Kate Forbes MSP Cabinet Secretary for Finance the Scottish Government St

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Kate Forbes MSP Cabinet Secretary for Finance the Scottish Government St Kate Forbes MSP Cabinet Secretary for Finance The Scottish Government St. Andrew's House Regent Road Edinburgh EH1 3DG Dear Ms Forbes As Chief Executive of the Scottish Tourism Alliance, the representative body for Scotland’s tourism industry, I would like to take the opportunity to outline the impact that the threat of the Coronavirus is currently having on our sector in the short term and the concerns our industry has in relation to the medium and longer term impact. The developments over the past ten days are having a significant economic impact on our sector which is being hit the hardest with the immediate change in consumer and business travel and behaviour as a reaction to the threat of Coronavirus and the subsequent and expected measures to contain and minimise the spread of the disease. I have had several conversations with a variety of tourism businesses across Scotland this week and the outlook for all types and size is grim. Businesses are starting to fail just a few days into the crisis and the medium-term outlook for Scotland’s tourism industry is catastrophic. To briefly outline the situation; in Q1 hotel occupancy was down 15%, eating and drinking out declined by 7%. With 60% of advance bookings made a fortnight in advance, we can foresee booking declining 40-50% across hotels, banqueting and food and beverage services soon, largely as a result of social distancing and working from home, and travel and meeting bans being unilaterally implemented. A string of business conferences and events are being cancelled across Scotland, international visitor cancellations are happening across all areas of our accommodation and adventure sector on an hourly basis and future bookings are continuing to decline. We are approaching core trading periods with Easter and the Summer season on the near horizon and a projected peak in the spread of Coronavirus across the UK. The impact this will have on the viability of many businesses is significant and widespread. As an employer of around 260,000 people and a significant contributor to the health of Scotland’s economy, I would like to make several asks for immediate measures to support our industry in the short term and to mitigate the threat of widespread business closure, a spike in unemployment and the very real risk of an unprecedented downturn in our tourism economy, the effects of which will be felt far and wide across Scotland’s communities, supply sectors and the nation’s economy. Below are a number of measures that will offer a short-term buffer for many of our businesses and reassurance that the Scottish Government is committed to supporting our industry through this extraordinarily challenging time and would ask that you consider the following: • A business rates moratorium for a minimum of 3 ideally 6 months for all sizes of tourism business – this will allow for the required continued investment in the properties and marketing to enable businesses to be as competitive as possible • A payment delay to ease cashflow (i.e. on VAT, PAYE) – cash flow being one of the biggest concerns for small to medium business which dominate our sector. They like others need to be able to stem the outgoings to see them through the other side so that they are in a positive place and able to respond quickly when travel confidence returns. • A continued push from Scottish Government to the UK government for an immediate cut in tourism related VAT to incentivise consumers both from our domestic and international to book trips and holidays to enable trade to resume as quickly as possible when the virus threat subsides. • Make funding/low interest loans available to support tourism businesses to stay afloat, pay their staff many of whom have just been contracted for the season and operate as far as can possibly be normal throughout the short to medium term. As you will know, the Scottish Tourism Emergency Response Group (STERG) is to be established to respond in a coordinated manner to the threats and problems which will result from a Flu Pandemic in Scotland, so they can redefine and redirect its resources towards crisis management tasks internally and externally. The STA is part of this group and we will meet on Tuesday to discuss its role, remit and activity required over the coming days and weeks. I am also a member of the High-Level Tourism Working Group which has agreed to convene weekly . Given the significant reach and very close personal and direct connect the STA has with many businesses across all sectors of the industry, c75% of all tourism business being under our umbrella of membership, the STA are of course fully committed to playing the fullest part possible to help manage this unprecedented challenge and communicate to all through these difficult times I would very much hope that the Scottish Government will make an announcement of the much needed crisis support package for Scotland’s tourism industry recognising just how important the industry is, not just being a major employer but also a driver and heartbeat of Scotland’s economy in all 32 local authorities which will offer some comfort to our industry at this critical time. I look forward to your reply in due course. Yours sincerely Marc Crothall Chief Executive Scottish Tourism Alliance Cc Fergus Ewing MSP, Fiona Hyslop MSP .
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