and I am aware that your position, cabinet secretary, is bound by the need to distinguish between the two and that the two should not be allowed to be confused by ministerial intervention at an inappropriate time.”—[Official Report, Economy, Energy and Tourism Committee, 16 June 2010; c 3834.]
That is not about taking a hands-off approach; it is about respecting the fact that VisitScotland is a non-parliamentary group and allowing it to measure its activities.
We have had a dose of gripe from those who proposed today’s motion; it is time that we had a dose of common sense.
09:51
I am pleased to take part in the debate and to support the Labour amendment.
“Our plans do not require a rise in VAT. The Tory plans do.”
Those are not my words; they were said by the Liberal leader, Nick Clegg, in April, when he was on a flying visit to Glasgow—it was certainly not a staycation—to launch what his party thought was a clever poster under the heading of “Tory VAT bombshell”. The Conservatives’ response came from George Osborne, who said:
“We have no plans to increase VAT.”
Well, now we know the truth. Those leading figures in the Con-Dem Government were misleading the public. Will Mr Smith and Mr Purvis now defend the indefensible? According to today’s Scotsman, there seems to be muted support for a VAT rise among their colleagues. In typical Liberal fashion, Robert Brown and Ross Finnie are not saying; apparently, Hugh O’Donnell has no views; and Mike Pringle does not think that it is an issue—he must have missed the poster launch in Glasgow, then. Only Liam McArthur is honest enough to admit that it was not something that he had campaigned for—and no wonder. It is no use the Liberals moaning about changes at the top of VisitScotland or the SNP’s decision to not introduce a transitional rates relief scheme when their Westminster colleagues have so blatantly broken a pre-election promise and, at the same time, delivered a hammer blow to the tourism industry. Make no mistake: increasing VAT to 20 per cent is as devastating to an industry that relies on customer choice as the damage that is done by excessive rates rises. Perhaps Mr Purvis can enlighten us about what his Borders hotel owners think of the VAT rise, and what the effect will be on jobs.
I am delighted to be able to say that I spoke to the manager of the Tontine hotel in Peebles last night. She said that she is not concerned about the VAT rise and that the biggest impact on her staff would come from the lifting of the income tax threshold, which would be the best bonus for the industry.
The previous Labour Government regularly used PricewaterhouseCoopers for consultancy. The hospitality director at that consultancy firm described the VAT increase as having “little or no impact” on demand in the hospitality sector. That is not exactly a “hammer blow”.
Mr Purvis will find that time alone will tell. Tavish Scott apparently believes that the Liberals got good things out of the budget. Really? He must believe that the loss of up to 100,000 jobs is a price worth paying, just as the Conservatives do.
The Liberals and the Conservatives should take a lesson from Europe. While our coalition Government at Westminster is busy making it more expensive for tourists to come here, across the continent, VAT rates are coming down in a bid to attract visitors for value-for-money holidays. France lowered VAT for restaurants from 19.6 per cent to 5.5 per cent, and Germany announced a cut in VAT on accommodation from 19 per cent to 7 per cent last January. A comparison of VAT rates in top competitor tourist destinations such as France, Spain, Italy, the United States and Australia shows that, on average, visitors to Scotland pay about 10 per cent more for accommodation and restaurants and 3.5 per cent more for entry to attractions and other venues. The rise in VAT to 20 per cent puts Scottish tourism at a clear disadvantage in a competitive global market.
“If you look at the effect of a sales tax, it’s very regressive, it hits the poorest hardest. It does, I absolutely promise you.”
Again, not my words but those of the Prime Minister, David Cameron.
Tourism should be one of our major growth industries. Events such as the Commonwealth games in Glasgow, the Ryder cup at Gleneagles and the Olympic and Paralympic games in London will provide the sector with its largest opportunity to market itself on a world stage, but the VAT increase will hit them, too.
