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Debate on promoting tourism in the UK, House of Lords, 24 June 2021

In order to contribute most effectively, councils need earlier involvement in decisions at a national strategic level, and local government should also have representation on longer-term bodies like the Tourism Industry Council.

Key messages

  • The tourism sector, along with the arts, entertainment and recreation, has been one of the sections of the economy hardest hit by COVID-19. Councils have provided vital support to businesses through the delivery of a range of grants and other financial and practical support, along with developing and delivering local plans for economic recovery. 
  • As the biggest investors in place, council cultural services, as well as other services such as planning, business support, highways and environmental health, are fundamental to creating thriving destinations that people want to visit. In addition to being direct providers of visitor and tourist attractions, councils also play a vital strategic role in the visitor economy, through developing and marketing their places as destinations.
  • As the visitor economy faces unique conditions and challenges in each area, strengthened national coordination of UK tourism must be combined with a locally led, place-based approach to recovery. As locally elected leaders of place, councils are well-placed to work strategically with partners, including the Government, Visit England, Destination Management Organisation’s and LEPs, to develop their places as destination and deliver on wider local objectives.
  • In order to contribute most effectively, councils need earlier involvement in decisions at a national strategic level, and local government should also have representation on longer-term bodies like the Tourism Industry Council.
  • Local government plays a crucial role in leading and creating a thriving visitor economy, but it is vital they have the powers and resources to market and invest in destinations. Alongside a long-term sustainable funding settlement for councils, the government should also consider ways to reinvest income generated by tourism back into destinations, for example, through a tourism levy.
  • Before COVID-19, culture was linked to 42 per cent per cent of all in-bound tourism related expenditure. Many theatres and performing arts venues continue to face significant financial instability and are at risk of closure, despite support from the existing financial support schemes. The Government should provide further support for theatre, festivals and events affected by the delay to full reopening by backing a tailored insurance scheme to restore confidence to the sector.
  • The UK tourism industry faces significant skills challenges. This has been exacerbated by the pandemic and the labour market impacts of the UK’s exit from the EU, leaving many businesses with critical workforce shortages. Councils are well placed to coordinate skills and employment investment decisions to support local employers and providers and help local people into jobs.

Destination Management

  • As leaders of place, councils play a crucial role in planning and developing their local visitor economies. Councils are direct providers of visitor and tourist attractions, including castles, historic buildings, museums, theatres, galleries, piers and amusement parks, and they act as destination management organisations for their areas. They run over 350 museums, public archives, over 116 regional theatres and galleries, and are responsible for many monuments. 
  • Councils are the largest public investor in cultural activity, spending over £1.1 billion each year on cultural services and suppliers. Councils’ contribution to regional visitor economies is particularly significant, with many regional airports being directly or indirectly owned and managed by councils. These transport hubs are essential to ensuring all parts of the country benefit from the visitor economy.  
  • In order to contribute most effectively to recovery efforts, councils need earlier involvement in decisions at a strategic level, particularly given that national initiatives depend upon on council services such as destination marketing, business support, planning and licensing for their delivery on the ground. Giving local government a seat on longer term bodies like the Tourism Industry Council, would also enable councils and combined authorities to contribute their expertise and join-up local and national strategy around place.
  • Longer term, as part of the tourism recovery plan, it is important that tourism is spread more evenly across the country, and efforts should be made to extend the season beyond the peak travel months in the Summer so that tourism is an all-year-round activity. To deliver this ambition, it is essential that local leaders across the UK have the powers and resources to invest in, regenerate and market their places as destinations. This should include funded pilots to explore sustainable and innovative ways of addressing the ‘last mile’ gap, enabling visitors to make their way between the train station or bus stop and the attraction or accommodation they are visiting.
  • To support local economic recovery of tourism, and its co-dependent sectors, we are calling for the acceleration and expansion of effective, place-based interventions:


    Councils should be supported by Arts Council England to develop more cultural compacts to drive local economic growth. In 2019, Arts Council England and the Department for Culture Digital Media and Sport (DCMS) funded the creation of cultural compacts in 20 areas, which established formal, goal-driven partnerships between councils, local cultural sectors and wider stakeholders to co-design future cultural offers and deliver prosperity through cultural investment. The review of the compact pilot initiative found that this approach has delivered for local economies.


    Tourism Zones should be expanded in numbers and scope, with an appropriately scaled funding levels, and brought forward as soon as possible. This should include innovative options for raising finance, building on proposals from the Cultural Cities Enquiry, including the option of a tourism levy, and business improvement districts. 

  • Stronger coordination and direction of the tourism sector is needed at the national level, as we set out in our response to the Independent Review of Destination Management Organisations (DMOs).
  • Over time, as a result of changing national policy and unstable funding, the network of DMOs has become patchy, under-resourced and uncoordinated, with varying performance standards across organisations. VisitEngland has a key role in addressing these issues and fulfilling a leadership and coordination role.
  • While some DMOs have developed as purely marketing and visitor information services, others provide more wide-ranging support services, and work towards a long-term vision for the sector. This leads to significantly different levels of support available for tourism businesses in different areas.
  • It is disappointing that no business improvement districts focus on tourism and there is also limited recognition of the visitor economy in delivery plans for Local Enterprise Partnerships (LEPs). A clear strategy should be developed by Government working with DMOs, tourism businesses and councils, to determine the most appropriate local ways to deliver on these objectives, as set out in the Tourism Sector Deal.

