I am grateful to my hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies) for giving the House the opportunity to discuss tourism. His brief opening survey of the industry showed a close interest and an expertise which have been gained over many years. My hon. and learned Friend was closely involved in the consultations over the Development of Tourism Act 1969. As a consequence of his interest, that legislation was improved during its progress through the House.
I congratulate my hon. and learned Friend on attracting such an array of talent to his parliamentary committee from among our colleagues, not least my hon. Friend the Member for Romford (Mr. Neubert), who is now present in the Chamber. I know that the members of the committee will be offering their help both to me and to the tourist industry in promoting tourism in Britain.
My hon. and learned Friend stressed the valuable contribution made by tourism to the economic well-being of the country, and indeed to our general well-being. Although we may find that occasionally tourists are filling what we think of as "our" theatres and other attractions in London and other points of tourist pressure, I believe that it behoves us to remember that many of those attractions would not be economic, and indeed in many cases would not exist at all, if it were not for the revenue provided by tourists who come to this country throughout the year. A record number of 12½ million overseas visitors came to Britain last year, and spending by those visitors earned the nation £2·5 billion. Even allowing for expenditure by our own countrymen on their visits and holidays abroad, we calculate that the net earnings to our tourist industry approach the figure of £1 billion. That puts tourism firmly in the top league of invisible earners.
I do not believe that we can expect to maintain the phenomenal growth of tourism that this country has experienced in recent years. That occurred mainly because holidays in the United Kingdom were extremely cheap. There is already, as my hon. Friend underlined, some evidence of a decline in tourist visits. That has happened principally because of the strength of sterling, which has changed the relative costs of holidays spent in this country compared with holidays abroad. I also believe that this winter's chaos had something to do with the fact that a great many tourists decided not to visit Britain. The newspaper headlines did not make encouraging reading for those overseas who were made aware of the industrial relations and economic chaos engendered by the then Labour Government.
Following that, we had the fuel crisis and the extremely unnerving stories of terrible petrol shortages in the regions. My hon. and learned Friend the Member for Thanet, West was right to mention those because, although the Government were able to do something about correcting the stories, the best and most effective correction was made by the tourist boards—the ETB, the Scottish and Wales boards and the English regional boards.
I am happy to confirm that there are no parts of England, or indeed the United Kingdom, which are without petrol. As my hon. and learned Friend said, there is a difficulty sometimes at weekends because garages tend to close, but that will soon be straightened out by normal competitive pressures. The tourist authorities and I will do anything we can to encourage garages to run, say, a roster system to make sure, especially in the more remote rural areas such as Scotland, that there is always somewhere that tourists can buy petrol even on a Sunday.
A number of points have been raised, and I shall do my best to answer them. On the subject of tax incentives for hotels, the Government are in favour of such incentives as a means of helping to regenerate the economy. In this respect, hotels have always qualified for the 100 per cent. allowance for investment in plant and equipment. They now qualify for an initial allowance of 20 per cent. of capital investment in buildings, and an annual writing-down allowance of 4 per cent. to hotels meeting specified requirements.
It is correct to say that that is less than they would receive if they were industrial buildings. A powerful case has been made that there should be some changes in that area. I had better not say more about my feelings in that respect, except that I am aware of the case that has been made. Equally, I am aware that my colleagues at the Treasury would be reluctant to do anything that would reduce unduly its take of tax in these hard times. However, there is a balance to be struck and I hope that it will be a balance that we can demonstrate as sensible to the requirements of both raising revenue and encouraging investment.
My right hon. and learned Friend the Chancellor of the Exchequer, in his Budget, was able to introduce measures to help small businesses, which make up by far the greater part of the tourism industry. He raised the threshold of corporation tax and reduced the rate of development land tax. We will bear in mind the need for further action in that area.
My hon. and learned Friend referred to the unfair exclusion of the tourist industry from State aid in non-assisted areas. That applies to all sorts of industry, and I think that it is perhaps unfortunate in some ways that so much of the tourist industry is in areas that are not assisted. The object of regional assistance has been directed towards, not particular industries, but problems of unemployment in the region. In general, there is not massive unemployment in the South-East, although I accept that in some of the traditional holiday areas there are high rates of unemployment. We are looking at those matters in a review of the tourist industry which I am undertaking to see how we can best help it.
I noticed what my hon. and learned Friend said about the problems of bus licensing and the licensing laws. Those matters are for my colleagues at the Home Office and the Ministry of Transport. I can assure him that the Department of the Environment has already told local authorities—in April—that they should be encouraged to participate in tourism activities. That and the extent to which they comply with our advice are matters that are best decided by the local authorities rather than by me from Whitehall.
There is a good case for registration of accommodation, but it must be voluntary. We should not attempt to take powers, and then enforcement powers, with a further bureaucracy and inspectorate devoted to chasing landladies around because they have not registered their accommodation. I shall not comment on other reasons, although I can hear some muttering in the Chamber.
There are excellent guides, especially abroad, which are extremely accurate in listing available accommodation and prices. Although we may not do that quite as well in this country, we do pretty well.
I recollect that a year or two ago I asked my hon. Friend the Member for Ross and Cromarty (Mr. Gray) about hotels in his part of Scotland. He promptly supplied me with brochures from the Scottish Tourist Board which provided excellent lists and an excellent account of the facilities and prices of those hotels.
My hon. and learned Friend raised the question of my dual responsibilities—more than dual, indeed. I am responsible for the airline industry, the provision of airports, and tourism, and I think that it is the first time that those topics have found their home in one section of one Department. It is helpful that I should have all those responsibilities together.
I am aware of the problems of the somewhat high fares in Europe, and in some areas the fares are very high indeed. As my hon. and learned Friend knows, the IATA fare-fixing edifice has been crumbling fast in recent years, principally due to the entrepreneurial activities of Sir Freddie Laker and others like him. In addition, we have begun to accomplish real reductions of fares in Europe. I think that we will continue to obtain those reductions within the limits of what is possible considering such problems as the price of fuel. Even the traditionally non-competitive airlines are beginning to accept that in the modern competitive world they will have to keep their fares down or they will go to the wall.
I take the point made by my hon. and learned Friend about the possibilities of gaining from funds available through the European Community for the assistance of industry. I should not like to attempt, in the time available to me, to go very far into those matters. However, we are looking to see in what way we can use the European regional development fund, to which my hon. and learned Friend referred, and the other funds—principally, for example, those made available by the European Investment Bank.
There are considerable difficulties in the way of both of those, not least because the funds are available only in designated assistance areas. If we are to overcome that problem we must see either whether it would be possible to designate tourist areas or whether we could persuade our partners in Europe to take a slightly different view of the tourist industry from that which they take of other parts of assistance to the regions.
I am not unduly optimistic about either of those prospects, but certainly we will do our best to ensure that any money that is available from Europe will be directed to the tourist industry wherever possible.
There are one or two other matters that my hon. and learned Friend raised that affect other Departments, notably the problem of customs and immigration controls at airports. I have been well aware of the problems there and have asked my colleagues to see what they can do to help.
As my hon. and learned Friend said, there are so many matters that one could raise about this industry. He has raised a number of them and, to the best of my ability, I have dealt with them briefly. I look forward to co-operation between my Department and my hon. and learned Friend's new committee and, indeed, the boards and other authorities concerned with tourism. I hope that when I review these matters with the assistance of the boards and my hon. Friends we shall find that the future for tourism in Britain will remain bright despite the temporary difficulties.