How do we capitalise on that potential when we all know that Scotland’s tourism and hospitality sectors are facing a massive skills shortage, which Marilyn Livingstone highlighted? The issue was also highlighted by Iain Herbert, chief executive of the Scottish Tourism Forum, who says that the industry will face a skills shortage of 80,000 by 2017.
How do we make our tourism businesses more attractive to potential employees and better at retaining staff? People 1st—the sector skills council for the tourism industry—argues that we need to continue to focus on improving skills in the three priority areas of management and leadership, customer service and chef skills. I say to Mr Gibson that we will improve chef skills if we reintroduce modern apprenticeship places for those aged over 19, because it tends to be older people who want to get into that area.
Most of all, we need clear direction from VisitScotland and the Scottish Government. Instead of the secrecy surrounding the removal of Philip Riddle and funding to a loss-making venture such as the gathering, the minister needs to focus on how he can support this vital industry. Despite all the obstacles that are being put in its way, tourism can still be a winner for Scotland and a provider of good, well-paid jobs.
09:56
Today’s debate is an opportunity to set the record straight. From reading the motion, one would be forgiven for thinking that the tourism sector in Scotland was in disarray. Of course, that is far from the truth. In the midst of a recession, our tourism industry has just had an extremely successful year. In a year in which tourism was down by 4 per cent, Scotland was the only country in the United Kingdom to show growth in international trips, with a 25 per cent increase in visits from North America and a 43 per cent increase in visitors from outwith North America and Europe over the summer months.
The year of homecoming generated more than £50 million of additional revenue and attracted almost 100,000 additional visitors to Scotland—by anyone’s standards, that is a success of which the whole Parliament can be proud. David Smythe, chairman of the Association of Scotland’s Self-Caterers, perhaps best summed up the situation for the tourism industry when he stated:
“In an economically tricky year we were very fortunate to have Homecoming. The Programme of events and the marketing of the celebrations helped promote Scotland as a must visit destination in 2009.”
The Scottish Government is committed to growing the tourism sector in Scotland, and the announcement of the second year of homecoming was welcomed by businesses throughout Scotland. Homecoming 2014 will take place in the year that Scotland hosts the Commonwealth games and the Ryder cup and marks the 700th anniversary of the battle of Bannockburn.
The second year of homecoming is also the target year for the opening of the Victoria and Albert museum Dundee on the waterfront in my constituency, which will put Dundee at the heart of the celebrations. It is hoped that we can replicate some of the success that Bilbao has enjoyed with the Guggenheim museum. The Scottish Government’s enthusiastic support has been key to driving the project forward to ensure that we create a truly iconic building on—or perhaps in—the Tay. In order to do that, a global competition to design the museum was launched and a shortlist of six companies has been drawn up. Global interest has been stirred by the design competition and six of the world’s leading architectural practices, which have designed some of the most iconic modern buildings around the world, are bidding to take on the work. Although those companies are from across the world, they have managed to tap into the huge talent that exists in Scotland. Every single one of them is using a lot of their manpower to bring forward their designs in Scotland and across the UK, which is to be welcomed at this time of recession.
I endorse and commend the member’s enthusiasm for tourism in his area. However, the new chairman of VisitScotland has said that there needs to be a change of strategic direction for both VisitScotland and the industry. We simply do not know what that change of direction should be. What does the member believe it should be?
We need to have a strategy that drives tourism forward. It is bizarre that the Liberal Democrats are saying, on the one hand, that everything is terrible so we need change and, on the other hand, that we do not need change. At the end of the day, what we have from the Liberal Democrats is a motion that talks down our industry and Scotland. We hear far too much of that.
I will return to the benefits that tourism has for Scotland and for my city in particular. The V and A in Dundee will grow and support tourism in the area. It is estimated that it will bring 130,000 visitors to Dundee every year, which will be a huge boost to the Scottish economy as well as to Dundee’s economy. It will tie into the other cultural centres of Aberdeen, Edinburgh and Glasgow and will really make Scotland a global cultural place to visit. I hope that everybody in the chamber will support that. I certainly have not heard any voices speak against it, which is a good thing.
