FSB NI response to the Review of NITB and wider Tourism Structures.
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1 FSB NI response to the Review of NITB and wider Tourism Structures. September 2014
2 Introduction The FSB welcomed the review of the Northern Ireland Tourist Board and wider Tourism Structures when it was officially announced by Minister Arlene Foster in November 2013 in a Statement to the Assembly. We were subsequently pleased to input our views directly to John Hunter in February 2014 as part of the stakeholder engagement which was undertaken to inform the review. Tourism is widely recognised as an important sector which is a key driver of economic growth. Whilst there have been notable successes of late in terms of the calibre of events hosted in Northern Ireland as well as exceeding Programme for Government targets, we believe there is also much which can be improved upon. The FSB in Northern Ireland has members across this sector in accommodation, such as hotels and B&B s, retail, transport, business services and many more. This response deals only with those recommendations which we consider to be of relevance to our members and we therefore do not seek to take a position on every issue detailed in the review, for example, those which fall into the category of being operational matters for the Northern Ireland Tourist Board or related tourism bodies. Recommendation I Overall, there needs to be greater strategic direction for the tourism industry. While a draft Tourism Strategy for Northern Ireland to 2020 was published in 2010, this has was never finalised. The FSB believes an overarching Tourism Strategy needs to be established which facilitates collaboration between DETI, Invest NI, NITB and other government Departments and tourism bodies to bring clarity to the role and functions of each. We also believe that an associated action plan should be produced to ensure that targets are set out which allow performance to be transparently measured over time. While the current Programme for Government contains high level commitments around overall visitor numbers and revenue from tourism, there also needs to be a focus on specific outcomes for the businesses that make up the sector and a Tourism Strategy and action plan can deliver on that. In general, the FSB believes that where possible more resources should be directed towards the tourism sector as well as businesses involved in that sector, however, it is much more difficult to make the economic case for doing so without an overarching Strategy in place. We note the Scottish approach to the development of a Strategy where the Scottish Tourism Alliance 1, took the lead in the development of ambitious targets for the 1 An independent trade body comprising of trade associations, individual businesses, marketing services and local area tourism groups who earn their living from tourism or have an active interest in tourism (circa 225 members) 2
3 industry. This stakeholder led approach should be replicated in Northern Ireland so the knowledge of the sector can be drawn upon. Recommendation II The FSB agree that the establishment of an Inter-Departmental Group to oversee progress in the implementation of the new Strategy would be a positive step. The review rightly points out that with the current structure of government, seven Departments have a role in tourism development, namely; DETI, DARD, DCAL, DoE, DSD, DRD and DEL. Therefore in order to achieve buy in on a cross-departmental basis, as well as to ensure that certain Departments see the merit of directing money to the sector, a group such as this is necessary. This Inter-Departmental Group should not only oversee the progress of the Tourism Strategy but report regularly on it in a transparent manner. Recommendation III and XV Strengthening DETI s existing accountability frameworks for NITB and TIL could help embed the objectives of the Tourism strategy within each body. However, there has been criticism in the past that accountability frameworks can be too complex and time-consuming meaning that an organisations ability to be responsive is diminished. Any accountability framework therefore needs to give NITB and TIL the freedom to operate. The FSB agree with the review that monitoring the value for money achieved by the various marketing campaigns of the two bodies and development of digital marketing and mobile technology are two areas of specific relevance. Recommendation IV Air connectivity is vital to all FSB members, whether in terms of their own individual businesses or the contribution it makes to the economy as a whole. The FSB want to see existing routes protected as well as new routes developed. It is disappointing that seat capacity on Northern Ireland routes has decreased by 7% from last summer and a route development fund is therefore an absolute necessity. Competition with the Republic of Ireland is obviously a central consideration. They have scrapped air tax in its entirety and have seen a 6% increase in seat capacity 3
