Rother Valley Railway: Local Economic Impact Study

ROTHER VALLEY RAILWAY: LOCAL ECONOMIC IMPACT STUDY

INTERNATIONAL TOURISM CENTRE

October 2013

International Tourism Centre 1 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

PREFACE

The International Tourism Centre was established in 1997 to undertake research and consultancy particularly, but not exclusively, in the emerging markets of Eastern Europe.

It has since extended its activities to managing European Union projects in Sustainable Tourism and Hospitality in the North West, and carrying out contracts for public and private sector clients in the UK generally. It has carried out a number of assignments relating to Cycling Tourism; Recreational and Leisure Tourism; and Heritage and Cultural Tourism activities.

Enquiries relating to the full range of services offered by the Centre can be addressed to:

Mr John Theodore Director International Tourism Centre Manchester Metropolitan University Hollings Faculty Righton Building, Cavendish Street Manchester M15 6BG

Tel: 0161-247-2720 E-mail: [email protected]

STUDY TEAM

Mr David Briggs Manchester Metropolitan University Dr Maurice Palin Manchester Metropolitan University

ACKNOWLEDGEMENTS

The authors wish to thank Graham Baldwin, General Manager of the Kent and East Sussex Railway, David Gillett of Rother Valley, staff at National Trust, Bodiam Castle and Tourism South East.

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Contents:

1.0 Executive summary 4

2.0 Introduction 6

3.0 Methodology 10

4.0 RVR/K&ESR “missing link”: background 11

5.0 Local economic impact 25

6.0 Policy considerations 35

7.0 Conclusions 52

8.0 References 58

International Tourism Centre 3 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

1.0 Executive summary

Rother Valley Railway (RVR) commissioned this report to update the findings of a previous investigation undertaken by Manchester Metropolitan University in 2007. The earlier study concluded that restoring the link between Robertsbridge and the Kent and East Sussex Railway presented a rare opportunity for K&ESR to realise the vision of founding members and secure the basis for a more viable future.

The principal findings of this study are as follows:

 Development of the RVR “missing link” should improve the commercial position of the Kent and East Sussex Railway with passenger numbers increasing to 150,000 per annum given moderate increases in capacity and 200,000 visitors per annum when additional resources from RVR come into place.  Recent studies conducted by a parliamentary select committee and the Heritage Railway Association confirm that heritage railways now make a significant contribution to local economies. Although short term multiplier values range from 1.2 to 2.47, over the long term values can be much higher as indicated by research into the ‘legacy’ effect of the London 2012 Olympic Games.

 The nature of Rother District and adjoining economies suggests, as shown in the main text, that the proposed RVR “missing link” development would have a significantly beneficial economic and social impact upon these communities given the wider than average variations in income, deprivation and inclusion.

 The KESR turnover for 2012 was £2.43m. Providing the capital investment required to increase capacity on KESR is made, as passenger numbers rise to 150,000 the potential economic benefit could be of the order of £8.1m of which £3.24m is directly attributable to RVR. On reaching its full potential of 200,000 passengers the total economic benefit becomes £10.80m. of which £5.94m would be directly attributable to RVR. (Using the multiplier of 2.0 recommended in the main text).

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Higher figures are obtained if the average multiplier of 2.47 suggested by the July 2013 Parliamentary sub-committee is utilised.

 The proposed RVR “missing link” development fits well with the vision and objectives set out in Visit England’s Strategic Framework for Tourism 2010-20.

 Increased visitor numbers will directly benefit RVR/K&ESR and indirectly nearby visitor attractions but not without difficulty if resistance to modal shift (from private car to rail/public transport) remains. Without substantial marketing inputs this problem may prove difficult to overcome just as it has done for operators in the commercial transport sector.

RVR/K&ESR like many heritage railways currently face a turning point in their development. As they move increasingly towards the provision of products having wider public appeal or function (such as a tourism transport railway), the balance of resources, especially the ratio of paid staff to volunteers, may call for a fundamental rethink. Demographic factors such as an ageing population may benefit heritage railways in terms of customer base and volunteer recruitment but the age profile of volunteers who were founder members inevitably works against them. Heritage railways such as RVR/K&ESR are now firmly woven into the economy and fabric of their host local community. The economic and wider impacts cement this relationship and in a manner increasingly of benefit to both parties

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2.0 Introduction

This study aims to update an investigation previously undertaken by Manchester Metropolitan University on the Local Economic Impact of Rother Valley Railway. Overall the findings were very positive and it is now necessary to reconsider many areas as the Rother Valley Railway (RVR)/Kent and East Sussex Railway (K&ESR) “missing link” project reaches a critical new phase.

The Kent and East Sussex Railway is a heritage railway currently operating between the town of Tenterden in Kent and a terminus station located near Bodiam Castle. Rother Valley Railway has restored two sections of track along a section previously linking Tenterden with the national rail network at Robertsbridge. Once the whole section from Bodiam Castle to Robertsbridge is reinstated, it is anticipated that impact upon the local tourism economy will be significant.

K&ESR is a good example that typifies achievements made in the field of railway preservation since the 1960s. Through the efforts of a predominantly volunteer workforce and local residents wishing to retain something regarded as part of the fabric of their community, railway closures forced on grounds of commercial viability ultimately gave rise to a thriving heritage railway sector. K&ESR is a success story in these terms and is marketed under the theme “Britain’s first light railway”.

Over the past fifty years, preserved railways have translated their success from a product having a strong appeal for narrow interest groups (rail enthusiasts) into one with much wider (public) appeal. Consequently, as preserved railways evolved into successful tourist attractions in their own right, the process has not been without challenges and some tension arising from the need to meet commercial objectives but simultaneously satisfy the objects of an organisation founded for the purpose of preserving valuable railway artefacts.

This conundrum remains because preserved railways would not exist without the foresight and continued contribution of railway enthusiasts. However, all of this may count for very

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little if the organisation through which they channel their efforts is not financially sustainable. Typically, most preserved railways are charitable organisations funded in part by members’ subscriptions and donations. Whilst charitable status brings many advantages with respect to taxation, revenues often need to be supplemented through trading activities in line with The Charities Commission (CC) and Her Majesty’s Revenue and Customs (HMRC) guidelines.

Trading activities place preserved railways on the front line as visitor attractions operating in a competitive environment exposed to general economic conditions and demands from an increasingly more discerning consumer within the visitor economy. Whilst volunteer inputs provide a substantial subsidy toward investment and operating costs, reliance upon a largely volunteer workforce has drawbacks in terms of availability and reliability in delivering required operating capacity on a day-to-day basis.

Recently, K&ESR have experienced a number of problems in terms of delivering a successful, well-proven product from a tightly constrained resource base. Through development of the “missing link” between Bodiam Castle and Robertsbridge opportunities may arise whereby some of these capacity constraints are alleviated. In turn, this may produce a more substantial player in the heritage railway sector and local visitor economy. Securing these benefits will involve trade-offs expressed in terms of economic, social and environmental impacts. Therefore, this study seeks to provide through a ‘holistic’ view an evaluation of these areas. It is within this context that the study has been commissioned by Rother Valley Railway and whilst research objectives broadly follow those of our previous study it is recognised that significant changes have occurred in the backdrop against which the RVR/K&ESR “missing link” project is set. Hence the following objectives were covered:

 To review long term visitor trends for K&ESR and the context of the visitor economy in which it operates  To evaluate the impact of an RVR/K&ESR Robertsbridge to Tenterden heritage railway upon the local visitor economy and other relevant stakeholders

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 To assess the extent to which investment in the railway would support local objectives for tourism and economic development.  To consider the relevance of Visit England’s Strategic Framework for Tourism as a reference point for future development of the RVR/K&ESR “missing link”.

The report is thus structured in the same sequence as the above objectives.

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3.0 Methodology

Local organisations and attractions were approached with a request for data and a number responded with varying degrees of detail. With other data that was either available online or was supplied it was considered possible to produce a report which highlighted some key facets of the impact of the proposal to extend the KESR to Robertsbridge.

Visitor data for the area around Tenterden and further afield, and for some of the local attractions, was gathered, as were the views of some of the stakeholders. Interviews were conducted with the managers of the two major local attractions: Bodiam Castle, and KESR. This was used to set the proposal in the tourism context for the area.

