By Luke Pollard, head of public affairs at Abta.
VisitEngland will spend £4 million in the next few months encouraging Brits to holiday at home instead of going abroad for their summer break.
The logic seems sound at first glance: the domestic tourism industry is having a tough time thanks to the VAT rise and economic turbulence. If all the money spent abroad was to be spent at home, it would boost the UK economy and help people into jobs. A simple and logical argument, isn’t it? Except it is flawed – let me explain why.
It assumes that money spent abroad is money lost from the economy, but this ignores the fact that the economic contribution of outbound tourism matches and by some accounts surpasses the value of visitors coming to the UK. Outbound tourism is a significant contributor to UK GDP and makes a healthy contribution to HM Treasury.
The Tourism Satellite Accounts produced by the Office of National Statistics indicate UK holidaymakers spend in excess of £27 billion annually in the UK in preparation for a holiday abroad. Abta’s own research indicates 29% of UK holidaymakers will spend in excess of £500 in the UK before going abroad, with 60% of UK holidaymakers spending at least £200.
If you include the considerable amount of tax paid by tourists departing the UK, the argument that holidays abroad don’t make a significant economic contribution to the UK simply doesn’t stand up.
The UK has one of the most successful outbound tourism sectors in Europe, employing hundreds of thousands of people, from high street travel agents and tour operators to airline staff.
Many of the world’s largest holiday companies are based in Britain: Tui Travel, which owns First Choice and Thomson, Thomas Cook, SAGA and many more. They contribute millions in taxes each year.
And it is not just in employment that the sector contributes. Each of us taking a flight to go on holiday may pay up to £184 in tax depending on where we’re jetting off to. This money goes straight to the Treasury – so one would think the contribution of the sector would be recognised.
However, the outbound sector is the poor relation of the tourism family, with barely a mention in the government’s tourism policy, when, like many industries facing tough market conditions, it needs and deserves support.
However you look at it, the UK is a tourism powerhouse. We have a superb domestic tourism sector. In every part of the UK there are outstanding attractions, superb hotels and guesthouses and tourists enjoying the sights and sounds of local culture.
Despite sky-high air taxes and expensive visas, the UK also continues to attract millions of international tourists – not as many as some of our European competitors, but enough that the inbound sector is heralded as important by the government.
Britain’s tourism sector is highly competitive, innovative and thrives on delivering what customers want. Far from being separate, domestic, inbound and outbound tourism are legs of the same tourism stool: inter-connected, inter-linked and, to an extent, inter-dependent. So why is one sector of the industry being pitched against another?
I have no doubt the intention behind the VisitEngland campaign is good: to maximise the legacy of the Olympics and increase employment in domestic tourism. But the government is misguided in doing this by subverting a successful free market and punishing UK businesses taking people abroad.
The holiday sector thrives on choice and delivering value for money. It is for each family to determine what value for money is and where and when to holiday. For some people, this will be a sun-kissed beach, for others a canal boat on the Norfolk Broads.
If Britain offers the best value for money for a family holiday, people will choose a domestic break. If they believe a destination abroad offers good value, they will head abroad. Each of us should be free to choose a without the government using taxpayers’ money to tell us their view of what represents best value.
This comment first appeared on the Huffington Post.
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