October 14, 2010
On Tuesday, 12 October the British Hospitality Association launched the Hospitality Economy Partnership at the House of Commons, London. This extensive research into opportunities for industry expansion was presented to an audience of BHA members and government representatives, including John Penrose, minister of tourism.
The Hospitality Economy Partnership is a written call for the private sector to form a pragmatic partnership with government in order to drive economic growth and was formed by research undertaken by Oxford Economics which was comissioned by the BHA and titled “Economic contribution of UK hospitality industry”. This research prompted the creation of the Hospitality Economy Proposition.
BHA president Sir David Michels said in his opening address: “The prime minister in August laid down two major objectives for the tourism industry. The first was that Britain should be one of the top five tourism destinations in the world and the second is that we should grow the contribution or the amount of money spent by Britons in Britain on hospitality and tourism from 36% to 50%. In response we commissioned Oxford Economics to do some scenario analysis in terms of the future contribution of the industry to understand if the ambitions laid down by the PM could be achieved”.
Sir David Michels also said subsequent findings bolster the importance of the industry to the overall economy. Figures reveal that hospitality employs more than 2.4 million people, full and part-time. “It provides jobs that suit the needs of people … and also is directly responsible for an additional 1.2 million jobs through the supply chain. Without hospitality and tourism key parts of the (United Kingdom) would be economically dead”.
The report explains how up to 236,000 jobs could be created in the U.K. hospitality industry in the next five year and also highlights that the U.K. hospitality economy is currently worth around £19 billion, a significant part of the total £116 billon tourism industry that generates an estimated £34 billion in taxes and duties every year.
Sir David Michels highlighted further figures: “Overseas visitors spend £16 billion a year in the U.K., of which roughly half is earned in our hotels and restaurants. Investment in 2010 alone is worth £8 billion with a thousand hotels built over the last few years. This extrapolates to a figure of nearly £15 billion. The industry between 1998 and 2010 has grown by 206,000 net jobs. To continue that growth we need to work in partnership with the government and others”.
Ufi Ibrahim, who joined the Association as Chief Executive in July 2010 talked about the intense competition for tourism faced by the U.K. from emerging economies. She laid out the key points of the BHA partnership proposal based on the research findings.
“The proposition is really framed around three key areas of action. The first is building upon government and hospitality industry—both must have the responsibility to champion the industry,” she said. “From the top levels of government, from the Prime Minister all the way down to local enterprise partnerships … we have to actively support Visit England and others to ensure that the importance of hospitality is not lost in (current government) transformations. We have to ensure that tourism budgets are not lost”.
Ufi Ibrahim outlined other calls to action.
“We are also calling for a cross cabinet committee to ensure that at the highest levels of government our industry will be championed,” she said. “The second area is about building a competitive industry in Britain, about minimising regulation, about streamlining, and we want to work very actively with government to achieve this. The third point is about efficiency and transformation in the longer term. We want to embrace sustainability, health and wellness as we move forwards. We don’t want Britain to be left behind, we actually want to lead”.
Ufi Ibrahim said the BHA wants to make sure the partnership proposals were “suitable, feasible and achievable”.
“Suitable because they are real solutions for industry, for government and for British economy and society, feasible because we are not asking the government for any money, in fact in many cases we are providing solutions and we are offering input from our own side, and achievable because we have the figures, we have the scenarios analysis that shows us that there is a real possibility to create these 236,000 jobs,” she said.
Photograph: President of the BHA Sir David Michels and BHA Chief Executive Ufi Ibrahim with British Tourism Minister John Penrose at the launch of the Hospitality Economy Proposition at the House of Commons.