Investing in the Visitor Economy

  • Tourism is a significant contributor to the UK Exchequer. However, one of the pivotal challenges holding back the recovery of English tourism is day-to-day funding of destination management and local areas’ ability to invest in and regenerate their destinations.
  • Council finances have been significantly impacted by the pandemic, which means that council-run Destination Management Organisations are likely to face further reductions in funding as councils have to make difficult budgeting decisions.
  • Some of the highest performing and entrepreneurial DMOs have been the most negatively affected by the loss of earned income during the pandemic, hampering their ability to provide support to businesses when they most need it. Many councils are working to support their local DMOs to maintain services, with some bringing these organisations in house, and others being commissioned out.
  • To stabilise funding in the tourism sector and secure the best chance of recovery, it is essential that local government is provided with a long-term sustainable funding settlement. Government should also consider ways to reinvest income generated by tourism back into those destinations. When the time is right to do so, and following the work done by the Scottish Government, we are in favour of introducing a tourism levy option, devolved to local leaders, that will empower them to secure long-term, sustainable investment in their destinations.

Cultural recovery

  • Before COVID-19, culture was linked to 42 per cent of all in-bound tourism related expenditure. Areas that win titles like Capital or City of culture have seen a doubling of hotel space and of visitors. 
  • Cultural services are integral to the social fabric of the UK and can deliver against some of our most pressing agendas. They attract tourists and other visitors, boosting our economies; a cultural institution can be a key anchor for a regeneration programme, and a major draw for businesses. Arts and culture add more than £10.8 billion to the UK economy every year.
  • Along with the tourism sector, the arts, entertainment and recreation industry has been one of the sections of the economy hardest hit by COVID-19, with more than 80 per cent of organisations in this sector ceasing trading in response to the pandemic in April 2020. It has had a larger proportion of its workforce on furlough during the pandemic than other sectors and has a longer journey to reopening, due to the impact of social distancing. As many as 50 percent of theatres remain closed under current COVID restrictions for example, as their business models are not viable with social distancing measures in place.
  • The Government should consider greater support for theatre and performing arts organisations, festivals and events affected by the delay to full reopening. We endorse the introduction of a tailored, Government-backed insurance scheme for events, similar to that offered to homeowners following flooding, to enable the events industry to proceed with some confidence.
  • Councils have been at the forefront of successfully developing leisure and cultural activities to stimulate inclusive, sustainable economic growth and revitalise the visitor economy, as we explored in our reports on culture-led regeneration and supporting local creative economies. Using these approaches, Manchester’s International Festival generated £40 million for the local area; Portsmouth’s Historic Royal Dockyard and council-planned Gunwharf shopping area attracted two million visitors and generated £51 million for the economy, and the Newcastle/Gateshead initiative secured or created 1,300 jobs.
  • Increasingly high streets and town centres will compete based on their experiential offer to visitors, and cultural and leisure activities are at the heart of how places can do this. A growing number of councils have made use of empty commercial units on high streets to establish meanwhile use or ‘pop-up’ cultural attractions, which have the advantage of making temporary use of a unit, and allowing its return to retail or other functions when required. The High Street Action Zones have made a particular impact by integrating local heritage into this offer.
  • Councils need the planning powers to curate high streets, as was done by removing permitted development rights from theatres and performance venues, protecting them from inappropriate development and preserving them for the community.


  • The UK tourism industry has long faced significant skills challenges, as highlighted by our research in 2019. Further exacerbated by the pandemic and the labour market impacts of the UK’s exit from the EU, many businesses are now reporting critical workforce shortages.
  • It is vital that local economies have motivated, flexible, and skilled workforce which retains and attracts employers and boosts productivity, and that skills and training provision is aligned with the place and and sector-based elements of the industrial strategy.
  • Councils are well placed to coordinate skills and employment investment decisions to support local employers and providers and help local people into jobs. For example, in Blackpool the council and tourism businesses have worked in partnership to establish a training academy to provide the skills needed by their local visitor economy.
  • Local government remains committed to moving towards a devolved and integrated skills system which can quickly and easily identify and address skills gaps and shortages, and deliver better outcomes for individuals and local economies. The Levelling Up White Paper provides an opportunity to consider this approach.
  • The Government should roll-out further T Levels to address skills deficits in the tourism workforce pipeline, and ensure that local councils and providers are given the flexibility to target training at particular local skills gaps.
  • DMOs could play a stronger role in collecting employment data, which was previously collected by VisitBritain but has now been discontinued, and acting as champions for the visitor economy with training providers. There is a particular weakness across nearly all DMOs in relation to engagement with higher and further education providers to ensure that there is a pipeline of talent. We hope that these issues are addressed in the findings of the Independent DMO review.