Where appropriate data was available, calculations were carried out to provide some projected outcomes. A number of aspects were considered. These included:

1) Current limitations on visitors, such as congestion and capacity issues at peak times: For the KESR For other attractions in the area especially Bodiam Castle.

2) Possible detrimental effects on increasing the numbers of tourists visiting the area.

3) Potential ways of increasing visitor numbers: Potential new markets  Increasing the proportion of visitors to the South East choosing to visit the Tenterden/Robertsbridge area  Inducing a modal transport shift for a proportion of the visitors 4) The possibility of using the restored link to promote the area generally. Recent publications were consulted to understand relevant policy considerations that may impact upon future development of RVR and K&ESR.

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4.0 RVR/K&ESR “missing link”: background

Heritage railways and economic conditions.

In common with many visitor attractions, Britain’s heritage railways rely heavily upon volunteer inputs and charitable status to meet their prime objectives. However, it is the realities of the marketplace that ultimately determine success or failure by whatever measures of performance are used.

Faced with a backdrop of difficult trading conditions within the national economy, heritage railways have, overall, produced some above average performances:

The figures reported last year showed a small decline but this would appear to have been a “blip”. It is good to see we are back on track this year. Taking the two years together we show an average visitor growth of around 4% per year. The figures demonstrate that we are a significant vibrant, resistant business sector.

D. Hillier Annual Statistical Survey 2011, Heritage Railway Association Annual Report 2012.

Growing the business and factors affecting growth: case examples

Although national economic factors produce positive and negative impacts upon heritage railways, some have turned in very good results through a combination of long-term investment and sound marketing practice. The following case examples would seem to illustrate this and offer appropriate pointers when considering how RVR’s development might progress:

1. North Norfolk Railway (Poppy Line)

The North Norfolk Railway (NNR) has a strong and well developed market image expressed through its identity as “The Poppy Line”. Geographical factors also play a part with Sherringham, a popular Norfolk coastal resort, and Holt, a thriving market town International Tourism Centre 11 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

having much appeal to tourists. More recently, visitor numbers received a boost with the opening of a level crossing in Sherringham linking NNR to Network Rail infrastructure:

We are currently celebrating a record 2010, figures just released show that a total of 143,991 travelled on our trains in 2010, a rise of over 13% on the 2009 total. Marketing Director Colin Borg said: “Given the challenging economic conditions during the year, this is a splendid result – and the railways highest-ever passenger total. It’s a real tribute to the skills and dedication of our volunteers and staff in delivering a superb experience for both residents and visitors”. General manager Trevor Eady puts last year’s success down to three key factors: “The reopening of Sheringham level crossing, doubling the number of trains run in May and June, and introducing new events like the visit of Ivor the Engine.”

Source: North Norfolk Railway website, 12th January 2011.

Whatever the underlying cause(s) responsible for post 2009 results, the chart below shows that growth has been substantial:

The North Norfolk Railway("Poppy Line") Visitor numbers 2008-12

160000

150000

140000

130000 Visitor numbers 120000

110000

100000 2008 2009 2010 2011 2012

Chart 4.1 Source: Visitor Attraction Trends England 2012, Annual Report

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2. The North York Moors Railway

Established forty years ago, the North York Moors Railway (NYMR) has become Britain’s largest heritage line in terms of visitor numbers. Set in a picturesque area of North Yorkshire, the railway benefits from having a terminus in the busy market town of Pickering. Also, ITV’s television drama (“Heartbeat”) still draws many tourists to the small village of Goathland and has featured the NYMR as a setting for many scenes.

Although NYMR is connected to Network Rail infrastructure at Grosmont, access from major routes such as the East Coast Main Line involves a lengthy journey via the (albeit scenic) Esk Valley line running from Middlesbrough to Whitby. Whilst Grosmont is a well- established network connection, it is NYMR’s access to the Whitby section of the line that has created potential for further growth in visitor numbers. Not only does Whitby, a popular coastal resort, offer access to a large day trip and vacation market, scope for modal shift from car to rail is another major opportunity. Visitors switching the origin for their NYMR journey to Whitby take pressure off NYMR parking facilities (especially in peak season and for popular events) at Grosmont and Goathland.

The following extract illustrates the true benefit from NYMR having access to running on Network Rail (NR) metals without passengers needing to change railways at Grosmont:

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A leading visitor attraction has defied both bad weather and the economic downturn.

The North Yorkshire Railway last year recorded the second highest number of passengers in its 40 year history.

A total of 315,000 visitors rode on the heritage railway, despite the poor summer and economic pressure.

General Manager Philip Benham described the figures as “remarkable “and added:

“We are very pleased with these results. There has been a lot of hard work and the figures reflect a railway which continues to be appealing for tourists and enthusiasts alike. Despite a small decline in volume, we remain the market leader in heritage steam and remain one of Yorkshire’s finest attractions. This puts us in good stead to face the challenges ahead”.

Extended services beyond Grosmont to Whitby were one of the key factors. In 2008 the number of services running between Pickering and the coast increased by half.

Source: The York Press, 3rd February 2009

RVR impact upon K&ESR

The development of any new visitor attraction needs examining with respect to the existing marketplace, local economy and surrounding region. In the case of RVR, restoring the “missing link” between Network Rail infrastructure and the K&ESR, requires considerable attention be paid to economic spill-over effects and other externalities.

The following analysis starts by considering the current position of K&ESR as a basis for understanding likely impacts from, and interactions with, the development of a connecting railway operation. Although time series analysis of passenger numbers can be been taken as an indicator of recent performance, this much used statistic for visitor attractions needs International Tourism Centre 14 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

treating with caution. Turnover and profitability could equally feature in any assessment and it does not follow that adverse or favourable movements in one variable correlate directly with others. Also, some of the distinctive characteristics of rail operations add further complexity to this task:  Railways, in whatever form, tend to be high fixed cost structures consuming large sums of expenditure in areas such as infrastructure, rolling stock and traction provision.

 Recovering variable costs from revenues earned is often within a set of imposed constraints. In the case of Train Operating Companies (TOCs) serving the national network, fares are regulated under frameworks established through government policy. By way of contrast, the independent nature of heritage railways exposes them to conditions in the marketplace leaving open market conditions a factor governing the scope to change prices. Also, heritage railways face exposure to the wider visitor attractions market rather than the narrower area of transport provision.

 As transport providers, commercial TOCs and independent heritage railways are obliged to comply with similar relevant safety standards (ROGS) set out in legislation and administered through bodies such as the Office for Rail Regulation (ORR).

 Many rail operations (commercial and heritage) enjoy substantial subsidies in one form or another. In the case of TOCs it is the taxpayer who, via government expenditure, makes this contribution. With heritage railways, it is the significant contribution from volunteer inputs and donations from a wide collection of sources that make up the ‘hidden’ subsidy.

 Efficient and effective utilisation of capacity are strongly affected by “peak load” problems experienced on a daily basis and through seasonal demand patterns. For managers of heritage railways, availability of volunteers who may have job and family commitments can create headaches when trying to deliver consistent service standards to a discerning public.

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 Rail operations, both commercial and heritage, are charged with meeting multiple objectives that extend well beyond the narrow requirements of breaking even or making a profit. Services provided by commercial TOCs contain a social element as do heritage lines which, additionally as tourist attractions also meet some cultural objectives.

 The perspective of a “stakeholder “(customer, volunteer, local community, custodian of national/cultural heritage) is more appropriate than the narrow one customarily associated with shareholders. However, a modern commercially oriented rail network does not escape these obligations when modifications to existing product delivery or new developments are put forward.

Analysis of K&ESR demand patterns Bearing in mind some of the points listed above, K&ESR passenger numbers were analysed using simple time series techniques. K&ESR is a well–established and successful heritage railway delivering a product themed around the concept “Britain’s first light railway”. As the following charts show, the past decade has seen an overall decline in passenger numbers averaging 1,034 per annum from 2000 to 2012.

K & ESR passenger numbers 2000-12

115000 110000 105000 100000 95000 GRAND TOTAL 90000 Linear (GRAND TOTAL) 85000 80000 75000 70000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Chart 4.2 Source: Data supplied from K&ESR Annual Accounts.