4 from last summer a completely different trajectory from Northern Ireland 2. In order to help redress this position, the issue of short haul Air Passenger Duty is a priority. The FSB believes that short haul APD should be abolished immediately for those customers flying from Belfast to GB and then internationally. A business case should also be prepared as soon as possible for the devolution of short haul APD to the NI Assembly with the intention to reduce the rate to zero. There is also a competitive disadvantage arising from the inability to utilise preclearance of US immigration and customs in Belfast when flying on Belfast s one current North American route. This is in contrast to Dublin where pre-clearance is available. It has been stated that NI falls well below the passenger threshold needed before US authorities would consider pre-clearance in Belfast 3, however, it should be explored as to whether this can be circumvented. Changes to Visa arrangements should be looked at closely to ensure that visitors to the Republic of Ireland from outside the EU are not prohibited from visiting Northern Ireland as part of their trip. At the moment that is not always possible because of the different visa requirements from the UK and Republic of Ireland. However, we must not allow a situation where people can use the Visa situation to fly from Dublin and avoid air tax as such visitors would be of little advantage to the NI economy. Recommendation V and XVII Work on the development of an NI economic development brand has already been taking place between NITB and Invest NI and the recommendation is that work should continue and be exploited once developed. The FSB is supportive of having an economic brand in place so that everyone who is marketing Northern Ireland overseas is doing so in a coherent manner, whether it is Invest NI seeking to attract investors, universities recruiting students or NITB promoting the country as a tourist destination. We are particularly interested to see more detail as to how this initiative would help encourage the development and mobilisation of private sector partnerships as this may involve our members directly. It is a welcome suggestion. Recommendation VI, VII, VIII and XVII How NITB works in partnership with the new eleven District Councils is central to the success of the tourism sector going forward, for example, in the formulation of 2 NITB, Access into Northern into Northern Ireland - Summer HM Government/NI Executive, Building a Prosperous and United Community; One year on, 2 July
5 effective cluster groups of businesses working together to maximise their tourism offer. The FSB therefore supports an MOU being developed between the NITB and each new Council. We believe this should be taken forward in advance of April 2015 when the new councils become fully operational. This is particularly important given the new powers which Councils will have in the areas of local economic development (which are transferring from Invest NI) and local tourism meaning that NITB needs to have a closer relationship with local Government than ever. The FSB are of the view that Councils will deal with local issues, NITB with Northern Ireland wide campaigns and TIL marketing tourism overseas. Therefore, it is essential that each has an excellent understanding of the role of the others. As new Councillors will have a raft of new powers and responsibilities to come to terms with, including those outlined above, the FSB agrees that Councillors and local government staff should avail of further learning opportunities. NITB may be best placed to deliver this training and again it should be provided as soon as possible and before April 2015 if possible. There seems to be an intention for NITB to adopt a more client facing model, with destination managers already in place across its nine key destination areas. The FSB sees the merit in them assisting with the tourism aspects of Council Community Plans but local businesses views must also be taken into account and the FSB is willing to play its part in that and work with destination managers to achieve that. Recommendation IX The Tourism Growth Fund is suggested by the review as the successor to the Tourism Development Fund. The FSB believes that funding of this nature is desirable in order to both increase investment into tourism generally and to bring together funds from various sources into a single strand. We note that the review says that the size of any grant from the NITB would be on a sliding scale dependant on the project s potential contribution to a growth in international, national or local tourist numbers. Whilst this is a reasonable approach which results in larger scale projects receiving money, the FSB believes this fund should be fully accessible to small businesses operating in the tourism sector. How grants would be administered under this recommendation is not clear, i.e. would the involvement of Invest NI simply be as a back office function or would they take control of this aspect of tourism funding? This needs to be clarified for potential applicants. 5
6 Recommendation X An MOU between NITB and Visit Belfast is advisable as Belfast is considered the gateway to the rest of Northern Ireland in tourism terms. This MOU should not conflict with any agreement in place with Belfast City Council. Recommendation XI The FSB is supportive of the NITB moving towards a more customer facing approach, however, we fail to see the rationale as to why this should only occur with regard to its larger clients. Many of our members can benefit greatly from working together in clusters with other organisations, and the five experience pillars (coasts and lakes, unique outdoors, living legends, creative vibe and Naturally NI) are the direction of travel adopted by the NITB in achieving these clusters. Others, however, do not naturally cluster and it is therefore important that their contribution to NI Tourism potential is fully promoted. Pillar managers must therefore engage positively with the small business community to maximise their contribution to the tourism industry and allow them to draw not only on the five