Before we begin the debate I have two announcements to make. First, I have not selected the Amendment in the name of the hon. Member for Tiverton (Mr. Maxwell-Hyslop)—
That this House declines to give a Second Reading to a Bill which sets up a system of tourist boards reflecting neither the economic nor the geographic balance of the tourist industry within the various parts of the United Kingdom, which, so distorted, implies an irrational allocation of public funds, and which does not lend itself, by reason of its drafting, to rectification by amendment,
or that in the name of the hon. Member for Honiton (Mr. Emery)
That this House, whilst recognising that tourism is a major British industry, declines to give a Second Reading to a Bill, the principal objective of which is to provide public funds to newly created statutory boards for allocation on a discretionary basis, and condemns a measure which fails to remove or alleviate the root causes of the tourist industry's difficulties, namely, selective employment tax, inadequate tax allowances, and poor communications to the principal holiday areas
This will not cramp the debate in any way. All the points made in the two proposed Amendments, and many others, will be made during the course of the debate.
Secondly, every hon. Member who represents what might be called a tourist constituency is anxious to speak in this debate. I appeal to those who are fortunate enough to be called to make brief speeches, because so many interests are involved in this Bill.
Mr. Speaker, I shall try to set a good example in response to your appeal for reasonably brief speeches.
I beg to move, That the Bill be now read a Second time.
Tourism, as we can see from the Order Paper, is a subject on which a lot of people have very strong views. It is a matter on which everybody has strong views. To start with, we are all—in some sense—tourists whenever we travel at home or abroad, whether on business or on holiday. Again, tourism covers an enormous range of economic and social activities of great interest to Parliament and the public. It is much more than an industry—one cannot classify it neatly, as one can, say, the motorcar industry or the steel industry. It involves most of the service industries, particularly air and surface transport, and hotels and catering, and a wide range of cultural, social and recreational activities provided by public and private bodies. And, lastly, it affects the constituencies of many hon. Members, some of whom have put down Amendments to this Bill. I take no exception to this fact, as I think we all have the same objectives at heart, and I welcome the fullest possible debate and discussion on the Government's proposals.
One thing we can all agree on is the importance of tourism to the balance of payments. In 1967 over 4 million people visited this country from overseas, and their spending is estimated at £236 million, without counting in fares paid to British air lines and shipping companies. If we include these fares and other expenditures, such as cars bought while they were here and then exported, the grand total for 1967 was about £335 million.
For 1968, the corresponding figure is likely to be about £375 million, earned from nearly 5 million visitors. This is an increase of 12 per cent., and there is every reason to expect that our receipts from tourism will continue to grow, particularly as the jumbo-jets come into service. This £375 million from tourism compares very favourably with the export earnings of some of our major exporting industries—£280 million, from cars, £282 million from aircraft and aircraft engines, £299 million from all textiles, £177 million from whisky.
These are overseas earnings. But, in addition, the British Travel Association estimates that in 1967 our own people spent about 26 million main holidays in Britain, and that "home holiday-makers" spent about £560 million in this country. Holidays at home save holidays abroad, and since about £260 million of foreign currency was spent on holidays abroad in 1967, we have here a considerable import-saving potential. Whichever way one looks at it, tourism is now very big business.
Almost every country in the world is trying to attract overseas visitors and to increase its tourist earnings. In Britain, as in other countries, success depends on two things. First, tourist promotion to persuade people to visit this country by publicising the various attractions we have to offer. Secondly, tourist development, that is, making sure that people get the facilities and amenities they want so that they enjoy their visits and come back again.
Successive Governments have recognised the importance of the first of these two jobs by giving financial support to the British Travel Association, which has devoted most of its energies to overseas promotion. The grant-in-aid to the B.T.A. rose from about £600,000 in 1950, when the B.T.A. was reconstituted in its present form, to almost £1½ million in 1963. In the four years since this Government came to power the grant has doubled again, and for the year just ending amounts to almost £3 million, which covers about 80 per cent. of the Association's total expenditure.
I am sure that the whole House will want to join me in paying the highest tribute to the B.T.A. and to its Chairman, Lord Geddes, for their work. It has been quite outstanding and has earned the admiration of tourist organisations all over the world. And we should not overlook the valuable work which the existing Scottish and Wales Tourist Boards have been doing, or the efforts of regional or area travel associations to promote their own areas. I shall come back to this a little later.
The second requirement of a tourism policy is tourist development. Promotion by itself is not enough: we also have to provide the facilities and the accommodation which tourists want.
This is not a job solely for central Government or "the faceless bureaucracy" of Whitehall which I read about in the papers. It needs to be done by all kinds of bodies, both public and private. Spending on airports and roads, on theatres and opera-houses, on sport and entertainment, all contribute to tourist earnings.
But the first priority in tourist development, as the B.T.A. has long urged, is to stimulate new investment in hotel accommodation. We must be ready to meet the demands of tourist growth in the 1970s. We must have in mind the "Jumbo" jets, the continuing growth of inclusive tour holidays, and generally the outstanding opportunities for accelerating the growth in British tourist earnings. It was with this in mind that the Government decided—and this is the first aspect of our new tourism policy—to provide direct incentives to the industry to encourage new investment through the Hotel Development Incentives scheme, for which Part II of the Bill provides, and which was described in the White Paper of last May (Command 3633).
I am distressed to hear that I have become so boring so quickly that hon. Members have to deal with their constituency correspondence. In view of the White Paper, and of your appeal, Mr. Speaker, I will not give a lengthy explanation of the provisions of Part II, which are in any event more appropriate for detailed discussion in Committee. But our basic aim is to encourage investment in hotels catering for short-term visitors, particularly investment in the medium and lower-cost categories of hotels. The Hotel and Catering E.D.C., I am glad to see, has welcomed this scheme in its recent report, "The First Two Years, 1966–68", which hon. Members will have read. I quote:
The Little Neddy has welcomed the Government's intention to introduce legislation to provide hotel development grants and improved loan facilities, and believes that they will have a substantial effect in stimulating new investment.
It is sometimes argued, it is argued in one of the Amendments by implication, that tax reliefs should be given instead and in particular relief from S.E.T. The trouble about this proposal to achieve our object by relief from S.E.T. is that it would be extremely expensive and yet would not achieve the end in view which is the development of new tourist facilities. It would cost, if we relieved hotels and catering from S.E.T., some £28 million a year—much more than the
Hotel Incentives scheme; and only 10 per cent. of this would effectively relieve foreign visitors, because 90 per cent. of hotel receipts derive from British visitors.
So it would cost very much more money. In addition, we could not rely on it to fulfil the end in view, which is to provide new accommodation for tourists of the right standard and in the right season. Generally, S.E.T. on hotels is passed on in higher prices. I quote again from the Report of the E.D.C.:
It would seem likely to the Little Neddy that many, if not most, firms in the industry will continue to recover the added cost of S.E.T. through higher prices, and that consequently the effects of increases in S.E.T. on hotel and catering services are similar to those of an equivalent increase in purchase tax on manufactured goods.
Assuming this is right, if we were to exempt the whole of the hotel and catering trade from S.E.T., that might lower the prices of hotel services by perhaps 3 to 4 per cent. Obviously, this would be very agreeable to all of us, but it would have only a negligible effect on the overseas demand, which in any case exceeds the supply of hotel accommodation in the main tourist season. And above all, it would not increase the supply of new hotel accommodation.
As I have said, the most important factor limiting our overseas tourist earnings, both at present and in the foreseeable future, is the limitation of supply, that is, of the accommodation available. So the appropriate thing to do is surely to encourage hotel development directly and immediately, which is what the incentives scheme does. It is essentially a scheme of payment by results at a fraction of the cost which S.E.T. exemption would involve.
I am most grateful to the right hon. Gentleman for giving way. His argument presupposes that it is more important to attract overseas visitors than to retain British tourists in Britain. Since this is not a proposition embodied in the Bill, would he explain the reason for this assumption he makes which is by no means self-evident?
I believe both are important. As the hon. Member will remember, I have already referred to the import-savings side as well as to what we may call the export-earning side. But even if we make some allowance for the additional British visitors who might be attracted to British hotels, by far the greater part of the relief as a result of S.E.T. exemption would go to British visitors who are not going there instead of going on holiday abroad. I must insist on this. I can see the superficial attraction of the S.E.T. solution, but I must insist that as a way of getting new investment in hotels, which is the crux of the matter, the Hotel Development Incentives scheme is much less costly and much more effective.
Before the hon. Gentleman leaves this question, may I ask him whether he would consider allowing the new Authority, perhaps in consultation with the Department of Employment and Productivity, to assist in drawing boundaries for the Hotel Development Incentives scheme. There are serious anomalies. One aspect is the development area side of it together with the question whether or not it is a rural area and a proper place for this kind of grant.
I was about to say that although I believe a general S.E.T. exemption is wrong, we have made certain limited concessions for hotels in rural areas to which my hon. Friend was referring. As far as boundaries are concerned, I am not sure, but I will certainly check to see whether this particular dividing line is one being looked at under the Reddaway Report, and I will certainly consider my hon. Friend's point.
The hon. Gentleman seems to put the argument on S.E.T. in terms of reduced prices of 2 or 3 per cent. rather than an accretion of profits or cash flow; in other words, financing investment in the hotel industry.
I say so merely because I am taking the argument of the "Little Neddy" on this, which says S.E.T. when it exists is passed on in higher prices, and appears to think that if it were reduced it would be passed on in lower prices.
The second aspect of the Government's new policy is the power which the Bill provides for selective financial assistance to other tourist developments. Clause 3 empowers the new tourist authority to propose general schemes of financial assistance for a class of project, subject to the approval of both Houses of Parliament through affirmative Resolution.
Clause 4 provides for financial assistance by way of grant, loan or investment to particular tourist projects or, as a last resort, for a tourist board to undertake such a project itself. At this stage I do not envisage any general Clause 3 scheme being introduced while we are still making large payments under the Hotel Development Incentives scheme; and as to Clause 4, we see this power as providing a supplement to, not a replacement for, projects financed on a normal commercial basis, or by public bodies such as local authorities through their existing powers and resources.
I will not try to give examples of the kind of project which might receive such selective financial assistance. It will basically be up to the tourist organisations to decide for themselves which developments to encourage, and in what areas; and whether it should support them financially. In general, developments will continue to be financed by private investment or by other public bodies. But occasionally the boards will wish to step in to finance some particular or essential facility, especially one which will affect the balance of payments directly, or generate tourist earnings of major importance to the local economy. We make it a selective power to avoid the "irrational allocation of public funds" to which the hon. Gentleman refers in his reasoned Amendment.
I turn now to the third new aspect of our proposals, the power to register and classify tourist accommodation. This is aimed at both promotion and development. By providing more comprehensive information to the public and to the travel trades, registration will make promotion more effective, and it will also help tourist development by enabling forward planning to take place more easily, and by contributing to higher standards
I recognise that there are differences of opinion on this subject and also on whether and how far we should grade hotels by quality as well as providing additional factual information. The British Travel Association has stated publicly that while it has no objection to the enabling powers in Clause 18 it would prefer a voluntary system of improving information about accommodation. It thinks that the Clause 18 provision should be treated only as a reserve power. But on the other hand, the "Little Neddy", the Consumer Council and the Scottish and Wales Tourist Boards have all welcomed the decision to seek powers to register hotels. I believe these powers are right in principle, but I have no predetermined scheme in mind. I certainly welcome public discussion of the subject, and I hope there will be a very full debate on this in Committee. Certainly the Government will welcome that. But at the end of the day it will be for the new tourist authority to advise on the subject, and it must do so only after the fullest possible consultation with consumer and trade interests.
So far, I have discussed the broad new policies embodied in the Bill, and I turn now to the question of organisation. Here, one thing is quite certain. It would be both wrong and impracticable to centralise in a single Government Department the responsibility for all activities with a bearing on tourism, but we need some effective arrangements both for co-ordinating and for stimulating tourist activities. The Government have reviewed the existing organisational arrangements with this in mind. So far, these arrangements have worked reasonably well, as the balance of payments figures demonstrate. But not only the Government but informed outside opinion has increasingly come to the view that a change is now needed.
Many people have made many different suggestions. These range from a Ministry of Tourism to proposals for new statutory boards or for giving statutory powers to existing organisations. Two years ago, the B.T.A. itself proposed to the Board of Trade that we should consider giving a "National Tourist Council" statutory powers and making it able to give financial assistance from Government funds; and give it also a strong co-ordinating rôle to ensure that tourist considerations were taken into account by all other relevant bodies, public or private.
But the Government, after much thought, have decided on the proposals which I announced on 13th November, and which are embodied in the Bill. Their shape is determined not only by the general need to intensify tourist development but in particular by the three new initiatives of the hotel incentives scheme, the power for selective financial assistance and the power to register and classify hotels.
There is also a new situation as a result of the three initiatives which I have mentioned. None of these would be appropriate to a membership organisation such as the B.T.A. and the other tourist organisations. They could, of course, be done by a Government Department, but could equally well be done by a statutory organisation. We chose the latter because a statutory organisation, unlike a Government Department, could undertake the promotion part of the job as well. There are strong advantages in combining both the development and the promotion function in one body. Promotion and development are closely related and the expertise and knowledge obtained in one field can be most helpful in the other. Moreover, having one organisation responsible for both promotion and development should make for greater efficiency in the use of professional and specialist staff and so lead to a saving of staff. I will come back later to the question of whether this entire set of proposals will or will not need more staff.
The statutory tourist organisation which we propose would have a status comparable to that of the other statutory bodies with which it would have to work in close co-operation. We propose the organisation in Clause 1 with the general functions and powers described in Clause 2. I must point out, in view of some comments which have been made, that this is a distinctly less bureaucratic approach than that adopted in most other tourist countries. Out of 86 countries which are known to have Government-sponsored tourist organisations, 63 have Government Departments, 12 have statutory boards, 11 have co-operative organisations similiar to the B.T.A. In Europe, France, Spain and Italy all have Government Departments responsible for tourism.
I hope that this will quiet some of the fears expressed by hon. Members opposite, one of which I read about in the Daily Telegraph report of a conference attended by one hon. Member who is present, when reference was made to
. . the danger of faceless wonders in Whitehall like the White Fish Authority.
Under our proposals the British Tourist Authority will undertake all promotion overseas and will be responsible for matters on which a national policy is needed in the country as a whole, such as re search, co-operation with other national organisations, the provision of a national advisory service and a policy on hotel registration and classification—
Has the right hon. Gentleman received any other telegrams, since some of us have seen another telegram from the West Country which says:
Please oppose Tourist Bill in its present form…insufficient safeguards for English tourism."?
Is that the only telegram that he has received?
I have received, indeed, one or two other telegrams, I thought that, since none of us is every likely to take a parochial or even purely regional view, the significant telegram was the one from the national body.
I have described the national functions of the British Tourist Authority, and it will in addition have certain functions in respect of England alone—that is, research, promotion and publicity specifi- cally for the benefit of English tourism. Clause 6 provides also for the establishment of an English Advisory Committee appointed by me, which will be under the Chairmanship of a member of the British Authority who will have particular responsibility for that authority's English functions. I intend that this Committee will be widely respresentative and reflect the diversity of English regions and activities.
I suggest that this is a better solution than either of the other two suggested, having a completely separate English body, which would mean four organisations instead of three—we surely do not want to proliferate these organisations—or, second, of having a statutory board for, let us say, the South-West, which would equally lead to calls for statutory boards for many other parts of the country, and we should end up with probably eight or ten statutory boards, which would make no sense in terms of economy or efficiency.
As the right hon. Gentleman has been dealing particularly with the structure of the new B.T.A. and the Board, how does he envisage that the present British Travel Association will fit into the new organisation? Is it intended that the new one should take over entirely the old B.T.A. and that the staff should be integrated? There has been no announcement on this and many people want to know.
That is a reasonable question, but I am afraid I cannot answer it, because the future of the present B.T.A. is a matter which only that Association can decide. So it is not for me, speaking for the Government, to lay down whether it should continue with different functions or wind itself up. I understand that it has not yet made that decision.
Reverting to the new Authority, it will administer in England the Hotel Development Incentives scheme, any selective aid to particular tourist projects and any registration and classification scheme. The separate boards for Scotland and Wales will carry out in those countries all the tasks and functions which the British Authority will perform for England. Their chairmen will be ex officio members of the British Authority and in this way will contribute to the development of national policies on matters affecting Britain as a whole and, of course, on tourist promotion overseas, for which the British Authority will be solely responsible.
The three statutory bodies must obviously work in very close consultation with each other on matters of common concern; for example, to achieve consistency in administering the hotel incentives scheme. But there is no question of the British Authority being the overlord of the Boards for Scotland and Wales. I am sure that close co-operation between the three can be left to the good sense of the people concerned.
Contrary to at least one report I have seen from the famous conference to which I referred, the membership of the new bodies has not been settled. I can positively deny the statement made by one person at the conference, who said:
''I have learned the name of at least one M.P. who has been offered one of these positions and whose only qualification happens to be that he has spent a number of holidays abroad.
If that were a sufficient qualification, we would certainly not be short of candidates. I have not yet got within some way of deciding the membership.
All three boards are intended to be compact functional boards. They are not intended to be strictly representative of sectional or geographical interests. We will draw their membership from people of experience and ability in tourism, industry, commerce, economics and administration. I hope that they will bring to their work experience in different parts of Great Britain, but the intention is that each board should be a team providing efficient leadership for their staffs, and not advocates of any particular interests.
That is how we see the new organisational arrangements at national level. But a successful tourist policy depends on success at all levels. Neither the Government nor any national organisation has a monopoly of interest or wisdom in these matters. We already have a number of active regional or area tourist associations, and I am glad to say that they show signs of expansion. They have an essential rôle to play, both in making local tourist activities more effective, and also in making sure that regional and local considerations are not neglected by the national organisations.
The way in which these associations develop is mainly for people on the spot to settle. It is not for us to decide at the centre. Our proposals provide the essential national framework and within that framework we want to see the greatest possible activity in the regions and localities.
I come to the cost of the Government's proposals and the fears expressed by hon. Gentlemen opposite, when I made my statement in November, of a "faceless bureaucracy". I expect—I say this categorically—no material increase in Civil Service staff as a result of the Bill. The Board of Trade and the Scottish and Welsh Offices already have some administrative responsibilities in connection with tourism. Our staff will continue to be needed, but I see no reason why it should be increased.
The new tourist organisations will recruit their own staff. I do not expect them in general to need significantly more than the B.T.A. and the existing voluntary boards in Scotland and Wales already employ; that is about 500. But depending on how things develop, they may require about 70 additional staff for the hotel incentives scheme and, later, for selective financial assistance. This additional staff would have been needed whoever operated the scheme. As to hotel registration, we have no set scheme in mind, and I can therefore make no estimate of manpower or cost. But this will obviously be a major consideration in looking at different proposals that may be made.
The cost of the new proposals will consist partly of the payment of grants and loans under the incentives scheme, for which Part II of the Bill provides, and partly of the expenses of the new boards in respect of their general work on promotion and development work.
On the first, I can give no precise figures for total spending on grants and loans, since this will depend on the timing and nature of investment by the industry and, for loans, on the extent to which loan assistance is considered appropriate in particular cases. I am working on the basis that expenditure could rise to about £8 million during the operation of the scheme. This assumes that while the scheme is operating, there could be an increase of 50 per cent. on the recent rate of provision of new hotel bedrooms, which has been some 3,000 rooms or 5,000 beds per year.
As to the general work and expenses of the tourist organisations, public expenditure considerations, which are constantly being urged on us by hon. Gentlemen opposite, rule out for the present any significant increase in funds, so I do not expect grants for this purpose to the three bodies in their first full year of operation—which is likely to be 1970–71—to exceed about £3½ million, including the administrative expenses of the hotel incentives scheme. Once the new authority is operational, the present grant-in-aid to the British Travel Association will, of course, come to an end.
At this stage, I cannot give a breakdown of the likely grant between the Board of Trade's Vote and the Vote of the Scottish and Welsh Offices. This will depend on how the British Authority and the Scottish and Wales Boards share out their work in general, and in particular on the arrangements they make for administering the hotel incentive scheme.
Thus, the total expenditure in prospect under the Bill might reach about £11½ million in a full year. In addition, I hope that the new boards will be able to attract revenue from outside bodies for co-operative promotion work, and from their publications and advertisements.
This leaves out expenditure under Clause 4. The new organisation's first job will be to implement the hotel incentives scheme and to maintain the promotional and development work of the existing voluntary bodies. I think it unlikely that either the British Authority or the two Boards will be able to put forward proposals under Clause 4 until some time next year. What order of expenditure will prove possible for 1970 or future years in this connection must depend on the public expenditure situation at the time.
I cannot hope—nobody in my position can—to satisfy all the demands that are made for more funds for tourism promotion and development. The present stringent restrictions on public spending rule that out. But I believe that a limited amount of additional spending on the promotion of tourism and the improvement of tourist facilities will pay a rich dividend in increased earnings of foreign currency. It is a sign of the importance which the Government attach to the tourist industry that the Bill has been introduced at such a time.
The President of the Board of Trade began his speech by pointing out the great service which the tourist industry gives to the United Kingdom economy. However, we have just witnessed what to me was an astonishing spectacle; the right hon. Gentleman introducing the Bill as if the Government were kindly benefactors to the tourist industry. Nothing could be further from the facts of the recent past.
The right hon. Gentleman spoke of a new tourist policy. I hope that it is new, because during the last four years, while he has been occupied with Education and other Ministries, many of my hon. Friends have been engaged in a stern struggle to protect the tourist industry from successive blows aimed deliberately at it by the Government. The Government's record in this matter is black. It is as black as it could be in its ill-treatment of the tourist industry. The Bill is a belated attempt to offer a partial remedy for this ill-treatment.