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The above data when converted into index format allows the relative position with respect to passenger numbers to be seen more clearly. The following chart takes 2001 as a base period and although an “untypical” year should not normally be taken as a basis for reference purposes, here it illustrates well the pattern that has emerged. Thus, comparisons with reference to the base period are to a year (2001) generally regarded as poor for visitor attractions and domestic tourism (because of foot and mouth disease). Later that year, overseas visitor flows were influenced by uncertainty in the aftermath of 9/11.

K&ESR passenger numbers 2001-12 (Base: 2001=100)

105.0

100.0

95.0

90.0 Index Linear (Index) 85.0

80.0

75.0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Chart 4.3 Source: K&ESR Annual Accounts

Whilst the above index shows a falling trend with respect to base period, values for recent years 2008-12 illustrate how time series values may be influenced. Typically, the following components may be present:  Trend – an underlying trend may represent long- term structural changes in demand such as an increase or decrease in the popularity of a product. Followers who subscribe to product “life cycle” theories may see a phase of the cycle when trend values remain stable over several years/decades

 Cyclical –business activity levels are influenced by cyclical variations in economic activity whenever the economy experiences a boom or downturn such as that following the financial crisis of 2008. When international tourism activity is taken into account, the

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impact may be substantial should overseas expenditures enhance, reduce or offset domestic tourism values.

 Seasonal - demand for tourism services usually carries a strong seasonal element showing up in terms of demand fluctuations from one quarter, month, week, or day to another.

 Random or irregular influences – Whereas the above three factors frequently exhibit stability that can be utilised for forecasting and planning purposes, random occurrences present a special challenge to operators. With external shocks outside the control of an operator, it is ultimately operational resilience that will shape business success and survival.

Seasonality Tourism expenditures/ visitor numbers during the first quarter of any year may be affected by a host of factors, such as:  Closure of facilities for maintenance purposes, generally low demand or closure of complementary facilities/attractions.

 Timing of the Easter vacation period and subsequent influence of weather conditions. It is for this reason that values for March and April have been aggregated in this study.

As Chart 4.4 shows, wide fluctuations in values over long periods of time may occur during the first quarter of the calendar year.

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Index of K&ESR passenger numbers 2000-12 (Base :2000 =100) 120.0

100.0

80.0 FEB 60.0 MAR/APR Linear (FEB) 40.0 Linear (MAR/APR)

20.0

0.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Chart 4.4 Source: K&ESR Annual Accounts

Upon entering the second quarter (spring season), trading conditions are often more favourable because of weather conditions and statutory holiday periods. However, the months of May and June falling outside the traditional summer vacation season present significant challenges from a marketing perspective.

Index of K&ESR pasenger numbers 2000-12 (Base 2000 = 100) 160.0 140.0 120.0 100.0 MAY 80.0 JUNE 60.0 Linear (MAY) 40.0 Linear (JUNE) 20.0 0.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Chart 4.5 Source: K&ESR Annual Accounts

For many visitor attractions, this is where efforts aimed at the group market need to be directed to improve capacity utilisation without sacrificing revenue opportunities. It is International Tourism Centre 19 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

interesting to note that North Norfolk Railway cite targeting of these months as a factor contributing to recently improved results.

For many UK visitor attractions high season is during the third quarter (summer) months. A problem faced by individual attractions is the level of competition from other nearby visitor attractions. The following chart shows how K&ESR may have been affected but again, long- term trend values (for August and September) quarter are falling.

Index of K&ESR passenger numbers 2000-12 (Base: 2000 = 100) 120.0

110.0 JULY 100.0 AUG 90.0 SEPT Linear (JULY) 80.0 Linear (AUG) 70.0 Linear (SEPT) 60.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Chart 4.6 Source: K&ESR Annual Accounts

The seasonal nature of tourism activity requires attention to be paid to low demand periods where revenue contributions are needed to at least cover overheads. The following chart shows successful results and rising trend values with K&ESR experiencing increased demand from themed events. Whilst Christmas and other themed events inserted into the low season calendar may lift demand, the marketing and logistical challenges are substantial. Dependency on volunteer inputs and weather conditions invariably prove critical as far as success or failure is concerned with one-off events.

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Index of K&ESR passenger numbers 2000-12 (Base: 2000 = 100) 200.0

180.0

160.0 OCT 140.0 DEC 120.0 Linear (OCT) 100.0 Linear (DEC)

80.0

60.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Chart 4.7 Source: K&ESR Annual Accounts

The following chart shows how K&ESR and nearby attractions fared under recent economic conditions. The sample was taken from south east attractions of various types close to the Rother District. Also, all attractions in this group have approximately 100,000 visitors or more per annum. Overall, the picture shows the variability that can occur when different attractions are faced with the recent economic backdrop.

Index of visitor numbers to South East visitor attractions near RVR/K&ESR (Base: 2008 =100) 130.0 K&ESR 125.0

120.0 Chartwell 115.0 1066 Battle Abbey and 110.0 Battlefield 105.0 Batemans 100.0 Bodiam Castle 95.0

90.0 Dover Castle 85.0 The Dockyard Chatham 80.0 2008 2009 2010 2011 2012

Chart 4.8 Source: Visitor Attractions Trend England, Annual Report 2012.

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The following chart shows K&ESR visitor numbers to be in line with regional and national patterns up to and including 2008. Afterwards, K&ESR figures show better results than might be expected, had national/regional patterns been followed. Index of tourism trips 2006-10 (Base: 2006 = 100)

105

100

95 K&ESR South East 90 UK 85

80 2006 2007 2008 2009 2010

Chart 4.9 Source: UKTS and IPS 2011 (N.B. Values post 2010 not included because of change in sample methodology).

The tourist environment around KESR/RVR

Tourism is an important part of the economy in the area bounding the railway, with a number of attractions in the vicinity.

The area of Kent in which the railway is found is the borough of Ashford. The pattern of visitors and the change between 2009 and 2011 in Ashford was similar to other areas of the South East. Tourism revenue was estimated at £m183.6 in 2011, an increase of 4% on 2009. Of this the proportions were:

24% by UK staying visitors 14% by overseas staying visitors 62% by day visitors

Approximately 3.5m daytrips were made to Ashford in 2011, with a further 371,000 International Tourism Centre 22 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

overnight stays. (Source: The Economic Impact of Tourism on the Borough of Ashford 2011; Tourism Southeast Research Unit)

The town at the eastern terminus of the railway is Tenterden which is an attractive market town with tourism making a significant contribution to the local economy. However, the general awareness of Tenterden as a tourist attraction is low compared to other areas of Kent. In a perception study conducted in 2012, research was conducted into the perceptions of many areas in Kent, including Tenterden, by visitors and non-visitors, both UK residents and non-UK residents Tenterden had the lowest profile of all the Kent towns included with only 25% of visitors claiming knowledge of it. This was the lowest awareness by a considerable margin. This suggests considerable scope for the expansion of tourism in the area which could be facilitated by improved transport links. (Source: Perceptions of areas of Kent by visitors and non-visitors from research carried out by Visit Kent (2012).

Other visitor attractions in the vicinity of the railway

There are a number of visitor attractions in the area:

1. Tenterden (Cinque Port) small town, museums: Tenterden Museum Colonel Stephens Railway Museum (KESR) 2. Bodiam castle

3. Northiam: The Mill Toy and Pedal Car Museum

4. Small Hythe Place (C16th house and garden)

5. Sissinghurst

6. Biddeneden Vineyards International Tourism Centre 23 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

7. Tenterden Vineyards

8. Rolvenden Vintage Car Museum

9 South of England Rare Breeds Centre

10 Battle Abbey and battleground

The most visited of the attractions in close proximity to the railway is Bodiam Castle. This is a National Trust property that attracts around 170,000 visitors a year (2011). There is considerable enthusiasm for the extension of the railway, and it figures in the medium term plan for the castle.

It is seen as a way of reducing traffic congestion and increasing capacity as the limiting factor at busy times is the capacity of the car park. A discount is given to people who arrive by alternative transport, including the KESR.

Another major benefit of the extension to Robertsbridge is seen to be the opening up of new markets from people currently without access to a car or who do not wish to e.g. circle London on the M25. This would particularly apply to Londoners or visitors to London, but would also allow non-car access from a wide area of the South East and other areas that could connect through London.

Tenterden Museum has modest visitor numbers and would welcome an increase. Again traffic congestion is a concern and alternative transport is seen as a way to increase numbers without causing other problems.

