UK Government needs to recognise the importance of tourism to the world economy

Tuesday 8, June 2010


UK Government needs to recognise the importance of tourism to the world economy


In Westminster on 4th June, Dermot Blastland, Managing Director of TUI UK & Ireland called on the Government for the need to recognise the importance of tourism and how it can alleviate poverty around the world. He also called for the Government to support the travel industry and help it develop.


Dermot Blastland said, “Travel matters to the world economy. Tourism represents 10% of World GDP and is the world’s largest industry. The poorest countries in the world are dependent on tourism for a high percentage of their overseas earnings. The UN recognises Tourism as a very powerful force for good in reducing poverty.


“The UK is home to two of the largest travel companies in the world. Yet UK Governments to date seem not to recognise, via their Overseas Development departments, the opportunity this presents in the alleviation of poverty around the world.”


Addressing 150 leading travel industry figures and journalists at ABTA’s Travel Matters briefing, Dermot Blastland also highlighted Volcanic Ash, the reform of Air Passenger Duty tax and financial protection as the top three issues currently facing the UK travel industry.


On the subject of volcanic ash, Dermot Blastland was resolved that the Government should compensate the travel industry. He said, “This was an extraordinary event, made worse by the intervention of the regulatory authorities, and we do believe that the industry is right to request compensation for the cost imposed upon us. We aren’t asking for a hand out or a bail out. We are competitive companies, run well, but believe compensation is due when we are expected to be the insurer of last resort in looking after a nation’s citizens. That’s the job of government. We are well aware of the economic circumstances that prevail. But that should not be used as a convenient excuse for government to avoid accepting responsibility.”


Moving on to APD, Dermot Blastland welcomed the Conservatives and Liberal Democrats proposal to replace APD with a per plane tax so that flights will be taxed on a whole aircraft basis rather than on a per person basis.


He said, “We also applaud the proposal to extend the tax to all aircraft movements. If applied sensibly this will encourage both the move to more fuel efficient aircraft and higher load factors on the aircraft that do fly. At the same time though, we would urge the Government not to use the reform as an opportunity to tax the aviation industry more heavily than is already the case.”


Finally on the subject of financial protection, Dermot Blastland explained how the Volcanic Ash Cloud made crystal clear just what an unholy mess the protection of air passengers departing from the UK has become. He explained, “The existing regulations were conceived in the 70’s. The Internet did not exist. Low Cost Carriers didn’t either and the market is now 4 times larger. Change is needed from the Byzantine mess that currently operates.”


“The proposals for reform of the ATOL Regulations set out in the recent DfT consultation were welcome and represented, in our view, a real step forward. As the largest single contributor to the ATOL scheme, we have a very strong interest in the matter.”


He concluded his thirty minute speech by summarising the benefits tourism brings to the UK market and destinations overseas and outlined his hopes for the industry’s future. “This is a dynamic vibrant industry. It contributes £19bn to the UK economy and employs 2.65 million people. It supports UK regional airports, benefits overseas economies, improves poverty and has resulted in two of the largest travel companies in the world being based in the UK. It can grow and be a force for good.


“Working intelligently and in co-operation I believe we can produce elegant solutions to the issues I have outlined. I also believe our industry can play its part in supporting the Government in developing a society that is more free, more fair and more responsible.”



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