Brexit funding threat

Uncertainty around Scotland’s ability to continue to attract EU funding could have damaging consequences for the tourism industry, Tourism Secretary Fiona Hyslop warned today.

Since 2015, almost 1,000 small and medium sized tourism businesses have directly benefited from £7.8m in European Regional Development Funding to internationalise their business and develop new markets. An extra 7,500 businesses are benefiting from targeted online marketing activity.

With its own match funding, VisitScotland estimate the £19.5 million programme is worth £145 million in wider economic activity.

But the threat of Brexit has thrown into question Scotland’s ability to attract similar support for the industry once the funding comes to an end in 2018.

Ms Hyslop also highlighted the impact of uncertainty around the immigration status of the 21,000 EU nationals currently working in Scotland’s tourism industry.

Ahead of a Parliamentary debate on the impact of leaving the EU on Scotland’s tourism, culture and creative industries, the Cabinet Secretary said:

“The threat of a hard Brexit with no protection for the EU nationals currently living and working in Scotland, coupled with uncertainty around the potential to attract EU funding, could have extremely damaging consequences for our tourism and hospitality industries.

“That is why the UK Government must urgently confirm what the immigration status of our EU nationals will be once the UK leaves the EU, and why the Scottish Government will do everything we can to protect Scotland’s place in Europe, retain free movement of people and stay in the single market.”

Chief Executive of Scottish Tourism Alliance Marc Crothall said:

“One of the critical issues for industry is the potential changes to the free movement of people which will directly affect the sector’s ability to attract, employ and retain overseas staff, both seasonal and permanent. EU migrant workers are a vital part of the tourism sector and we welcome and value their contribution to what is the most important industry in Scotland.

“Like many industries, Scotland’s tourism industry has a huge skills shortage and more than ever we need to address the issue of skills and employment within the hospitality and tourism industry. There is no doubt that this is a major concern for tourism businesses, particularly within the hospitality sector.”

Executive Director of the British Hospitality Association Willie MacLeod said:

“The hospitality industry has created 23,000 additional jobs in Scotland since 2010 and now accounts for 245,000 jobs in Scotland.

“Predicted industry growth will be threatened as the demand for staff cannot be met from the domestic job market - any curbs on access to the European workforce will constrain the industry, impacting on the way we all now live.

“European visitors are crucial to our hospitality and tourism businesses and any impediment to visa-less and passport-free entry to the UK must be resisted.

“The Government needs to ensure that the UK is perceived to be open for business and welcomes visitors. Non-UK staff working in tourism must be reassured that they remain welcome and that their contribution is valued.”

Background

Internationalisation is increasingly important to the Scottish visitor economy. Whilst only 17% of the current visitor market is International, it accounts for around 35% of the total income generated and is therefore a high value market opportunity for Scotland.

The VisitScotland Internationalisation programmes will provide new specialist support for SMEs across sectors including Food and Drink, Creative Industries and Tourism.

VisitScotland estimates that the project will generate £145m of gross economic activity – that is the monetary value of all economic activity related to or associated with a VisitScotland intervention.