I remind the House of what the Government have done. During their first one-and-a-half years in office they imposed a restrictive building licence procedure which did not apply to industrial buildings, but which did apply to hotels. This caused delays and uncertainty. Then they withdrew investment allowances—except on buildings—the investment allowances on hotel equipment of all kinds. At the same time, they made the hotels and the tourist industry ineligible for the investment grants which they introduced for manufacturing and other industries in place of the allowances.
Shortly afterwards there was a severe and unexpected blow. Selective Employment Tax, an ill-conceived and iniquitous impost, was brought in. As if that were not enough, last year they added a 50 per cent. increase to the tax. Some of us on this side of the House have fought against the imposition of S.E.T. on the tourist industry. The Government will say, as the President of the Board of Trade said today, that they have made some concessions in response. There is the exemption for part-time workers, for example, which, of course, was some help to the hotel industry, but we were urging this in the summer of 1966, when the first Bill concerned with S.E.T. was going through the House.
Last year, there was relief for hotels in certain areas described by the President of the Board of Trade this afternoon as rural. That relief did not apply to restaurants or other elements of the tourist industry. The result has been a substantial net increase in tax paid under S.E.T. after the 50 per cent. increase last year, despite the exemptions in rural areas. A rough estimate given by the "Little Neddy" is that in a full year the industry is now paying about £40 million in S.E.T., whereas before the amount was £30 million.
As for the arbitrary lines that are drawn, which were referred to in an intervention by the hon. Member for Cleveland (Mr. Tinn), in rural and non-rural areas these are ludicrous. The President of the Board of Trade said that he would look at them, as if he did not know where they were. The most plausible explanation I have heard is that the right hon. Gentleman, or his predecessor, sat down with a map of Britain superimposed on a bingo board and that the Chancellor of the Exchequer called out the numbers at random. [Laughter.] I am glad that right hon. Gentlemen on the Front Bench opposite are amused.
Playing bingo with a map of Britain may seem casual, but most of the damage done to the tourist industry has been deliberate The Government have behaved like a thug who, having battered someone Co the ground with blows, kicks him in the teeth. The kick was the Selective Employment Tax. Offering the victim some of his teeth back, he kicks him again with the 50 per cent. increase. After perpetrating this violence the Government reappear in the rôle of a Good Samaritan with a stretcher and medicine—the present Bill. But the medicine which is proposed is not the best which could be prescribed.
In responding to the challenge, I think that the gaming industry has had rather worse treatment. I would rather expect to see the same lobby taking part in the debate to assist hon. Members opposite as it supports them against the proposed statutory boards.
As to Selective Employment Tax, as a representative of an area which has considerable relief from the tax, I am concerned about the effect of the policies of the party opposite should hon. Members opposite come to power. Could the hon. Gentleman assure us that should the hotel industry have a sales tax imposed on it, which would be far more iniquitous and difficult to administer in areas which now get relief from S.E.T., they get relief from the imposition of a sales tax?
I am sorry that the hon. Member was not able to respond in a responsible way to my challenge. [HON. MEMDERS: "He did so."] He must have been joking, I hope he knows that the Conservative Party intends to abolish Selective Employment Tax entirely. That would be the best relief that the hotels want. [HON. MEMDERS: "Answer the question."] I shall be dealing later with the other points the hon. Member made. Three years ago—[Interruption.]—wait for it—a letter in The Times caused a great deal of comment. It was headed:
Troubles for hotels
How the industry is hampered ".
After describing the injurious measures carried out during the Labour Government's first year, there was the following passage:
Now there is the culminating blow. We are to lose the one piece of assistance we have
had, the Investment Allowances, on the equipment of our hotels (as distinct from the buildings themselves) and we are not to be eligible for the new cash grants.
Many of my hon. and right hon. Friends will recognise that as an extract from a letter by Sir Geoffrey Crowther, as he then was, now Lord Crowther, who has recently been appointed by the Government as Chairman of their Constitutional Commission. That is a recognition, rightly, of his judgment and ability. The letter went on:
Now we must adjust our policies to the new situation. The pace of modernisation will be slowed down or even stopped. Projects which could be marginally justified before will now not pay even in the long run. And we shall have less money to finance those that will pay.
That letter was written before Selective Employment Tax. By the time Selective Employment Tax was added to the troubles of the hotel industry, the situation was much worse.
The Government have continued to clobber the industry ever since. By withdrawal of investment allowances the Government did serious damage to the industry. The hotel industry was placed at a great disadvantage compared with other industries because hotels are not treated as industrial buildings and are not, therefore, eligible for depreciation allowances. It is important to note that the "Little Neddy" recommended that the right solution was to extend to hotels the assistance given to industrial establishments. That recommendation should be considered seriously and carefully by the Government.
The "Little Neddy" also drew attention to the fact that by 1970 hotels in Britain are unlikely to be able to meet the demands made upon them by visitors from overseas as well as the demand by residents of this country, unless there is a great increase in planned extensions and development. Perhaps this has stimulated the Government to take some positive action now to try to repair the damage they have done and to produce this Bill. Otherwise, Britain would lose a potential increase in foreign currency which would be earned. For the tourist industry is a foreign currency earner. It is also a foreign currency saver. If British people can find the kind of holidays they want within these islands, currency will be saved.
If proper treatment had been given to the hotel and tourist industry during the last four years, allowing foreign currency to be earned and saved, it would not then have been necessary for the Government to have brought in the egregious £50 foreign currency restriction. More would have been saved than the comparatively small amount saved by that folly.
Would not my hon. Friend agree that we are hitting our heads against a wall to a certain extent because the President of the Board of Trade last year, in reply to a Question by me, said that he thought it right to give preference to exporting rather than to import saving?
That is a relevant point which my hon. Friend has made. [Interruption.] I hope that the President of the Board of Trade will treat this matter seriously. Any Government that is capable of the kind of restrictive follies such as the £50 allowance clearly has no awareness of the international nature of tourism or of the factors involved.
Although the White Paper on the proposals for hotel development appeared in May of last year, the Government seem to have drafted the Bill without any proper consultation with the bodies mainly concerned. For example, I understand that the British Hotels and Restaurants Association was not consulted about the proposals in the Bill and particularly about Part I, because Part II had been described in the White Paper. I understand that an emergency meeting was held with the Minister of State only last Friday because of this and that a further meeting is arranged for Monday. This is a lamentable situation. No wonder the Bill is so clearly in need of amendment, clarification and filling in.
Clauses 1 and 2 propose new bodies and functions for them, but it is not at all clear how they will operate. My hon. Friend the Member for Hereford (Mr. Gibson-Watt), if he catches your eye, Mr. Deputy Speaker, will deal with Wales. There is already a Tourist Board for Scotland. A separate Tourist Board of Scotland is appropriate, but we wish to examine how it is proposed that it should function, to see whether it will be effective for the purposes required.
The arrangements for England are strange and seem to leave much to chance. The English Advisory Committee proposed in Clause 6 is to advise on some matters, and the new British Tourist Authority is to be responsible in England for certain other matters. Some of my hon. Friends representing important tourist areas of England will, I am sure, have more to say about the vagueness and defects in the arrangements proposed for England.
Some explanation is needed of the position of Northern Ireland. Clause 21 provides that the Bill will not apply to Northern Ireland, except for the House of Commons Disqualification Clause. Under Cause 5(3), however, the new Authority is to be able to carry on activities outside the United Kingdom to encourage people to visit Northern Ireland. The Government should explain what their attitude is to the development and promotion of tourism in Northern Ireland.
The right hon. Gentleman skated over Clauses 3 and 4, which deal with the preparation of general schemes and the execution of particular tourist projects. The right hon. Gentleman rather gave the impression that these Clauses were permissive and that nothing much was contemplated under them. We need to know what is intended. The President of the Board of Trade said that he would not give examples, but examples are necessary. Are these schemes under Clause 3 to be related to feasibility studies or, at the other extreme, is it intended that the bodies should enter into road-making or the building business?
My hon. Friend has underlined the point I made earlier, that in parts of the Bill the responsibility for England lies with the British Tourist Authority and in other parts it lies with the English Advisory Committee. It is left very vague. If I had an English constituency, I should be very worried, as I am sure my hon. Friend is, about this.
My hon. Friend has anticipated something I shall come to when I say a short piece about Scotland. In general, the position of these boards is left very unclear.
I come to Part II of the Bill—Financial Assistance for Hotel Development. The Government propose some financial assistance which we must regard as partially offsetting the financial blows of the Selective Employment Tax and the withdrawal of investment allowances. This is not the best way of doing this. We would much prefer a system of investment allowances to this proposed system of grants. The little N.E.D.C. has put forward other proposals, too, as its recommendation on the right solution for the tourist industry, as I mentioned earlier.
Although Part II may, during the period stipulated, help with new building, expansion and modernisation, we must recognise that there will be little help to established hotels in established resorts. For example, a high standard hotel, up-to-date, already modernised, with no reason or room to expand, providing a very good service, perhaps earning a lot of foreign exchange for the nation, is likely to benefit very little under the Bill. Most of such hotels are in areas where S.E.T. still has to be paid. Therefore, the Government should not delude themselves by thinking that they are lifting the burden generally from the tourist industry as a rule.
I am happy to clarify it. I said that we much prefer the system of investment allowances. We have made that clear in relation to other industries. Whether it will be the best system for the future is something that at this stage I cannot say. It is certainly a better system than the investment grant system, where the eligibility has to be decided on a whole lot of arbitrary criteria by officials and is thoroughly unsatisfactory.
The only clear light ahead for the tourist industry—[HON. MEMDERS: "Hear, hear."]—I am glad to hear hon. Members opposite cheering. The only clear light that the tourist industry can see ahead for itself is the fact that the Conservative Party, when it returns to office, will abolish the Selective Employment Tax.
Last year, when some Scottish hotels were relieved of Selective Employment Tax, there was also the 50 per cent. increase. The estimate is that, as a result, there was a net increase in SE.T. payments in a full year of about £150,000 in Scotland. That could hardly be regarded as assistance to the Scottish tourist industry.
In Scotland, during the last 10 years there has been a major and significant development—winter sports, which have provided a second season in the Central and Western Highlands. As this week is Cairngorms Winter Festival Week, it is an appropriate time for me to say a few words about it, particularly as I have been concerned with this development. Many of my constituents helped to start the winter sports and are still chairmen and members of the bodies which are running and expanding the development.
This has been an excellent example in the Valley of the Spey of self-help within an area, because the first £50,000 was raised by voluntary subscriptions in the area. It was a considerable risk. Nobody knew whether ski-ing would catch on. It did catch on, and it has been expanding ever since. But the anomally here is that, although the hotels in the area have now been relieved of Selective Employment Tax, the other parts of the winter sports development—the ski schools, the chairlift personnel and others—have not. That is an example of the extraordinary anomalies arising under the S.E.T. system.
I was glad last April to accompany the Leader of the Opposition almost to the top of Cairngorm when he came to see it, and he saw literally hundreds of skiiers out on the slopes.
The Leader of the Opposition gets around, including Scotland, a great deal, and he will be there again before long.
There is a sizeable job for the Scottish Tourist Board to do, whether the present Board or the new one proposed, in coordinating all the various kinds of tourist activity. Because we have much wild and magnificent country, moor and mountain, with a very long coastline, because of the narrow sea lochs and other indentations, there is a rapidly expanding caravan and motor car side to tourism in Scotland besides the hotel side. This involves caravan sites, chalets, bed-and-breakfasts arrangements, motels and restaurants. A lot can be done by a Scottish Tourist Board to knit this together, but the composition and funtions of the Scottish Tourist Board need careful consideration, as do their relations with the Highlands and Islands Development Board and the Countryside Commission. They are very vague at present.
Before leaving that point, the hon. Gentleman ought at least to draw the attention of the House to the extremely generous aid which has been available to the hotel industry in Scotland from Government sources and paid out by the Highlands and Islands Development Board. Perhaps I may at this point put to the hon. Gentleman the question about finance which I had in mind to raise earlier. Does he regard the Government's global total of £11½ million under Parts I and II of the Bill as right or wrong, in view of his right hon. Friend's attitude to public expenditure?
Until we know more about how the money is to be spent, I cannot answer that. We want to know a great deal more about the Bill and the Government's intentions before we can possibly make that sort of assessment, as we shall wish to do. I mentioned the Highlands Development Board, which has started to do work in tourism. We are concerned with whether some of the projects which it has started will be successful and flourish. We hope that they will, but that is the question-mark hanging over any such projects. Judgment on what is being done will, no doubt, come later.
As the hon. Gentleman has turned back for a moment to the question of finance, perhaps I may say a word. I shall not take up his point about the Selective Employment Tax, although I do not regard it as correct, since it is generally passed on, but he made a surprising point about initial allowances. I am not sure what his hon. Friend the Member for Oswestry (Mr. Biffen) had in mind, but, if the hotel industry is as unprofitable as the hon. Gentleman says, investment allowances will do no good because there will be no profits to set them against. It is illogical to say that they are better than investment grants.
The right hon. Gentleman has made his point. In any comparison between investment grants and tax allowances, the right hon. Gentleman has never misunderstood us on this side in our preference for the tax allowance system. Of course, other factors enter into the question. The tourist industry has been hit by other measures. I shall not mention the S.E.T. again, but all manner of other difficulties have beset the tourist industry. One has only to read Lord Crowther's letter to be reminded of many of them. Hotels may not now find business profitable. But, if the hotel industry had not been battered by the present Government as it has, it would be able to carry on profitable business, and the tax allowances would then be of use to it.
I was coming to the point made by my hon. Friend the Member for Honiton (Mr. Emery). We note that it is the new British Tourist Authority's function to deal with activities abroad for the whole of the United Kingdom in promoting tourism and attracting visitors to this country, including Scotland and Wales. How will it be done? There will have to be special arrangements—I am sure that my hon. Friends concerned about Wales will agree—to make sure that the tourist attractions of both Scotland and Wales are separately promoted abroad. We cannot afford to neglect this, because Scotland and Wales have special appeals for prospective visitors to this country.
Next year in Edinburgh there will be the Commonwealth Games, and we expect a large number of visitors there. Also, I expect to see and hear about a lot of visitors in Northern Scotland and other parts of Scotland, coming from Canada, New Zealand and Australia, who will go not only for the Games, but also to visit the birth places of their forebears and to look into family connections—this often happens and is an attraction in Scotland—besides enjoying a good holiday.
One futher general question on the Bill. When considering Part II, grants and loans, we should have more information about the experimental loan scheme started in 1967. We were told that £5 million was to be available. The latest information known to me, given in answer to a Question, is that loans of up to only £1·7 million had been made by June last. I hope that the Government will give us more information about that. The conditions for the scheme were onerous and arbitrary, but we want to know how it has gone and what the latest position is. It is appropriate to ask that question on a day when Bank Rate has been put up to 8 per cent.
The Bill is an attempt by the Government at last to do something to help the tourist industry. But it is not clear; it is not using the best methods; and it is plain that there has not been enough consultation. The Government must be prepared for considerable changes in the Bill when it is in Committee.
On a point of order, Mr. Deputy Speaker. [HON. MEMDERS: "No."] There is only one occupant of the Chair.
Mr. Deputy Speaker, can you assist me? The hon. Gentleman gave a clear undertaking to the House that later in his speech he would reply to the point which had been put to him—[HON. MEMDERS: "What is the point of order?"] I am coming to the point of order. The hon. Gentleman undertook to reply to the point about a sales tax and his party's policy. He gave a clear undertaking to the House, but he has wriggled off it. Is it not right—
I am sure that the House was much struck by the gracious way in which the Bill was welcomed by the hon. Member for Moray and Nairn (Mr. Gordon Campbell), though I, too, was rather sorry that he did not deal with the tax point on which he was challenged. I am even more concerned, however, by what he said, or, rather, did not say, about Wales. We heard nothing. The hon. Gentleman said that his hon. Friend the Member for Hereford (Mr. Gibson-Watt) would deal with Wales if he caught the eye of the Chair. The Chair will have to be extremely far-sighted if that is to happen, since the hon. Member for Hereford has not been present in the Chamber at all during the debate.
I must defend my hon. Friend. He has had to attend a funeral in Wales this afternoon. He has apologised to his colleagues on this side, but it was not easy for him to do so to hon. Members opposite. There is no discourtesy on his part. He will be here as soon as he can.
I quite understand. I was puzzled because the hon. Member for Moray and Nairn referred to his hon. Friend in that sense at least twice.
I shall be as brief as I can, because I do not represent a traditional tourist area and I realise that many such hon. Members wish to speak.
In July, 1967, I raised the problems of the tourist industry on the Adjournment. One of the points I made was on S.E.T. on which I am not convinced by my right hon. Friend's arguments today. But I am convinced about the Bill, and I welcome it very much. It sets up a new Authority which, with Government help, can benefit the industry enormously.
It is recognised that in 1970 the number of visitors from abroad will probably have risen to about 6 million, and that in the following five years it may be up to 10 million. Where are these travellers to go? We need more hotels in the traditional tourist areas and that case will be argued. But the biggest problem is shortage of hotel accommodation in London. The problem is not only that the number of tourists is increasing, but that the pattern of their travel is changing, with the jumbo-jets to which my right hon. Friend referred. As air travel becomes relatively cheaper, people who are not accustomed to foreign travel will come here, and they will tend to travel in organised groups, particularly in inclusive tours for about 40 people. We have to cater for this.
For example, a very rich part of the United States consisting of Chicago and its suburbs has a gross national product—if I may so describe it—greater than Sweden's. In view of the enormous increase in the numbers of tourists who have never travelled before, a travel agent in Chicago will find it easier to organise group travel to Continental towns which have adequate hotel accommodation than to chase around London splitting up his party among a number of hotels. I fear that we shall lose to the Continent many of these future travellers unless we provide tens of thousands more beds, especially in Greater London. I am surprised that under the Bill it looks as though we shall provide grants for hotels in Greater London with as few as 25 letting rooms. This figure is too low.
Our problem will be solved not only by increasing accommodation in London, but also by attracting more visitors from London, not only to Scotland, Wales and Northern Ireland and the tourist parts of England but to other areas that are not so well-known as tourist attractions. I am pleased that the English tourist industry will be looked after by the main British Tourist Authority. At present, tourists are not given enough information about the ordinary English countryside, with its villages, churches, castles and so on, and I hope that the new Authority will cure this.
For example, my constituency in Northamptonshire, in the heart of England, has some of the loveliest English countryside, with farm land, park land and 69 villages, each more beautiful than the other. But it is not known as a tourist area. There are many other hon. Members representing English county constituencies with many tourist attractions that are not generally known. Furthermore in July, the peak tourist month, tourist accommodation is often available in these areas. Certainly, there is in my constituency, in old modernised coaching inns in Kettering, or in a brand-new hotel in Corby.
The present B.T.A. has done good work, and I hope that the staff will be able to help the new B.T.A. I have been particularly impressed by what it has done in advertising on the Continent. When chasing the dollar, we must also remember the deutschemark, the franc, and so on.
I hope that an enabling Order will come on the registration of hotels, so that work can be done on this and on classifying, because here we are far behind many Continental tourist countries. The registration will not only help by giving greater information to travellers, but will also, I hope, raise the standards of accommodation.
My right hon. Friend referred to the E.D.C. Report on service in hotels. There is much inefficiency in the use of labour in hotels. I trust that hotel keepers will study the report. There is a serious shortage of staff, and, therefore, it is all the more important that there should be no wastage in the use of the staff available. In the report there are some remarkable figures to encourage the planning of that labour.
We have much to offer the visitor from abroad, but we must offer it at the right time, at the right price and in the right place. Above all, the problem is to have more hotels in London and, at the same time, to attract tourists away from London to Scotland, Wales, Northern Ireland and the ordinary, unknown English countryside.
I share the hope of the right hon. Member for Kettering (Sir G. de Freitas) that we can attract more trade to England, but I doubt whether it will be so forcibly attracted by an Authority, which is a strange mixture, being part federal and part national, as far as England is concerned, as opposed to an exclusively English board. The success of Wales and Scotland, and indeed the Republic of Eire, in having separate, distinct national boards is a strong argument for having an English board, and a federal system to co-ordinate all the boards.
I welcome the recognition of the importance of tourism which is explicit in the Bill and the White Paper that preceded it. I support any Measure that will raise standards in the hotel industry and will inject new capital into it.
The attitude of the Government, although it is improving, has been somewhat strange over many years. The right hon. Member for Leeds, North-East (Sir K. Joseph) asked the President of the Board of Trade on 13th November last year why there was discrimination against the tourist industry in the investment grants procedure. The right hon. Gentleman replied that the crucial fact was that
… manufacturing industry can make a more direct and immediate contribution to our balance of payments than services and distribution.
He said a little later:
… there are sectors of the service and distributive trades—hotels is a supreme example—which can also make a direct contribution, and this is why we have introduced the Hotel Development Incentive Scheme,…"—[OFFICIAL REPORT, 13th November. 1968; Vol. 773, c. 409.]
The tourist industry as a whole—and it is very difficult to divide it up—makes a supreme contribution to our balance of payments, not only our invisible but our visible earnings. It is one of our most important dollar-earners. Therefore, I rather disagree with the Government when the White Paper says at paragraph 3:
Tourism is not one industry. It covers many trades and activities;…
Tourism is one industry with many different facets, but it is the industry collectively that is the earner of hard currency and the saver of currency being spent by our nationals abroad.
Therefore, unless the Bill is used to encourage the development of amenities just as much as for the expansion of hotels, it will have failed in its purpose. I felt that the President of the Board of Trade was giving extremely high priority to the expansion of hotels and rather low priority to the interpretation of Clauses 2, 3 and 4 on the provision of facilities. It is often things like marinas, racecourses and festivals that encourage people to go to certain areas.