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5.0 Local economic impact

The Value of Tourism

In a survey commissioned by Visit Britain and conducted by Deloitte in association with Oxford Economics the value of tourism in England for 2009 was estimated to be:

 £52 billion in direct contribution (businesses providing tourism related goods and services (4 per cent of GDP)  £63 billion ‘indirect contribution, leading to £115 billion total economic impact (supporting businesses in the supply chain) amounting to 8.9 per cent of GDP.

 In terms of the top 50 districts with highest share of employees in the Visitor Economy, Rother District ranked 35th with 13% of employees engaged in tourism related goods and services.

The complexity of quantifying the Visitor Economy is indicated inDirect the diagram expenditure below: from Supply chain payments to UK UK residents living owned enterprises outside Rother outside Rother District

district.

Overseas visitor Indirect/induced supply Direct visitor income expenditure from chain expenditures within Rother within Rother District. district

Supply chain expenditures to non UK owned enterprises

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In terms of the national picture, the Deloitte/Oxford Economics model utilises 400 variables interconnected by an equal number of equations and variables. Unfortunately, the task of quantifying the value of tourism at the local level is not reduced to any significant extent because macroeconomic variables still need to be factored in.

The statistic quoted for tourism related employment in Rother District is significant because, as the report explains, high levels of employment in the Visitor Economy can be found in cities but “rural areas are more dependent on the sector playing a larger role in local economies and indeed communities”

This study and a previous one commissioned by Visit Britain emphasised the wider impacts of the Visitor Economy and highlighted how it contributes to “the wider policy agenda including economic and social inclusion, enterprise/business formation, sustainable development impacts and regeneration”.

In addition to the importance of the tourism sector in rural areas, the report points to other key factors:  Opportunities for those traditionally less likely to engage with the labour market in a full-time role. Across the UK, one- in- three employees in tourism are part-time female workers.  Relative ease of entry into the industry encourages entrepreneurship and a higher than average number of small to medium sized enterprises (SMEs).  Accommodation usage reflects the offer and trips taken – holiday visitors tend to take part in more activities than visitors visiting friends and relatives.

The Visit Britain report on the value of tourism also emphasised the dynamics of the Visitor Economy, which needs to be evaluated in terms of the context around the offer/core product that attracts visitors to an area or place. Thus, the demand for tourism is considered to stem from one or a combination of factors (such as entertainment;education; aesthetics and escapism ) that make up the “visitor experience”.

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The supply side covers what people go to see or do and may include a mix of cultural assets:  Natural environment  Arts and culture  Towns and commercial centres

Whilst the economic impact of tourism is frequently a focus for many proposed developments, a more holistic approach is now being taken and emphasis placed on the offer expressed in terms of:

Assets/direct offer:  Natural assets such as countryside and landscapes  Historic assets including the iconic features which attract tourists such as castles, railways and traditions  Converted assets previously built for a specific purpose but now offering tourism related products  Purpose built venues Indirect offer: assets which make the destination more attractive by providing services that enhance the trip by increasing convenience or comfort (food, drink, accommodation, transport etc).

The Deloitte/Oxford Economics study concluded that: “Without demand for tourism there would be no reason to provide/support tourist attractions (the supply) and without supply, there would be no effective demand. Demand and supply are therefore mutually beneficial”.

Indicators of economic activity for the Kent economy show wide variations as does the composition of districts (urban, rural, coastal) that make up the county. The following charts show that whilst Kent is located in a region with higher than average levels of prosperity for England, significant variations are evident at district level:

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Unemployment rates: Kent and adjacent dstricts 2010-11 (% Persons aged 16-64)

Thanet 16.4 Dartford 14.2 Hastings 10 Dover 9.8 Gravesham 9.4 Canterbury 9 Shepway 9 Rother 9 Swale 8.9 Tonbridge and Malling 8.8 Medway 8.4 England 7.8 Tunbridge Wells 7.7 Eastbourne 6.8 Sevenoaks 6.4 South East 6 Ashford 5.2 Wealden 4.5 Maidstone 3 Brighton and Hove 2.5 Lewes 2.5 0 2 4 6 8 10 12 14 16 18

Chart 5.1 Source: Office for National Statistics, Neighbourhood Statistics, 2012.

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Employment activity: Kent and adjacent districts Aged 16-64 (% Persons)

Maidstone 84.9 Tunbridge Wells 81.5 Shepway 81.1 Gravesham 80.8 Brighton and Hove 80.7 Lewes 80.7 Swale 80.7 Eastbourne 80.5 Ashford 80.1 South East 79.5 Sevenoaks 78.9 Tonbridge and Malling 78.6 Dartford 78.5 Thanet 77.9 England 76.3 Medway 76.1 Rother 75.5 Dover 74.8 Wealden 74 Hastings 72.8 Canterbury 71.4

60 65 70 75 80 85 90

Chart 5.2 Source: Office for National Statistics, Neighbourhood Statistics.2012

Tourism expenditures and multiplier effects

Economic theory suggests that initial (direct) consumer spending will create additional rounds of expenditure in the form of indirect and induced spending, as those receiving revenue from direct spending make purchases from their suppliers and pay incomes to employees.

Although every pound of tourism expenditure may lead to additional expenditures within the local economy, the magnitude of subsequent expenditures may prove difficult to quantify. A major problem arises in terms of following the “money trail” to identify expenditures retained within, and those leaking from, the local economy.

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Hughes (1994) calls for a more judicious approach when applying the multiplier to tourism related expenditures. Areas of principal concern include the following:  Confusion arising because of the variety of approaches to multiplier analysis.  Lack of longitudinal data to show the effects over time of an injection of expenditure; multiplier analysis sometimes fails to take into account the time period for the full impact to be felt.  For short term expenditures the link between employment and tourism expenditure may prove questionable.  Unrealistic and restrictive assumptions, such as there being a linear relationship between expenditure, employment or income as well as the availability of unemployed and mobile resources.  Opportunity costs for resources are frequently ignored.

Additionally, it can be claimed that multiplier analysis neglects real relationships and interactions that make up the real costs/benefits of tourism in the form of social and cultural matters.

This report has taken the above factors into account when utilising secondary statistics based upon multiplier analysis. Also, it is recognised that the development and impact of heritage visitor attractions calls for an understanding of something wider than purely economic benefits. Few preserved railways operate solely as commercial undertakings and, as such, frequently become integrated into the social, commercial and cultural fabric of a local community.

In estimating the impact of Rother Valley Railway it was concluded that, in common with new projects, lack of data was the principal obstacle to obtaining precise predictive values specific to this undertaking. Instead, indicative measures were used from established sources.

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Tourism impact data for districts in Kent Organisations at regional level responsible for monitoring and promoting tourism use a variety of models. Tourism South East publishes data on the impact of tourism expenditure and uses the widely accepted Cambridge model developed by Geoff Broom and associates.

The Cambridge model offers a valuable snapshot of features relating to tourism expenditure in an area. Changes in the methodology used to derive some of the data inputs make it difficult to show comparisons over time. However, many of the results published from application of this model do exhibit high levels of consistency:

Tourism expenditures by district (multiplier values) 2009 £ millions 500.0 75.7 400.0 70.7 300.0 66.4 30.0 200.0 56.6 398.2 30.4 53.6 47.9 36.5 20.5 36.4 336.4 32.1 219.6 100.0 179.3 180.2 20.0 180.3 175.9 182.9 186.8 180.6 202.2 INDIRECT/INDUCED 116.7 81.7 DIRECT SPEND 0.0

Chart 5.3 Source: Tourism South East Research Department.

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Tourism expenditures(multiplier values) by district 2011 £ millions 600.0

500.0 111.1

400.0 95.0 300.0 65.1 31.2 200.0 59.2 406.0 56.0 53.6 47.9 36.5 20.5 36.4 333.6 32.1 226.9 INDIRECT/INDUCED 100.0 181.1 187.6 20.0 187.3 184.5 191.5 193.9 194.0 210.1 126.4 86.1 DIRECT SPEND 0.0

Chart 5.4 Source: Tourism South East Research Department

Expenditure and multiplier values for Rother District show similar levels of consistency over time: Rother District : Tourism expenditures (multipler values) 2008-11

350.0

300.0 48.2 43.3 49.0 50.0 250.0 200.0 150.0 INDIRECT/INDUCED 237.2 262.5 100.0 267.2 272.0 DIRECT SPEND 50.0 0.0 2008 (1.22) 2009 (1.22) 2010 (1.22) 2011 (1.23)

Chart 5.5 Source: Tourism South East Research Department

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Although expenditure multiplier values average 1.23 across all districts, the impact of direct spending upon indirect and induced spending has to be regarded as an immediate/short term impact. An in-depth study of expenditures and subsequent impacts at West Somerset Railway suggested a multiplier value approaching 1.9. Estimates using K&ESR accounts for 2012 also indicate a figure close to 2.0.

