Thursday 21 October 2010

VisitScotland CEO Responds to Spending Review

VisitScotland has reacted to today’s UK Government spending review announcement, stating that tourism will be ‘at the heart’ of the UK recovery.

In reaction the review, Malcolm Roughead, the recently named chief executive of the Scottish Tourism body said: “We have been working with the Scottish Government on its preparations for the comprehensive spending review for several months and are committed to working together with the tourism industry to deliver sustainable economic growth and best value for Scotland."

He continued: "Tourism will be at the heart of economic recovery in Scotland, but growth will only come from investment. We know that the money we invest in marketing brings an immediate return to Scotland, delivering at least £20 for every £1 we invest. Last year alone some of our key marketing campaigns brought £400 million into the economy.”

The argument is not that marketing is a prerequisite of destination marketing the challenge is how we alter the balance between public and private sector influence and input.

The public purse cannot justify supporting a fundamentally free market sector with an unlimited budget. The long heard shout from small operators about VisitScotland doing nothing for them has always been flawed anyway (VS not being there to sell rooms but to market the country - in theory) but now is the time where budget cuts may concentrate those minds further.

The return on investment may sound good but as we've highlighted elsewhere in this blog tourism statistics are perhaps the most unsound use of figures and can be made to say anything currently. The ROI of 20:1 is indeed impressive but is actually totally irrelevant if the revenue figures we use plucked from the air meaningless multiplier factors.

And anyway, the challenge should not be about increasing our public sector expenditure in Scotland but about making it more effective and efficient.

Savings must be made by concentrating on the knitting, divesting of ancillary and non productive public sector roles and concentrating increasingly on partnership marketing built to date by Malcolm Roughead in his marketing role at VS.

As a knee jerk reaction?
  • Marketing must have increased private sector funding for campaigns
  • They must reduce administrative costs and departments nationally and regionally
  • Duplicated tourism development/marketing spending by Councils and publicly funded DMOs must be eradicated
  • VS must become administratively much more lean
  • VS must concentrate on core activities and divest of  all other roles
  • The private sector must take more responsibility

Meanwhile, VisitBritain will see its funding reduced by a quarter over the next four years, it was announced today.

The tourism body will review its operations as part of the budget tightening restrictions applied to the Department for Culture, Media and Sport with the current grant for VisitBritain falling from £28.8m this year to £26.5m in 2011/2012and £21.2m in 2014/15.

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