In the South-West our problem is the need to expand our hotels and have more accommodation. But an equally serious problem is to get higher occupancy of the existing hotel accommodation. The British Travel Association has produced a valuable report on tourism in the South-West which says that even during the eight weeks of the high season vacancies are very often to be found. Therefore, we must be very careful not to indulge in over-simplification and to think that increasing the number of hotel bedrooms will in itself solve the problem. Hand in hand with it must go the extension of our amenities.
Again, before we ask ourselves whether this is manna from heaven, we have to set it against the financial disadvantages which the industry has been facing, and which are considerable. The British National Export Council, referring to the valuable contribution made to our invisible exports by tourism. went on to say:
One conclusion emerges—that the Government are not providing sufficient help to enable this country to derive the maximum benefit from its tourist potential.
The "Little Neddy" for tourism also suggested that the industry should be on the same tax footing as industrial development—for example, as regards building allowances, investment grants, equipment and so forth.
Even if we accept the figure of £3 million as the sum which may be claimed for improvements by way of grant—and I take the point that the Leader of the Opposition was unreasonable in trying to press for a precise figure on November 13th last, because that turns on the amount of applications made—the money which is to be injected is much less than the incidence of the Selective Employment Tax and the loss of investment allowances which the present Government have brought about. I estimate that the breakdown is £3 million for administration, £5 million for grants and £3 mil- lion for loans, making a total of about £11 million.
That is why I said £3 million for administration, which represents 80 per cent. of the outgoings of the B.T.A., which will now go to the new authority.
But the Government gave the game away when they refunded S.E.T. for rural hotels in development areas. I was delighted when they did so. Parts of my constituency benefit. But the Government cannot say on the one hand that the refund of S.E.T. will not make a great difference to employment and prosperity in Tourism while on the other hand say, "Look what a tremendous contribution we have made to helping development areas by refunding SET.".
It is just for the sake of accuracy that I intervene. It is not true to say that rural areas in development areas get a refund of the SET., for many parts of Scotland which are rural and within development areas—almost the whole of Scotland is inside a development area—do not get refunds. The refund is based on a labour exchange and not a rural area basis, and it is a very inequitable system.
That is wholly correct. Perhaps I did not draw the distinction because I am fortunate in the fact that the two coincide in my area. Nevertheless, this is one of the anomalies which I hope will be looked into. I hope that it will be the subject of one of the first recommendations of the new authority.
Let us set the picture of grants and loans against the fiscal disadvantages placed on the hotel industry. On such a balance sheet, the industry is not much better off. Far more could and should be done by fiscal means if we want to inject capital into the industry and get growth. It is fair to say that the sum total of these grants and loans will go nowhere near to offsetting the recent fiscal disadvantages.
When the statement was made on 13th November last, the Conservative Opposition were rightly worried about whether we need a statutory Board. [HON. MEMDERS: "Hear, hear."] I am pleased to carry some of their back benchers with me, and I am surprised that the hon. Member for Moray and Nairn did not mention it. On 13th November, the President of the Board of Trade said that a voluntary board is not suitable for administration. Three functions will be discharged—the making of loans and grants, selecting aid projects, and registration. But the present hotel development incentive scheme is operated by an advisory committee of the Board of Trade. Admittedly, that scheme has not been in operation long and has a limited objective, but it did not require the setting up of a statutory board. Likewise, grants to development areas are made by the Board of Trade on the advice of advisory committees. Sometimes I think that these committees could work faster, but the principle is there. If we are to give away public money, there must be control, and my criticism of the Government is that, time and again, public money is dolloped out to Cunard and others with virtually no public control. If we are to safeguard public money, there must be public control, but this does not per se call for the setting up of a statutory board.
I believe that those advising on priori ties, and certainly the priorities in regard to special projects, should be the regional economic planning councils and boards, which are interested in the economic growth of their areas. The present Government set them up—albeit as appointed and not elected bodies, alas—and their advice should be sought and their views attended to.
I listened carefully to the right hon. Gentleman's prognosis of the number of officials involved and in my mind I could hear an hon. Member getting up in a year or 18 months' time and saying, "Does the right hon. Gentleman recollect the undertaking he gave on 27th February, 1969, about the number of civil servants employed?" No doubt in the words which the Prime Minister used, the right hon. Gentleman will reply, "There are new responisibilities which the House has placed on us. The House decided that this work should be expanded and I am sure that no one would wish to cut down on the activities of the new authority." The right hon. Gentleman will find that, with the best will in the world, he will find this a promise difficult to keep.
I come now to the question of registration. Is it necessary to have a statutory board because of that? I welcome the right hon. Gentleman's suggestion for discussion about registration—it is a civilised way of running a democracy—but nevertheless we are being asked to grant great powers without any indication from him of the way his mind is working on the matter. We have not even been given broad guidelines. We are asked to give powers for a penalty of £200, to orders which will require people to provide any information which may be specified, for charging annual or other periodic fees, for registration, for displaying certificates, for inspection of establishments and for exemptions which may be provided for in the Order.
We are being asked to provide rights involving a considerable degree of intrusion and interference with the liberty of the subject. It may be justified. We want to know more about registration, however. Is it intended that there shall be a massive compendium of about 30,000 or 40,000 establishments which give accommodation? That will not be a handy book for the traveller. Or is it merely to be a technical register so that people who want to invest in various parts of the country will be able to look through the Minister's list? How much is the registration contribution fee going to be? Would we gain so much by the Imperial Hotel, Torquay, making a £200 or £300 contribution to help with the costs of 200 worthy three-bedroomed boarding houses in Clacton? Or is the State to decide standards and make recommendations?
I recoil from the prospect of the State as the arbiter of comfort and service. It seems that its direct experience of running residential establishments is limited to approved schools and prisons.
The right hon. Gentleman interrogates me sedentarily—I make no complaint. There is the Michelin Guide in France, which is extremely representative, and certainly sells better than anything published by the French Government. All I can say is the Automobile Association, which has some experience in these matters, and which is universally accepted as producing an extremely good guide, estimates that a complete compendium and proper registration would cost something like £2 million. If that be true, it seems that it would be £2 million a year which would either be added to the administrative expenses which are at the moment costed at £3 million, or would be a levy on existing hoteliers, or a combination of both.
Not only on the grounds of the criminal sanctions, and the right of entry which we are being asked to pass, but also because of the prospective costs, we are entitled to know a little more about registration.
I want to deal with the creation of Scottish and Welsh Boards and the sort of mixed federal-cum-English authority. I welcome the existence of Scottish and Welsh Boards for two reasons. [Interruption.] I declare an interest, I am only a very small percentage English. I regard myself as a Celt. This is right for two reasons. The first is because Wales and Scotland despite the ribaldry of certain English Members, are nations with their own traditions. It is right that, as in many other things, they should run their own affairs. It is for this same reason that I believe that England should have had the same facilities afforded in this Bill. It is also because Wales and Scotland are distinct holiday areas. I claim that, not on the first count but on the second, there are other areas in the United Kingdom which are equally distinctly holiday areas.
No one would deny that the Southwest, which has an annual intake of between 8 million and 9 million visitors, with a gross turnover of between £100 million and £120 million a year is a distinct holiday area. For that reason, there is certainly a case for an authority of its own, comparable with other regional authorities which might be set up within England. Speaking for the South-West, we feel that we would be swallowed up by this advisory committee, which is a sort of sub-division of the federal body.
My criticism of the B.T.A., which in many respects has done a first-class job, is that it does not think, other than in a very centralised manner of advertising places, other than London, Stratford-on-Avon and Windsor. My hon. Friend the Member for Bodmin (Mr. Bessell) went to Paris and New York the other day to check on the sort of publicity which the B.T.A. was putting out.
There was no publicity at all for the far West, and very little else, apart from what I would call "The Blue Rinse Trail"—which leads from a London hotel to Stratford and the other places which the American ladies like to visit. Since Lord Crowther is mentioned, I hope that he will not take this most extraordinary hotch-potch of Welsh and Scottish Boards and an English Board, somehow blended and submerged in a federal board, as a precedent for any further constitutional innovations.
I want to raise one particular Scottish matter because the hon. Member for Moray and Nairn (Mr. Gordon Campbell) really did not do himself justice. Although he made many references to ski-ing there was also a good deal of "skating". He raised a significant point on 13th November when he asked:
Will the Highlands and Islands Development Board still be responsible for grants and loans to tourism in its area, or will that matter now be taken over by the new tourist board for Scotland?
The President of the Board of Trade replied:
The answer to the first part of the hon. Gentleman's question is, ' Yes, Sir '"—
That is to say the grants will continue to the Highlands and Islands Board, and
…to the second part ' No, Sir '."—[OFFICIAL REPORT, 13th November, 1968, Vol. 773, c. 411.]
That is the new Tourist Board will not take it over. If I may, for a moment, discharge the responsibilities of the Conservative "Shadow" Secretary of State for Scotland, I would have thought that there must be hon. Gentlemen, certainly this applies to my Scottish Liberal colleagues, who would be very worried about what the Tourist Board is to do and what its powers will be in relation to the Highlands and Islands Board, which has done an extremely good job of work.
We run the very great risk of setting up a bureaucracy which will not be subject to any local democratic control. Nor will it necessarily represent the distinctive individual requirements, all of which are competing, of particular holiday areas. The Government are continually getting away from the philosophy of fiscal incentives; loans and grants are very good, they are certainly better than nothing, but more and more the Government will find themselves in a stronger position, and able to say "This tax does not matter", or "That tax does not matter, because we are giving loans and grants."
The President of the Board of Trade could have been much more helpful towards the B.T.A. He recognised its valuable work and then said that it would be for the Association to decide what it was to do. Since, in a throw-away line at the end of his speech, he said that he was to cut off its 80 per cent. grant because it would be transferred to the new Board, I thought that he had almost made up its mind for it. I hoped that he might have said that there were some very skilful people with great experience of tourism who would be needed in the new set-up.
If, as I hope, that is in his mind, perhaps the Minister will correct the omission. Anything that can assist tourism, which can inject capital is to be welcomed, but I have very grave reservations about the Bill. Although I do not intend to vote against it, because no one ever votes against money being paid to his constituents or constituency, it has to be considerably amended in Committee, and I hope that it will be.
I welcome most of the provisions of this Bill. Two years ago I sat on the Committee which considered the Industrial Development Bill. I regretted then, as did many of my colleagues on that Committee, that no provision was made for any kind of assistance to the tourist industry. The position is now considerably improved. The Government appear to have recognised over the last 12 months the importance of tourism, and this further stage, the presentation of this Bill, means that they are aware that the tourist industry is a proper industry in its own right. It is a very fragmented industry and, as such, needs certain provisions made for it which would not be the case with an industry in which operators are very large.
The Bill recognises two basic needs in tourist areas which we have urged upon the Government for a long time. Firstly, if the industry is to thrive, there must be considerable injection of Government funds for capital development. Secondly, statutory Government bodies, financed by the Government, should be responsible for overall planning within the industry, for research and marketing policy, for publicity and promotion, particularly overseas promotion, for the registration of hotels, the maintenance of standards, amenities and service within the industry.
Much of this is covered in the Bill. However, I have some reservations to which I should like to draw attention, particularly concerning Wales, which is in a curious and somewhat paradoxical tourist position. Our income from tourism in 1967 was £80 million. Wales has one of the highest per capita incomes from tourism in the world. Among European countries, only Switzerland and Austria have a substantially higher per capita income from tourism. However, only £5 million is derived from overseas visitors. Therefore, on that comparison with other countries, Wales comes at the bottom of the list of earners of overseas currency.
We get a very good share of the domestic market, 13 per cent., which is quite splendid, but only 2 per cent., namely, £5 million out of £235 million, of the sum earned in Britain from overseas visitors. Our great need in Wales therefore is to attract overseas visitors. The domestic market is probably contracting, certainly it is stable at the moment. Therefore, if we are to improve our earnings from tourism, it must be done by increasing our attractiveness to overseas visitors.
The Wales Tourist Board is most disturbed—and I share its disquiet—that the structure envisaged in the Bill of two Boards, one for Scotland and one for Wales, and a rather different Authority, is exceedingly dangerous. The British Tourist Authority will have specific responsibility for England, together with certain overall responsibilities for Britain as a whole.
The existing British Travel Association has adequately projected Britain abroad. I am less satisfied that it has adequately projected Wales abroad. I was in Paris fairly recently, and I went to look at the B.T.A.'s showroom. It was evident that it had had a window display illustrating Wales for a very long time—there was a lot of dust on it. There were dolls with Welsh hats and coracles and a large poster with the word "Wales" on it, but there was nothing with which a Frenchman would associate the display with this comer of Britain. From that point of view it was rather wasted.
We feel in Wales that it is proper that one body should act as the agent for all the tourist interests in this country. Under the Bill, the British Tourist Authority will not act as the agent of the Welsh and Scottish Boards in promoting Wales and Scotland overseas, but will do this in its own right. Those Boards will have no say in the policy of the new B.T.A. As a safeguard, I should like the Secretaries of State for Wales and Scotland to have the right to allocate funds for overseas publicity and promotion of Wales and Scotland over and above what the British Authority will do should they feel it necessary and to supplement the work of the Authority.
My second reservation—and again I express what I know to be the views of the Wales Tourist Board—is that the fact that the right to prepare and finance schemes for improving tourist amenities should lie solely in the hands of the British Tourist Authority is a great limitation. Such powers should also be vested in the Welsh and Scottish Boards. I have always advocated when tourism has been discussed in the House that we need in Wales a statutory body with the right to prepare and finance what it thinks fit and to improve amenities. Instead of being able to make a direct approach to the Secretary of State or the Board of Trade, the Scottish and Welsh Boards will have to work second-hand through the British Tourist Authority.
The Bill gives adequate control over what the British Tourist Authority will do in promoting schemes. There is control by the Board of Trade; the Board of Trade will have the right to alter schemes which have already been approved; Treasury permission must be obtained; and any scheme must be put before the House. This is ample control and, within its limits, I should have thought that trust could be placed in the members of the Welsh and Scottish Boards, when they are appointed, to prepare and finance schemes in their own right rather than having to work through the B.T.A.
When the Secretary of State for Wales is considering the appointment of the members of the Welsh Tourist Board, I trust that he will bear in mind one small matter. Although the bulk of the population of Wales lives in South Wales, and although many parts of South Wales are extremely valuable as tourist areas, most of the tourist industry in Wales is in North Wales. I hope that my right hon. Friend will bear in mind that the coastal counties of Flint, Denbigh, Caernarvon and Anglesey, together with Merioneth, where there is a rather different sort of inland interest in tourism, account for £47 million of the £80 million earned from tourism in Wales. Caernarvonshire, my own county, earns a quarter of the total income from tourism in Wales—£21 million. I hope that this will be reflected in the choice of personnel on the new Wales Tourist Board.
I wish to say a few words about the grants and incentives proposed in the Bill. They are to be welcomed as the right way to improve and stimulate the tourist industry. However, I should like to make two points. First, I wish that the minimum qualification for assistance had been set lower to bring the smaller hotels within eligibility. We have many good small hotels in Wales which would like to take advantage of the Bill, but they are not big enough to qualify.
Secondly, Wales has a special problem which has been well illustrated by the comprehensive research project carried out by the Wales Tourist Board. Although there are 400,000 tourist beds in Wales, there are only 1,500 bedrooms with private bathrooms attached. Undoubtedly our great problem in Wales—I am not sure that this applies to the same extent elsewhere—is that we must increase the number of rooms with private bathrooms. There should be flexibility to give the Secretary of State for Wales the right to empower for Wales a special scheme of, say, 50 per cent. cash grants for private bathrooms in hotels which otherwise are suitable for overseas visitors.
Incidentally, I should like the assurance of my hon. Friend the Minister of State that expenditure qualifying for grant as listed in Clause 9(4) will include expenditure which may result indirectly rather than directly from increasing the number of letting rooms. A completely different central heating system may have to be installed. Dining rooms may have to be extended. Will expenditure on such matters be qualifying expenditure for grant?
I wish to express my pleasure that the Bill applies to the whole country and does not again commit the nonsense of assuming that hotels in development areas have a greater need than hotels outside development areas. Several references have been made to S.E.T. exemptions applying only within parts of development areas, those areas having been selected on the basis of a low ratio of workers in manufacturing industries. Such a situation exists in my constituency in the town of Llandudno, which is the only corner of my constituency not in the development area. Although the ratio of workers in manufacturing industries is probably lower there than in any other part of my constituency, it gets no advantage from S.E.T. exemption, because it is outside the development area.
It is a mistake to confuse there two factors. Development areas are areas which would benefit from industrial growth, whereas the weakness of the tourist industry is that it is seasonal. In Llandudno, hotels must employ key hotel staff throughout the winter, for whom they must pay S.E.T., although they trade only for about five months of the year. If hotels are to keep their key staff they must employ them throughout the winter. It is the seasonal nature of the industry which needs to be catered for, and this has nothing to do with the accident of falling either within or outside a development area.
In selecting areas within development areas for exemption from S.E.T., the reason given was that these were areas with a low concentration of manufacturing jobs. Conway, in my constituency, was included for S.E.T. exemption. Llandudno is adjacent to Conway but, being outside the development area, it was not included. I thought that it would be interesting to get the figures of manufacturing workers in Llandudno and in Conway, but I found that such figures had never been kept. These two labour exchange areas have always been lumped together as one area, so that figures were available only for Llandudno and Conway together. I do not know how on this basis it could be said that Conway qualified for inclusion, but not Llandudno. It makes no sense, since the figures were not available in the Minister's office when the decision was made.
The Bill makes no distinction between the treatment of those hotels within and those outside a development area, and I welcome this. The Bill recognises that the needs of the tourist industry are special needs, and it goes a long way towards meeting those requirements.
My hon. Friend is correct, there is a marginal difference, but it is by no means a difference of principle such as in previous cases of exemptions from S.E.T. It is nothing like as much.
This is a matter of principle; exactly the same principle applies, a distinction between fish and flesh. This is an important principle; there should be equality of treatment for all, and that is why I have objections to certain parts of the Bill.
I wish to raise shortly, one or two points of general interest. In listening to the right hon. Member for Kettering (Sir G. de Freitas) and the hon. Member for Conway (Mr. Ednyfed Hudson Davies) I have envisaged beautiful English villages and the glorious parts of North Wales. There is a vast range of countryside in Britain which is so attractive to the tourist. The tourist industry is enormously important; it is basically one industry, although it has many parts.
I am sad to have to speak discouragingly on something which the Government intend to be helpful, but my disappointment with the Bill is because it seems to continue the myth which the Government have continually tried to develop that there is something basically better in making things than in being part of the service industries. I wish that the Government would change their mind and get down to the basic principle which the hon. Member for West Stirlingshire (Mr. W. Baxter) was trying to make. The tourist industry is part and parcel of industry, and the whole of industry should be treated in exactly the same way.
I take issue with what the President of the Board of Trade said, which no person off the Government Front Bench believes. He said that in some curious way S.E.T. postively helps the tourist industry. This has been said from the Scottish Office over and over again, but it is believed by nobody outside that limited corner. The truth of the matter is that extra costs, whether they arise from S.E.T. or an increase in petrol prices, can be passed on to the consumer, but the tourist idustry must be competitive and, if it has to bear all the extra costs distributed by the Government, it will price itself out of the market. Let us not think of tourists being rich people from Chicago or Texas. The vast bulk of them are people who travel on package tours, and they are the people we must think of.
The Bill does not deal with the restaurant trade, which, in many parts of the country, is just as important to the tourist industry as the hotels. Many people visiting outlying districts stay in bed-and-breakfast establishments and need to eat elsewhere, and I appeal to the President of the Board of Trade to think carefully about this before the Committee stage of the Bill.
The President of the Board of Trade gave a broad indication of the composition of the boards, but I hope that we shall have a much clearer indication of the people he has in mind. It is difficult to judge the merits of Ministerial thinking without knowing who will be in charge of the boards. I hope that he will stick to professional, functional people and is not led away, and the hon. Member for Conway was advocating, into picking people because they come from a certain area. This would be disastrous.
I add to the plea made by my hon. Friend the Member for Moray and Nairn (Mr. Gordon Campbell) that we need to know what will be the position with the Highland Development Board. The Board has had a larger amount of money to spend on the promotion of tourism than is envisaged for the Scottish Tourist Board. It is doing a very good job. Perhaps it has made certain serious mistakes in its dealings with tourism, but we accept these as inevitable. We wish it well, and it will be interesting to hear what is to be the relationship between it and the new Scottish Tourist Board.
I agree with the hon. Member for Conway that it is nonsense to talk about development areas in the same terms when we discuss industry and tourism. They are not the same types of areas or bodies. I hope that we shall have some more intelligent thinking about it by the time we come to the Committee stage.
It is interesting to see that of the 10 or 12 hotel projects known to be going forward in Scotland during the course of the next year or two, five are in Edinburgh, five are in Glasgow and one is at Abbotsinch, which is Glasgow's airport. Although they may be useful for many business people and some tourists, they do not provide the extra beds which are required over a wide area of the country where many foreign visitors wish to go.
During the months between now and the General Election I hope that my right hon. and hon. Friends will give serious thought to the future of this industry so that they will be able to produce a policy which treats the tourist industry as part and parcel of all our other industries, and find an equitable and fair method of giving it the help which is so badly needed.
I have the honour to represent a constituency in which the tourist industry is of great importance. It contains not only the town of Great Yarmouth, which is famous as a seaside resort providing such varied entertainments as seals on Scobie Sands and a municipally-owned racecourse, but also the Norfolk Broads, on which boating holidays can be enjoyed, and the lonelier parts of Norfolk in which the contemplative pleasures can be engaged in. We are reminded of them in the paintings of Crome and others.