The following chart suggests that, long term, the multiplier value can be much higher:

Economic impact of London Olympics 2012 (£ millions)

6000

5000

4000 5100 Total stimulus to UK economy 3000 Consumer spend increase(2012)

£ millions £ 2000 1140 1000 750 750 0 2012 2015

Chart 5.6 Source: www.visaeurope.com

Chart 5.6 uses data from, and shows impacts upon, a wide range of industries from 2012- 2015. Here the multiplier value is approximately 6.8. Another study conducted by Oxford Economics estimated the impact of London 2012 Olympics on tourism expenditures alone. More importantly, it considered impact over the long term 2005-17 with “legacy” accounting for over £1 billion at 2012 prices. Another key feature of this study was that it identified net impact by considering factors such as displacement. Overall, the multiplier value attributed to tourism expenditure was estimated to be 2.5.

Estimating multiplier impacts arising from expenditures generated at a specific tourist attraction requires data gathering for the “money trail” leading from direct to indirect and induced effects. Tracking the money tail, as advocated by organisations such as The New Economics Foundation, can help in raising the multiplier effect by enabling a better focus upon leakages (e.g. through not using suppliers outside the local area in which an attraction International Tourism Centre 33 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

operates. Taking broad categories of expenditure found in K&ESR annual accounts, a multiplier value of approximately 2.0 is estimated.

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6.0 Policy considerations and assessment of impact.

The complex and interconnected interface that makes up demand and supply sides of the tourism offer increasingly calls for any tourism related development to be in harmony with wider policy frameworks at local, regional and national level.

In terms of the latter, Visit England has introduced a Strategic Framework for Tourism 2010 -20. Published in March 2010, this document sets out four interdependent objectives identified to address the opportunities and challenges for England’s visitor economy: Objective 01 – To increase Englands’s share of global visitor markets Objective 02 – To offer visitors compelling destinations Objective 03 – To champion a successful, thriving tourism industry Objective 04 – To facilitate greater engagement between the visitor and the experience

In addition to providing the vehicle for steering development of England’s visitor economy, these objectives play a part in the allocation of government funded initiatives and resources for tourism. For example:  In Autumn 2013 the British Hospitality Association and Visit Britain will deliver a series of road shows highlighting the growth opportunities in the visitor economy and how these can be realised through greater collaboration in local areas (Objective 2).  The Department for Environment Food and Rural Affairs(Defra) working with Visit England continue to deliver on the £25m Rural Economy Growth Review Package (Objective 3).  15 Employer Academies have been set up in strategic UK locations with Providers and Employers (Objective 3).  Employer Ownership of Skills Pilot – round one allocated £90m for activities ranging from helping young people into work by delivering pre employment training to extending apprenticeships and training (Objective 3).  Work has commenced to identify examples of best practice in the co-ordination of public transport services and transport modes and destinations (Objective 4).

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With suitable vision and resources the RVR “missing link” could develop into a focal point for, and spearhead the type of initiatives cited above in the Rother Valley.

Similarly, the RVR/K&ESR “missing link” would seem to offer opportunities for making a contribution to the aspirations of Objective 01. As the following chart suggests this area is atrracting increasing attention because the long term trend for overseas visitor numbers is a declining one although expenditures in nominal terms are rising.

Indicies of overseas visitors to UK(GMAA) and overseas visitor expenditures (GMAK) 2005-13 (Base: January 2005 =100) 300.0 250.0 200.0 GMAA 150.0 100.0 GMAK 50.0 Linear (GMAA) 0.0

Linear (GMAK)

2005JUL 2006JUL 2007JUL 2008JUL 2009JUL 2010JUL 2011JUL 2012JUL 2013JUL

2006JAN 2007JAN 2008JAN 2009JAN 2010JAN 2011JAN 2012JAN 2013JAN 2005JAN Chart 6.1 Source: ONS, Travel Trends Dataset 2013.

A network connected RVR/K&ESR would seem to present opportunities for the following reasons:  Location – close proximity to London the first point of entry for most overseas visitors.  Location – the South East region and Kent in particular are a natural first stepping- stone for many European visitors (France ranks first in terms of visitors to the UK from a single country and is within range for day trip visitors).  Location – Heritage and natural landscape, key components of the England visitor offer attracting overseas visitors, make up the principal assets along the RVR/K&ESR corridor.  Implementation and delivery – lack of an appropriate management skills set and philosophy does not appear to be a barrier in terms of achieving progress in the area

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covered by Objective 01. In addition to well established and direct contributors such as Tourism South East, organisations such as Robertsbridge Enterprise Group, Hidden Gems of England, and High Weald AONB Unit already offer a valuable pool of expertise.

In June 2011, Visit Britain launched a series of industry Action Plans and in March 2012 three were launched covering Skills, Quality and Transport.

Visit England Tansport Action Plan

The Tourism and Transport Action Plan is a key reference point for a project which seeks to establish a “missing link” and provide not only greater integration of transport facilities but also core and supporting players delivering the visitor experience:

Vision: Contribute to a 5% growth year on year, in the England tourism market by 2020,

through better planning, design and integration of tourism and transport products and services.

Objectives

1. To improve the ability of domestic and inbound visitors to reach their destinations,using the mode of travel that is convenient and sustainable for them with reliable levels of service(by road and public transport), clear pre-journey and in- journey information at an acceptable cost 2. To ensure that visitors, once at their destinations, face good and convenient choices for getting about locally,meeting their aspirations as well as those of the local community for sustainable solutions. 3. To help deliver the above, to influence transport planning at a strategic level as well as local level to give greater consideration to the needs of the leisure and business traveller and to overcome transport issues that act as a barrier to tourism growth.

4. In all these, seek to work in partnership with public authorities and commercial transport

providers , to ensure that the needs of visitors are well understood and acted upon,and that

their value to local economies is fully taken on board in policy decisions about transport

infrastructure and service.

Although major capital projects such as Thameslink and Crossrail will impact on the plans

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Over the long term, some of the seemingly minor issues such as the complexity of ticketing for public transport can be overcome and present ‘quick win’ opportunities that alleviate tensions and frustrations faced by tourists.

In addressing the relationship between the transport and tourism sectors, Visit England’s Transport Action Plan outlined some important points that present opportunities for a project such as the RVR/K&ESR “missing link”:  The transport infrastructure that serves visitors provides benefits to loal residents as well  The transport experience can also be an important component of the holiday itself  England has a lack of transport integration and this is compounded by deregulated service provision in areas outside London  Recognising the appropriate modes of travel for the different types of journey and to advocate a proper understanding of those links and the value that they have to local economies among the transport policy and planning community.

Integrated transport and the ultimate goal of seamless travel, as far as the transport element of tourism is concerned, calls for long term solutions but “quick win” opportunities are feasible in both of the principal travel elements influencing the visitor experience:

1. Getting about destinations locally – Visit England’s Transport Action Plan recognises the dominant role private car plays for visitors, at least when travelling to a destination. However there may well be greater scope for Management Organisations (DMOs) working with visitor attractions to develop and market alternative modes of transport whilst travelling around a destination. National Parks have faced up to this issue over many years and recognised the need to: “adopt sustainable means of transport in line with the character of the destination and the local environmental policies being pursued whilst also giving the visitor choice and a quality ‘must- repeat’ experience”. Thus it would seem that the RVR/K&ESR “missing link” is well placed to play a pivotal role in this process and benefit directly or indirectly from visitors making

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use of cycle hire, specialist bus, walking and park and ride whilst exploring the Robertsbridge – Tenterden corridor.

