‘Liberate British Tourism Resorts’ says former Tourism Minister

John Penrose, MP for the seaside resort of Weston-super-Mare and a former Tourism Minister, is calling for changes to Package Travel rules to liberate British tourism destinations from red tape and allow them to market themselves more effectively.

The European Commission is currently studying changes to the Package Travel Directive and is due to publish proposals in the Spring. At the moment, the rules treat British people buying inclusive trips to places like Norwich as though it was New York, and Stratford as though it’s Shanghai. The travel agent needs an expensive bond, and local tourism attractions are legally barred from marketing themselves jointly without one as well.

Mr Penrose has written to Jo Swinson, the Minister responsible for Britain’s approach to the European Directive, asking her to simplify the rules so most British domestic tourism trips would be exempt.

He said: ‘these EU rules are a massive handbrake on British tourism destinations marketing themselves properly. And they add costs to a British weekend away which, with money so tight at the moment, isn’t great either. Getting an exemption would be a huge help, and would liberate British resorts from Whitby to Weston-super-Mare, which is why I’ve asked the Minister to look at the idea closely.’

Mr. Penrose’s proposals have been welcomed by tourism organisations including ABTA and the Tourism Alliance and he has offered to lead a delegation of industry representatives to meet the Minister to discuss them.

Copy of letter to the Minister below:

Ms Jo Swinson MP
Minister for Employment Relations, Consumer & Postal Affairs
Department for Business, Innovation & Skills
1 Victoria Street

I’m writing about revisions to the Package Travel Directive (PTD), since I understand that proposals will emerge from the European Commission in spring 2013 and will presumably land on your desk shortly after that.

As you can imagine, as a former Tourism Minister and MP for the seaside resort of Weston-super-Mare, I’m particularly keen to support any measures which could drive economic growth in this sector. It looks as though the revisions to the PTD are a useful opportunity to do so.

Currently, both the Directive and the UK’s transposition of it in the Package Travel Regulations (PTRs) define a package as being created when a combination of two or more elements (transport and/or accommodation and/or other tourist services) are sold together at an inclusive price. This definition excludes ‘click-through’ sales, where holiday arrangements are booked by clicking through from one website (typically an airline’s) to another linked website, and needs to be modified because both the Government and the Commission want them to be included in future. And the current definition also discourages domestic tourism destinations from bundling products together into an attractive overall weekend or short break offer, because they need to be bonded under the PTR.

For example, a couple may book accommodation for a weekend break in Chester. But if the person with whom that booking was made encouraged the sale of another tourist service alongside the accommodation – going to Chester Races, for example – it would currently make the arrangement a package. The bonding and other regulatory costs of complying with the PTR are significant, particularly because domestic tourism businesses have a very high proportion of SMEs. And, equally importantly, it makes marketing domestic tourism destinations much harder if they can’t design attractive products by bundling together their best local attractions properly either. The missed promotional opportunity is huge, and leaves domestic destinations at a significant competitive disadvantage compared to professionally-marketed outbound foreign packages too.

So I’d suggest we should propose a new, simpler definition of what counts as a package. Having spoken to industry leaders, it looks as though the definition of a package could be narrowed so it no longer includes selling ‘other tourist services’ (a phrase which, in itself, cause difficulties of interpretation) alongside transport or accommodation, but could instead be defined simply as a holiday comprising ‘transport and accommodation’. This would capture click-through holiday sales more easily – I’m told the Commission is having technical difficulties with this issue at present – and would allow domestic holidays to be bundled easily and effectively without falling foul of the PTD.

I have discussed this idea with tourism organisations including ABTA and the Tourism Alliance and there is broad support to explore this proposal further. I should mention that I have also discussed whether it would be possible to exempt all domestic packages from the PTD, since the problems caused if a domestic holiday goes wrong are usually much smaller than foreign travel, but I understand that this approach is unlikely to work for other European countries where the markets operate differently. As a result, under this proposal, it’s worth noting that coach trips and rail breaks would still be covered by PTD because the risks are (marginally) higher than for a self-drive holiday where consumers can simply get in the car and go home early if something goes wrong.

So the industry thinks the idea could be very helpful, but none of us have managed to quantify the potential net gains properly yet. It seems likely they will be substantial once the improved marketing opportunities start to kick in alongside the reductions in red tape, but the precise figures are hard to gauge. I was wondering whether your Department has carried out any research in this area, particularly in estimating how many bookings might be freed from regulation as a result of the simplified definition?

As the Minister responsible for the UK position on PTD, I would welcome the opportunity to meet to discuss this proposal in more detail and lead a delegation of industry representatives if you might find this helpful.

Yours sincerely,

John Penrose
MP for Weston-super-Mare

Copied to: Patrick McLoughlin MP, Secretary of State for Transport, & Simon Burns MP, Minister of State for Transport Maria Miller MP, Secretary of State for Culture Media & Sport, & Hugh Robertson MP, Minister for Sport and Tourism Malcolm Harbour MEP, Chair, IMCO Committee, European Parliament

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