I hope that the establishment of the Authority is only the first step in an intended federal structure. Like other regions, Norfolk needs its own board preoccupied with its own local problems.
A previous speaker mentioned amenities. Alas, many of these are fast disappearing. If foreign visitors are to increase in numbers, as I think they will—the trickle of Dutch and French visitors to the area is becoming a stream—attention must be given to this point. Norfolk cider is disappearing. It is becoming impossible outside the houses of one's friends to enjoy free-range turkeys and Norfolk ducklings. In Great Yarmouth, many of the bloaters are not, in fact, Yarmouth bloaters. These are the kinds of problems with which such a board would have to occupy itself.
In the past, the B.T.A. has suffered from being in London and not having local offices throughout the country. I hope that many of the services that it has provided will not be lost. As one who has worked as a guide and courier, I have in mind the regulation of guides in London that it has introduced. It examines would-be guides and registers them. It ensures that foreign visitors to London receive adequate service from people who are skilled in history, archaeology and a knowledge of modern London. This is the kind of service which should be provided throughout the country and, once again, it seems that it could be provided more easily by regional boards.
I welcome the grants which will be given to hotels, but I cannot find any definition of "hotel" in the Bill. I hope that we shall be told which hotels will be able to qualify for grants. I also hope that many private hotels and even large boarding houses will be included. As a previous speaker has said, for example, there are not enough bathrooms available and the demand is increasing. I hope that the word "hotel" will be interpreted in an extremely liberal fashion.
Coming to Part III of the Bill, if regional boards are not to be established I hope that the registration of tourist accommodation will be done through local authorities, possibly through their weights and measures inspectors. In Great Yarmouth, an excellent town guide is produced listing hotels, boarding houses and private hotels which wish to be included. Occasionally, the county borough council refuses an application for inclusion on the list, and very properly.
I can see no difficulty in providing a list of approved establishments, provided that inspection is carried out. For that purpose, the necessary local inspectorate must be available. It could be done through the local authorities. In that connection, I hope that it is intended not only to provide money and help to the tourist industry, but also to look at the provision of other services which are required.
Several hon. Members have spoken of the type of advertising which the B.T.A. has engaged in abroad. Some of it has been good. Some of it has not been. It can be argued that it is inclined to be a little too "precious" at times, concentrating too much on guardsmen and Devonshire teas, which are difficult to find. It should present in real terms the pleasures which are available to our visitors, rough, ready and vulgar though they may be, but supremely colourful and part of our local and regional folklore.
We should present the pleasures of the uncrowded parts of our country. Too often, foreigners are completely unaware of them. But, to back up the pleasures created by man and nature, we must provide foreign visitors with adequate accommodation, good food and drink. In my view, it is up to the Government to provide the framework within which this can be done.
I welcome the Bill as representing a first step. I hope that we shall be told that it is only the first of several more that are envisaged.
I rise to do what I can to further the general interests of the tourist industry in the country as a whole. Many of us on this side of the House feel that the Bill does not do that. It is for that reason that more than 50 of my right hon. and hon. Friends tabled an Amendment, which has not been called, but from which it is obvious that some of us feel that the Bill does nothing like far enough in trying to deal with the major problem of the development of tourism.
We welcome the fact that, due to constant pressure from this House, from many outside organisations and, not least, the B.T.A., tourism is ceasing to be a downtrodden Cinderella. It is not so long ago that people referred scornfully to guest house keepers and travel agents. It might be said that the only point in favour of the Bill is that, at last, it treats tourism as an industry.
Tourism is assuming its rightful place It is recognised as earning over £236 million of foreign currency, plus another £115 million earned by carriers transporting foreign visitors to this country. Tourism also earns more United States dollars than any other industry.
Let it be clearly understood by all that we think it is wrong, and perhaps a diabolical liberty, to present the Bill as setting out to deal with the basic problems of tourism. Perhaps it should be termed the "Development of Foreign Tourism Bill". I would go along with that, because that would be a fair description. It should not be duped as dealing with the whole industry or as a Bill to establish special tourist treatment for the minority Celtic fringe. Scotland and Wales emerge as two areas of Great Britain, each to be given their own tourist board, yet each contributing only about 10 per cent. of the tourist trade of the United Kingdom—and jointly less than the contribution made by the Southwest alone.
I do not wish to be parochial. I believe that there should be one British Tourist Board, and that all areas should be dealt with as suggested by the English Advisory Committee. However, it seems strange that Scotland and Wales should be given a specific statutory creation with powers to act, and the English committee remains in an advisory capacity. If we are to talk sensibly, surely there should be the same treatment for all areas.
I pay particular credit to the British Travel Association. It has done a first-class job. It has been responsible, more than any other organisation, for the benefit that tourism has brought to this country.
I believe that the B.T.A. should continue in operation until the Maude Committee has reported. If there are to be varied regional groupings thoughout the country, that would be the time to make up any breakdown in regional advice which could take the place of the authority of the B.T.A.
I considered that in the opening remarks of my hon. Friend the Member for Moray and Nairn (Mr. Gordon Campbell) we were seeing an alteration in the view of the Conservative Front Bench. This was good, solid stuff, criticising much of what the Government had not done for tourism. I am sorry that the Conservative Party has not been willing to make it clear that many of us believe that this is a measly Bill. We are afraid to vote against it because it gives to some of our constituents a sum of money.
This is a strange and wrong attitude, particularly when nearly everybody on this side of the House believes that investment grants are the wrong way to give investment encouragement. Although it may be bringing it into equality with industry, if we believe that something is wrong at the start we do not bring any benefit by increasing what is wrong. That is exactly what the Bill does concerning investment grants.
We have heard from the President of the Board of Trade a great deal of praise for the "Little Neddy" and for the B.T.A., both of which axe financed by his Department. However, both organisations have suggested other means than investment grants as the best methods for encouraging the building of hotels. Therefore, it seems strange that the Minister should subsidise certain authorities, recognised as being the major instruments in the hotel and tourist industry, and not take their advice on the best methods to assist in the building of new hotels and the improvement of bedrooms in existing hotels.
Much has been said about the abolition of S.E.T. I believe that my right hon. Friend the Member for Argyll (Mr. Noble) is right in pinning down the Government, because they are trying to get off the hook. If they believe that S.E.T. will encourage greater investment in the hotel industry, they know nothing about modern methods of cash flow or the judgments that have to be made on the profitability of a project when the investment has been completed.
It is all very well the Government saying, "But the industry can carry it." This is true, but the Government must be frank. If S.E.T. were abolished, I do not believe that cost pricing in the industry would fall; it would be used for further investment or profit, both of which would be a direct benefit and encouragement to the industry.
In the reasoned Amendment we paid particular attention to communications. This has not so far been mentioned. One of the biggest factors with which the tourist industry has to cope is getting people to tourist centres. Here I point my finger in criticism at the Government. The President of the Board of Trade said that they have included this factor. I do not wish to go into the question of the spine road in the West Country, but this would encourage the tourist industry there.
To be regional, the West Country accounts for 20 to 22 per cent. of all holidays in this country. The Government frequently pay no attention to the import saving factor here. The encouragement which has been given in public spending on furthering the West Country compared with other parts of Great Britain is negligible, unless that money has been found by the South-West Travel Association. The Government are to be criticised for that.
I should like to pose four questions arising from the Bill. What are the Government's intentions about the level of occupancy? One of the biggest factors with which the ordinary hotelier has to cope is that the season is too short. How are the Government thinking of setting about ensuring that seasons can be extended, whether for conferences or for special projects? This concerns all tourist resorts. If the season can be extended to a 14-, 15- or 16-week period, that will be of major assistance for the profitability of the hotel industry generally.
Why do the Government wish the new B.T.A. to hold shares? What is the object behind that? I am always a little suspicious when I see another statutory board being given specific powers which are slipped in the Bill rather late just as another matter. If there are genuine reasons, let the Government say what they are so that we know.
What has been the cost of the previous hotel loans scheme which was to be the saviour of the tourist industry about 24 months ago? The £5 million provided has not been used. What has been the administrative cost of running the scheme?
Next, I propose to refer to something which is not particularly popular in certain sections of the tourist industry, the modernising and providing of better camping sites. If we want to encourage people to stay here, we must provide good facilities for camping and caravanning. We do not need a statutory board for this purpose. This is something the Government could do themselves. They ought to have put their minds to this problem long before now. What will the Bill do to provide that kind of improvement?
The Bill will, of course, do something. It will create a costly and unnecessary hotel registration scheme which has been condemned by the Hotels and Restaurants Association, the very body which it is meant to assist. It will provide special and favoured treatment for small minority interests of Wales and Scotland. I believe that all the areas should have similar standing, and that there should be only one statutory board for the whole country. The Bill provides for discretionary grants. The Government are to give away taxpayers' money with no assurance of how, where, or on what criteria the money is granted. We are being asked to approve the Bill without having any of the necessary information before us.
Nor do we know whether the same criteria will apply to different schemes in different parts of the country. Will the same criteria apply in Exmouth as in Edinburgh, in Sidmouth as in Scotland generally, when it comes to providing financial help for improving hotels or providing new buildings? If the same criteria are not to apply throughout the whole of the tourist industry, the industry will have every reason for criticising the Government.
I can find little reason for supporting the Bill. This is why a number of my hon. Friends and I are sorry that we cannot express our feelings by voting for the Amendment. Had it been selected, we could have expressed our feelings about what I can only term a very inadequate Measure.
I am sure that the hon. Member for Honiton (Mr. Emery) will forgive me if I do not follow him too closely. The right hon. Member for Devon, North (Mr. Thorpe) is right when he says that the tourist industry is not a combination of industries, but an industry in its own right. As such, it has had an impact on many other aspects of holiday making, and has played a major rôle in increasing exports and in import saving.
I agree with the tribute which has been paid to the B.T.A., but I think that if one looks at the opportunities which have been presented during the last decade for the development of the holiday trade one must admit that in many ways it has failed to take full advantage of the situation to expand the industry.
I hope that the Minister will consider again this question of setting up tourist boards. When my right hon. Friend the President of the Board of Trade made his statement to the House about introducing tourism legislation, he said that all three boards would be compact and functional, indeed, that the Government would welcome a further development of regional and area tourist associations. I am sure that no one would expect me to say that we should have one tourist board for the whole of Britain, but that is precisely what I do want to advocate, because the concept of separate boards for Scotland and Wales does not fit into the tourist needs of the country.
I consider that there is a case for having a separate tourist area covering the County of Northumberland and the southern part of Scotland, rather than having one for Scotland as a whole. The Highlands and Islands Board has to cope with different and differing problems from those in the south of Scotland, and one could list six or seven areas which have problems of their own. I shall not bring in the regions, because I do not consider that the regions which are necessary for local authority or industrial development purposes are necessarily the same as those which should be set up for the tourist trade and the holiday industry.
I think that we have been a bit piecemeal in dealing with the question of tourist boards. It would have been far better to have had one board for the whole of Britain, and then to have established tourist areas in various parts of the country, such as the Lake District, and Northumberland. I shall not elaborate the advantages of Northumberland over other areas, but in case anyone challenges that let me add that I am prepared to discuss the matter at some other time. I should like the Government to consider this question of area boards and their functions, because I do not believe that a board which deals with the whole of the country is able to deal with particular parts of areas.
Different speakers today have dealt with their areas and the opportunities they present for attracting tourists and holiday-makers, and this is what makes the Bill so important. For the first time for many years holiday areas are being given the opportunity to expand and to take advantage of the situation. This being so, I think that we must lay down standards which will not only attract people, but will make them feel that they are getting a good return for their money, and, what is more important, will make them want to come back.
I do not want to single out particular areas, but some boarding-house and hotel associations have done a first-class job in raising the standards of the hotels and boarding-houses in their areas. Indeed, some have imposed some kind of registration. They have laid down standards below which hotels and boarding-houses in their area must not fall.
There have been limitations. Some hotels and boarding-houses have got through the mesh of the local grading scheme, but in the main this kind of scheme is being worked throughout the country. If I was drawing up a grading list of the local authorities, seaside resorts and other holiday places that have done this kind of thing, possibly I would put Blackpool and Whitley Bay at the top and Brighton at the bottom. Hon. Members are entitled to relate their own experiences, but that would be my grading after a number of years spent not only on holidays but at conferences as well.
It has been said that one of the difficulties facing the holiday centres is that the holiday period is telescoped into too short a part of the year. Indoor facilities, extended facilities for holiday resorts and conference halls were mentioned. The question of conference halls, which is possibly the best way of extending the holiday season, ought to be examined by five or six of our major resorts. While not every seaside resort would be happy about having a Conservative Party conference—I may be biased in this matter—they have the choice of the T.U.C., Labour Party and other major conferences that are moving around the country.
On the question of hotel registration, I hope that my hon. Friend will be able to have a look at the Trade Descriptions Act to see just how far the brochures of some of the hotels in this country, and particularly the London hotels, fit in with the requirements and demands of that particular legislation. I would also hope that we would be able to persuade not only the hotels in this country, but those abroad as well, to have a simpler system of hotel symbols. The kind of symbols we get in brochures, guide books and other material mean little or nothing when one moves from one country to another, so perhaps we could have brochures and guide books available for use abroad, to attract people to Britain, with symbols indicating not only the standard of hotels—I am not thinking of "starring"—but the type of facilities a hotel provides. If that could be done on an international basis, through the different travel and tourist agencies in Europe and the world, it would make for simplification and the attractiveness of our own tourist industry would be enhanced as a result.
I was a little surprised at the heat generated by some hon. Members on the question of the Selective Employment Tax and then to see the retreat that was staged when it was pointed out that, far from being an imposition on the hotel owners, the tax is actually an imposition on the residents and visitors in hotels, because when I move about the country I realise, on looking at my hotel bill, who is paying the Selective Employment Tax and who is not. In the main, it is certainly not the hotel owners who are doing so.
While it is true to say that this happens in places like Claridge's and other such hotels, is the hon. Gentleman really suggesting that seaside hotels in the Isle of Wight, Hastings and elsewhere on the South Coast, which charge inclusive terms for a week's holiday, automatically put up their rates to cover S.E.T.? If he is suggesting that, he is quite wrong.
I have not stayed at Claridge's, but having stayed at small boarding-houses and hotels in various conference centres since the S.E.T. was introduced, I believe that it would still be fair to say that while it is not levied on the customer in small hotels and boarding-houses to the same extent as it is in larger hotels, nevertheless to a considerable extent the cost of S.E.T., even in establishments of that kind, is being met by the residents and not by the owner.
Does not my hon. Friend recognise that S.E.T. is paid irrespective of whether anybody is staying in the hotel or not? It is based on the number of people who are employed there. This is a tax that has to be paid even if one does not earn it. May I remind him of the simple fact that many small hotels are in grave financial difficulties owing to the imposition of this tax?
That is an entirely different question. My hon. Friend knows full well, as I know from my own experience of Whitley Bay and other places, that, in the case of many of the smaller establishments, if there are no residents in the hotel people are very seldom employed by the owner. But it does come back to the point made by the hon. Member for Honiton, with which I agree, that it is the amount of investment and the cash flow in regard to the imposition of S.E.T. which are factors in this. Nevertheless, a comparatively high proportion of S.E.T. is met by residents, not by owners.
I was pleased to note the other day an article in a leading newspaper on the abolition of tipping. I say that not because my own town happens to be Aberdeen, but in the interests of the hotel industry. The quicker we get away from tipping and the 10 per cent. surcharge and other such things and charge a flat rate for the services offered to residents, the better it will be for all concerned and the easier it will be for hotels to carry out their administrative work.
I go some way towards agreeing with the hon. Gentleman on the question of tipping, but this question comes up year after year. The difficulty is that people will tip. One cannot stop them tipping. The people who tip the most are our foreign visitors. If we were to abolish tipping many American visitors would still insist upon giving tips.
I would think that the hon. Gentleman, of all people, would have been the first to agree with me on the question of the abolition of tipping. I have mentioned my own origins in this connection and I would have thought that he shared my view.
I make one final plea to the Minister. If we are serious—and the Government have indicated that they are serious in introducing the Bill—over the development of tourism and the tourist industry, then there is sufficient need for a Minister of Tourism. This should not merely be handled by a Department of the Board of Trade, which is already fairly well loaded with a wide range of numerous responsibilities. I hope that in accepting the Bill and bringing it into legislative effect we will take note of its contents and will appoint a Minister to be responsible for its administration.
I have three propositions to put to the House. First, although the Bill undoubtedly has some elements which will help the tourist industry, its essential structure is so distorted that it should be rejected and then reintroduced with a structure related more realistically to the geographical pattern and balance of tourism.
Secondly, after the Bill had its First Reading, and was printed, a reasonable time should have been allowed before Second Reading, so that interested parties—with perfectly legitimate interests—whether local authorities, tourist and travel associations or Members of Parliament, had proper time to study it and consult those with expert knowledge. I cannot believe that any hon. Member in the Chamber—although there are not many here, anyway—is happy that he or she has had adequate time to discuss the Bill with his local authorities. The local authorities themselves have not had time to decide their view. Not only is the structure of the Bill defective, but time for consultation has been inadequate.
Thirdly, because of the form in which the Bill is drafted, it cannot be rectified by amendment. The essential distortions are in the Long Title and, because of the way in which the Money Resolution is drawn, this cannot be amended. That is why the Bill should be rejected completely, so that it can be corrected and reintroduced. That is the only way to get a pattern established statutorily with which we would want to live. By the time that the Bill has gone through the House, it is highly unlikely that Parliamentary time will be found for another. This is the time to send it away.
The Bill is not in a sensible form. At present, 12 per cent. of the tourist capacity—that is, people multiplied by the number of nights that they stay in an area—is provided by Scotland, 12 per cent. by Wales and 76 per cent. by the whole of England—including 22 per cent. by the South-West—yet there is to be no Tourist Board for England, and the specific projects which can be financed under Clause 4 are not to be carried out, as in the case of Scotland and Wales, by a Tourist Board, or in the case of England, by what we have to live with instead, an Advisory Committee, but by the Central Tourist Authority.
It is worth noting that two of the seven members of the Authority are the chairmen of the Scottish and Welsh Tourist Boards, whereas the chairman of the English Advisory Committee has no locus standi on the Welsh or Scottish Tourist Boards. This is not a criticism of either of those boards, but the Bill's pattern bears no perceptible relation to the economic realities of tourism, and this must be wrong. We can only assume that the Government are motivated by political considerations rather than economic or rational judgments.
The Bill says that the central body will have two duties—to encourage people to visit Great Britain, and to encourage those living here to take their holidays here. That is admirable. Therefore, it cannot be said that although the South-West provides 22 per cent. of the holidays taken in the United Kingdom, that does not count because only 2 per cent. are overseas visitors. It is immaterial to our balance of payments whether we save expenditure leaving this country, or attract it from abroad.
To take another example from the South-West, the region on which I am most closely informed, it has the highest tourist expenditure, both per party of holiday makers, and per head, of any area. It is those with the highest expenditure per head which are most likely to be attracted to holidays abroad. This is an important reason for saying that this is just as valuable a service to our national economy as the attraction of visitors from abroad.
So we must either accept the Bill with a distorted structure which implies an irrational allocation of public funds, because that will presumably be related to the structure, or reject it. We cannot salve our consciences by saying that we will let the Bill have a Second Reading, and try to knock the nonsense out of it in Committee and on Report, since we know that, because of the drafting, that is not possible.
Faced with that situation, the choice is obvious. We should save the House wasting time later by rejecting the Bill now, not as totally bad or misconceived, but because it needs so much improvement that it would be a waste of time to take it further. The Bill is ill-considered, and the consultations which would have improved it have not been possible. It completely ignores many of the efficient bodies, the local travel and tourist associations, which receive no direct Government subvention, and it offers them no help. It proposes the employment of another 70 people—whether they are called civil servants or not is immaterial—to do what is already done at no charge to the taxpayer by the regional tourist associations.
This is not an efficient way of doing what the Government propose. We should have a central board corresponding to the present B.T.A., which is doing an excellent job very economically, and a number of regional authorities designed on a basis of economic reality and not of local political pressures. If they are to take funds from the central Government, as I think they should, those funds should be allocated so as to enable them to budget properly, so that they can predict staff needs, and these funds should be related to the finance which they raise from local authorities and business enterprises within their own areas. Funds made available from the central Government in this way would result in regional and area boards having to provide for themselves by their own efforts, and public money, which is in short supply, would be used to best advantage.
There is much more that I would like to say on this subject, but as many hon. Members wish to speak I will resume my seat.
Unlike the hon. Member for Tiverton (Mr. Maxwell-Hyslop), I do not want to get rid of the Bill. I welcome it because it represents an important step forward in our economic welfare. I share the concern of the hon. Member for Honiton (Mr. Emery) about the lack of communication and I remind him of the effects of the Beeching axe on holiday resorts. I endorse his remarks about the need for airfields to connect centres and the general lack of facilities for caravanning and camping.
The popularity of caravanning and camping has grown enormously; it is international in character. The facilities for this type of pastime are totally different from those which obtained when I was a young boy scout and camped amid an atmosphere of smoky tea and burnt porridge. Modern camping equipment has made a big difference to this type of pastime. Campers are, generally speaking, good citizens who are concerned for the welfare and cleanliness of the countryside.
Britain, as distinct from most other countries, has been slow to recognise the increasing demand by both young and old for camping and caravanning facilities. Some improvement may be expected from the Countryside Act, but its effects will be patchy. I fear that there will continue to be areas of availability and areas of restriction. Camping and caravanning must be "sold" not only abroad but at home, and the various tourist associations must do everything in their power to avoid the mistaken objections that give rise to restrictions.
