UKinbound’s latest Business Barometer results have indicated that the recent Government stimulus, designed to help businesses and the economy, falls short and won’t help a significant number of valuable companies in the inbound tourism industry that are in a critical state.
Over half (52%) of businesses stated that the Government’s VAT reduction would not be beneficial to them, with just one in five stating the policy would positively impact on business.
When questioned on the merits of the Job Retention Bonus, nearly two-thirds of businesses stated they hoped to be eligible, however one in 10 companies said that they don’t expect to bring anyone back from furlough.
Confidence levels about the impending 12 months also sit at a near-record low, with just 13% of respondents stating they are confident about bookings/visitor revenue/customer orders in the next year.
The survey also asked members about their bookings/visitor number/customer orders in Q2 2020, with 96% confirming they were down on the same period last year, by an average of 92%.
Just last month, the Association expressed grave concerns that its tour operator and destination management company (DMC) members will need to make around 10,000 job cuts, and over half will fail within the next six months, if the Government does not intervene.
UKinbound asked Government for immediate support for the inbound industry, a call it is urgently renewing in light of the latest Business Barometer results, requesting:
- A Tourism Resilience Fund to help businesses that are wholly reliant on international visitors to survive until the anticipated return of the market in Spring 2021
- Guidance on rate relief and grants should be amended to include tour operators and DMCs
- Extension of the Coronavirus Job Retention Scheme through to March 2021
- National insurance and corporation tax holidays for these businesses until the market recovers
CEO Joss Croft commented, “Our latest Business Barometer results further confirm that many inbound tourism businesses are in critical need of specific support, and that the Government’s ‘one size fits all approach’ leaves many out in the cold.
“Our members are hopeful that the international market will return from Spring 2021, but this leaves a gaping hole in business finances until then, and although the VAT cut and Job Retention Bonus is welcome, they alone will not help previously profitable inbound tourism businesses stay afloat.
“We implore Government to act swiftly with measures that will positively impact businesses and save jobs, such as the introduction of a Tourism Resilience Fund, amending rate and grant relief so it’s accessible to tour operators and DMCs, and introducing a national insurance and corporation tax holiday.
“Inbound tourism was worth over £28 billion to the UK economy in 2019, and is vital to our long term economic recovery, a successful Brexit and the Government’s ambitions for a truly global Britain.”
Later this month, UKinbound and its members will meet with MPs from across the country to discuss their concerns, the Business Barometer findings and possible solutions to this crisis.