Scots tourism industry faces 'many more casualties' without support

Scotland's beleaguered tourism sector faces "many more casualties" unless emergency government funding to prop up the mothballed sector reaches frontline firms, MSPs have heard.

The Ardoe House Hotel in Aberdeenshire has been among the most high-profile casualties of lockdown
The Ardoe House Hotel in Aberdeenshire has been among the most high-profile casualties of lockdown

The flagship sector for Scotland's economy is in a "more desperate state" than it was a few months back as the impact of fresh restrictions sees the country locked down, Holyrood's tourism committee was today told.

For some bigger hotels, the share which they receive of multi-million government support is "virtually nothing" compared with their daily running costs.

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Marc Crothall of the Scottish Tourism Alliance revealed that he held talks with Finance Secretary Kate Forbes and Rural Economy Secretary Fergus Ewing this week to raise concerns about the speed with which the lifeline support funding is reaching frontline firms.

"We made our views very clear as have others around timing, transparency, consistency, communication - but importantly the need for pace of delivery of this money into business," he told MSPs today.

The Scottish Government has announced a total of £900 million in business support funds during the pandemic, including an additional £185 million last month, and says that £600 million of this has already been allocated. Ministers say they have been working with local authorities and other partners to “accelerate” delivery.

But Mr Crothall said that the situation facing tourism businesses, which enjoyed a brief reprieve last summer as restrictions were lifted, is now stark.

"We are in now a far more desperate state than we were a few months back," he said.

"The money has dried up, the cost of overheads now at this time of year is far greater than they were last year."

Heating costs have gone "through the roof" as winter sets it, he added, and financial loans are starting to near their "repayment time."

"Also importantly the mental health of our sector is getting very tested,” he added.

"So any delay or any slowdown or if that future support were not to be forthcoming soon, we're going to see many more casualties along the way and it would be a travesty to the sector."

Among the most high-profile victims of the Coronavirus lockdown on the industry has been the luxury Ardoe House Hotel, on the outskirts of Aberdeen, which announced in November that it had been plunged into liquidation with the loss of 68 jobs.

Mr Crothall admitted that while the "headline figures" attached to Government support grants being announced in Parliament may seen sizeable, the share which goes to each individual business can often have a minimal impact.

"When you actually break it down into the amount of money that each business is going to get it's virtually nothing,” he added.

"I some cases a £25,000 grant payment for hotel that is actually a £51,000 rateable value - I know hotels whose daily fixed costs right now, that are being absorbed, are well in excess of that sum of money.

"So as fast as it might come in, it's gone out in a multitude of times more in a matter of days and weeks."

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