The Bill pays much attention to hotels. Indeed, I thought at one stage that hotel keepers had drafted it. I appreciate that assistance for hotels is necessary, but I regret that the Bill does not specifically mention camping and caravanning facilities. A general reference to this past-time appears in Clause 3, but the matter should have been referred to in detail. The need of sites and facilities for camping and caravanning will, I hope, be stressed in Committee.
I have connections with two ideal tourist centres. I come from the Cotswold country, close to Shakespeare territory. I regret that the hon. Member for Cheltenham (Mr. Dodds-Parker) is not in his place—
I was hoping that he would talk about the Cotswolds and leave me to talk about Norfolk. The tourist authorities concerned with the Cotswolds have had little difficulty in popularising the area because it is so closely adjacent to Shakespeare country.
My hon. Friend the Member for Yarmouth (Dr. Gray) took us on a mini-tour of Norfolk and extolled the beauties of Yarmouth and its wonderful smells. He spoke of the Norfolk Broads and about Norfolk dumplings. But he forgot to mention the "Norwich Canaries" who now play football and Norfolk stew, which is sold in Norwich market and which is not only delightful but is excellent in this cold weather.
I do not share my hon. Friend's view that there should be separate regional boards, although I agree that the tourist potential of Norfolk and Suffolk has yet to be fully realised. It is a tribute to the boating and yachting organisations—I admit that this has occurred through private enterprise effort—that the Norfolk Broads have been popularised to such a great extent, both at home and abroad. Nevertheless, facilities will have to be expanded to ensure that the waterways are maintained and improved. This must mean greater co-ordination between the various public authorities in the area.
The potential of this part of the world is not confined to the Broads. The glories of the coastline must be fully realised and in this I know that I have the support of my hon. Friend the Member for Norfolk, North (Mr. Hazell), who will no doubt remind me that I represent not Norfolk but Norwich. This is an indication of the parochial difference; the old difference between county and city which is based on centuries of prejudice and disagreement and which has led to work being carried out independently by the various authorities.
Norwich has a great cultural attraction for tourists; and I suppose that if I do not extol the virtues of Norwich I will have a local riot on my hands, again because of the parochial approach. I hope that, with the passage of time, this approach will end, because it hampers effort being made on an overall basis for the advantage of the whole area.
The new organisation envisaged by the Bill should do much to rid us of a lot of local differences and rivalries. It may result in regions as a whole being popularised instead of this work being done on a purely local basis. After all, Torquay may be competing with Eastbourne, but there are both inland and coastal areas which can be popularised together, and I hope that the various authorities will be persuaded to drop their local rivalries.
Over the years hon. Members who represent Suffolk and Norfolk have been pressing for the economic development of the area. This is another reason to support the Bill. In the main, our thoughts have been of orthodox industrial development, but we must recognise that in areas like Norfolk and other so-called regions of grey development tourism is just as important an economic factor for development as industry. I hope that the Bill will assist us materially to develop areas like Norfolk and Suffolk, which need increased industry and tourism. I therefore strongly support the Bill.
I apologise for having missed the first speeches in the debate. I had an urgent engagement in my constituency which I wished to keep.
I make clear that my reason for taking part in the debate is to put before the House my interpretation of what the Welsh side of the tourist industry thinks about the Bill. It is customary to express an interest, and I do so, although I shall not benefit from the Bill because I am not an hotelier.
In speaking about the attitude of Wales towards the Bill I do not want to overlook the fact that in many constituencies tourism is of inestimable value. Herefordshire, from Symond's Yat and Ross-on-Wye, from the castles and churches of the villages to the hotels and steak bars of the cathedral City of Hereford, is a famous area for the holiday visitor.
In Wales last year tourism made £80 million. The Welsh Tourist Board played a great part in improving the position. The Chairman, Mr. D. J. Davies, and his staff did excellent work. In Wales as a whole 400,000 beds or bed spaces, which include caravans, are available. Only the Netherlands has a greater density of such accommodation. However, there are only 1,500 hotel beds with bathrooms in the whole of Wales. Cardiff has only 150 and only 10 new hotels have been built during the 'sixties. That is why the average tourist spending is only £16 per head. Last year Wales earned only £5 million from overseas tourists out of a total of £80 million.
Most overseas tourists want a bedroom with a bathroom. Whatever the effects of the Bill, and there certainly are some, it at least aims at increasing the number of bedrooms and bathrooms. That aim I support and I believe that it is supported in Welsh tourist centres. In this year of the Investiture, which we call Croeso '69, we are made increasingly aware of our shortage of this type of accommodation.
The harmful effect of S.E.T. has been referred to by a number of my hon. Friends. For a party which says that it is concerned about rural depopulation, it is incredible that the party opposite should have brought in such a tax and kept it for so long. Tourism has to be a big and lavish employer if standards of comfort are to be high. It employs some old people and some who are partially disabled. It is virtually the only industry, except for agriculture, in some areas of Wales. S.E.T. is bitterly resented in the rural areas and small towns.
I put the direct question to the hon. Member which I put to his hon. Friend the Member for Moray and Nairn (Mr. Gordon Campbell). If his party got into power, and abolished S.E.T., I understand that it would replace S.E.T. by £. sales tax. Is it the intention of his party to exclude from the operation of sales tax those areas where S.E.T. is now paid by hotels?
I do not know from where the hon. Member gets his evidence about sales tax, but I assure him that we intend to get rid of Selective Employment Tax, although his Government do not wish to do so.
Although I believe that in Wales there should be some form of development areas, I doubt whether the present areas for Wales make much sense for industry, especially for tourism. There cannot be a tenable argument for allowing 25 per cent. grant on a maximum of £1,250 for each new letting bedoom in Aberystwyth and only 20 per cent. on a maximum of £1,000 for each new bedroom in Llandudno, where there are 40 per cent. of the Welsh hotel beds and development is expected and desired.
Nor does Offa's Dyke—the border between Wales and England—produce a very sensible boundary for a development area. I understand that the extra benefits to which I have referred are to go to Presteigne and Knighton, in Radnorshire, but not to Kington or Leominster, which, by the same drawing of the area, go on paying S.E.T.
Nor is the position on bank lending of much help in this respect. I should like an assurance that in bringing in the Bill the Government have been shown willingness by the Chancellor of the Exchequer to give tourism top priority for borrowing, or reasonably near it. My hon. Friend the Member for Honiton (Mr. Emery) rightly referred to roads. No question is more important for tourism in Wales than communications. Time and again we have stressed the importance of east-west communications. If these matters could first be put right the necessity for the Bill would be greatly diminished. Because these matters have been wrongly dealt with by the Government the tourist industry in Wales is in the mood at present to welcome the Bill. It is the "lolly" that counts.
Under the Bill, public money will be spent on promotion. The chairmen and members of the boards will have to be paid if they are to do a good job. There will be a growth in the number of the boards' employees, as was suggested by my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop). There will also be an increase in staff at the Welsh Office to cope with the increased work.
By far the largest expenditure will be on the 20 per cent. and 25 per cent. grant for extra bedrooms in new and existing hotels. If full advantage is taken of the Bill the grants will amount to many millions of pounds. How can we be certain that the Government will not fall down on their financial promises, as they did in the Countryside Bill? The hon. and learned Member for Derby, North (Mr. MacDermot) then had the unenviable task in Committee of admitting that for the foreseeable future the Countryside Commission could not properly carry out its new responsibilities because the money was not available. Even Baroness Wootton, Chairman of the Countryside Commission, publicly regretted that this had happened.
There is nothing worse than raising people's hopes and then dashing them. Will the Minister therefore tell us tonight how much the Chancellor has earmarked for 1969–70? The financial effects of the Bill, as outlined on pages 4 and 5 under Part III are much too vague; so is Clause 20. Unless the Minister can tell us roughly what figure the Treasury has earmarked, the House and the country will be tempted to draw their own conclusions. We know that the party opposite has mortgaged the past. I seek an assurance that by the Bill they will not mortgage the future.
I apologise to the House for not being present when the two opening Front Bench speeches were made. I received a deputation of miners from Scotland and could not be here at that time.
I declare an interest in hotels as my wife and son run a little hotel with seven bedrooms. Therefore, I claim to have a passing acquaintance with some of the problems of this industry. Over the years under both parties there has been an extension of a political disease. It is a disease which appears to be all too prevalent, and that is interference with the individual and his ability to run his own business and the need to take money from one pocket and to put it into the other. In the process some are losing considerable sums.
We all agree that the aim and object is to have a viable and expanding tourist industry. We all wish to see good hotels with proper facilities, good bedrooms and bathrooms and as up to date as they can be. We would like there to be a betterment of restaurants throughout the land. This aspect has not received nearly enough attention, but it is of paramount importance to many camping visitors who wish to take all their meals except breakfast in restaurants.
Another point which can cause no controversy is that there should be considerable emphasis on countryside amenities. Over the years these have been desecrated to a great extent. Shame on the Labour Government and the Conservative Government for allowing this to continue. Whatever else the Bill does, let us hope that it brings encouragement and strength to those who are anxious to preserve that which is good in the nation and to ensure that houses and other buildings are constructed with considerable good taste and a proper regard to their amenities.
I know that the Tories were just as great sinners as my colleagues in the Labour Government are. Just as the Tories advocated with all sincerity a bed tax in Scotland, in sheer stupidity my colleagues introduced the Selective Employment Tax. This was fundamentally wrong in its conception, particularly for the restaurant and hotel industry. I know that my words will fall on the stony ground of infertility which seems to be prevalent on the Government Front Bench. If this were not so, the Bill would have been a better conception of the requirements of the tourist industry at present.
This is what I chastise my colleagues for. The concept is befogged and befuddled by the actions of the past. The notion is that, because something was done in the past, it must be continued for the future. It has been argued that if a bad thing like the S.E.T. is neutralised, so to speak, by money being handed back as soft soap, something good is being done. These two bads do not make one good. It is the negation of good administration.
What does the S.E.T. cost the hotel industry? I heard someone say, sotto voce, £20 million. How much does my right hon. Friend propose to hand back to the industry under this scheme? I hear my informant saying, sotto voce, £13 million. What will happen to the £7 million? Does that go to the Exchequer, or does it go to set up these various bodies? It would be far better to leave this money in the pockets of those who are running the industry. They can do without the interference of people who know nothing about it.
I claim to be conservative, with a small "c". I conserve that which is good and destroy that which is bad. If that is conservatism, I am pleased to be a conservative. I do not seek to destroy everything. The natural forces of business compel a hotel to be built in one place as against another. There is a danger in enticement by grants or gifts such as under this scheme. This is the octopus which can catch the unwary. People will take a grant and build a hotel in a place or in an area which is not a profitable or good area from a strictly business point of view. People will do this because of the enticement of the grant. This is the octopus of public money being granted without the exercise of sound business judgment as to whether the project is good or bad.
In the Bill we reach the unfortunate pass that we are seemingly unable to get on without committee upon committee. We must have somebody to tell us how to do this, that or the next thing. This concept is absolutely and fundamentally wrong. A central body should be set up with the broad task of giving general indications of what can be seen in Devon, Cornwall, Scotland, Wales, or wherever it may be. Such a body would whet the appetite of the overseas visitor or the native Briton and make him go and see these places for himself. Without involving myself in any argument about decentralisation or regionalism, areas should be given the power to emphasise the delights of their own attractions. There should not be this monolithic growth of committee upon committee to tell us whether this is good or that is bad.
If this were being done in a realistic way, this is how I believe it would be done. I have spoken about the setting up of a central body. Secondly, S.E.T must be abolished, because it is an iniquitous tax. Taking my wife's hotel as an illustration, this tax is put upon that small organisation: this 7-bedroom hotel must pay about £1,500 a year in S.E.T. because my wife must provide a service for the casual visitor. Who knows when he or she may arrive? But the organisation must be maintained whether the casual visitors come or not, the tax must be paid. This is the negation of fairness, of good government, and of good administration.
As my hon. Friend has declared his personal interest and as this "iniquitous tax" affects his business, may I ask him whether the profitability of his hotel has declined since the tax was introduced? My experience—I thus declare my own interest—is that it has not.
There is no doubt but that the profitability of my hotel has declined considerably. I say that with all truth and sincerity. It can be proved. If my hon. Friend will show me his balance sheet, I will show him mine. That is a true Scottish cautionary note! Next, there should be a return to the system of investment allowances. Furthermore, the tax on close companies, which can seriously affect small hotels and small organisations, should be nullified or altered fundamentally. There is no question about that.
If need be, after the hotels are relieved of the taxes to which I have referred and have been given back their right to investment allowances, if hoteliers or the local authorities find that special grants are required in certain areas, representations can be made to the central authority. I am not very keen on maintaining the business of grant after grant because grants all come from the taxpayer, but, if a grant is required for the common weal—and that should be the only basis on which a grant is paid—it should be paid in a selective manner, in the best interests of the community as a whole.
I have some notes here, and I have wandered off the mark a little, but those, briefly, are some of the aims and objects which any government should pursue. Let us have no more interference than it is absolutely necessary. [HON. MEMDERS: "Hear, hear."] Grants are not necessary if the natural forces of business are permitted to prevail. [HON. MEMDERS: "Hear, hear."]
I have heard a few sounds from the benches opposite. The growth of interference, the political disease, as I call it, has affected the Conservative Party as much as the Labour Party. Let that be understood. I am only bringing hon. Members back to a sense of reality, a sense of purpose and a sense of justice, and in doing so I say, "A plague on both your houses".
We all enjoyed that refreshing, hard-hitting Conservative speech from the hon. Member for West Stirlingshire (Mr. W. Baxter). It was a great delight to me to listen to it. Like the hon. Gentleman, I delare my interest. I have been associated with the hotel industry for a great many years.
I do not support the Bill. We were promised reasonable time between publication of the Bill and Second Reading, but that has not happened. We have had little opportunity to discuss the matter with our constituents. The biggest industry in my constituency of Eastbourne is the hotel industry, and I should have liked to find out a little more of the views of my constituents and of the many trade associations which are vitally affected by the Bill.
I regard the Bill as a typical Socialist approach to legislation. If the Government had not mucked up the tourist trade in the first place by imposing the S.E.T.—every speaker has complained about that—by withdrawing investment allowances—most have mentioned that—and by not making planning consents for new ventures easier to obtain, the Bill would have been unnecessary. Incidentally, the main reason why more new hotels have not been built is probably the difficulty of obtaining planning consents.
The reasons for the Bill all stem from the iniquitous way in which the Government have treated us in the past. I do not refer here to this Government alone. Past Governments have treated the tourist trade badly. But this Government have treated it disgracefully, imposing every sort of hindrance upon it. If, on the other hand, it had been treated as one of the largest dollar industries, as it is, the Bill would have been superfluous.
Both the British Hotels and Restaurants Association and the Catering Association have said that they regard the Bill as unnecessary and wholly unacceptable in its present form. I heard that Scotland wanted it and that, for some reason or another, Scottish Members must not be upset. I made a few inquiries about whether the Bill was wanted in Scotland. As the President of the Board of Trade read out a telegram, I shall read one, too. Here it is:
The Scottish division of the British Hotels and Restaurants Association which represents hotels throughout Scotland wishes to make it known that it is completely opposed to the Development of Tourism Bill in its present form.
I believe that the Association sent a copy of that telegram to the President of the Board of Trade.
Almost everyone agrees that the British Travel Association has done a magnificent job in promoting tourism to Britain. Anyone who has visited its offices in New York will be most impressed by what it is doing in the United States. I have heard international hotel keepers, particularly from countries which already suffer from Government tourist agencies, say how much they envy our present virile go-ahead organisation, the British Travel Association.
The Association is supported by the Government, by local authorities and by private enterprise. Being the main sponsor, the Government are entitled to call most of the tune, but I draw to the attention of hon. Members that £200,000 is collected annually from outside subscribers. The Association enjoys the cooperation and admiration of everyone with a knowledge of the tourist trade. To replace it by a statutory body, by people who will not necessarily be qualified to represent the industry, seems absolute madness.
The Association is at present governed by a board of experts drawn from businesses connected with tourism—railway transport people, shipping people, hoteliers, travel agents—
Yes, and, as I say, it is supported by local authorities representing areas where tourism is an important industry.
These men give their time free. They are not paid, and I do not think that any of them draw expenses. I repeat my question: what can be the point of chucking overboard a highly successful organisation which has publicised and promoted tourism to Britain in a first-class way throughout the world, and put in its place a new Authority appointed by the Board of Trade?
Will the members of the Authority be paid? Is the new chairman to be paid? Lord Geddes has done the job as a labour of love; he has cost neither the taxpayer nor anyone else anything. What will the pay of the new board be? One hon. Member opposite suggested that a lot of Members of Parliament would be applying for jobs. Perhaps they will if the pay is sufficient.
The first function of the British Tourist Authority is to replace the highly successful British Travel Association and take on the publicity and promotion of what used to be known as the "Come to Britain" campaign. Its second function, under Part II, will be to administer the grant and loan scheme. A system of grants, to my mind, must necessarily be selective, and it can lead to unfair competition.
I do not think that many hotel operators in Eastbourne will get grants, because the standard is already very high there. Other parts of the country where the standards are not so high will presumably get the grants, while those who have done their best to look after their businesses will not. That is discrimination.
If only the industry's earlier advice to the Government had been taken, and the tourist trade had been regarded as an important industry, it would have been placed on an equal footing with other industries engaged in the export trade, and not regarded differently because it supplies services instead of manufactured goods.
The former loans scheme was a flop. We have heard that £5 million was set aside, and that less than £2 million has been taken up. Part II of the Bills is more or less an extension of the loans scheme. The Government turned a deaf ear to informed opinion. Instead of doing what I suggested at the beginning of my speech they introduced a grant and loans scheme limited both in amount and duration. The scheme was not something that the industry sought. It is true that it may possibly encourage a few new hotels, and perhaps the addition of a few new bedrooms to existing hotels, but it does nothing to provide the climate in which existing enterprises can operate a viable concern. There is nothing here of a long-term nature that will be much use. All I ask is that the Government create the right climate through suitable tax amendments so that the industry can be placed in a position as favourable as that of manufacturing industries.
Part III of the Bill deals with registration and classification. Guides are already produced by travel agents, the motoring organisations, the British Travel Association and the British Hotels and Restaurants Association. Local authorities have their own guides dealing with towns and villages in their area.
Let us make no mistake about it, there is tremendous competition throughout the world to get the tourist trade. It has been suggested that all the countries which are eager to gain more and more of it have trade classification and registration. But that is not true. There is no statutory classification in Germany, Belgium, Denmark, Canada, Holland, the United States, Finland, Norway and Sweden. I am told that that list is far from complete. Spain and Italy publish official classified lists, but the current Italian one weighs 5 lbs. and is very bulky. I have seen it. It is the sort of book one would not wish to try to put in one's hip pocket or even in one's brief case.
I am told that the British Travel Association set up a working party to examine the possibility of producing a comprehensive guide in Britain, with classification. The working party concluded:
…the present voluntary system should be maintained in preference to the adoption of a new system of compulsory registration, classification and grading, where the cost involved would outweigh the benefit achieved.
That was after considerable study by people who knew what they were talking about and what they were studying.
Many people know of, and have used, the Michelin Guide in France, which is not based on statutory powers. The primary question is one of cost. We know from bitter experience that all these boards and bureaucratic organisations are never simple or cheap in operation. The cost of the new set-up is bound to fall on the hotel operators or their clients. The President of the Board of Trade was very vague about what all this will cost. We do not know the total sum that will be given in grants; there is no estimate. It is wrong even for the present Government to issue a blank cheque, which many of us feel would be completely unnecessary if the industry were treated properly.
If the tourist industry were recognised as really important, if the burden of S.E.T. were removed, if investment allowances were restored, and there were a general easing in the granting of planning consent for new ventures, with only one Government Department instead of about eight to deal with, the industry would go ahead under its own steam, with its own enthusiasm and enterprise.
For all those reasons, I cannot support the Bill.
I should like briefly to take up the time of the House. My hon. Friend the Minister of State, Board of Trade, intends to curtail his remarks accordingly, so that the time for back-bench speakers is not diminished.
I rise for only two reasons—to deal, first, with the comment of the hon. Member for Eastbourne (Sir C. Taylor), and second, with the comments of the hon. Member for Moray and Nairn (Mr. Gordon Campbell) and the right hon. Member for Argyll (Mr. Noble) about the position of the Highlands and Islands Development Board.
There are so many telegrams flying around that the Post Office must be making a handsome profit from the debate. The hon. Member for Eastbourne spoke about the Scottish section of the British Hotels and Restaurants' Associa- tion. The Scottish Tourist Board, with which I have very close connections and whose members I have met many times not just during the past year but also during the past three years, is wholeheartedly behind the Bill; and the board is representative of the tourist industry in Scotland, including the Scottish section of the B.H.R.A. But it may be a question of mavericks sending the telegrams. I shall pursue the matter, but until the hon. Gentleman spoke we could have said that it was a unanimous view in Scotland that, whatever the detailed defects of the Bill, its general idea was wholeheartedly welcomed by the industry.
Does not the hon. Gentleman agree that it would be rather a peculiar board if it said that it did not want the possibility of money under a new Tourism Bill, and that possibly the Scottish branch of the Scottish Hotels and Restaurants' Association, which is thoroughly against the Bill, is a much more representative body, since it will not get any money from this?
The hon. Gentleman does not understand the Scottish Tourist Board. It is not a statutory body. It is a voluntary body drawn from distinguished Scotsmen, and the majority, if not all, are in the industry. Once the statutory Scottish Tourist Board is established the present board will cease to exist, and, therefore, the support does not result from self-interest.
There is popular demand in Scotland that we should treat tourism more seriously than it has been treated by both Governments up to now, and that we should have the statutory board. That may not be the case in parts of England, but it is in Scotland, and I suspect very strongly that it is so in Wales. I gathered from what the hon. Member for Hereford (Mr. Gibson-Watt) said that that was the contrary opinion in Wales. However, I do not intervene to speak of other parts of the United Kingdom.