2.Travel to destination – although rail usage is currently at its highest level for ninety years, capacity constraints leave potential for growth coming from off-peak leisure travel, especially at weekends. Rail services such as those provided on the London - Hastings line are primarily designed to meet the needs of commuters and other users with regular weekday travel patterns. Leisure travellers on the other hand have less predictable requirements. However, opportunities exist whereby mutually beneficial arrangements (for train operating companies and tourist passengers) can be utilised via greater use of capacity in off-peak periods.

Although development of more sustainable modes of transport is a feature of many policy pronouncements, in practical terms and from the consumers’ perspective, a switch from private car to rail is still likely to encounter resistance.

By following recommendations set out in Visit England’s Transport Action Plan the RVR/K&ESR “missing link” could pilot a more sustainable approach geared to a greater proportion of visitors using the NR connection at Robertsbridge. However, this will require major marketing inputs to change consumer perceptions generally and specific consumer choices regarding travel to Rother District.

Even though it is assumed that consumers make rational economic choices regarding their travel plans for their leisure, there is available evidence which points to contradictory results. As a consequence, consumers may be at odds with rational decision making. Consider the following charts(6.2,6.3 and 6.4) and underlying rationale. Recognising the potential catchment area that services such as Thameslink might open up for RVR/K&ESR, a sample of towns and cities was selected where one way journey times to Robertsbridge were between approximately two hours and preferably under three. Start times for outward journeys were timed to be as close as possible to 10 am (to secure off peak travel rates). Return journey times were timed as close as possible to 4pm. Costs were then calculated for

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a return journey to Robertsbridge for two adults and two children. No discounts from use of railcards were included.

The following chart shows, using these assumptions, a comparison of travel costs by rail and private car. For private car, only fuel costs were used initially and the assumption that a small/medium vehicle with modest consumption of 40 mpg applied.

Comparison of travel costs to Robertsbridge (Off-peak return trip,2 adults + 2 children) 90 77 80 74.2 72.6 69.6 67 66 70 64.4 63 59 60 47.4 46.4 50 43.6 45.2 Return cost (£) 40 30 30 Rail cost 30 21.6 Road cost 20 13.2 10 0

Chart 6.2 Source: Data from National Rail Enquiries/AA routeplanner

The values presented above are what might be described as ‘ headline’ values that may influence consumer choice with regards to mode of travel. Clearly costs for travel by road appear to be lower based upon the assumptions used. Since it is a host of factors which will influence consumer choice road and rail journey times were also considered. The following chart shows journey times for a one way trip to Robertsbridge from selected origins:

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Comparison of journey times to Robertsbridge (one way times in minutes) 200 180 186 172 180 161 164 149 148 149 153 150 160 138 140 123 130 120 101 Trip time 100 (minutes) 80 72 53 60 Rail time 40 23 20 Road time 0

Chart 6.3 Source:Nnational Rail enquiries/AArouteplanner

With the exception of London Bridge, all origins in the sample offer, lower travel times by road for a one way journey to Robertsbridge. For inbound tourists these results may have little significance if London is the most likely departure point. However, for domestic tourists journey times in the region of 120 -180 may prove a disincentive to travel. When other factors are added in, from the consumer’s perspective, travel by road has distinct advantages. For destination managers, these advantages translate into problems with regard to travel into and around destinations.

However, it is possible to show a different comparison of travel costs using what might be regarded as the relevant true cost of travel using private car. Since rail fares include fuel, operating and infrastructure costs, it could be claimed that this produces a fairer or more consistent basis for comparison. Also, if consumer behaviour did accord with economists’ model of ‘rational economic man’ choices would be based upon true costs of travel by private car rather than ‘headline’ values.

The following chart show the comparison metrics change more favourably towards rail when overheads are included for using private car as mode of transport to a destination :

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Travel costs to Robertsbridge (Off-peak return trip: 2adults + 2 children) 120

100

80 Return trip 60 cost(£) 40 Rail cost 20 Road cost

0

Chart 6.4 Source:Nnational Rail Enquiries/AArouteplanner

Encouraging a modal transport shift

An advantage of connecting to the main rail network is that it provides the opportunity to bring about a modal shift in the way some of the visitors come to the area. A major issue in encouraging this shift is the cost of rail travel compared to travelling by car. If the total cost per mile of having a car, as calculated by the AA is used, then in many instances a family of two adults and two children would pay approximately the same amount whichever way they travelled. For longer distances it would be cheaper to travel by rail, albeit with a longer journey time, unless the journey starts from a location in the South East.

However many people who are car owners would discount much of the annual cost of running a car for a specific journey and would focus mainly on the fuel cost. In this case, it is much cheaper to travel by car as the fuel costs are between about a quarter and a half of the rail cost. Less people travelling in the car reduces the differential.

A positive incentive to rail travel to Robertsbridge is that its position means that for most motorists the obvious route is the M25 which is seen by many people as an uncomfortable International Tourism Centre 42 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

driving experience and often subject to delays. This offsets some of the extra convenience that road travel seems to offer. It also means that journey times by road can be greatly extended.

Nonetheless, it is likely that some financial incentives would be needed to bring about a significant modal transport shift. This is currently done by Bodiam Castle, which discounts the entry price for visitors arriving by "alternative transport", including those visitors arriving via the KESR. An exploration of links and possible joint promotions between the railway, mainline rail operators and other visitor attractions/hotels etc could be effective in bringing this about.

An advantage that would be in the interest of the various attractions is that promotions could be tailored to bring in visitors at what are currently times of lower demand. This is an important issue for Bodiam Castle as mentioned earlier, where the capacity of the car park limits visitor numbers at busy times. The KESR itself would benefit from the smoothing of demand that this would bring as at peak times it operates at full capacity and probably loses significant numbers of passengers as a result. Shifting some demand to less busy times using promotions would therefore allow an increase in overall numbers.

Marketing the restored link As mentioned in an earlier section, as well as encouraging some of the existing visitors to change their method of transport, opportunities exist for developing new markets. The main target for this falls into two broad groups: 1) London residents; and 2) visitors to London.

1) Car ownership amongst London residents is much lower than for the rest of the country due to the cost and inconvenience of keeping a car in London and the existence of a highly developed transport infrastructure which makes car ownership less important. This means that many Londoners wishing to make trips outside London focus on destinations allowing access by public transport. Currently this excludes places served by the KESR.

2) The large majority of independent visitors to London either from other parts of the UK or from overseas do not have a car with them or would find hiring a car and driving from International Tourism Centre 43 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

London to visit other places in the Southeast a daunting prospect. Consequently as for London residents, if they want to explore areas around London they will look for places to visit which have a rail connection.

These two groups therefore offer the potential for creating significant numbers of new visitors to the area once the link with Robertsbridge is re-established.

In addition to the London focussed marketing opportunities, there are substantial conurbations on the South Coast such as Eastbourne which could provide further marketing opportunities to residents and visitors to these locations. As is mentioned in another section, Tenterden, although an historic town has a low perception rating and public transport access should allow marketing to attract visitors from these locations, both day trippers and some staying visitors.

Importantly, the opening of the link will afford the opportunity of marketing the area generally. This should increase the number of visitors whatever their method of travel. Consequently other attractions in the area, though not directly served by the railway should also benefit from the raised profile that this will give. Extra visitors may arrive by car or coach and it should be possible to persuade a significant number to include the heritage railway in their itinerary. If in addition to extending the link to Robertsbridge a direct rail connection to the mainline is made, the opportunities for bringing in heritage rail excursions opens another market.

Visit England: Tourism Action Plan

Scope and prospects for using RVR/K&ESR “missing link” as a focal point for developing tourism in Robertsbridge/Ashford districts sit well with Visit Englands Rural Tourism Action Plan which seeks to achieve the following:

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Vision To maximise the potential of the rural tourism offer,which will bring substantial benefits to local economies and communities and contribute to 5% growth year on year,in the England tourism market by 2020 Objectives 1. To diversify and modernise rural tourism products to generate business opportunities suited to local environments and communities and to develop a year round visitor offer. 2. To increase consumer awareness,understanding and enjoyment of the products and experiences available in rural areas 3. To encourage rural communities and economies to benefit from the values of rural tourism by taking ownership for the development,management, protection and conservation of rural assets and locations.