I understand why some businesses have taken issue with the business rates revaluation, because nobody wants to pay more tax, but the revaluation is carried out by an independent assessor. To fail to implement its recommendations or to introduce transitional relief would mean that many businesses would be forced to pay more than they should. Transitional relief would work both ways: it would mean that businesses that have been assessed as paying too much would continue to pay too much, which cannot be right. We would force businesses to pay more than the independent assessor has stated they should pay. No member should be in any doubt that, by ensuring that the overall package of rates relief to businesses in the tourism sector is more generous than in any other part of the UK and by investing in projects such as the V and A in Dundee and homecoming 2009 and 2014, the Scottish Government is committed to and delivering for the tourism sector in Scotland.
10:01
It is clear from the debate that the Scottish Government needs to do better on tourism. It is not the industry but the Government’s strategy that is in crisis. Tourism is hugely important to us, as colleague after colleague has stressed this morning.
For us in Edinburgh, tourism is one of our biggest industries. We are one of Europe’s most popular destinations, but we cannot afford to rest on our laurels. That is why the lessons of the gathering have to be learnt. I asked the Auditor General for Scotland to intervene and investigate last year because I was deeply disturbed by the lack of transparency in the dealings around the event, the huge cost overruns and the damage done to businesses locally. It required a series of parliamentary questions and freedom of information requests to unearth exactly what happened.
As a result of yesterday’s report, we now know that the Scottish Government knew that the gathering was in trouble when it approved a secret loan to keep it afloat. That loan became a write-off. It is clear that the Scottish Government tested neither the viability nor the robustness of the business case offered by the gathering organisers. It is now also clear that the First Minister personally engaged in a round of phone calls to try to offload the company, desperately trying to persuade somebody to take the company on and save the Scottish Government’s face.
The Auditor General’s report is damning because it identifies a lack of due process, which is fundamental in a democracy. Moreover, the Scottish Government and the City of Edinburgh Council did not have a full understanding of the position before they released information last year about the future of the company, which is absolutely galling for the 103 local businesses that were misled by those statements. They were left by the Scottish Government to fend for themselves and they found out this week that another company that has the organiser of the gathering, Lord Sempill, at its helm and which was given a loan by the Scottish Government has resurfaced to start trading again. Where is the fair treatment for private businesses?
The Auditor General is clear that lessons have to be learnt. Due diligence, clear expectations and performance indicators need to be agreed when large sums of money are being handed out. Our tourism industry deserves better. The Auditor General’s report shows us what went wrong with the gathering, a key part of homecoming, but it does not explain why the Cabinet Secretary for Education and Lifelong Learning, Mike Russell, and his boss, the First Minister, acted in such a cavalier fashion. That is important, because there are still questions to answer. I was astonished that the minister could not bring himself to apologise for the handling of the debacle. He only got round to mentioning the gathering when Iain Smith challenged him about it in the last 15 seconds of his speech.
Things are not getting easier for local businesses, because, as many colleagues have suggested, business rates are up. Hotels in Edinburgh are hit by an average of 20 per cent and cafes and shops, which are vital to our tourism industry, are also hit. When Edinburgh Chamber of Commerce and I met John Swinney, he made sympathetic noises about tax increment finance and the specific need to avoid inconsistent decisions on individual rates bills, but he did not offer any comfort on transitional relief.
SNP members, including Rob Gibson in particular, have asked for reality. The point that the minister made ignores the extra cash that the SNP Government has taken in through revaluation this year. He needs to address the point made by the Scottish Chambers of Commerce, which thinks that the figure of £60 million—the sum given in response to parliamentary questions—could be higher.