I want to refute the suggestion, for the Scottish Office, that a substantial segment of opinion in Scotland has made known its opposition to the Bill. If one partner is opposed, it is news to me, but the majority remain in favour of the Bill.
We have had experience of the Highlands and Islands Development Board working with the Board of Trade in the operation of various loans and grant schemes, separate from the Local Employment Act. There has been no friction between the two Departments—
—my right hon. Friend confirms that—and it is true that we have operated the system for some time very successfully. Now, both the new Scottish Tourist Board and the Highlands and Islands Development Board will be under the same Minister. We have had good relations between the two Departments and two separate Ministers and we do not envisage the new system working out differently under a common Minister.
I accept that. The Scottish Tourist Board is substantially in favour of the Bill and is concerned only about the fact that it wants to see the new board responsible for tourism throughout Scotland. But the policy towards tourism in Scotland has been generally considered to be the responsibility of the board. We have yet to work out in detail the functions between the two boards which will be responsible, but there are certain broad principles which we will observe.
The new Tourist Board will have statutory responsibility for the Hotel Development Incentive Scheme. At the same time, my right hon. Friend the Secretary of State for Scotland intends that the Highlands and Islands Board shall continue its own scheme for grants for hotels in the Highlands where they qualify for one or other supplement. But any applicant will have to opt for one scheme or the other and will not be able to benefit from both.
My right hon. Friend the Secretary of State is confident that, working in close partnership, the two boards can achieve a great deal for tourism in Scotland and that by these new administrative arrangements, we shall create a good partnership. It is his firm intention to see that that partnership is fostered.
I start by asking, what is the tourist industry? It is important to define it before we start. Then we can discuss its problems, how its difficulties have arisen and what is needed to put them right. On these criteria, I want to judge the rather grandly-titled "Development of Tourism Bill" to which the President of the Board of Trade has given his procreative blessing and to which the Opposition Front Bench has given an ambiguous form of muted praise.
My impression is that the tourist industry is a complex jumble of service activities—travelling, accommodation, catering, transportation and recreation—which, taken together, make up a most important industry. But the complexity of the industry and its dispersal over so many different fields makes it essential, as my hon. Friend the Member for Eastbourne (Sir C. Taylor) said, to try to draw the various strands together into a more coherent whole.
This vital factor which the Bill neglects needs further discussion and debate. For if those who talk of British tourism are merely referring to the 900,000 beds in boarding house accommodation and the 185,000 hotel beds, such a definition would be too narrow.
The satisfaction or otherwise of our foreign visitors with the service trades, whether the trains run on time, the facilities at London Airport, whether visitors are treated as aliens on arrival here or as welcome guests—all these intangible items are as important as the question of the dripping taps, worn carpets or insufficient hotel bedrooms here and there.
The Bill is concerned mainly with foreign tourists, but we must remember that the 4 million foreign visitors each year have to be compared with the 30 million holidays taken by British people in the United Kingdom; and whether 8 million people should continue to decide to go to the South-West or to take their holidays on the coast of Spain, will always be of infinitely greater importance in balance of payments and in economic terms than whether we are able to encourage a few hundred thousand more Americans to visit Stratford-on-Avon, Edinburgh or Wales.
Since 1964 the Government have imposed on the general service trades which cater to, or represent directly, the tourist industry a discriminatory tax of £400 million, to which hotels and boarding houses are contributing £30 million. The Government have drastically reduced, if not removed completely, the tax allowances which these establishments have had, it has also imposed an additional £2,000 million in tax on the country as a whole, and it has neglected, on any reasonable view, communications to the holiday areas.
Each time there has been a crisis in the tourist industry the Government, having first created it, have then responded late with a restrictive remedy. The payments crisis and the growing tourist deficit in 1966 produced the travel allowance, which was damaging to sterling and undignified for every British person travelling abroad. Acute shortages of seasonal hotel accommodation produced the hotel loans scheme with no one to administer it and application forms of such complexity that it became a farce.
Now the latest move is this pathetic Bill, which will channel an additional £8½ million of new money into the tourist industry as compared with the extra taxation of about £400 million on the service industries through Selective Employment Tax, and probably about £50 million specifically on hotels and restaurants if we use the narrower definition of the "tourist trade". That figure is composed of £30 million for S.E.T. and £20 million, which is about what they have lost in tax allowances since 1964.
As I understand, the new Authority will receive about the same as the B.T.A.—probably about £3 million. Another £500,000 will be available for the administration of the Scottish and Welsh Boards and this will be in addition to what the Highlands and Islands Development Board is now receiving for the development of hotel accommodation in Scotland and of the Scottish tourist industry.
I do not greatly mind the Government having their policy dictated to them by the Scottish Nationalists, but I do object to my constituents having to foot the Bill. At present, the South-West Travel Association gets an indirect grant from the Government of about £12,000 a year. And yet it yields in holiday terms nearly as much as the whole of the Scottish and Welsh tourist industries put together. I have no fundamentalist objection to transfer payments being made from my Cornish constituents to Scotland for their regional development, but if the money is for regional development than let it be stated as such. Cornwall has an important holiday trade, yet the aggregate income is lower than in the Scottish Highlands and in Wales. I see no reason, therefore, why my constituents should have to make a transfer payment to pay for Scots hotels. That is wrong. The balance of the Bill, as my hon. Friend the Member for Tiverton (Mr. Maxwell Hyslop) said, is incorrect.
I come now to some specific objections to the Bill. I want to quote from the British Hotels and Catering Association and the Catering Association of Great Britain. These bodies, the largest in the tourist trade, find these proposals
…not only quite unnecessary but quite unacceptable ".
They express the hope that all Members will oppose them. I am interested to hear that the Scottish branch of these great associations has also objected to the Bill and asked Members of Parliament to vote against it.
The Associations claim, and rightly, that the abolition of the B.T.A. is wrong. The Minister said that the B.T.A. can continue if it wishes to do so, but since he is removing 80 per cent. of its income and giving it to someone else he is not giving that body much opportunity to continue, and he knows it. The B.T.A. has been a voluntary body, composed of experts drawn from every part of the tourist industry. It has collected voluntary subscriptions. Why does the Minister want to get rid of something which has worked perfectly well without much administrative burden on the public purse and replace it with a statutory board?
Then there are these special projects. What are they to be? Are they to be ski resorts for the Swiss on Snowdon, or are there to be projects in Aberdeen to encourage Mediterranean males to go there for the sun? Presumably these special projects will not be economic ones, because otherwise the industry would produce the facilities themselves. They are one more example of the false belief that Whitehall, or Welsh or Scottish bureaucrats, appointed by a Minister are better able to judge the needs of an industry than those who practise in that industry, namely, the hundreds and thousands of large and small hoteliers and guest house owners whose livelihood and savings depends upon the making of a correct economic judgment.
Let me transfer my affection for one moment to my own Front Bench. It is nice to have three speakers from the Front Bench here today and I am delighted with it. I do not mean, in saying that, any disrespect to my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) or to my other hon. Friends who have spoken. They have shown great interest in this subject and I look forward to hearing what my right hon. Friend has to say.
If I was a Scot I suppose that I would not want to vote against the Bill, even though the Scottish Branch of the Association I referred to earlier would have asked me so to do. But I think that I would have to examine my conscience, as a Conservative, in arriving at that view because for many months my party has stood out firmly against discretionary industrial grants, the proliferation of Government appointed boards, and the escalation of Government expenditure of a discriminatory kind. Yet now we are proposing to override all these principles in case our vote against the Bill should be misunderstood.
In my view, all great political parties are in the business of educating the public to their views, not just following conventional opinion, in case they are misunderstood. As for the suspicion that the tourist industry will not understand a vote, this is a typical piece of politician's arrogance, the type of paternalistic view which led the Macmillan Administration to become increasingly interventionist in our industrial life. The tourist industry knows where its interests lie only too well. Most hoteliers know just as much about the Bill as my hon. Friends or myself. They can form their own judgment on it and we should not be frightened of our vote being misunderstood.
What should the correct policy for my party be? Having been rather critical of the Government, having perhaps made some implied criticism of my party's attitude towards the Bill, I ought to give some answer. Our policy should be crystal clear. First, we should abolish all discrimination in the taxation system, which involves the ending of S.E.T. Secondly, we should recognise that the tourist trade is a great industry and should agree to treat it on a comparable basis with the manufacturing trades.
Whatever may be our policy on investment grants for industry we should treat the tourist trade in the same way. No more, no less. If manufacturing industry receives no investment subsidies then the tourist trade should not receive them, either. If manufacturing industry receives some kind of help, then my party's policy should be to give the tourist industry the same. Moreover, we should place the tourist trade on a comparable basis with manufacturing industry when it comes to capital allowances, initial allowances and the rest.
We should treat this as an important industry. We should step up the promotion and publicity of Great Britain overseas and do that through the B.T.A. which is doing very good work already on a voluntary basis. Why get rid of it when this is widely recognised? Then we should channel funds, if the Government have some available for regional publicity, broadly in proportion to the relative contribution which the different parts of the United Kingdom are making to the holiday industry, through the existing voluntary bodies.
I liked the point of my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop), that in channelling funds for publicity through local regional bodies we should not give them a lump sum but should say, "You can have X per cent. of what you raise by voluntary subscription." This will give them an incentive to raise money by subscription from their own hoteliers and from local authorities in the area.
Lastly, we should insist that the B.T.A. is comprised of members representing, on a fair and impartial basis, the different holiday areas of the United Kingdom and the different industries which go to make up the tourist industry as a whole. Why not give the B.T.A. statutory powers to levy precepts for its work abroad. This would be perfectly reasonable. Give it borrowing powers, too. If it can levy precepts, give it borrowing powers as well. I see no radical objection to such a course.
I suggest a basis of no discrimination, no discretion, no special projects; but equal treatment for the tourist industry with every other trade, which up to now it has not had.
The tourist industry is an important industry, and this is an important debate. I would like to follow the hon. Member for St. Ives (Mr. Nott) who, like me, represents a part of the most attractive and beautiful tourist area in the country, by saying that the tourist industry is more than just the hotel industry. It embraces catering, restaurants, camping and caravanning and the whole question of the general amenities and services in our tourist areas. It is an important industry for our balance of payments, because through it we earn this large sum of foreign currency. It is possible to earn foreign currency more easily by this means than through direct exports of material goods.
It is also an industry which has a considerable import-saving potential. We are beginning to appreciate this increasingly, and this means that we should be increasingly adopting the same attitude towards this industry as we are adopting towards other industries with a similar potential. Because of the nature of the industry it is one with considerable regional implications.
We have heard about the industry in Scotland, Wales and the South-West of England. These are parts of the country facing economic and industrial difficulties, often the problems of depopulation and high unemployment. This is an industry which has advantages in these rather difficult parts of the country, despite the fact that it is a seasonal industry. When we talk about it being a seasonal industry, in so far as we can attract foreign visitors it becomes less so, and therefore of more importance from the regional economic point of view than perhaps from the point of view of the domestic holiday-maker.
I welcome the Bill. It is significant that its name is the Development of Tourism Bill. We are not talking about a hotels Bill. I welcome it from the point of view of the industry, the holidaymaker and the community as a whole who will derive considerable benefit from it.
I wish to say a few words about promotion. Promotion overseas is difficult. I should not be as critical as some hon. Members on both sides of the House about what has happened in the past, and this inevitably concerns the rôle of the B.T.A. on occasion. I regret that we still sometimes project in our promotional literature overseas what I would call the Beefeater image of Great Britain as a tourist country. We still tend to go too much for the tourists who want see London, Stratford-on-Avon and perhaps Edinburgh and forget the vast areas in, for example, Wales and the South-West which attract very few foreign visitors.
My hon. Friend the Member for Conway (Mr. Ednyfed Hudson Davies) mentioned the low proportion of tourists from abroad who go to Wales. The figure for the South-West is far lower than the Welsh figure. The South-West, one of the major tourist areas in Europe, probably, and in my view certainly, attracts a smaller percentage of foreign visitors than any other tourist area in Europe. It has enormous potential if we develop adequate promotional activities abroad.
I should like us to work towards extending the season. One thing which concerns me is that much of the additional investment in tourism, from wherever it comes, will be fully utilised for only a very short time in the year. Should not we do more to extend the holiday season through school holidays, encouraging second holidays and action in industry to encourage people to go to the tourist areas of other parts of the country?
One thing which has emerged from the debate is that everyone accepts that the Government have a rôle to play. But I regret that so much of the opposition to the Bill seems to be of a completely confused nature. It seems to centre on the problems of the Selective Employment Tax and communications in the regions. I do not say that these are not problems or that I am entirely uncritical of the S.E.T., but I do not share the irrational criticisms which we have heard from both sides of the House. I should like a bit more selectivity and flexibility introduced into this taxation measure. But to imagine that we shall achieve v/hat we want to achieve in the Bill more readily and cheaply by abolishing the S.E.T. is a complete illusion. The figures given by my right hon. Friend the President of the Board of Trade today demonstrate that if we were to do this far greater demands would be made on the taxpayers because the money would have to come from somewhere and the results in terms of modernising hotels, attracting foreign visitors and import saving would be far less beneficial than the benefits of the Bill.
Communications are vital for the tourist industry, but I do not think that improvements in communications conflict with the desirability of the Bill. They are another problem. To confuse that problem with incentives to improve the industry, with the question of publicity and boards is wrong.
Surely the hon. Gentleman would agree that it is a question of getting our priorities right. The first thing is to get there, and this is where communications are vital in the South-West.
I do not accept that it is a question of either or. These things are not incompatible. We must improve communications, but there is a need for legislation like the Bill to improve hotel accommodation, to provide bathrooms and to attract people to holiday areas. Accommodation must be provided which will attract people and we must get people in and out of the regions.
Part I of the Bill sets up the various authorities—the British Travel Authority and the Boards for Scotland and Wales. I welcome it in so far as it represents a degree of devolution and a step away from centralisation of control. But there is an element of untidiness. Those representing tourist areas in England are very conscious of it. The figures have been quoted many times today. Far more visitors go to the South-West than to either of the areas for which separate boards are to be set up. I suggest to my right hon. Friend the President of the Board of Trade that the question of the regions warrants further examination in Committee. I was pleased to hear him say that the rôle of the regional associations and boards which we have now is essential. I hope that we shall follow up this matter in Committee and that the findings of the Royal Commission on Local Government will be taken into consideration in so far as they are applicable.
Part II outlines the means by which financial assistance is to be given, particularly to hotels, along the lines of the recent White Paper. I welcome that it will be discriminatory. We have a duly to the taxpayers to ensure that it is discriminatory. We do not want financial assistance to be wasted. We want assistance to go to those who need it. We are always being told, sometimes rightly, that we do not pay enough regard to the way in which aid and assistance of various sorts is given. In so far as these grants are discriminatory, they are good.
The concept of discretional loans, although I realise that this may come later, with the boards and the authority having a considerable say about which areas they will help, will be of great use. I hope that they will use these powers, not only in orthodox tourism, but in intiating the projects which commercial interests are not prepared to initiate. I do not agree with the hon. Member opposite who said that this was profitable, because if it was the commercial interests would do it anyway, and if it was not profitable, it should not be done. There are schemes which should be initiated on which private interests are not prepared to embark
The Government have a duty to stimulate activity. We have seen how successful this can be in other industries. We are always being told that tourism should be regarded as another industry. This is another way in which we are preparing to do that.
Part III suggests that orders may be made for the registration of hotels. This is desirable. It is admirable that we should attempt to maintain standards and to inform the public. The range of standards in our hotels is very great. They compare with the best in the world. But the bad are truly abysmally bad. A system of classification or grading is long overdue and is in the interests of the industry.
Camping and caravanning form a part of the tourist industry which is developing very rapidly. Sometimes it is regarded as the Cinderella of the industry and does not perhaps get the attention it deserves. I regret that there was only passing reference to this part of the industry in the Bill and in the White Paper. It is rapidly expanding, but it has considerable significance for our balance of payments. It may be, as the White Paper says, that the builk of foreign visitors to this country tend to stop in hotels for most of the time they are here. One reason for that is the inadequacy of camping and caravanning facilities in many parts of the country.
The Government have a duty to stimulate development in this part of tourism to attract holidaymakers, younger holidaymakers in particular, from the Continent who travel round Western Europe and stay on first-class camping and caravanning sites. The Government have a duty to attract many more holidaymakers of this sort who will bring in foreign currency. Camping and caravanning have an important-saving rôle as well as a foreign currency earning rôle. I should like greater emphasis to be placed on this element of the industry.
This is a good and workmanlike Bill. It will warrant close examination and possibly amendment in Committee. It would be quite disastrous for the industry if it were held up at this stage in its progress. This is a Bill not just for the hotel industry or the tourist industry. It is a holidaymakers' Bill which will benefit the whole community by the foreign currency earning and the foreign currency saving which will result from it when it becomes law.
I want to take a wider but reasonably brief view of the tourist industry. From listening to the debate one would imagine that the tourist industry was concerned simply with those areas of the country to which people go on holiday in the summer. Probably fewer overseas visitors go to Blackpool or the West Country than go to London and up to Stratford, or Scotland. I am being realistic. These are the people who provide us with what this Bill is about. If we were concerning ourselves with British people taking their holidays at Butlins the Bill would not be needed. The Government are not justified in introducing the Bill because they want British people to stay at home for their holidays. No Government have the right to tell British people that they shall have their holidays at home and not abroad. The Government have done their best to this end by the introduction of the £50 currency restriction, but that restriction does not help the country to earn foreign currency. The French have since imposed a similar restriction. This kind of activity is always self-defeating.
We need to increase our earnings from foreign tourists, and this is now a very large business. I have a certain interest in it, as I have declared on a previous occasion, but I have a wider interest in the tourist business as a whole through the committees on which I sit. I have discussed this matter with many people, and some who sit on committees and boards are inclined to support the Bill. They see the building of an empire which will give them the increased prestige which would follow from the creation of a Government board. I am not saying this about the people who are already sitting on the British Travel Association. Others I have spoken to are against it. On balance, I think that the present system of the British Travel Association promoting this country abroad is the best system. The Association must have increased financial assistance year by year, because it spends its money on promoting this country and is not wasting the money. The British Travel Association is very economically run.
We are inclined to forget that, quite apart from the British Travel Association, there are a host of other organisations and firms that promote Britain overseas. There are the nationalised airlines, Thomas Cook and Son, which is owned by British Railways, and the shipping companies with offices all over the world. We are setting up a Government board dealing with a very limited sector, and it will be an expensive authority for that limited sector.
We should strengthen the present B.T.A., perhaps by improving its committee structure and by bringing into it those who represent other interests, the shipping lines, the airlines, even principal exporters who send people abroad to sell our manufactured goods. A reorganisation of the present system and an increase in financial support would be much cheaper than setting up a new board.
I wonder whether my hon. Friend will face up to the question with which the noble Lord, Lord Geddes, dealt in another place, and that is that this is a company limited by guarantee. There is no precedent in this country for any company limited by guarantee to be able to spend millions of £s of public money, and he advocated that it must turn itself into some other form of statutory authority. If we could retain it in its present form but as a stautory authority, would we not have the best of both worlds?
I cannot understand the argument. It has done very well up to now and it has increased its budget. Year by year it has been given more money, and the number of visitors to the country has greatly increased. Why should it not continue to do what it has been doing?
This is an industry that does not need any shoring up. It is a vital, expanding industry that has developed greatly since the war. Are we to put this prosperous industry into the same position as, say, the shipbuilding industry which has been given so many grants, with the result that the shipbuilding industry has had to come back for more money. I am not suggesting that the shipbuilding industry did not need assistance, but that is an industry which was running down whereas this is an expanding industry. Giving it a crutch could result in it becoming a cripple. Despite what the Minister has said, I am convinced that the amount of money that will be spent as a result of the Bill will grow and grow over the years and when we get back into office we will be faced with it.
What happened with the redundancy fund? The Government said that it would cost £5 million; they had £20 million written into the Bill, and they had to come back for more. The Minister has said that this will cost £11 million, but we shall find that it will cost £20 million or more. The Bill contains a reference to the year 1973 as the final year for the receipt of hotel grants. Once the hotel industry gets used to grants, it is not likely that after 1973 they will be satisfied with having no more grants. If it is thought that the grants will finish in 1973, I warn the Government that there will be an almighty rush to receive these grants and to complete extensions of hotels or the building of new hotels between now and 1973.
It may be that the amount of the grant that is given—the top figure is £½ million—will create a situation where there will be too many small hotels being built. It would be far better for a hotel company to build two, three or four hotels and to claim the £½ million grant than to build one big hotel.
There are two dangerous elements in the Bill; first, an increase in bureaucracy, and secondly, more and more subsidy; subsidy for an industry that does not need it. With more bureaucracy and more subsidy, clearly there is less independence. It happens in every industry on which the Government secure a grip.
Looking through the Bill, one sees that there is an open end to the amount which can be provided, and there is almost an open end to the projects which can be included. No one knows what activities will be subsidised. Will they include grouse shooting, hunting, boating? Where is it to start and where is it to stop? Hon. Members opposite have spoken eloquently in favour of caravanning. There are many aspects of the Bill's powers which run parallel to the powers in the Countryside Act. It will be interesting to see whether the Countryside Commission carries out a certain function or whether the new British Tourist Authority is to carry it out.
