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March 5, 2009

John Greenaway MP:Cancelling meetings is stupid and short-sighted

For a number of years I have been a consultant to an organisation that is now called Eventia, which is the trade association for the meetings, events and incentive travel industry and, for some years, I have helped organise a major international politicians’ forum on this subject in Frankfurt, which has focused on ensuring that governments, both at local, regional and national level, understand the huge potential economic value of the meetings sector. My wife Hanneke runs a successful inbound tour operating business, mostly bringing business, events and meetings into London—and into other parts of Britain, including York and Scotland—from the near continent, including Germany and Holland, and, we hope, increasingly from America.

I have to tell the Minister and say to the interested hon. Members present that the impact of the recession on this sector is becoming all too clear, as is obvious. Many events and meetings are being cancelled because people do not want to be seen having a good time. This is really stupid and short-sighted. The idea is that such events should be cancelled because there is a recession on, but that just makes it worse. There is a phenomenal infrastructure dependent on the inbound tourism industry and it is not just based in London, although it is particularly acute there.

The infrastructure is also in York and Southport. For example, many of our universities market themselves as potential and real sites for meetings, and this happens. People hold meetings and events at university campuses during the university summer break. All of this applies, whether we are talking about Lancaster, Durham or London.
I have just been in the USA, hence my slightly darker colour. I am not sure if the Minister is aware that the US Congress is developing a policy that will inhibit companies in receipt of emergency funding from holding meetings and event activities to communicate with and motivate staff, as has been prevalent before. That is ridiculous. The sector’s professional associations in America have started a campaign called Keep America Meeting. I suggest that we should keep the world meeting, because tourism is a vibrant element of the real economy.

Understanding the impact
The hon. Member for City of York mentioned the problem with pubs, and the truth is that the hospitality industry in north Yorkshire is probably the area’s biggest employer. Even in my constituency, which is recognised as being one of the main agricultural parts of Britain, more people are employed in hospitality than in agriculture or even food manufacturing. It is vital to understand the impact of that.

Most Americans do not know what has happened to the exchange rate. I do not know how to get that message across in a marketing campaign, but they do not realise that the pound is now down to $1.40 or $1.35, and that there is an exchange rate boost for the dollar.

What do we need from the Government? First, we need renewed recognition of the sector’s value, and the opportunity that it creates for jobs, training, education and economic growth. Secondly, we must recognise that the sector is under threat. The Minister’s facial expressions show that she responds positively to the points that I have made. The hospitality industry across the board is under real threat from the recession, as is everyone else, but we must understand that it is no good having a beggar-my-neighbour approach and making an already difficult situation worse, because it is one of the sectors that can help to bring us out of recession. I have no doubt about that. We need more cohesion in policy-setting across Departments. Transport has been mentioned, and I would add the role of local government, and a greater understanding that the sector needs to work in partnership with local and regional government to deliver better facilities.

I take this opportunity to make a particular point about the necessity for a greater understanding of the impact of taxation. I do not expect the Minister to reply to this now, but she will be aware that many tourist operators make VAT payments under the tour operators’ margin scheme. However, thanks to the usual ham-fisted intervention of the European Commission, TOMS will change. The Treasury has sensibly postponed the change to January 2010, but when it comes in it will have a huge impact on the sector because, understandably, when businesses use hotels, transport and conference venues for meetings and events, they expect to get their VAT back, but they will do so only if they do not use agents or the organising sector. That needs attention.

I entirely support what my hon. Friend the Member for Cities of London and Westminster (Mr. Field) said about London’s need for a convention centre. I have made many speeches about that.

Conitnued investment is crucial
I turn my attention to what we need from the sector, and what it should do. It must recognise that even in these difficult times, the importance of investment remains critical. The hon. Member for Southport (Dr. Pugh) talked about the wonderful places that people may go to in Italy and France when they have been to Rome or Paris, but when they go to such places, they find extremely high standards. The American market will not tolerate low standards. Americans want five-star hotels and the sort of luxury that hotels in Las Vegas and Florida provide. We must ensure that money is available to the sector for such investment, but it must continue to invest in training and facilities. The Minister may speak about the importance of training people to proper standards. I am a member of the Sector Skills Council for Active Leisure and Learning, which is aware of the opportunities for training and upskilling of workers. That is critical, and we must encourage young people to consider the sector as a real career opportunity. Far too many of them think it is the last possible career, but that attitude does not prevail in other parts of the world.

I again congratulate the hon. Member for City of York on securing this debate. We must be positive and constructive, but the sector is under severe threat as a result of the attitude that people involved in hospitality and events are having a good time when others are being made redundant. That attitude only increases the number of people losing their jobs. We must reverse that, and I look forward with interest to hearing what the Minister says. This is the first time that I have had the opportunity of debating the matter with her. I also look forward to hearing what my hon. Friend the Member for Bournemouth, East (Mr. Ellwood) has to say, because he has the job of shadow tourism Minister, which I enjoyed for several years. It is one of the best Opposition jobs, and I hope that he will have the opportunity of doing it in Government.

John Greenway is Conservative MP for Rydale and Eventia's Parliamentary representative

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