The timing of the revaluation was crucial: it happened when business was good and the values of the properties were significantly higher than they are now. Therefore, businesses face a double whammy: they are hit by rates revaluation at a point when the value of their property has plummeted, and the value of their business is not as good as it was, which means that their rates valuations are inflated. That has pushed up costs for business throughout the city. The Government is not making it easy for companies that are trying to deal with the Salmond slump.
It is a Labour slump.
There is a differential impact in Scotland, as the Government’s own figures show.
Edinburgh is now a global destination, but it has taken years of work to build us up to that. We cannot be complacent, and the last thing that we need is an incompetent approach. We need only consider what is happening locally: we are reaching the anniversary of the beginning of the waste dispute in the city—it is astonishing that it has not been settled a year on. The price is overflowing bins and rubbish in the streets for tourists to see. It is not good enough.
We need more competent, engaged leadership, nationally and locally. Edinburgh is one of Europe’s most popular destinations but there is a global recession, so everybody has to work harder. That is why it is even more important that VisitScotland has a clear focus and the Scottish Government takes clear action not only to help generate tourist visits but to help the industry survive really difficult times.
10:06
It has been an interesting debate. Over the course of it, we have covered a number of issues, a few of which I will pick up on.
I will start with the subject of my amendment: the decision on the tax rules for furnished holiday lettings, which is good news for about 5,000 or so lettings throughout Scotland, many of which are in the Highlands or the south of Scotland.
Paragraph 2.85 on page 51 of the budget document says:
“The proposal inherited by the Government to repeal the special tax rules for furnished holiday lettings will not be implemented.”
The industry has been lobbying for that for some time. Unfortunately, that lobbying fell on deaf ears in the previous Labour Administration, which cited European regulations, saying that they outlawed the position, and simply refused to listen to the cogent arguments that the industry advanced.
I am pleased to say that the lobbying on behalf of the industry has achieved a successful result. There are still European regulations to work our way around but there is political will to do that, and the coalition Government in the United Kingdom will pursue the matter, which will help our industry in Scotland, as well as tourism elsewhere in the UK.
There were some interesting speeches. I will touch on one or two important ones.
Lewis Macdonald for the Labour Party argued well and advanced various pieces of evidence for a good case. However, it is one thing for the Labour Party and the Liberal Democrats to argue for a transitional rates relief scheme, but how could such a scheme be implemented? As I said in my opening speech, either money must be clawed back from the businesses that gained from the rates revaluation—about 60 per cent gained, and they are, in general, smaller businesses—or it must be paid for out of Government revenue. We have not heard from any party how it would be implemented. Mr Macdonald made a good case but, without a solution, a scheme cannot be implemented.
Lewis Macdonald also said that tourism businesses were demanding change. Some are, of course. He cited the Aberdeen Hotels Association, but hotels are not the only tourism businesses. The vast majority of our tourism businesses are extremely small businesses, many of which gained from the rates revaluation and are not arguing for any changes or for transitional relief. If somebody argues for transitional relief, they must say how it ought to be implemented.
Gavin Brown knows that, since last summer, I and other members have been raising the issue of the lack of consultation with the business community on transitional relief. Is he, in principle, in favour of transitional relief? If so, why has he supported the Government since last summer, given the figures that it has provided?
I have no principled objection to a transitional relief scheme; it is a matter of practicality. Until a practical solution is put on the table, transitional relief is simply on the wish list from the Liberal Democrats and the Labour Party.
It was last summer.
By “last summer”, I think that Jeremy Purvis probably means March, which was about a month before the election.
No, it was last year.
Mr Purvis is due to speak at the end of the debate. Why does he not use that opportunity to say how a transitional relief scheme ought to be implemented to try to get members behind his proposition?
10:10
The Labour amendment highlights a number of matters, but I will draw attention to two in particular in my closing speech. One is the need for openness and transparency from the Government and its agencies in dealing with the tourism sector and the issues that affect it. The second is the need for the Scottish Government to address the competitive disadvantage that Scottish tourism businesses will face.