In making the case for taking action on rural tourism, several points raised by Visit England suggest areas where the “missing link” could have direct and indirect impact through adding to and supporting the tourism offer along the Robertsbridge-Tenterden corridor:  Holiday trips to the countryside are on an upward trend.  Tourism in rural areas creates employment and opportunities where other opportunities may be limited.  Tourism provides the ability to supplement income streams of businesses operating or fixed in rural locations.  Tourism supports the economic viability of communities (shops, pubs, restaurants, transport and postal services).  Tourism has the ability to contribute to the conservation and enhancement of Englands natural and built environment.

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From these arguments for development of rural tourism a number of challenges and opportunities were identified:  Day visits to the countryside account for 16% of tourism day visits (136 million) day trips accounting for £4billion expenditure “There is significant growth potential for rural tourism if day visits can be converted into overnight stays”.  Similar growth potential exists from international visits. Total inbound visits to England in 2009 were 25.4 million and a relatively low 17% involve a trip to the countryside.  Business trips to the countryside show a decline but this trend could be reversed  70% of day visits to the countryside are in Spring/Summer compared with 52% across all destinations. “To ensure rural tourism growth, destinations must develop and market new products and experiences that appeal to visitors all year round and are less weather dependent”.  Rural tourism provides an escape for the urban population and a range of distinct leisure time activities.  Consumers are becoming more reliant on technology to access information. “Rural products can be brought alive using new interpretation techniques to attract and meet the expectations of new and existing audiences”.  Rural attractions and businesses are relatively small and promotion needs to avoid creating demand on a scale that detracts from the quality of the experience for visitors.  Rural tourism is distinctive to its locality. “The good range of local produce scores highly among those who visited the countryside".  Planning constraints can be a major barrier to the expansion and diversification of the rural tourism product.  Transport in rural areas continues to be a challenge for tourism and local communities “public transport provision is a major challenge and perceived as being expensive”.  Car-free rural areas will be difficult to implement “but encouraging more initiatives that increase dwell times at destinations, reduce mileage and length of car joirney such as walks and itineraries that are integrated with public transport and visitor

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experiences” lead towards development of sustainable transport options (cycle hire firms, cycle racks and cycle friendly venues).  Vulnerability of rural tourism to current and expected increasing fuel, energy food compromises the profitability and resilience of rural tourism.  Changes to traditional funding streams for agriculture (EU Common Agricultural Policy and Rural Development Programme for England) mean rural asset managers are looking for more diverse income streams.  Funding models available in urban areas are not available or appropriate in rural areas. “However, there is greater potential for the involvement of community and the ‘third sector’ (not for profit bodies and charities), which adds to the distinctiveness of the rural product”.

As with Visit England’s Transport Action Plan an approach based upon ‘wise growth principles’ is advocated: “ Ultimately, businesses will draw on the best of the locality to meet visitor expectations, maximising economic returns that stay within the area and support key rural assets, and do so in ways that is a benefit rather than a burden to the environment and resident community”. Source: Visit England, Strategic framework for tourism 2010-20.

Rother District has performed well in terms of tourism over the past decade. The following chart shows how Rother has fared against the average for all R50 (Rural 50%) districts in England, nearby Ashford, and the South East :

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Index of tourism expenditure(Gross value added) 2001-10 Base year 2001 =100 200.0

180.0

160.0

140.0 Rother(R50) Ashford 120.0 All (R50) South East 100.0

80.0

60.0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Chart 6.5 Neighbourhood Statistics,Office for National Statistics

The following charts suggests that Rother District is well equiped to benefit from and support tourism through provision of accommodation, food, entertainment and recreation services, albeit from a less diverse economy.

Proportion of Local units, March 2012 Percentage Accommodation & food services 8 7 6 5 4 7.0 3 6.3 5.8 5.4 2 1 0 Rother South East England Ashford

Chart 6.6 Source: Neighbourhood Statistics,Office for National Statistics

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Proportion of Local units, March 2012 Percentage Arts, entertainment, recreation and other services 8

7

6

5

4 7.3 7.3 7.1

3 5.6 2

1

0 Rother South East England Ashford

Chart 6.7 Source: Neighbourhood Statistics, Office for National Statistics

Employment in agriculture is also relatively high for Rother District providing a good indication that the local economy retains much of its rural character, an asset tourists from urban areas often seek:

Proportion of Local units, March 2012 Percentage Agriculture, forestry & fishing 10 9 8 7 6 5 9.0 4 3 6.6 2 4.2 2.8 1 0 Rother South East England Ashford

Chart 6. 8 Source: Neighbourhood Statistics, Office for National Statistics

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Full time workers median weekly gross pay, 2012

£ per week Males Females 700

600

500

400

300 589 546 553 462 452 447 200 356 374

100

0 Ashford South East England Rother

Chart 6.9 Source: Nomis, Office for National Statistics

Full time workers median weekly gross pay, Rother £ per week Males Females 700

600

500

400

300 476 445 467 447 200 390 385 398 374 100

0 2009 2010 2011 2012

Chart 6.10 Source: Nomis, Office for National Statistics

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Full time workers median weekly gross pay, Ashford £ per week Males Females 700

600

500

400

300 535 546 498 523 200 350 357 358 356 100

0 2009 2010 2011 2012

Chart 6.11 Source: Nomis, Office for National Statistics

People aged 16-64 claiming benefits and out-of-work benefits, August 2012

Percentage Rother South East England Ashford

16

14

12

10

8 13.2 13.9 6 11.9 11.4 10.4 10.4 9.2 4 8.3

2

0 Total benefits Out-of-work benefits

Statistics

Chart 6.12 Source: Department for Work and Pensions, via Nomis, Office for National

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7.0 Conclusions

A previous study of the RVR/K&ESR “missing link” concluded that, with operations extending from Tenterden to Robertsbridge passenger numbers closer to 200,000 per annum might be achievable. The reason this potential exists stems from the possibility of having a connection to NR infrastructure at Robertsbridge and proximity of RVR/K&ESR to very large tourist markets.

Although time series analysis of passenger numbers shows a falling trend for the past decade, the K&ESR is nonetheless a successful operation delivering an excellent portfolio of products, ranging from theme events to regular services in keeping with the character of Britain’s first light railway. This foundation and the spill over effects from relatively large visitor attractions such as Bodiam Castle points to K&ESR having a consistent consumer base of approximately 100,000 visitors a year. It seems reasonable to expect that a stand- alone RVR operating between Robertsbridge would realise something approaching 50,000 visitors per annum, especially if rail connection encourages a modal shift and increase in visitor numbers at Bodiam Castle.

Increasing passenger numbers will provide valuable additional revenue for K&ESR but may also create additional problems because of constraints within existing capacity. With regard to the level of operating capacity, there may be some scope for absorbing increased passenger levels through greater use of under-utilised capacity (i.e. within existing timetabled services). However, a major problem in planning capacity for tourism products is the seasonal nature of demand and the pressure that one-off events create. It seems likely that recent and proposed investments in capacity at RVR will alleviate some of the current constraints facing K&ESR. However, simply adjusting capacity levels through a “chase demand” strategy will incur trade-offs (e.g. difficulty in maintaining quality standards) that are unacceptable to passengers and key stakeholders such as paid and volunteer workforces.

Therefore, it is important that the overall “capacity mix” is considered when planning for future increases in visitor numbers. Increasing the size of locomotive and rolling stock

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fleets, servicing facilities and numbers of operating staff is a more visible requirement when the core product (running passenger trains) is considered. However, the total visitor experience when viewed from customer and marketing perspectives calls for much more in terms of what might be described as supporting infrastructure. Visitor attraction quality rating schemes and indeed values found regularly in K&ESR annual accounts point to the significant impact on revenue generation from so called ‘support’ services. Whilst marketing and promotion are key activities for any heritage railway, planning for the right balance of operating capacity is a fundamental precursor if increased visitor numbers and quality standards are to be maintained.

One tension that may well arise is that between offering a “tourist transport railway” where passenger volume is important and that of presenting a heritage railway product themed around authenticity. Using valuable ‘authentic’ artefacts to deliver routine services has been over the years a controversial issue in railway preservation. In the case of K&ESR, the marketing theme Britain’s first light railway offers a valuable unique selling point(USP) but may also prove a limiting factor if passenger numbers grow beyond 100,000 a year. Therefore, it may prove worthwhile to rebrand as niche products, some of the services that reflect the distinctive characteristics of K&ESR as it is today and as it was in the vision of founding members during the early days of preservation. Also, it should not be taken to imply that those artefacts giving K&ESR its distinctive character will somehow be side- lined. On the contrary, it was encouraging during our investigations to hear of a suggestion to develop a “National Light Railway Museum”. Such a development would appear to offer a natural fit with how the railway has evolved to date and how it might grow into a more sustainable future without detracting from the vision set out by past and present supporters.