pillars identified by NITB, but also in relation to the activity attractions. Recommendation XII More extensive use of MOUs by NITB with significant partner organisations would be a positive development. This will allow other organisations to have a better understanding of the impact on tourism due to the decisions they make. It also allows common ground to be found by NITB and their various partner organisations. We believe this could also be a helpful mechanism to promote dialogue between NITB and organisations making decisions which directly or indirectly affect the tourism industry. Recommendation XIII There is of course merit in establishing an advisory body from the tourism sector as a whole for the purpose of increased representative and improved engagement. The Scottish Tourism Alliance is an example of this working well in practice. However, this is little point in a body of this nature unless it produces tangible results and we therefore welcome the intention that it has input into the new Inter- Departmental Group and view this as necessary for the success of this body. The FSB would be willing to represent our members on a new advisory body provided it produces meaningful partnership working and has a voice at Ministerial level. 6
7 Recommendation XIX We agree that market research is needed to ascertain the value of the current star grading system for accommodation and we would ensure the views of our membership were fed into that work. Changes in how visitors assess and book accommodation alongside the growth in popularity of sites like tripadvisor (and the associated legal challenges) should all be considered as this project is taken forward. In general, the FSB would welcome a grading system which is easy to understand and internationally recognisable. Recommendation XX The FSB offers a range of business services to members including tax protection, employment advice and a legal helpline, while Invest NI provides their own bespoke support to small businesses, and this can help those in the tourism sector as well. The new destination and pillar managers should be well placed to signpost businesses to the specific Invest NI support which is applicable to them. However, this yet again illustrates the plethora of support and advice which is available to businesses. This can be difficult to navigate and again illustrates the need to look at the establishment of a small business advice network. Recommendation XXII and XXIII Co-operation should clearly continue between Invest NI and NITB to attract more events to Northern Ireland like the Giro D Italia as these types of event stimulate business activity in Northern Ireland during the period they are held but also promote Northern Ireland and on a global stage thereby increasing reputational value. The FSB also agree that Invest NI is better placed to lead on projects which are considered to be major given their greater experience of operating at an international level and this may also bring a greater economic focus to this type of project. Recommendation XXVII The area of skills and training needs to be addressed to continue to increase visitor numbers and revenue from tourism. This ranges from developing competency in basic customer service and communication, such as through the WorldHost Customer Service Training, through to ensuring management practices and leadership skills are the best they can be. Access to assistance can often be a challenge for small businesses and barriers to utilising government support need to be broken down. 7
8 In light of the above, the FSB strongly advocates that DEL takes forward a review of the tourism sector skills needs and we agree that industry needs to be consulted widely in this. A review of this nature will be the first step in ensuring that tourism is seen as a career of choice for young people making decisions about their education, training and employment. Recommendation XXVIII The development of skills must match the future needs of our changing economy and the growth of the tourism sector is a good example of that. Monitoring the training needs of the tourism industry is therefore vital. However, in taking responsibility for this monitoring, NITB should have cognisance of other work such as the Partnerships Groups which are intended to inform demand in respect of apprenticeships through a skills barometer approach annually at a sectoral level. Conclusion Overall, the FSB welcomes the direction which the review recommendations set out for NITB and related tourism structures in Northern Ireland. Firstly, a strong policy framework is needed with more ambitious commitments in the next Programme for Government, an Economic Strategy which recognises the potential and value of the tourism sector for growth and a new Tourism Strategy and action plan which give clarity to the industry and promotes collaboration between all stakeholders. Further to that, the restructuring of local Councils as well as the changes to NITB should allow more support to businesses as a more client facing and local approach to tourism is taken forward. However, the larger scale projects which have been such a success during this Assembly term will still be on the agenda with Invest NI taking the lead and TIL, with improved collaboration with NITB, marketing Northern Ireland internationally. On the whole we believe the above has the potential to maximise what our small businesses can offer to the tourism sector and we look forward to scrutinising the Ministers final policy decisions in this area. 8
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