Government published its response to the consultation and the bill to introduce the the new subsidy control measure which replace EU state aid rules on 1 July, the consultation response bill and supporting documentation can be accessed at: Subsidy Control Bill – GOV.UK (www.gov.uk)
Although it is too early to assess the full impact of the new legislation on publicly funded support to business and for our purposes tourism and the visitor economy it is disappointing to note at page 43 specific reference to Government’s intention not to maintaining “maps proscribing disadvantaged areas”. Those maps have in our view been invaluable in identifying and managing deprivation nationally, regionally and especially locally. It doesn’t necessarily follow that fine detail down to ward level and critically also the level of national to local data analysis that allows it to be produced and maintained will be lost but it does represent a potentially serious risk which needs to be carefully watched to avoid it happening by accident or by intent.
A useful background document on some of the key issues published in 2019 by the Industrial Communities Alliance can be accessed at:
“This consultation invites views on the best ways to design a bespoke approach to subsidy
control. Subject to the outcomes of this consultation, the Government will bring forward primary
legislation to establish, in domestic law, a system of subsidy control that works for the entirety
of the UK. This system will advance both the growth of the UK’s economy and the interests of
its citizens, while reflecting our international obligations”.
Although not specifically targeted towards tourism and the visitor economy the Government’s future approach to subsidy (State aid) will almost certainly fundamentally influence and shape accesses to structural and other funding support, something that has and will continue to be critical to general tourism and destination specific development.
The consultation may also offer a new opportunity to influence the ingrained Treasury view that domestic tourism acts, in England at least, as a displacement of economic activity that would in any case occur somewhere else geographical and/or on something else within the UK economy. I.e. there is no net gain and therefore little or no justification to invest scarce public resource to supporting tourism and the wider visitor economy. The other Home Nations take a more enlightened view, hence the apparent disparity in approaches to domestic tourism development and national domestic, destination marketing support.
As you may recall we have been working to promote an alternate economic concept that domestic tourism should now be viewed as an engine of economic distribution; a vehicle that move wealth, often generated in major Cities and parts of certain regions and takes it to the more geographically and economically remote areas, where much of the UKs popular, domestic tourism activities actual takes place. This makes best use of tourism’s almost unique characteristic that the consumer must travels to the product in order consume it, not the other way round. It also allows tourism to be viewed and used as a tool to achieve this movement and, thus, fully justifies any targeted use of public resource to support tourism development and destination management and appropriate destination marketing. By happy coincidence this concept could and should fit very well within the current Westminster Government’s emerging leveling up agenda.
I would naturally assume that all Local Authorities will already be aware of the consultation and given the relevance to their own activities are likely to respond directly. That said, Destination Managers may wish to ensure that some of tourism’s unique characteristics are registered in local responses, for example in the response to section starting at para 89 on: Sector and category specific provisions. If the engine of economic distribution and the linkage to leveling up could be mentioned in the comments from major destinations that would be a bonus. The consultation is not the most engaging of reads and it would probably help to have a good understanding of existing state aid regulations, something that should be second nature to all those working in economic development and regeneration and to most destination managers.
Comments for inclusion in a potential British Destinations response and/or for passage to the Tourism Alliance for possible inclusion in theirs would also be welcomed.