The link from Robertsbridge to Bodiam will impact on K&ESR in a variety of ways. For example, there may well be a trade-off in terms of revenue as passengers using the railway to reach Bodiam Castle as their final destination switch to starting from Robertsbridge instead of Tenterden. However, it is reasonable to expect that many visitors to Bodiam (and those arriving at Robertsbridge via NR) may be more inclined (through ease of access) to visit Tenterden. Research into customer perceptions has shown that Tenterden has a good destination image, albeit from a low percentage of the population. It is probably fair to International Tourism Centre 53 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

conclude that research conducted by Tourism South East points to Tenterden punching well below its weight in terms of visitor numbers. With careful marketing and promotion visitor awareness could be raised and in turn a case made a case for increased development of railway facilities at Tenterden.

Thus, K&ESR/RVR have the potential to grow existing and new products that contribute to the aim and objectives of Visit England’s Strategic framework for tourism 2010-20; indeed the railway is well positioned to become a blueprint and example of good practice for growing England’s tourism offer. Through enhanced supporting facilities, it may be possible to deliver a more effective marketing effort geared to increasing numbers of visitors from overseas. Making a contribution to Visit England’s objectives on tourism growth should come from the strength of being in close proximity to London and France (England’s biggest source of overseas visitors). Above all, having a connection to NR infrastructure at Robertsbridge should prove a valuable component in attracting visitors, who unlike domestic visitors, tend not to have use of private car for travel to and around their destination.

As heritage railways evolve into visitor attractions, a widening portfolio of products occurs as development in one product area encourages success to feed into the creation and development of others. Visit England notes the relative slow development of business tourism in rural areas. Provision of suitable facilities (core and supporting) may be more problematic than is the case with urban counterparts. However, many heritage railways (including K&ESR) are very good at providing educational related services. These tend to sit well with the needs of the business tourism market as does the skill set required to deliver efficient and effective events management. Analysis of historical data suggests K&ESR already has sound expertise in this area. Also, it is worth noting that provision of services in areas such as education can attract public funding for capital projects, especially where furthering social inclusion is seen as an outcome.

This study has, of necessity, considered how the RVR/K&ESR “missing link” will impact upon the railway itself; for other stakeholders it is what impacts on the local economy and community that is of prime importance. In terms of quantifying economic impact, whilst International Tourism Centre 54 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

there are methodological problems, there are models available that provide reasonably sound data which can be used provided reasonable caution is exercised. Thus, many organisations such as those promoting tourism make use of the Cambridge model which typically produces multiplier values between 1.00 and 1.5 when the ratio of direct to total visitor expenditure is considered. However, these values only represent a snapshot taken at a particular point in time and thus reflect what might be described as immediate impact. Studies conducted into the ‘money trail’ over longer periods suggest multiplier values close to the range 2.0-2.5. In the fullness of time when it is possible to consider the concept of ‘legacy’ multiplier values may reach values of 6.0 or higher. Early studies suggest this may prove the case with the London 2012 Olympic and Para Olympic games.

As data for London 2012 shows, translating initial (direct) spending from tourists into much higher total spending over time depends upon the level of leakage from the local economy and what are often described as “displacement” costs. To some extent, these reflect the opportunity cost that might have arisen had resources been used elsewhere. It is widely accepted that London 2012 may have caused some UK residents to take more trips abroad and for some overseas visitors who might have visited the UK and London in 2012 to go elsewhere. Similarly, it is frequently reported that rural tourism suffers when visitor numbers reach excessive levels; excessive being expressed in terms of (increased) traffic congestion and loss of amenity (tranquillity, feelings of remoteness etc).

Visit England’s Strategic Framework for tourism and the All Party Parliamentary Group’s Report on the Value of Heritage Railways recognise wider societal impacts that increased tourism activity brings. Data from ONS Neighbourhood Statistics show that, at district level, not all communities share the same level of economic benefit as the rest of south east England, an area of relatively high prosperity. For districts such as Rother, tourism development offers the prospect of speedy returns because much of the necessary visitor economy infrastructure is already in place (i.e. physical assets such as hotels, bed and breakfast, and self- service accommodation together with a workforce already engaged in this sector).

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As in urban areas, a diversified local economy may be regarded as important where resilience to changing economic conditions needs to be built. Heritage railways not only offer a product very much in tune with the local rural environment but they often bring requirements that foster employment normally associated with urban industrialised areas. Locomotive and rolling stock servicing on heritage railways has brought back a demand for heavy and general engineering skills plus a host of associated craft trades that have long disappeared in many locations. Tasks such as overhauling steam locomotive boilers that were once the domain of large railway centres such as Crewe, Swindon, Eastleigh and Doncaster can now be found carried out, albeit on a smaller scale, in facilities located at heritage railways. In some cases they offer valuable apprenticeship schemes to younger members of the workforce and an opportunity for older generations to pass on life-long work skills, either as employees or volunteers.

Rother District has, as might be expected, a higher than average (for England) proportion of the workforce engaged in agriculture, forestry and fishing but employment for professional and administrative occupations outside the public sector tends to be fairly limited in rural areas. The marketing effort and other support services required to promote heritage railways and tourism in general within a locality may also help prevent migration of younger sections of the workforce to commercial centres such as London and elsewhere. Disparities in income and employment opportunities may ultimately be the product of market forces but other factors such as rural location and quality of life may for some individuals counter them.

Visit England’s Strategic Framework for Tourism 2010-20 places considerable emphasis upon rural and transport action plans which will in turn work towards the aims of a quality action plan, so as to ensure delivery of a sustainable tourism offer that leaves visitors satisfied and willing to return again and again. Heritage Railways in general and RVR/K&ESR in particular, meet all of the necessary criteria for this project to be a success and appropriate for the setting where it can be found. Favourable and positive impacts in economic and societal terms suggest successful outcomes for most stakeholders. Guaranteeing delivery will call heavily upon a marketing effort that will capitalise on the opportunity presented by a connection to NR infrastructure at Robertsbridge and a restored International Tourism Centre 56 Manchester Metropolitan University Rother Valley Railway: Local Economic Impact Study

direct service to Tenterden. Satisfying both internal and external stakeholders will ultimately depend upon growing the capacity of the railway in a balanced way to enhance the visitor experience and the wishes of those who pay through their contributions as volunteers.

Finally, the authors of this report recognise that increased visitor numbers and the introduction of level crossings (especially on the A21 Robertsbridge by-pass) may have negative economic impacts arising from the RVR/K&ESR “missing link”. These issues will be addressed in a separate report based upon a study conducted by Mott MacDonald.

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8.0 References

All Party Paliamentary Group on Heritage Rail (2013), Report on the Value of Heritage Railways.

Heritage Railway Association (2012) Annual Report.

Hughes,H.L.(1994) Tourism Multiplier studies: a more judicious approach, Tourism Management 15(6) 403-406.

Manchester Metrolpolitan University (2004) West Somerset Railway: Local Economic Impact Study.

Manchester Metrolpolitan University (2007) Rother Valley Railway: Local Economic Impact Study.

Mott MacDonald (2011) Rother Valley Railway Proposed Level Crossings: Impact Study.

The Kent and East Sussex Railway (2012) Annual Accounts.

Tourism South East (2008) The Economic Impact of Tourism: Rother 2008.

Tourism South East (2011) The Economic Impact of Tourism: Rother 2011.

Tourism South East (2012) The Economic Impact of Tourism(Kent and Medway) 2012.

Tourism South East(2008) The Economic Impact of Tourism(Kent and Medway) 2008.

Office for National Statistics (2012) Travel Trends 2012.

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Visit Britain,(Deloitte/Oxford Economics (2010) The economic contribution of the Visitor Economy UK and the nations.

Visit England(2013) Strategic Framework for tourism 2010-2020, Annual Progress Report 2013.

Visit England (2012) Tourism and Transport Action Plans,Annual Review 2012

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