The decisions on VAT clearly affect tourism businesses throughout the UK. However, the decisions on transitional relief are a specifically Scottish problem. The Conservative-Liberal Administration at Westminster has inherited from Labour a transitional relief scheme that caps at 12.5 per cent the impact of rates revaluation on any business in any one year. It is essential that the Scottish Government recognise that two additional tax burdens have been imposed on tourism businesses in Scotland in the past couple of months and that those will have an impact that it is the Government’s responsibility to seek to address.
Ministers have argued, as Jim Mather did again today, that they cannot afford to provide transitional relief to hotels that have been hit hard by rates revaluation. Gavin Brown said that it was incumbent on those who look for transitional relief to suggest how that might be implemented.
Does Lewis Macdonald realise that transitional relief would mean 63 per cent of hotels being worse off or no better off?
No, I do not accept that. The fundamental problem is that ministers are not listening. John Swinney met Aberdeen and Grampian Chamber of Commerce on 23 May. The chamber of commerce explained to him the calculations that it had made and why it had come to the view that his were flawed. He went away and examined those calculations and his officials indicated by telephone to the chamber of commerce that, fundamentally, it had got them right. However, when he wrote back to it this week, he failed to take that on board.
The chamber of commerce also put to John Swinney a specific proposal for how a transitional relief scheme might be organised. He wrote back saying that he was not prepared to support that proposal and explained the reasons why he had come to that view. The chamber of commerce’s disappointment at the rejection of that option was, I think, less than its disappointment that he did not provide an alternative option or even suggest that he was prepared to consider alternative options.
This is not a zero-sum game. As Sarah Boyack said, John Swinney indicated last month in answer to a parliamentary question that there was a £60 million increase in the revenue that is coming to the Scottish Government as a result of rates revaluation.
It is zero sum.
If the chamber of commerce is correct, the £60 million—which John Swinney concedes as additional Government revenue from rates revaluation, even if Stewart Stevenson does not—may be an underestimate. We have seen figures from various places such as the small town of Ballater in Mike Rumbles’s constituency, which was mentioned in the debate. In Ballater, three quarters of the selected small businesses that were assessed and which previously qualified for small business rates relief no longer qualify because revaluation has put them over the threshold.
Those facts raise fundamental questions for those businesses, but they also affect the amount of money that is available to the Government. I hope that, when Mr Swinney meets the delegation from the Scottish Chambers of Commerce on Monday, he takes on board what we have said to him before and repeat today. These are not minor issues and we are not making a mountain out of a molehill; they are significant issues for many businesses.
There is no single solution, but there is a number of potential solutions if ministers are prepared to accept that they may have miscalculated and that their model may be wrong. They have certainly already accepted that they have £60 million that they did not have last year. Let them reconsider what else might be available to them. Even if they are not prepared to follow the Labour model that was established in England of a 12.5 per cent annual cap, what else can they do to limit the impact on businesses? It is open to them to consider that, and I hope that they will do so in a positive spirit on Monday.
10:15
The debate has been characterised by massive misjudgments on the part of the Liberal Democrats. They seem to be more interested in attacking the Government than in improving and supporting the wellbeing of individual tourism businesses. Their approach does not conform to one that would make them collegiate partners in team Scotland, which is trying to optimise the tourism offering. Rather than helping to build an industry through collaboration and constructive criticism, there is a pattern among the Lib Dems of seeking to create division and seeing everything in the bleakest, blackest light. It is not the stuff of collaboration, trust and respect that leads to optimisation; rather, it is an approach that is deeply committed to the stuff of sub-optimisation.
Will the minister take an intervention?
Let me complete the charge sheet: misinformation, an incomplete picture, divisiveness, blame and negativity. Over the five-year revaluation cycle, business rates will not rise a penny more; in fact they will rise less. In 2010-11 alone, the decision to match the English rate poundage will save business in Scotland more than £200 million.