Another interesting feature which is also hidden in the Bill is the fact that the new Authority will have power, through a Government Department, to give technical assistance to overseas countries. It will be able to use money provided for the purpose by the Ministry of Overseas Development. This is quite extraordinary. I hope that those of my right hon. and hon. Friends who represent holiday areas will realise that, if the power is made use of, it will encourage overseas countries which are underdeveloped to increase their facilities for the reception of tourists. That will defeat the main object of the Bill, because the money will be used to encourage British people to go overseas by enabling facilities to be provided for them when we say in the Bill that we do not really want our people to take advantage of such facilities.
Then there is the extraordinary point about 20 per cent. grants being made to hotels in non-development areas and 25 per cent. grants to those in development areas. I thought that this was a Bill to assist the development of tourism. Why should we give another advantage to the development areas? Either the Government have development areas on their conscience or they must have a phobia about them. After all, very few development areas are tourist areas—[HON. MEMDERS: "Oh."] Some of the grey areas are, I agree, but few of the development areas are.
When I speak in terms of development areas, clearly I am thinking of the industrial parts.
It is obvious that the aim of the Government and of the British Travel Association is the initiation of package tours into Britain. However, do we need a board to do that? The package tour business has boomed since the war and it is still expanding, thanks to the efforts of private enterprise. It has not been done by Thomas Cook. The only nationalised industry in tourism has made no large contribution to the package tourist exit from this country. As for bringing people into the country by package tour, this is not just a matter for the State-owned airlines and Thomas Cook. It is something which can be done by foreign airlines, but they will not take much notice of what a Government-sponsored board says. This is a matter for free enterprise. If the Government want to encourage package tour visitors to this country, they do not need a board to do it.
If my hon. Friend pursues that line, does he not agree that we need a large amount of new accommodation? The difficulty of the travel agent today is that he is unable to offer would-be tourists the right accommodation at the right place. It does not exist in the right quantity or at the right place. Unless immediate effort is given to providing more hotels, there will not be enough rooms in which to put overseas visitors.
The situation has improved greatly in the last few years. With most foreign visitors coming to London and then going to the Shakespeare country or to Scotland, more accommodation has been provided to cater for them. As a result, it is possible to go to a London hotel some weekends and barter with the management about the price one will be charged for a night's accommodation.
The Government are acting as they always do in these matters. They bash an industry on the head, they thump it, they squeeze it and then say, "You need some help". It restricts an industry in every way and then says, "You are in a bad shape. We must support you." They then bring in a Government board, ostensibly to give support, at great expense to the public—because the taxpayer has to pay, not the industry. They put some sweetening on the pill, the industry takes the pill, but at the end of the day finds that it is less sugary than was thought. This is my view of the Bill. I want the Government to take it away and lose it.
As a Welsh Member with an interest in Welsh tourism, and some knowledge of the operation of a few Welsh hotels, I will speak briefly on the Bill.
I welcome the fact that the Bill deals with the Welsh tourist industry. I can understand the difficulty of the Opposition in this matter. I am sure that there is not a Conservative Member in Wales representing a tourist area who could honestly say that the hoteliers in that area are against the establishment of a Welsh Tourist Board.
The history of the Welsh Tourist Board has been somewhat mixed. One reason why the board was founded was dissatisfaction with the deal that Wales was getting from the British Tourist Association. This is one of the factors in Wales which has brought about far more interest in the work of a Tourist Board than can be found elsewhere in other tourist associations.
Although there is interest in its work, the Welsh Tourist Board, year after year, has been short of money. The hotel and tourist industries are run and financed by individualists. Once a voluntary tourist board becomes efficient and starts setting its own standards, often the most efficient highly individualist hotelier begins resenting its powers and influence. This has been happening in Wales. The board has been short of money, and time and again the Government have had to bail it out. We even had the ridiculous situation a few years ago that a chairman had to be appointed to the Welsh Tourist Board partly because he had sufficient money to guarantee its overdraft. This situation could not continue.
There has been a demand in Wales for a properly financed board with sufficient powers to operate. I make no apology for taking a parochial view of the matter. I shall not criticise the views of hon. Members opposite who are not in favour of statutory boards. However, they must agree that they have found no support from amongst their colleagues representing Welsh constituencies for the views that they have expressed criticising the establishment of a statutory board. It is significant that even the right hon. Member for Flint, West (Mr. Birch), who generally expresses all the Conservative phobias about intervention, is not present to express them today. However, I criticise the way in which the board has been established, because I am not sure that Wales welcomes yet another board to be appointed by the central Government.
I asked a Question about the number of organisations that we have in mid-Wales trying to promote industrial development. I was staggered to find that there are already five separate organisations, three of which have been established by my Government. The functions of the Countryside Commission, the Rural Development Board, and this statutory board will be in conflict. Personnel will have to be found to staff them and the work that they will do may be in conflict.
The purpose of the Welsh Tourist Board is that the proliferation of these matters to which the hon. Gentleman refers—the Sports Council, the local planning authority, the Ministry of Agriculture, and the others to which he has referred not only on this occasion, but previously—can be co-ordinated and come under one umbrella. Why not?
I suggest that the umbrella should be an elected council for Wales. There are so many nominated non-elected boards operating in important areas in Wales that Wales is an ideal candidate for the establishment of the first elected council. If the powers which we are to give to the board were operated by an elected council, there would be far greater acceptance of some of the unpalatable provisions which the board will have to introduce to reorganise the industry.
I agree wholeheartedly that there is a need for the powers of the board to be far more extensive. The board—and preferably an elected board—should be able to look at planning. Time and time again efforts to develop the tourist industry are frustrated by planning authorities. In rural areas, particularly, local authorities tend to be dominated by farmers, some of whom resent the incursion of the tourist industry into areas which in the past have been dominated by their influence There is a certain amount of resentment against the rapid development of the tourist industry. The development of hotels, motels, and camping sites, is frustrated far more by the decisions of planning authorities than by any shortage of finance.
Far more needs to be done for the small hotels in my constituency. By its very nature my constituency cannot accommodate large hotels of the kind which the Bill will assist, but many farms there could provide first-class accommodation if they were encouraged to do so. I do not think that they will be sufficiently assisted by a Bill of this kind.
I propose, now, to deal with the question of taxation of the tourist industry, not the taxation of hotels. The effect of S.E.T. in a tourist area is not limited to hotels, it extends to the whole range of tourist facilities. Although we in Wales claim to have a high tourist income, a great deal of that income comes from day trippers. The highest percentage of catering facilities is provided by people outside the hotels, and a number of things must be done, in association with the hotel industry in Wales, to attract tourists into a new tourist area.
An interesting development in Wales is the holding, on the Irish pattern, of medieval-style banquets, catering, and entertainments alongside, and associated with, a rather remote country hotel. The hotel gets S.E.T. relief because it is in a rural area, but the catering company which provides the essentials for this profitable and interesting development has to pay S.E.T. for its staff.
I am concerned—and here I am taking what I hope is a very long-term view—about the proposals of the party opposite for this industry. I was a member of the Committee which considered last year's Finance Bill. Time and again when we discussed abolition of S.E.T. and a reduction of general taxation the right hon. Member for Enfield, West (Mr. Iain Macleod) said that the party opposite would impose a sales tax to do so. If this is a change of view, the assumption of power by the party opposite would not be quite as disastrous to the hotel industry in my constituency as it could be, but a sales tax would be a far bigger burden than S.E.T. on hotels in my constituency.
I have listened with interest to what was said on the letter to The Times by Lord Crowther. I took the precaution of seeing the trading results of Trust Houses from the date when that letter was published and I noted with interest that the trading profit of Trust Houses from the date of imposition of S.E.T. has increased substantially every year.
I took great care to consider that point and will develop the theme.
S.E.T. has not affected the trading profits of Trust Houses. What has affected the profits is other taxation. In my own part of Wales the Corporation Tax and the onset of new rules for closed company taxation have had a far more insidious effect on investment in the tourist industry than the charging of S.E.T. on services provided.
This is, perhaps, a plea to the Chancellor of the Exchequer, but we ought really to give serious thought to the way in which we are taxing closed companies in the tourist industry, because more and more of the investments in hotels, notably small hotels, comes from private individuals. They are not interested in in- vesting money in a partnership. They are always accustomed to having the protection of an investment in a closed company and they will not, in the future, be interested in investing in small hotels if, in order to get tax advantage, they have to trade publicly. This is a serious matter which must be considered.
Finally, a tax point in connection with this Bill on the question of investment grants: we have been asked to be pragmatic and we must be pragmatic in this industry. Many individuals who are prepared to invest in the hotel industry often have made a lot of money in some other activity. They are then prepared to look round for an investment in their own locality. If one is able to offer them an investment that gives them a tax allowance they are far more interested in a tax allowance at that stage than in investment grants.
Some people who have made a lot of money have a phobia about paying tax and if they are offered an investment which enables them to have even an illusory avoidance of tax they are more prepared to make the investment. I cannot see why we cannot offer the alternative, in paying these grants, of taking either an investment grant or a tax allowance. These are points which we should take up at Committee stage and I hope to be on the Committee to do so.
Finally, I hope that the acceptance by the Board of Trade of the importance of this industry shows that there is to be a new attitude by the Government and by all parties, to this very important industry. It is the only indigenous industry in my constituency with growth potential and I hope that the potential of the industry will be recognised not only by the Government, but also by the people in my constituency and that they will see the opportunities that this important industry offers; that they will think in the field of education not only of agriculture, teaching and the professions, but equip themselves for this industry, also. I hope that young people in my area will realise that there is a great deal of potential in the tourist industry and in the hotel and associated industries and that Welshmen will take an interest in this important industry.
It is significant that, when we are discussing what is possibly Wales's biggest industry, the hon. Member for Carmarthen (Mr. Gwynfor Evans), who reflects the old-fashioned attitude in Wales to many industries, is absent and, apparently, has no interest in it. If we had a financially independent Wales, which heaven forbid, we should be very dependernt on tourism. Yet the Nationalist Member who wants to establish an independent economy has no interest in the one indigenous growth industry in Wales which can be developed by Welshmen.
In contrast, apparently, with some of my hon. Friends, I believe that the House should give the Bill a Second Reading, but I want to make two criticisms. First, I am surprised that there is nothing in the Bill about how the co-operation of the tourist industry will be secured. This is a vital point and I am surprised that the President of the Board of Trade did not deal with it.
Co-operation is important, because this industry is different from most others. It is 5 per cent. of many other industries. The work of hotels, restaurants, car hire, theatres, travel agencies, bus operators and railways, among others, has an important effect on our success or otherwise in tourism. It follows that one of the most important jobs of the Tourist Authority, or whatever body is centrally responsible, is co-ordination and stimulation. Its rôle should be that of the starter motor and not the main engine.
Its other most important rôle is not the administration of grants or a compulsory registration and grading scheme—I hope that the relevant Clause on that subject will be treated as a reserve power and that it will not be necessary to use it—but marketing, promotion and publicity. That sort of job, like the coordinating job, can be done only with the closest co-operation with all parts of the industry. Regrettably, even before this new body has been set up, the industry is suspicious. This is the Government's fault, partly for failing to consult the industry until Friday of last week. If ever a Government should have bent over backwards to ensure that an industry was consultsd, this is the classic case.
I condemn the Government on this ground, which may affect the success or otherwise of the Tourist Authority for some years to come. The Government talk about the importance of participation and even have a Minister with responsibilities for it. Was he consulted before the Bill was introduced? There was apparently no opportunity given to the industry to participate at all.
I wish to refer now to the grants and loans scheme. The right hon. Gentleman effectively demolished, with great skill and grace, the Government's policies on taxation and investment grants. Among other things, he said that the problem is now shortage of beds in hotels. He said that it does not matter if S.E.T. puts up prices—he admitted that it did—but that there was the problem of this shortage. Why is there this problem of a shortage of beds, which has appeared only since this Government came to power? The B.T.A. itself has said that. It is the Government's policies which have been responsible.
The Government should put the tourist industry on a par for tax purposes with manufacturing industry. The relevant little N.E.D.C. made this recommendation and I want to know why it has not been carried out. This is a competitive industry—competing not only at home, but with other countries—and in this business there are no Queensberry rules. The rules of the General Agreement on Tariffs and Trade do not apply to competition in tourism. Other countries, far from penalising their tourist industries, as Her Majesty's Government have done, foster them with massive programmes of fiscal and other aid. I am not urging the Government to go that far. But they should carry out the "Little N.E.D.C." recommendation and give it parity with manufacturing industry.
Like other hon. Members, I welcome the Bill.
In my capacity as the president of a national trade union, I spend virtually every weekend in a different hotel, not only in my constituency but throughout the country. As a result of doing this for the last three or four years, I have considerable knowledge of hotel conditions generally.
I pay tribute to the hotel industry for what it has achieved in recent years and for improving its services. Much has been done in recent years. I say that although I am not the chooser of the hotels at which I stay. They are booked for me by my local officer and I have therefore stayed in hotels of all types and sizes.
During this winter I stayed at one hotel which had no means of heating the bedrooms, not even a gas or electric fire. It was bitterly cold and I was frozen. A hotel like that is a bad advertisement for the tourist industry. There is a minority of these places and the financial provisions of the Bill, enabling grants and loans to be made towards modernisation and for new equipment, will be of considerable assistance and will help these hotels to improve and attract more trade. I trust that it will result in the below-standard hotels being brought into line with the better ones.
I represent a constituency with some 40 miles of coast-line and incorporating about two-thirds of the Norfolk Broads. The tourist industry is, therefore, vital to my area. The Norfolk coast is bitterly cold for much of the year and the holiday season for the small hotels at places like Sheringham, Cromer and Wells is extremely short. The financial provisions of the Bill will be of assistance to the owners of these hotels and boarding houses, who are already contemplating modernising their establishments.
I will not be led into discussing the effects of S.E.T. and the impact that this taxation has had on the industry, although I appreciate the reason why my hon. Friend the Member for West Stirlingshire (Mr. W. Baxter) dealt with the subject. However, as this is the time of Budget-making, I urge my right hon. Friend to tell the Chancellor about the effects of S.E.T., particularly on coastal areas where the holiday season is short.
There is no denying that for restaurants, cafés and small hotels the impact of S.E.T., although the cost is passed on to the customer, has a demoralising effect. The tax retards the possibility of expansion and modernisation. If my right hon. Friends could see their way to mitigate this tax, particularly in areas such as Norfolk where we have twice the national average of unemployment, it would give that boost which is so vital if we are to bring hotels up to the standard needed to attract tourists. I say this with all the seriousness I can command.
My hon. Friend is right about that in the coastal area, particularly in small townships. I hope that my right hon. Friend will take note of this and pass it on to the appropriate Minister.
Another problem in coastal areas is lack of public transport. I take Norfolk as an example. We have two railway lines left there. One is from Norwich to Great Yarmouth. That seems to be reasonably sure at the moment, but the future of the other, from Norwich to Cromer and Sheringham, is very unsure. It is in the hands of the Ministry of Transport whether that line shall remain open. I draw attention to the serious consequences which will come to the tourist industry in Norfolk, the Broads and the coastal area if that line disappears.
It would mean that people arriving with children and laden with luggage at Norwich Thorpe Station would have to walk two miles to a bus, which would take nearly two hours to get to Cromer of Sheringham. Can one expect holiday-makers laden with luggage to undertake such a trek? If the railway line disappears this will have a marked impact on the holiday trade throughout the area which so vitally needs the trade as part of its general economy.
The Norfolk Broads is an area of expansion. We have tens of thousands of holiday makers visiting the area each summer. Because of the expansion of the tourist industry in the Broads a substantial boat-building undertaking has been established. As a consequence there is a considerable export trade in the saling vessels which are built there. This should be encouraged, but there is a tendency for some parts of the Broads to be overcrowded. I hope that the new board, or the Countryside Commission—I do not know which would administer this—will activate the opening of new areas to enable the public to travel about over a wider area of the Norfolk Broads than is possible at present. Extensions of rivers could be opened at very little cost and Broads which are privately-owned could be made open to the public. I hope that steps will be taken by this or some other authority to make the attractive broadland district known and available to a wider tourist trade.
There is a greater concentration of caravans and campers in North Norfolk than there is any other constituency. Last summer Norfolk had the wettest summer that I can recall. I was sorry for the families who came to those camps, for there is no provision for entertainment. They looked very miserable day after day. If this Authority is to do anything to attract more campers to the area, I hope that it will give attention to the provision of amenities for those who occupy camping sites.
I am very glad to have the opportunity to say a few words about the effect of the Bill on the Lake District, which I represent. I should declare an interest. I am interested in a motel development and caravan site.
It is often said in the House and outside that the House of Commons engages itself in churning out too much legislation. The Bill is a classic example of unnecessary legislation. Everyone in the House wants to encourage tourism and do everything possible to help this great industry, but I think that the Bill in its detail is typical of the Government's approach to problems. In social matters and in industry we have seen the tried motto of the Labour Government, which falls into three parts—set up a board, pour money into it and compile endless statistics. That is exactly what Parts I, II and III consist of.
First, the British Tourist Authority is to be set up. Hon. Members have asked why it was necesary to do this. What is wrong with the British Travel Association which, as the President of the Board of Trade admitted, has over the years done such a fine job? The proposed functions of the Authority under Clause 2 are almost identical with the job that the British Travel Association has done for years. Apart from giving away money and compiling statistics, the job that the new B.T.A. will do is virtually identical to that which the previous one did. The game is given away by the statement in the Explanatory and Financial Memorandum that no extra staff will be neces- sary, although £½ million will be spent on doing the same job.
My hon. Friend should be fair about this. Perhaps he will give it some thought. The whole purpose is to transfer the functions of the British Travel Association to the British Tourist Authority, but the Authority is to be given more money to spend. Perhaps my hon. Friend would ask the President of the Board of Trade whether he proposes that the British Travel Association in its new guise shall continue with the same staff that it had hitherto. I greatly hope that the answer will be "Yes", but nobody has yet asked that question.
I have thought about it a good deal. If my hon. Friend would care to read the Explanatory and Financial Memorandum he would find that the question he has asked is very largely answered. The reason for setting up the Authority is to transfer into the Government's hands the power to do this job. The existing organisation is perfectly able to perform these promotional activities.
The Government's second intention here is to pour money into the tourist industry. If that be their intention, I am the last to refuse it on behalf of my constituents. Comments have been made—I shall not elaborate them—about the way in which money is being taken from the industry through the S.E.T., which is such an iniquity in most areas, and is then to be returned through grants under the Bill. This is the straight political doctrine of right hon. and hon. Members opposite. Their political philosophy is that money is better in public hands, and their proposals under the Bill are just part of the way in which they are bringing that about.
One objection I have to the grants proposed is that under a tourism Bill a good deal of the money will go into improving hotels which have nothing whatever to do with tourism. I take the example of a hotel in a small dingy provincial town which never sees a tourist from the beginning of the year to the end, a hotel used almost entirely by commercial travellers and those who have to visit the town for business reasons.
Another example is an establishment providing "night hawk" facilities for lorry drivers going up and down a main road. I know something about this. [Laughter.] I say that because I have an interest in a business of that kind. If someone wants to put up a new hotel entirely for lorry drivers, he will, as I understand, be able to have grant under the Bill to do it. It seems absolutely fatuous that under a Development of Tourism Bill we should give assistance to a purely commercial affair nothing whatever to do with tourism. It is quite wrong.
I do not see why it is necessary to set up the new statutory body, the new B.T.A., to pay out the money. The Leader of the Liberal Party was entirely right to point out that the Board of Trade already gives away industrial grants in development areas through its own departmental organisation. This legislation is unnecessary on that score. The Ministry of Agriculture gives large grants to farmers in a similar way to that proposed in the Bill, but it is done by the Ministry's machine. There is no need to set up a great new public authority for the purpose.
The third intention is to compile a mass of meaningless statistics. My hon. Friend the Member for Eastbourne (Sir C. Taylor) spoke about that, and I shall not elaborate it.
How will the Bill affect my constituency? My constituents will regard it as just another tier of statutory authority piled upon them. I very much agree with what the hon. Member for Merioneth (Mr. William Edwards) said earlier. The economic planning councils already have a function in tourism. The Northern Planning Council produced a great book with a chapter on tourism. It makes studies and surveys of golf and water sport facilities, all part of the tourism functions of an economic planning council.
In the North of England now the Rural Development Board is being set up under the Agriculture Act, 1967, and this body, too, has powers to give assistance to tourist facilities. Under the Countryside Act, 1968, the Countryside Commission has power to do all sorts of things for tourism, particularly in the Lake District—grants and loans, country parks to be established, the local planning authorities allowed to create camp- ing sites, picnic sites, car parks and all the facilities going with such amenities.
In the Lake District, another amenity proposed for tourists is a theatre at Windemere, for instance. The Arts Council will help there. I do not understand why we must have a new authority on top of all the existing ones to help tourism in my constituency. If the need is to help tourism, all the facilities and bodies are there to do everything necessary.
I shall not vote against the Bill, because if the Government are intent on pouring money on my constituents, who am I to oppose that? But the whole thing is grossly unnecessary. We have tier upon tier of statutory bureaucracy piled upon us. It reminds me of a wedding cake. This is typical of the sort of marzipan and icing sugar society that the Government have created for us. If we get much more, our whole society must topple, and this is the sort of Bill that will finally do it.
The hon. Member for Rutland and Stamford (Mr. Kenneth Lewis) dealt with the problem of communications. People leaving this country or coming to it today seek to use air transport as much as they can. They want as long as possible at their holiday resort, and therefore want to get there as quickly as possible. Air transport has been increasing immensely, and perhaps sooner than we realise the jumbo-jets carrying 300, and later 500, passengers, will be with us. I hope that when that stage has been reached we in Britain shall not still be arguing whether we are to get a jumbo-jet for 250 passengers. I hope that we shall have resolved that problem by then.
