Scott Wright: Scottish industry right to be furious at Tory ‘drunk on cheap labour’ slur

A MAJOR campaign has just been launched to entice foreign tourists to holiday in Scotland again – and it could scarcely be timelier.

The new drive from VisitScotland seeks to ensure Scotland is “front of mind” among potential holidaymakers in key markets such as the US, Germany and France when they are contemplating plans for vacations in the months and years ahead.

It is the opening salvo in what looks certain to be a difficult and long bid to rebuild the Scottish tourism industry following the devastation stemming from the pandemic.

There may well have been a significant – and welcome – upsurge in staycations this year, but talk to tourism industry experts and they will tell you this has not been enough to make up for the continuing absence of foreign visitors in meaningful numbers.

And what makes their absence even more keenly felt is the fact that foreign tourists spend more highly than domestic holidaymakers.

Statistics show that, before the pandemic, visitors to Scotland from the US and Europe spent respectively four times and twice as much as their UK-based counterparts.

This is not down to UK tourists being unduly parsimonious: the domestic market tends to be based on short breaks and confined to single locations. By contrast, overseas visitors typically stay for longer and distribute their expenditure around the country.

Vicki Miller, director of marketing and digital at VisitScotland, outlined the pressing need to address this issue in an interview with The Herald last week. While there has been “some very early recovery” in parts of the market, she said it has not been felt by those businesses that depend on foreign visitors, including cultural attractions and tour operators that cater for foreign tourists.

The recently-announced relaxation of the UK testing regime for people arriving from non-red list countries should help, but the market will not spring back instantly.

“We know there is pent-up demand because people have not been able to do it (travel from overseas to Scotland),” Ms Miller said. “But equally we know that if you are travelling that bit further on holiday, you are going to take time to plan it. It is not going to be an overnight decision to all of a sudden come from America to Scotland, or indeed from some of our key European markets.”

Ms Miller’s assertion that recovery has still to get underway in parts of the tourism industry was quickly reinforced by a major survey last week, which laid bare the continuing difficulties faced by the visitor attraction sector.

The Association of Scottish Visitor Attractions, which represents more than 240 organisations spanning 500-plus sites, found that in the first fortnight in September turnover was down by in excess of 50 per cent at more than one-third of destinations when compared with the same period in 2019.

It also found that nearly half of the sector (47.5%) had seen a decrease in visitor numbers of greater than 50% this year, again when compared with 2019.

Based on such findings, it was no surprise to hear the ASVA declare that there has been no staycation boom this year, at least as far as its part of the market is concerned.

“The pandemic has had a truly devastating impact on Scotland’s visitor attractions and these latest results provide further evidence that this impact is still very much being felt,” said chief executive Gordon Morrison. “I cannot emphasise strongly enough that, despite a number of media reports to the contrary, there’s been no ‘staycation boom’ or widespread economic recovery for our sector this year, and we face a very challenging winter period ahead.”

The problems facing Scotland’s visitor attractions are not solely down to the lack of visitors from overseas. In common with the wider tourism and hospitality sector, they are also being held back by a chronic shortage of staff, linked to both Brexit (which ended the huge benefit of free movement between the UK and European Union) and the ramifications of the pandemic.

Amid widespread staff shortages, the ASVA survey found that less than half (48.1%) of the sector is currently fully open, while 40.9% of outlets are running with reduced hours or limited capacity. More than one in 10 attractions remain closed.

“Tourism like many other industries in Scotland has been hugely impacted by the loss of EU workers as a direct consequence of Brexit,” said professor John Lennon, director of the Moffat Centre at Glasgow Caledonian University, which carried out the survey for the ASVA.

“The ability to adequately and safely staff operations has become the next insurmountable challenge.”

Unfortunately for visitor attractions and many other businesses in the tourism and hospitality industry, there is no prospect of the UK Government responding to these genuine concerns.

Although a small number of temporary visas have been granted to allow companies to hire heavy goods vehicle (HGV) drivers from the EU, it seems very unlikely that any such benefit will be granted to tourism and hospitality.

Instead, what we now have is rhetoric from the Conservative Government this week that business is “drunk on cheap labour”, and that the current staff, goods and fuel shortages we are seeing is because of a lack of planning for free movement ending.

One imagines this will be a particularly bitter pill to swallow for many in business who warned for years that Brexit would bring precisely the kind of chaos we are witnessing now, and who were given little practical advice from the UK Government on how to prepare for the country being ripped out of the single market and customs union.

For Marc Crothall, chief executive of the Scottish Tourism Alliance, this dismissive attitude ignores the strenuous efforts made by his industry in preparing for the “exodus” of staff Brexit sparked. This, he said, has ranged from supporting employees to achieve settled status to firms offering increasingly attractive pay packages at a time when resources are stretched to the limit.

“The sector has been focused on improving employee benefits and reward for many years,” Mr Crothall said. “Businesses are raising wages to the highest level they can afford; right now many are offering 30% more than they did two years ago.

“They’ve focused on work culture, benefits, health schemes, pension contributions, work/life balance – we are at a point where we cannot do more.”

In Mr Crothall’s view, the “drunk on cheap labour” accusation peddled by the UK Government shows “just how far removed” Boris Johnson et al are from the reality facing businesses.

“There is no value in any government pushing blame to businesses with a ‘you could have done more’ attitude,” Mr Crothall added. “Frankly, it highlights just how far removed the UK Government is in its understanding of the sector’s potential and its ability to make significant contribution in driving economic recovery, our supply chain and the very real and intense challenges faced by business owners every single day.”

If the UK Government is not going to start issuing temporary visas to help hospitality and tourism ease the staffing crisis, there are other ways it could assist. Trade bodies are now throwing their weight behind calls for value-added tax to be locked in at the current temporary rate of 12.5%, instead of it being returned by the Government to its pre-pandemic level of 20% in April.

Given the continuing struggles facing the sector, it would seem like a logical step that could help businesses remain competitive. Indeed, there is some evidence from countries on the European continent that lower rates of VAT can bring in greater tax revenues, chiefly because it makes bars, hotels and restaurants more price-competitive and appealing to potential customers.

Sadly, logic seems to be in short supply for this UK Government when it comes to safeguarding the good health of this most-important industry.

The Herald Scotland

The Herald Scotland

The Herald is a Scottish broadsheet newspaper founded in 1783. The Herald is the longest running national newspaper in the world and is the eighth oldest daily paper in the world. The title was simplified from The Glasgow Herald in 1992