Will the minister accept an invitation to Ballater?
I would gladly visit Ballater.
Thank you very much—
Mr Rumbles, sit down.
We have exposed a misjudgment of the mood of the tourism industry. The industry is working more closely than ever with the board, chair and management of VisitScotland to achieve a new beginning and a new vibrancy in the sector. Lots of other agencies are involved in that process. The Lib Dems have misjudged the fact that the people of Scotland are conscious of the tangible benefits that have accrued from the advantages of the business-benefit approach to rates for small businesses and, hence, are concerned about anything that could reverse those gains. The Lib Dems have misjudged the fact that people realise that the Government has to be pragmatic from time to time in seeking to protect the greater interests and reputation of Scotland.
Lewis Macdonald mentioned alternative options. We have suggested alternative options today. We will work as never before with successful businesses that have been affected, to help them to move forward.
The Lib Dems have misjudged the mood of the revalued hotels. We understand that they would all prefer lower taxes, but revaluation is a hard-wired function of a long-established independent system. Businesses know that there is an appeals process, and we encourage them to take that route. Now, Government and many other small businesses and stakeholders want to work together to help those hotels to fill their rooms and restaurants. Like Scotland, they need to earn their way to better outcomes.
Does Mr Mather accept that the issue for hotels in my constituency and, I suspect, throughout the country, is not the revaluation process or the appeals process but the absence of transitional relief—a decision that his Government took without consulting business first?
For 63 per cent of Scottish hotels, transitional relief would either have cost them more or kept them where they are. We are interested in channelling a programme of work in which we can help businesses to achieve higher occupancy, higher revenues and greater financial resilience. I have tried the negative approach and it does not work. A positive collaborative approach and capitalising on things such as the exchange rate takes us forward in a way that those who take the divisive and hypercritical approach can only dream of. We need to move away from that divisive approach.
As David Whitton suggested, the Lib Dem approach to accountability is to avoid it. As we have seen in The Scotsman today, many Lib Dems are saying on VAT, “No comment”, “Not an issue for me” and “I didn’t campaign for it.” The Lib Dems seek to damn the Government if we do and damn us if we do not. It is a fatally flawed and divisive strategy that is designed not to improve the system but to score political points. The Government has stayed focused on what is best for its sectors, in particular tourism—it has stayed close to that sector. It has rolled up its sleeves and is willing to roll up its sleeves further in working with the tourism industry and sharing the challenges that it faces. Unlike the Lib Dems, we are primarily focused on the industry’s reputation, on Scotland’s reputation, on morale and investment in the industry and on the tangible results that will come forward.
Sarah Boyack mentioned the gathering yet again. Who carried out the initial due diligence that got the company up and running and funded? That is the key question. Cannot we look at the bigger picture and the collateral damage that could have happened to Scotland had we not taken pragmatic action? The important issue here is that we are positive about the tourism industry and we are working with it. There is a new board and a new chairman in place; we understand that they are managing operational matters and that they need to be left to manage them properly. The rates revaluation is normal in the model. Now is the time for Scotland to move together. Ours is the antithesis of an incompetent approach; it is a cohesive, collaborative and competent approach. We are all living with the legacy of Labour’s incompetent management of the economy.
10:20
The minister’s speech is in stark contrast to what the Economy, Energy and Tourism Committee was recently told. He said that the industry body is being led in a cohesive, competent and collegiate way, and that VisitScotland’s board and leadership are closer than ever. Why, then, was the committee informed that the chief executive will be sacked and that a strategic change of direction has to be made, without that information being published or anyone being aware of it? The Cabinet Secretary for Finance and Sustainable Growth, John Swinney, told the committee that Peter Lederer, the former chairman,
“raised no such concerns with me during his tenure as the chair of VisitScotland, and neither did any individual board members.”—[Official Report, Economy, Energy and Tourism Committee, 16 June 2010; c 3822.]