Sooner than we think, massive hoards of tourists will be coming into our airports—London, Manchester, perhaps Newcastle, and so on. What preparations are being made to handle these massive crowds? Those of us who use London Airport know how busy it can become in the holiday season merely handling the ordinary holiday traffic. What will it be like when the tourists are landing in massive numbers? As a regular user of London Airport, I do not see any preparatory steps being taken to deal with those crowds. Moreover, how are we to meet the problem of their transport into London, to which they will first go?
I did not mention Glasgow Airport because at present that is a contentious issue, but there is no reason why I, as a loyal Scot, should not say that tourists come to Glasgow because it is the finest tourist centre in the United Kingdom. From Glasgow, one can go by bus, sea, rail and air to some of the most beautiful parts of the United Kingdom. I am not selling Glasgow; I want to prevent it being sold. I hope that it will maintain its position, and that my right hon. Friend will see that it does. At present, the tourist comes to Glasgow by B.E.A. from London, having flown to London by B.O.A.C. I want to see that he goes to the other places in Scotland by means of one or other of the routes I have described. In speaking for Glasgow Airport I am not saying anything against any airport in any other part of the country.
I take a different view from most of those who have spoken in the debate. If the Government, at long last, want to do something to help at any rate part of the tourist industry, we should encourage them to do so. I have made a study of this matter for a considerable time, and certainly over the last nine months, and have tried to put down my findings in writing. I shall speak briefly now, but in Committee we shall have an opportunity to develop some of the themes with which we should deal.
Neither this Government nor their predecessors have ever had a national tourist policy. I have bitterly regretted this for many years and have campaigned, very inadequately, for such a policy. Again, no one has yet defined what tourism means, nor what is a tourist. But these are important considerations. The Bill is a misnomer. It is really a hotel incentives Bill explained as a Bill to promote a new Authority.
Am I right in assuming that, under Part I, the Government do not mean to replace Mr. Lickorish, the General Manager, Lord Geddes and other members of the staff from carrying on, although of necessity they have now become a statutory Authority? So far, the board has been a company limited by guarantee. I do not ask for an assurance that every individual will be retained. Will, however, the staff in general be retained?
Secondly, will the Government please retain the existing committees, including the voluntary ones? Merely because one works for a statutory authority one does not have to be paid. Will, for example, the excellent committees which deal with historic homes and consumer interests be retained in substantially the same form?
Part III of the Bill deals with registration and grading. I believe that registration is necessary but that grading is out of date. The qualitative type of attitude is no longer necessary. I will not say why I believe it to be so, but in Committee I shall explain why I believe that registration is necessary. In any case, the reserve power acts as a single deterrent. If someone does not get in one's book, he cannot get trade. Any travel agency will tell us that.
Part II deals with the Hotel Incentives Scheme. In the main, what the traders always wanted was to be able to obtain loans on preferential terms rather than grants. The Government may find themselves wanting to go in reverse on this matter. If they do, as a quid pro quo they may wish to go a little further than they are proposing. Would the Government consider some form of hotel bank, an institution concerned with loans rather than grants?
Will the Government please take a careful look at Clause 8? It is completely out of date to say that one must have an evening meal in a hotel and I am not sure that one must have a lounge in modern hotels, of which I see something. I was late because I was dealing with a planning appeal concerning hotels.
I want to put an idea to the President of the Board of Trade and his staff. If he is to get effective control of hotel policy, the right hon. Gentleman must persuade the Minister of Housing and Local Government to release to the Board of Trade the decisions as to what are to be the hotels and how. That will involve seconding some staff from the Ministry of Housing and Local Government to the Board of Trade so that they can make the decisions under one umbrella—for example, whether a hotel should be built and under what terms. Such an idea should already have been considered.
There are many things which need to be done to make the Bill infinitely better. It is not very well drafted—the latter part is an abomination. As to Clause 4—the idea of having specific projects—I disagree profoundly with what other Members have said. It is absolutely essential that we have a national conference centre in London, and quickly; it is absolutely essential that we have a national booking centre for hotels, quickly.
No one will set these up because they are loss-makers. The G.L.C. will not do it, and has told the Government so, unless it gets a grant. This is a perfect project. Will the Government please tell us what is the sort of thing which they regard as being a suitable Clause 4 project?
Generally, the debate has been rather poor for two reasons. It has been far too parochial. We have had far too much of Wales, too much of Scotland. The team from the South-West were brilliant, absolutely brilliant. I take my hat off to them. They way they handled their case, the way they hit the ball over the net and knocked the Welsh and the Scots out, was excellent. But this is not a game of tennis with my hon. Friend the Member for Rutland and Stamford (Mr. Kenneth Lewis) as referee. This is more serious. It is an international Bill to deal with tourism and I greatly hope that we will approach it in a far more nonparty spirit in future.
My hon. Friend the Member for Isle of Thanet (Mr. Rees-Davies) is a student of the tourist industry and managed to pack into seven minutes a great deal of knowledgeable comment on the Bill. He congratulated the hon. Members from the South-West, and they do deserve hearty congratulations. They made scintillating speeches. I do not agree that the ball always went over the net, sometimes the ball landed squarely on my back, but I do not complain of that. It was a fascinating debate with a lot of strong feeling. Now we must try to sum up.
I may carry some of my hon. Friends with me when I describe the Bill as a very patchy palliative of a Bill. Because it has a palliative element I suggest it should not be opposed. I do not deny that it has very undesirable features. I start with Part II. This is the reason for the urgent presentation of the Bill. It provides for financial assistance for hotel development. In essence it is no more and no less than a rescue operation, intended by the Government to offset a small part of the damage that their previous fiscal, tax and monetary policies, have caused to the tourist industry.
Like all industries in a developed economy the tourist industry should have its own momentum and balance. Provided the Government create a suitable economic context the industry should be able to look after itself. If demand changes or rises then supply too should change or rise. We now have the expectation that tourist demand, particularly from overseas, is rising, but supply is not. Why is this? What has gone wrong with the market operation of this sensitive, sophisticated, complex industry? On this my hon. Friends and I see eye to eye. What has happened is that the Government have insensitively, probably not realising what they were doing, heaped on the tourist industry burden upon burden which has wrecked its capacity to respond to rising and changing demand. I am not saying that we on this side of the House were exactly the toast of the tourist industry every year of our period in office. But we cannot begin to compete with the Government in what appears to be their positive prejudice against the tourist industry.
Does the House realise that Lord Crowther's letter, which has been referred to several times, was written before the Selective Employment Tax was invented? I will read a few lines which my hon. Friend the Member for Moray and Nairn (Mr. Gordon Campbell) did not read. Lord Crowther said that he did not think that
the Government yet realises"—
this was in February, 1966—
what it has done to one of the country's main earners and savers of foreign currency".
That was before the S.E.T., before increases in Corporation Tax, and before the screw was turned in a number of ways.
Now the Government face a loss of foreign currency and they rush to the rescue. This Bill is, above all, as to its timing, a balance of trade operation. It is not concerned with the basic health of the tourist industry. That is why my hon. Friends who have criticised it are abundantly right. It does not attempt to deal with the basic health of the tourist industry. It deals with one specific tourist problem, and that is the question of increasing the supply of hotel rooms, because the supply and demand response has broken down due to Government burdens.
Because the Bill does not attempt to deal with the basic health of the tourist industry, it is no wonder that the telegrams are pouring in. The telegrams are quite right about the Bill as it is. The tourist industry will have to wait until we return to office for a more understanding approach to it.
I would need a lot of convincing that that was true, but if it is I am delighted to hear it. It does not accord with the impression I get from reading the newspapers.
The instrument of help provided in Part II of the Bill is the investment grant. We on this side of the House dislike investment grants intensely. Investment subsidies, like all subsidies, need justifying up to the hilt. But, of investment subsidies, investment allowances seem to us far less of an evil than investment grants for reasons which my hon. Friends have put very well. We therefore dislike the method of Part II. We accept the need for it and, although we deplore the method, I think we all hope that it will be successful in creating more hotel rooms.
I turn to Part I of the Bill. I echo the tributes of my hon. Friends to the British Travel Association. It has done an absolutely first-class job. Replacing it by a British Tourist Authority could make sense—to allow a statutory body to co-ordinate other statutory bodies and to stimulate the industry and to market and promote for the industry. But, as my hon. Friend the Member for Blackpool, South (Mr. Blaker) said, it can make sense only if there is a working co- operation between the new authority and the industry. I share the surprise of my hon. Friend the Member for Blackpool, South that the President of the Board of Trade did not find time to refer to this essential co-operation. The industry involves a myriad of inter-related parts, each with its own specific interest and each self-motivating. It is idle to think that the proposed British Tourist Authority will be in any way as effective as the British Travel Association unless it wins the co-operation of the industry.
I hope that the Minister of State will say something about the Government's intentions. How will they recover from the unfortunate birth of this Bill on which consultation was omitted? How will they convince the industry, which is used to working with the British Travel Association, that it will find the British Tourist Authority equally understanding?
Part I naturally provokes the strong regional feeling expressed by many of my hon. Friends. We must try in Committee, so far as the Long Title enables us, to rectify the defects in this Part of the Bill. It is not only the South-West that will require to know how its interests are to be safeguarded, and it is not only the regions of the country in the normally understood sense; London and the South-East remain the main tourist magnet for overseas and an essential part of many home holidays. We shall need to satisfy ourselves in Committee that more regard can be had to regional requirements and regional feelings.
What, we ask ourselves, is this new British Tourist Authority intended to do? We recognise the job of promotion, marketing, co-ordination and stimulation; that we all accept. But we find it hard on this side of the House to understand, from the relatively slight time which was given to them by the President, what Clauses 3 and 4 are intended to do, and we shall want to examine these fully in Committee.
We accept that there may be a case for some triggering operation occasionally in order to start a process for which private enterprise will meet the market demand. But we are not an underdeveloped country; we have a magnificent private enterprise system and a stalwart local authority system, and there should be precious little that Clauses 3 and 4 need to do if the tasks are approached in the right way. There may be individual cases, and we shall listen to the explanation in Committee before coming to a conclusion.
On this part of the Bill I must ask the Minister of State to say a word about Northern Ireland. It has a particular relationship to the British Travel Association. What will be its relationship to the British Tourist Authority?
I turn, finally, to Part III, on registration. We on this side of the House find that the voluntary system has worked extremely well, that there are a number of guides and that the guides are improving. We find it hard to justify registration, let alone classification, grading or even, perish the thought, inspection. What justification can there be, in the light of the growing and improving voluntary guides, for all the paraphernalia of staff, cost, inspection and penalty? I ask the Minister not to tell us that other comparable countries depend upon statutory guides. They may have statutory guides, but the people who visit and spend holidays in those countries use the voluntary guides.
We shall try, in Committee, to put the powers of Part III at least into reserve, if not into abeyance. We shall try to make Part I more sensible. We hope that Part II achieves its purpose, but the basic health of the tourist industry as a whole will need far different treatment from that provided by the Bill.
Before today's debate began there were strong rumours of internal oposition difficulties over this Bill. "West M.P.s rebel", one headline ran. "Scots and English Tories split" was another.
I was prepared to believe that this was an exaggeration of the difficulties within the Opposition, but the reports have been fully reflected in the debate, not least in the opening speech of the hon. Member for Moray and Nairn (Mr. Gordon Campbell), who was not allowed to tread, as he sought to do, softly around his case. Had the Opposition decided officially to vote against aid for hotels and a new organisation for tourist development, as the majority of speakers on that side of the House would have had them do, we would have rejoiced. This would have been self-inflicted damage.
We shall see at the end of the debate if there are many hon. Members who choose to go on record against a new organisation for tourist promotion and development, new incentives to the hotel industry and provision for support for tourist projects. That is the logic of most of the speeches which we have heard from right hon. and hon. Gentlemen opposite. They do not like the Bill. They do not like any of its provisions. One of them said that its structure is wrong. The logic of all that is to go on record against it.
For my part, and for all hon. Members on this side of the House, although it is possible to argue about one aspect or another and although there may be Committee points to be dealt with in due course, this Bill is a charter for tourism. It provides a framework for development. It would be very unfortunate for Britain if the House went on record against it.
The right hon. Member for Leeds, North-East (Sir K. Joseph) made a very reasonable speech. However, all that he said failed to paper over the cracks on the other side. The schizophrenia of hon. Members opposite is painful. They want more boards and less bureaucracy. They want more spent on tourism, and almost everything else, but, of course, less public expenditure. They complain about delays, but consider that consultation did not go far enough.
Last week, the hon. Member for Eastbourne (Sir C. Taylor) suggested to my right hon. Friend the Leader of the House that this Second Reading was a bit early. The hon. Member for Tiverton (Mr. Maxwell-Hyslop) repeated that today. It may be a bit early for some hon. Members opposite, but, believe me, it is not too early for many of those in the industry who have been urging us—as have a number of hon. Members, including the hon. Member for Blackpool, South (Mr. Blaker)—to produce the Bill and carry it through because of its incentive provisions for the hotel industry.
The hon. Gentleman has misrepresented the position a little. The complaint is not that the Bill had its first Reading too early, but that there was inadequate time between First and Second Reading for proper consultations. Local authorities have put that view to me.
I fully understood that point. The complaint is that we published the Bill and have taken the Second Reading too soon. However, I think that the majority opinion in the industry would be that, having published the Bill, it was our duty to bring it before the House as soon as possible so that we could have our debate today.
I am sorry that there was not sufficient time, but, on occasions like this, most of us find it possible to make representations and, as a number of references today have shown, there has been time enough for others to make representations to us.
The plain fact is that the Opposition see much merit in the Bill, but resent having to give the Government credit for it. That is a pity. The subject is too big and too important for such pettiness. In fact, the positive prejudice which the right hon. Member for Leeds, North-East mentioned has been shown in the speeches of right hon. and hon. Gentlemen opposite today, with one or two notable exceptions, one of which was the very constructive speech of the hon. Member for Isle of Thanet (Mr. Rees Davies). For the greater part, they have not been concerned with constructive policies, but only with making a thorough nuisance of themselves. They are entitled to do so. But this is an important Bill. It is good for Britain and we want to make progress, or hear constructive comments which will enable it to be further improved later.
I was struck by the remark of the right hon. Member for Argyll (Mr. Noble), who made a very thoughtful speech. He made an appeal to the Front Bench that he has lately left. He asked that at the next election there should be a Tory policy for tourism. That sums it up. There is no Opposition policy today; only a reflex. They are united only in hostility to S.E.T.
The more I heard about S.E.T. today, the more I was persuaded that this is not a subject upon which the House is prepared to have a rational discussion. I could repeat what my right hon. Friend said about S.E.T. not necessarily affecting profits or investments. I could point out, as did the hon. Member for Oswestry (Mr. Biffen), the irrelevance, for the most part, of investment allowances. I could indicate that the limited concessions last year on S.E.T. for hotels in rural development areas was justified, because in those areas alternative employment is not so easily available. But I do not believe that, whatever my arguments, I should change opinions today or thereby advance the course of the development of tourism. We must await Reddaway and other occasions for this.
I want to make one point about aid for the industry and for promotion and development, which ought surely to go on record. During the last four-year period of the previous Conservative Government, the average grant in aid each year to the B.T.A. was in the region of £1,400,000. The average for the four full years of this Government is £2½ million—an increase of 75 per cent. Those who complain about this Government's attitude to tourism, and suggest that the tourist industry is on its knees, do not help the industry; they deny the facts of the growth of tourism and the support which has been given to the B.T.A.
Doubts have been expressed about the adequacy of consultation. The hon. Member for Moray and Nairn (Mr. Gordon Campbell) and the hon. Member for Blackpool, South mentioned this matter. I do not think that such criticism is justified, but I should like to deal with it, because it is a serious point. Were those doubts justified, I should be sorry. Certainly, considering the constant pressure in this House for action, of which I do not complain, I think that we have consulted very fully. Once again, the Opposition cannot have it both ways.
My right hon. Friend first declared his intention to introduce a new hotel incentive scheme on 20th March, 1968—nearly a year ago. The White Paper, published in May, which also made clear our intentions on registration, in paragraph 44, states that the Government are considering the possibility of organisational changes. On 13th November last, my right hon. Friend made a full statement to the House, which the Bill closely follows.
I think that such a lengthy period of preparation, with suitable stages within it, would have provided every interested body with a chance to make its views known to us. Many have done so. Most representations have been in writing. I am not aware that at any time consultations with officials on detailed matters have been denied either concerning the White Paper or the statement of my right hon. Friend on 13th November last.
As hon. Gentlemen opposite know, there is a difference between consultation and acceptance. We have listened to, and carefully considered every comment and suggestion. We have not always been persuaded, we could not have been, in so far as some representations have inevitably been contradictory. In particular, we have been in close consultation with the B.T.A., and my right hon. Friend has already paid tribute to it for its work. We very much appreciated its constructive advice at all stages.
As the right hon. Gentleman said, it is important that we should have its continuing good will during the hand-over stages. We are anxious that relations which the Association has built up with the industry should be maintained. We shall play our part, and I am sure that the B.T.A. will continue to be as helpful as it has.
I shall come to that in moment.
Apart from frequent discussions with officials, Ministers have been in close personal contact with Lord Geddes, and I shall be seeing him next week. The B.T.A. has not complained of a lack of consultation. We have been anxious for its advice. We need it still, and we are very ready to listen.
In formulating proposals we have properly regarded the B.T.A. as the main channel of communication for the industry, while not excluding any other. There is no need for me to list all the organisations represented on the Council of the B.T.A. It is very extensive. Even the much smaller board gives a good spread of interests—hotels, catering generally, breweries, transport, travel agents, local authorities, and so on.
There has been unanimous praise for the B.T.A. today. Some of our critics outside the House have also named the B.T.A. as their model. Surely it is churlish to argue that its virtues do not extend to being the best vehicle for conveying the distilled wisdom of the industry to the Government? That is why we have relied on it, and if hon. Gentlemen think that we were wrong, they are free to say so.
I am, however, aware that the British Hotels and Restaurants' Association has felt a sense of grievance in this matter. I have looked carefully into the history of this, and I do not find the complaint justified. I hope that the House will forgive me if I refer to these details, but this is the only way to establish the point, the complaint having once been made. I have found correspondence from the secretary, on 3rd April last, saying how much he appreciated our invitation to let us have comments in advance of the publication of the White Paper, and similarly, on 17th June, acknowledging the invitation to put forward observations on the White Paper. Not until 27th January of this year were Ministers asked to receive a deputation, and this was immediately agreed.
I must add that the Chairman of the Council of the B.H.R.A. is also a member of the board of the B.T.A. Be that as it may, in so far as the B.H.R.A. has felt a sense of grievance, I am sorry. I said this to its deputation last week, and offered to be personally available for consultations during the progress of the Bill. I shall be seeing them again next week, and Mr. Hugh Wontner has kindly expressed his personal appreciation. In so far as there were hatchets to be buried, they are now several feet under.
As my right hon. Friend said, it seemed good sense to us, involving the fullest utilisation of brains and manpower, to put the functions of promotion and development together, but we had no preconceived view of how this might best be done. It was only after thought and discussion that we settled upon the form embodied in the Bill. I have listened to the contributions to the debate today, not primarily in order to shoot them down, but to discover whether there is a convincing alternative which we might have overlooked, but none has emerged.
There are advocates for the solutions which we rejected, but no original proposal. We seriously considered the advantages of a separate English board, but concluded that it would be either wasteful of resources, bureaucratic in the sense that hon. Members opposite so much dislike, or, if it led to the extinction of the British Tourist Authority, would fragment effort and impede overseas promotion.
More important, a board of seven members was hardly likely to satisfy the intense feelings, the passions, which we have seen today of different parts of England. In that assumption, we have been amply justified. The South-West, it seems, wants a board to itself, but the Lakes, or Northumberland-Durham, spoken for by my hon. Friend the Member for Blyth (Mr. Milne), or the Thames Valley, or Norfolk, for which my hon. Friend the Member for Yarmouth (Dr. Gray) made an eloquent plea, could make the same demand. This would be bureaucracy run mad, especially if we included Rutland as well.
Even in the South-West—distinct holiday area as the right hon. Member for Devon, North (Mr. Thorpe) called it—there are divisions of opinion. Cornwall is very proud of its identity and traditionally distrustful of Devon. It wants to run its affairs on its own. We all know the problems that there have been in the South-West of getting a united voice speaking for the South-West. Corn- wall wants to be on its own and, in the end, if we followed this path, we would have not two boards or three but 22 or 23. Surely that would be bureaucracy taken beyond the point that anyone could tolerate.
But, of course, we want to see the new regional organisation well backed by regional interests, both public and private. We want to see the voluntary regional associations grow. We shall seek to encourage them, and we believe that the English Advisory Committee will be able to speak for the different and diverse regions of England. The Bill does not legislate for Northern Ireland, nor for the Isle of Man or the Channel Islands, but we know that the respective Governments welcome the provision in Clause 5(3) by which the British Tourist Authority will be able to help with the promotion overseas of tourism to Northern Ireland and the Islands in consultation and co-operation with their own organisations.
We do not claim that the Bill will transform the tourist industry. In any case, transformation is not what the occasion requires. It is, however, a charter for tourism. One of Britain's great attractions is the diversity of its countryside, the great contrast between regions each of which has so much to offer. I acknowledge and respect the genuine local patriotism of the kind which has found powerful advocates today, but it would be unfortunate if this diversity led to fragmentation of effort or a less than wholehearted willingness to make the new tourist organisation work.
In the end, the success of tourism depends upon the individual efforts of many hundreds of thousands of people and, for foreign tourists, the welcome which they get when they arrive from overseas. But the Bill is a step in the right direction which should be supported.
The hon. Gentleman has brushed aside the criticism from this side with the arrogance which we have come to expect from the Government. I was surprised to hear him also discuss the hatchets which are supposed to be so deeply buried so far as the British Hotels and Restaurants' Association is concerned—