Trade associations representing thousands of tourist businesses across the UK – including the CPT – together with the Local Government Association, have written to the Chancellor of the Exchequer asking him to urgently change civil servants’ interpretation of his Coronavirus Business Rates Relief Scheme, launched to support the UK’s hospitality and leisure industries.
In addition to tour and coach operators, English language schools, destination management organisations and tourism and hospitality charities are all being excluded from the scheme despite Rishi Sunak promising to extend it to all businesses in the hospitality and leisure industries on 17 March. He said: “Every single shop, pub, theatre, music venue and restaurant, and any other business in the retail, hospitality or leisure sector, will pay no business rates whatsoever for 12 months, and if they have a rateable value of less than £51,000, they will now get a cash grant as well.”
However, guidance from the Ministry of Housing, Communities and Local Government says any relief to these businesses does not qualify for support because they are not in premises which customers enter to make a purchase. “This distinction is both arbitrary and counter to the Chancellor’s repeated statements that ALL businesses in the leisure sector are eligible for support,” says the letter, adding: “Failing to support these businesses puts at risk many thousands of businesses that generate a large percentage of the £25bn per annum that the UK earns from inbound tourism.”
Confederation of Passenger Transport UK (CPT) Chief Executive Graham Vidler said: “The coach industry is central to the leisure sector and it is deeply disappointing that this decision has been reached. It suggests a worrying lack of understanding from government about the sector. Coach tourism contributes over £6bn a year to the UK economy helping ensure people can enjoy sporting events, festivals, theme parks, theatres and trips to tourism hotspots across the country. With the industry facing an 18-month winter this funding would have helped provide a much-needed lifeline to businesses that we need to survive the current crisis to help the leisure industry gear up quickly as soon as it is able to do so.”
John Wales, Chairman of the Coach Transport Association, said: “It is staggering that government has retracted support for the coach industry on the basis it is not part of the leisure sector. Coaches play a vital role in both our transport system and the leisure industry transporting millions of people on day trips, holidays, on school trips, to theatre, music and sporting events. The industry is worth £6bn to the economy and business casualties are mounting daily. Urgent help is needed, so the greenest form of transport can help spearhead the tourism recovery nationwide. Coach operators are definitely in the leisure sector.”
Kurt Janson of the Tourism Alliance which co-ordinated the letter from eight tourism, English language teaching and transport trade associations as well as the Local Government Association, said: “It is hard to see how these businesses do not qualify as part of the leisure sector in Government eyes. If this is not a lack of understanding, it is a false economy: these businesses generate so much income and so many jobs for local communities that it will be devastating if they are forced under through lack of support.”
Tom Jenkins, CEO of ETOA, the European Tourism Association representing 1,200 organisations, said: “Spending by international visitors is a vital component in the UK service economy. Without them, shops, restaurants, theatres and attractions cease to be viable. Those companies that sell the UK throughout the world are vital export businesses. Over years they have invested in global distribution networks centred on expertise based in the UK. These export companies now face a total loss of business in 2020. For the UK to recover in 2021 they must be allowed to survive. With assistance they have a chance; without this, tens of billions of future income will disappear.”
Simon Kirby of Kirby’s Coaches, a member of the Coach Tourism Association, commented: “It is hard to understand the argument that coach companies do not fit the category of tourism and leisure. Our coach depot not only houses our coaches and workshop but also provides a departure point annually for approximately 10,000 people. In the last 12 months our business has undertaken 643 day excursions and holidays providing leisure experiences for 21,679 people, we have conveyed 152 groups of foreign visitors on holidays of average eight days spent around the UK, 92 rail replacement services and another 250 excursions and holiday experiences for social and school groups. We also provide employment for 25 local people.
“Our clients are highly likely to be the last group to be allowed to socialise therefore ALL of the above is in jeopardy if we aren’t given the help we as an industry need for survival.”
The letter has also been signed by the Local Government Association (LGA), whose members will only be reimbursed for granted business rate relief to tourism businesses if they fall within the official scope of the scheme. The LGA is highlighting the importance of supporting these businesses and the wider tourism supply chain, arguing that their failure will significantly impact local communities, including the ability of councils to raise income to reinvest in local public services.