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How the Department for Transport is supporting the travel and tourism industry.
Thank you for that introduction.
And thank you ladies and gentlemen.
It’s a real pleasure to be here.
And a welcome opportunity to talk about some areas of government policy that impact on your industry.
The importance of tourism is something my constituents have appreciated for years.
347 years, to be precise.
Because that’s how long Scarborough has been a holiday destination.
Initially visitors came to benefit from the health-giving properties of its spa waters.
And later, as the town developed, they also came to enjoy the beaches on what we like to call the Yorkshire Riviera.
In fact, Scarborough has a strong claim to be Britain’s first seaside holiday resort, an early pioneer in an industry that today directly contributes £58 billion annually to the UK economy.
So strong is UK tourism that it has continued to grow during the downturn, helped of course by events of global interest, like the London Olympics, the Queen’s Diamond Jubilee, and the royal birth.
Last year overseas visitor numbers reached 32.8 million - an all-time high.
And they spent over £21 billion when they were here – a staggering increase of 12.7% up on the previous year.
There was particularly encouraging growth in visitors from rapidly growing economies like China and India - which illustrates the changing nature of tourism in a rapidly evolving global economy, and the prizes on offer for countries that sell themselves abroad, and reach out to markets with a high growth potential.
Clearly that’s something we’ve been doing well - and when I say ‘we’, I mean all of us: the tourism and hospitality sector; government; aviation industry; trade associations.
Lots of people have contributed to the growth in visitors over recent years.
And building on that success, making sure that Britain remains a leading destination for global leisure and business travellers in the future, will also be a co-operative effort.
That’s why we’ve recently announced the creation of a Tourism Council.
This will bring together government and industry together to co-ordinate efforts on strengthening the tourism sector further by focusing on jobs and skills.
The council will be made up of 22 members representing a broad range of organisations and interests, including businesses from the travel, hospitality, accommodation and entertainment sectors.
The first meeting will be next month.
We do not underestimate the importance of the outbound travel industry, either.
Last year’s the Association of British Travel Agents (ABTA) estimated the value of outbound tourism to the UK economy at £31 billion.
We want to help tourism businesses through better and less regulation.
So we’ll be looking at regulations that government is responsible for – and the impact this has on business.
The aim is to remove obstacles to greater leisure and business travel.
We are all aware of the current issues with passport applications.
Indeed, a number of my constituents have been in contact with problems – which thankfully we have always been able to resolve.
The Home Secretary has put in place a number of measures to address the level of demand.
Overseas customers renewing an existing passport are now able to apply for a 12 month extension in the country of application.
Instead of a passport, emergency travel documents are available for children living overseas who wish to travel to the UK.
And UK applicants with an urgent need to travel are able to get a free upgrade, which will speed up processing, printing and delivery of their passports.
After already issuing more than 3 million passports this year, the new measures are designed to make sure that people get their passports in good time for the summer holidays.
I know the Passport Office values its relationship with ABTA very highly. And I would be keen to hear from you of any impacts on the travel industry from these recent difficulties.
Together with the wider travel industry, ABTA has also made a valuable contribution to the call for evidence on Air Travel Organisers’ Licensing (ATOL) reform.
I’d like to thank you particularly for running a series of workshops for members across the country.
We had a real variety of views from respondents on the future organisation of financial protection and funding.
We plan to publish our response later this summer.
That response will be co-ordinated with another – from the Department for Business, Innovation and Skills, following the call for evidence on the proposed Package Travel Directive (PTD).
I think we all agree that consumer confidence in travel and tourism is of huge importance.
And the proposals to update PTD do reflect changes in the leisure travel market.
But there are elements of the package where we have concerns.
Those travellers affected must be able to understand when and whether they are subject to cover.
Currently there is insufficient clarity on its scope – particularly on the difference between the ‘package’ and the ‘assisted travel arrangement’ models.
Secondly, it’s crucial to establish the limits to protection.
Insolvency protection, for example, should reflect a realistic assessment of the established risks to consumers.
But the new approach – based on where the business is based rather than type of sales activity – might undermine protection.
Thirdly, we want to explore the possibility of deregulating domestic packages which do not include a transport element.
We doubt that the extra burden it places on business can be justified in terms of consumer benefit.
Because changes to ATOL policy are inevitably dependent on the outcome of negotiations on the PTD, we aim to publish the 2 responses together.
As far as my own department is concerned, one of the best ways we can help you is investing in better transport links in the UK.
The HS2 Hybrid Bill is making good progress.
Crossrail is being built – on time and on budget.
We’re investing record sums in the rest of the railway.
And we’ve tripled the budget for major road schemes.
In fact there will be £70 billion of capital investment in transport over the next Parliament.
Airports across Britain continue to improve facilities for passengers and invest in new capacity.
Just recently, Heathrow Terminal 2 opened.
The £2.5 billion scheme is one of the largest privately funded construction projects in the UK.
As you know, the Coalition Government set up the Airports Commission to advise on the UK’s future airport capacity needs.
In its interim report, the Commission concluded that there is a need for a net increase of one runway in the South East by 2030, and probably another by 2050.
Three options, two at Heathrow and one at Gatwick, were shortlisted for further work by the Commission and a fourth, an Inner Estuary Airport will be studied further to determine whether it should be added to the shortlist.
Surface access is another important area where the Airports Commission has been making recommendations.
The government’s National Infrastructure Plan began the process of implementing these recommendations.
They include £50 million of support towards:
- the enhancement of Gatwick Airport Station
- the provision of smart ticketing facilities at airport stations
and further work to enhance road and rail access to Gatwick, Heathrow and Stansted.
We won’t be commenting on any of the long-term options until the Airports Commission has concluded its work.
To sum up, I think there’s every reason for this industry to feel optimistic about the future.
As the economy recovers, demand for travel and tourism will continue to rise.
And we have to be in a position to meet that demand.
Despite continued pressure on budgets, the government is prioritising investment on transport to stimulate growth.
And we are keen to work even more closely with you to make sure we’re providing you with the support you require.
So that just leaves me to thank you for listening.