However, the new chairman informed the minister—who did not inform the cabinet secretary for a month—that it was the unanimous view of the board that it should get rid of the chief executive. If that is cohesive and collegiate, I do not want the minister to be responsible for any staff review in the Government.
There have been some positive moves for the economy and tourism in Scotland as a result of the United Kingdom budget. It was a tough budget, but the scrapping of the increase in tax on furnished lets is good news, as is the consideration of pilots for rural fuel discount and rural tourism. The income tax threshold increase will lift 100,000 low earners out of tax altogether and will help 2 million people on basic-rate incomes. That is more money in people’s pockets and for the Scottish economy, which is critical for our domestic tourism and hospitality business.
Now that he has access to the UK Government, will Jeremy Purvis take to his colleagues the message from France and Germany about preferential rates of VAT for tourism businesses?
I will take no lectures from a minister under whose Administration businesses face a 100 per cent increase in their tax bills. Is that the most authoritative position from which to ask me to make representations to the Treasury? If he gets his own house in order, lessons can be provided.
Let us address tax specifically. Last year, the minister believed that a 5 per cent increase in rates bills would be burdensome for business. Last year, the Government said:
“For those businesses that still have to pay rates, we are acting today to offer them vital breathing space in these tough economic times.”
That refers to a 5 per cent increase, and a decision to allow businesses to defer their rates increases. The Government believed that a 5 per cent increase would be harmful for the economy. It continued:
“Spreading the cost will improve cash flows this year and so help businesses through the current economic challenges so that they can be better placed to take advantage of the upturn when conditions begin to improve.”
However, now—shortly afterwards—the Government does not believe that a 42 per cent increase, a 59 per cent increase, a 43 per cent increase or a 120 per cent increase for Malmaison in Aberdeen, for the Radisson in Glasgow, for the Apex in Dundee, for the Townhouse in Melrose or the Dryburgh Abbey in the Borders places any burden on those businesses.
Will the member take an intervention?
If I have time later, I will give way to the minister.
It is right that Parliament should continue to hold the Government to account for the decisions that it takes.
We have heard assertions from the minister on transitional relief. We have found out that communications between him and the cabinet secretary have been less than perfect over the past few weeks, so perhaps the minister does not know that John Swinney wrote to me after our previous debate to confirm that a number of transitional relief options could be introduced. However, only one has been put forward by the Government. Gavin Brown believes that I, single-handedly, should design the transitional relief scheme rather than hold the Government to account for it.
Everything that the ministers have said has given the impression that businesses in Scotland are paying less in rates, but as answers to parliamentary questions from my colleague Alison McInnes and me show, the latest forecast for the yield from business taxation in Scotland for 2010-11 is £180 million higher than it was when this Government came into office in 2007. We are talking about a £180 million game, not a zero-sum game. That is the increase in revenue from business rates under the SNP Administration, which believes that no support should be provided to businesses that face increases of up to 100 per cent. We waited and waited. Finally, the minister said that the Government would help; he said that he would roll up his sleeves to support the companies that face such massive increases, but rolling up his sleeves and telling them to appeal is not the best action that he can take.
We make no apologies for raising the issues of rates and the leadership and strategic direction of VisitScotland. The Government set the strategic direction of VisitScotland in September 2007 in a statement by the Cabinet Secretary for Finance and Sustainable Growth. We have now been told that it is the unanimous view of the board that that strategic direction needs to be changed, but the Government has given us no indication of what the new strategic direction should be. If there is to be a change of strategic direction as well as of chief executive, the Government should publish a new tourism strategy for Parliament to scrutinise. Let us see it, discuss it and, with the participation of the industry, decide on the way forward. At the moment, the leadership of VisitScotland is in chaos. That needs to be put right. Many businesses face increases in rates of up to 100 per cent, but the Government is simply wringing its hands instead of rolling up its sleeves and acting, which is not good enough.