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Tourism on the Treasury Radar

KURT JANSON is policy director of Tourism Alliance

Government reveals UK space tourism goal

Te government has backed plans for a four-fold expansion of the UK space industry, with the potential for an operational British spaceport within five years as it bids to cash in on the expected boom in space tourism. Science minister David Willetts


sually when there are govern- ment policies that impact on the tourism industry, we see a case of “the law of unintended

consequences” where the impact has been a result of the government trying to solve an issue in another area of the economy and not thinking about the impact of the change on the tourism industry. However, recently there have been a cou-

ple of decisions that have bucked this trend and have been specifically implemented to support tourism businesses. First the government announced it

was setting aside £2m to support tour- ism businesses in the wake of the winter flooding and storm damage. While not a huge amount, it is significant in that only tourism and farming businesses received dedicated support funding. Tis support was also in contrast to the 2001 Foot and Mouth outbreak when the government didn’t even recognise tourism as a com- ponent of the rural economy. Secondly, there was the budget

announcement that APD rates for long- haul destinations would be reduced from 2015 to support travel from emerging econ- omies such as China and India. Again, this move is not that substantial, but it reverses the continual increase in APD charges to these markets over the last seven years. Te most important aspect of these ini-

tiatives is that, being fiscal in nature, they will have been sanctioned by the treasury. And, with the treasury and government dedicated to reducing the deficit, it takes a very strong case for the treasury to agree to provide funds or reduce the tax take. This means the treasury must have

been convinced that supporting the tour- ism industry in the way the government did would provide economic growth and employment. This change in their per- ception of the industry is a small but significant step forward. Te test now will be to demonstrate to government that the support produces an increase in revenue and employment. If we can achieve this, we can start a virtuous circle of further govern- ment support for the UK tourism industry.


has long been an advocate of the British space industry and hopes to see it grow to £40bn in value by 2030. Willetts has reportedly indicated

that he’d like to see Richard Branson’s Virgin Galactic space shuttles take off from the new UK site. The government is currently

investigating the required legal framework to permit a spaceport to be set up in the UK, with preferred sites thought to be away from the south east. Te latest government announcements came

in response to a high-profile industry report published last year called the Space Innovation and Growth Strategy Action Plan. With space tourism expected to grow con-

siderably in the next decade, the government is eager to leverage the UK’s precision engi- neering skills honed through its strong defence technology sector to capitalise on the boom. “Space industries already support 95,000 full time jobs and generate £9.1bn for the

Shuttles may be blasting off from a British spaceport by 2019

economy each year, and our response to the Growth Action Plan shows our commitment to secure its future growth and realise ambi- tions to develop a viable UK space port for commercial space flight,” said Willetts. Dr David Parker, chief executive at the UK

Space Agency, said that government was work- ing “shoulder-to-shoulder with industry to exploit the full potential of the space sector to grow the economy, deliver more efficient pub- lic services and inspire the next generation”. Details:

UK’s foreign tourism spending set to soar

Te UK will see an upswing in over- seas visitors, with tourism spending from foreigners forecast to rise by more than a third over the next four years to reach £27bn per annum. Visitors from the US currently

spend the most in the UK, followed by France and Germany, with the spending pattern predicted to con- tinue through to 2017. However, it’s the emerging economies – such as China, the UAE and Russia – that will have a significant effect, out- stripping the established spenders in growth terms due to the increasing wealth of consumers in these countries, particularly their burgeoning middle-classes. By 2017, the UAE and Russia are set to

Te south west has been highlighted as a standout area for growth Spending on hotels, dining and attrac-

break into the top ten nationalities to visit the UK, while tourists from China alone will spend £1bn each year, a considerable 84 per cent increase from the figure in 2013. Te report by Barclays also predicts that

the retail, leisure and hospitality sectors will be the big winners, with the rise in tour- ist spending contributing towards a boom.

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tions will rise by 33 per cent to £14.7bn in 2017. Overseas visitors are predicted to spend £5.3bn on eating out by 2017, up 34 per cent, with spend on leisure attractions increasing 32 per cent to £2bn. Hotel accommoda- tion will attract £7.3bn in spend by 2017, an increase of 33 per cent, according to Barclays. Te report also highlighted the south west

in as a standout region for growth, with a Chinese influx of tourists predicted for the area. Details:

Twitter: @leisureopps © CYBERTREK 2014

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