Tourism and its impact on Cornwall’s Economy

To most people, they see the benefits of tourism. It contributes to a large part of Cornwall’s economy, as without it, things would be dire indeed. But just what is the impact with or without tourism; how much money does tourism help contribute to the Cornish economy?

On the job front, the tourism industry employs 25% of all employment in Cornwall. That is 60,921 jobs; which is made up of 45,017 FTE jobs and 15,904 non-FTE jobs. In comparison with our closest neighbours, the FTE jobs are: Devon 12% – 46,4532; Dorset 12% – 29,800 and Somerset 9% – 23,444.

This data is further broken down by the former District Council as:

  • Kerrier – FTE  jobs: 4,294 – actual 5,891 – 15% of all employment
  • Caradon – FTE jobs: 4,833 – actual 6,827 -20% of all employment
  • Carrick – FTE jobs: 5,426 – actual 7,433 – 14% of all employment
  • North Cornwall – FTE jobs: 7,782 – actual 10,917 – 29% of all employment
  • Penwith – FTE jobs – 5,898 – actual 8,133 – 31% of all employment
  • Restormel – FTE jobs 8,674 – actual 11,951 – 23% of all employment

With what is the actual amount of money that is put into the Cornish economy? Well it is not a small amount; as the total amount is £1,855,422,000.

This is made up from domestic £1,212,999,000 and overseas £129,990,000 on accommodation type; day trips – £468,336,000; friends and relatives – £35,724,000 and second home/holiday accommodation £8,373,000. This makes the £1.8 billion.

This spend can be broken down further by the amount spent by purpose: holiday tourist is £1,126,447,000; business £34,809,000 and visits to friends and families £43,500,000. For Overseas it is: holiday £90,145,000; business £19,863,000 and visits to friends and family £10,553,000.

Second homes and boats make a contribution, too. For boats it is £4,934,000 and second homes, it is £4,439,000. The spend on second homes includes maintenance, and replacement of furniture and fixtures. For boats, it covers berthing charging, servicing and maintenance.

For the South West region as a whole, the spend is:

  • Accommodation – £1,646,962,000 (18%)
  • Shopping – £2,339,775,000 (26%)
  • Food and Drink – £2,847,358,000 (31%)
  • Attractions £984,184,000 (11%)
  • Travel – £1,284,980,000 (14%)

This makes a total of £9,103,257,000. That is a huge amount of money from tourism.

However, there is a danger with Cornwall and the South West relying too much on tourism. As if there is a massive change, from either domestic and overseas competition, or the poor weather that has inflicted itself on us for the past few years. As a shift in people visiting would leave a very big hole in the Cornish and regions economy.

So what is the answer? More industry? If so, how do we as a county attract industrial businesses down? As from my experience sitting on Strategic Planning we receive few of this application type. It is either housing developments, supermarkets or renewable energy type applications. Not many jobs from renewable energy is there?

Furthermore, there has been this chicken and egg scenario of do you build houses to attract the business, or business first than housing? A balance of both would be right, but that is not happening. It has been made worse by recent changes to planning policy and the reliance on having to have a Local Plan. As without one, developers are using this against the council by submitting plans and claiming lack of Local Plan and/or no five-year land supply.

It is going to be interesting to see what 2013 brings

Tourism data has been taken from Visit Cornwall’s report – Value of Tourism 2011

Joint Meeting on Tourism

Today I attended a joint meeting of the Tourism Panel of Cornwall Council and the Visit Cornwall Partnership (VCP). The VCP is made up of businesses in the tourism industry.  For me, it was good to meet some of the players in the industry and who came from the Minac Theatre, St Austell Brewery , The Scarlet Hotel, Classic Cottages to name but a few.

The issue of the tourist tax, or bed tax was discussed and those from the industry were very annoyed by the comments made by the senior officer of Cornwall Council to a Parliamentary Committee. They felt this was a PR disaster for Cornwall’s tourism industry which had in turn gone international with the news coverage. Those from the industry felt the officer should be fired, flogged or sent to the various tourism organisations in Cornwall to explain himself.

After the bed tax issue was discussed it was felt that tourism should be higher up on the political agenda. I agree, as for an industry that accounts for at least 25% of the Cornish economy there is no Cabinet position for Tourism. If not a full Cabinet Portfolio you could put it under one of those new Cabinet Support Members that the Leader likes so much.

