Written evidence submitted by London First

Response: Digital, Culture, Media and Sport Committee Call for Evidence

Promoting Britain abroad

Response from: London First

Middlesex House

34-42 Cleveland Street

London

W1T 4JE

Date submitted: Wednesday 5th January, 2022

Introduction and overview

1. London First is a business campaigning group with a mission to make London the best city in the world in which to do business, for the benefit of the whole UK. We convene and mobilise business leaders to tackle the key challenges facing the capital and beyond as we work towards recovery. We are made up of c. 175 leading employers across a wide range of sectors.

2. We welcome the opportunity to share our views on the recovery of the UK as a holiday destination for international travellers. It will be important to harness the attractiveness of London, as the UK’s global city, to act as springboard for both domestic and international tourism. Our key recommendations below speak to the UK’s rapid recovery and constitute our view on the actions the Government should take in addition to implementing the Tourism Recovery Plan, as set out in the terms of reference for the Call for Evidence.

3. To summarise our response, we believe that Britain’s attractiveness to international tourists and shoppers is at risk falling behind our European neighbours. We have an opportunity to address this by reversing the decision on tax-free shopping, improving the visitor visa system and relaxing Sunday trading restrictions. Reforming these regulations will enable the UK to attract greater numbers of international tourists. We have also seen our international counterparts significantly step up their spending to attract tourists, from New York through to Singapore. A large-scale, properly funded campaign is needed to bring people back to London and the UK, to speed up recovery and avoid the worst-case economic scenarios. This should leverage the strength of London’s international brand, recognising that the capital can act as a more effective gateway to the whole UK.

Tax-free shopping

4. Since the Government abolished the VAT Retail Export Scheme (RES) and Airside tax-free shopping scheme at the beginning of 2021, the UK has become the only European country not to offer tax-free shopping to non-EU visitors. Given the potentially negative impact of the withdrawal of tax-free shopping both on British businesses and HM Treasury’s tax revenues, we support the call of the Chairman of the Treasury Select Committee for an independent assessment of the full impact of this measure. It is our view that reinstating it can only be helpful in boosting visitor numbers to the capital.

Visa system

5. Further visa reform targeted at attracting short-term visitors also has the potential to increase the attractiveness of the UK as a tourist destination. This could include:

1. Ensure that the visitor visa product and application process match that of Schengen, particularly the Electronic Visa Waiver scheme for visitors from the GCC states.
2. Extend the Electronic Visa Waiver Scheme to other high spending markets, for example, China.
3. Introduce a standard 10-year visitor visa, as countries like the USA have done, for visitors from high spending markets, such as China.
4. Introduce a visa for the families of international students studying in the UK that lasts as long as the student visa, to encourage parents to visit their children multiple times during their studies.
5. Expanding the joint Schengen/UK visa application process in China – currently a pilot with Belgium – to Schengen countries with larger numbers of visitors, such as France and Italy.
6. Expand the Youth Mobility Scheme to other countries, building on recently announced new arrangements with India and Iceland, to encourage young people to visit, study and work in the UK for a time.
7. Introduce collective passports as a replacement to ID cards which are no longer accepted, to ensure travel to the UK for junior groups, for example English language students, remains straightforward and accessible.

Sunday trading

6. London First supports New West End Company’s campaign to add two of Britain’s International Centres (the West End and Knightsbridge) to the list of exemptions in the 1994 Sunday Trading Act so that stores can open beyond 18:00 on Sundays, as is the case in most competitor countries.

Campaign funding

7. Research including London First’s recent report, Central Government’s role in helping London drive recovery, has shown that London is a significant draw as the country’s global city.[1] London is a critical acquirer of tourists for the UK, and if this is not appropriately leveraged, the overall number of tourists will not recover as rapidly.

8. We want to ensure that London – and the whole of the UK – can bounce back quickly from the pandemic and resume the position as a leader in international tourism. In 2020, we saw an 80% decrease in spending from tourists in the UK. This was a significant blow to the national economy, accounting for a loss of £24.7 billion according to data from Visit England[2].

9. The private and public sectors acting together can help to leverage London’s attractiveness to tourists to revitalise the sizeable tourism sector that the capital has to offer. This is pivotal for the financial success of many of London’s institutions – moreover, in drawing tourists to the UK via London, travellers coming to the city will use the capital as a springboard to travel to other popular tourist destinations in the UK. Making it as easy as possible for visitors to affordably access the domestic rail network would also have considerable benefits.

10. Working together, London & Partners, Visit Britain, DCMS and the GREAT campaign could have a tangible impact on the bounce-back rate, but more needs to be done to formulate a clear plan, share learning, and ensure adequate funding is available for a campaign to bring visitors back to the capital and onwards to tourist destinations across the UK.

11. As part of our recovery report, London First set out what a large scale, properly funded campaign to bring people ‘back to (central) London’ would look like. The Let’s do London campaign has been a good start here but requires ongoing support and greater funding if it is to achieve the full potential of the capital as a tourist attractor. For example, Hong Kong’s comparator agency spent £80m in 2019/20 alone, c. £57m above London’s annual spend.

12. If we were to raise London & Partners spending to Hong Kong’s level for three years, it could have a dramatic impact on increasing domestic and international footfall, helping to avoid the worst-case economic scenario, and making it more likely that London’s tourism sector will see a timely recovery from the impact of the pandemic.