It was also agree in principle that the Tourism Panel and VCP should meet for regularly as in the last two years today was the first time both panels had met. This would work as it would have those in the industry who know the business and those in the business of politics singing from the same hymn sheet.

Alex Folkes who is also on the Tourism Panel has made comment about today’ s meeting HERE

A Poll Tax on Tourist

The latest announcement from Cornwall Council is to look in the possibility of a Tourist Tax. It is claimed that no final decision has been made, but from my experience you are hardly going to go public about it, unless it’s been pretty well discussed and decided this is the way forward.
My understanding is this Tax could be raised by means of a premium added to the accommodation costs that the tourist pays. Its been said this could be £1 per bed per night. This on face value might not seem a huge price to pay, but if you take for example a family of 4 will generally require 3 beds and they are staying for a week. It does not take much of a maths boffin to workout this is an additional £21 a family has to find for their stay.

This process of taxing a bed may work for Guest Houses, Hotels and Bed and Breakfast establishments, but what about the Holiday Lets? A Holiday Let House may have six bedrooms, but only four people stay. Are you going to charge per house, or the number of beds in use? The other problem is not all Holidays Lets are marked down as businesses. Many are used by the owners, but supplement their incomes by renting it out for a month or two.
The administration of this whole process would be complex and labour intensive. I believe a lot of the money collected would be spent on running the system, and so most of the money would be gone before it could be spent on the infrastructure.
Tourism is a very competitive market locally, nationally and internationally all fighting for the little money that is around. The message this sends out to tourist could have a negative impact; because other areas like Devon would surely make the claim that don’t go to Cornwall because they tax you to visit, but we in Devon don’t. The tourism industry struggles at the best of times, adding this tax could really do a lot of damage.
It would be far simpler if the Government allowed Cornwall Council to keep all the Business Rates it collects for them. That way, the money collected from these rates could be used for infrastructure and improvement.
My opinion is this idea of a Tourist Tax is nothing more than a Poll Tax on tourist. If introduced would be very damaging to the reputation of Cornwall’s tourism industry.
Yet again there has been no backbench involvement on this issue. My real fear is that we won’t get any involvement either. The Cabinet and the Directors can sit on the 4th floor and think up these ideas, but please before you go live on radio and talk about them, include the backbenchers in the discussion first.

Tourism – It’s important

I sit on the Tourism Panel. Tourism is important to Cornwall. Without it, we would be up the creek without a paddle, and probably the canoe too. It equates to £1.5 billion to Cornwall, or in money terms the income equivalent of £3000 for every man woman and child who lives in Cornwall. It employs 40,000 people. So it’s very important to Cornwall.
From the stats and figures that we were shown today, it seems Cornwall has come though the current recession better than expected with the average length of stay down from 7.5 days to just under 7 days. We have around 88% repeat visitors. These are people who come back to Cornwall within 5 years. So it seems once they come, they will return. 
While the visitor numbers are good, it seems that whilst lots of money is spent in Cornwall a large part of it does not stay because of the VAT and Business Rates what goes to the central coffers of the Government. The Tourism Minister, John Penrose is currently draft a new Policy on Tourism that could mean that more of this tax money stays within the borders of where it’s been spent. One dreaded word that was mentioned by Malcolm Bell was a Tourism Tax. This was merely mentioned as an idea and nothing more than that (yet).
I raised a question what was Visit Cornwall (Tourism Wing of CC) doing to attract visitors to Cornwall during the Olympics. This is one of the largest events to happen to the UK since 1948 when the Olympics were last here. It has a huge potential to attract more people to visit Cornwall and more importantly revisit over and over again. At present nothing overtly happening, but Malcolm Bell did acknowledge more work should be done to attract those wanting to get away from the Olympics or wanting to see more of what the UK has to offer whilst they are here during the Olympics. He said he would get more details from Visit Britain who is handling a lot of the PR on tourism during the Olympics. I believe this is a trick not to be missed.
On the downside, Cornwall Development Company (CDC) which Visit Cornwall sits in is facing cuts along with everyone else. The danger that was pointed out by me and many other Councillors on this Panel is the budget for Tourism is seen as a soft target in these cuts. It may seem soft on paper, but current money that goes into tourism would have a more hard hitting effect on Cornwall and those who this industry support.
I am very confident that we have the right man at the helm in Malcolm Bell. From the meeting I have had with him he currently knows what he is talking about.