Business and Planning Bill

Baroness Doocey Excerpts

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Monday 6th July 2020 Lords Chamber

[Baroness Doocey (LD) [V]]

My Lords, I will focus on those aspects of the Bill relating to tourism. Tourism generates revenues of £155 billion per annum for the UK economy, including £28 billion in export earnings. The industry employs 3 million people, making it the UK’s third-largest employer. Every region has at least 100,000 tourism-related jobs. The sector has been disproportionately affected by the Covid pandemic; inbound tourist numbers are forecast to decline by 59% and expenditure by 63% this year, resulting in a loss to the UK economy of nearly £20 billion and a loss to the domestic tourism industry of a further £25 billion.

Councils have been working hard on measures to help hospitality businesses reopen, for example using town centres differently so that businesses can operate outside. However, a lot more can be done. While the Bill contains welcome new flexibility for businesses to put tables and chairs on pavements, there are at least three further measures we could take to help firms which have lost months of trading income.

First, the package travel regulations should be amended to make transport a mandatory component of package travel, thus allowing small businesses to make a combined offer of, say, accommodation in a guest house and a meal at a local pub without incurring all the responsibilities of a package holiday operator. Research suggests that this could boost domestic tourism by £2.2 billion with no loss in consumer protection.

Secondly, we should remove restrictions preventing caravan parks operating during winter. These parks have already lost between 35% and 50% of their income, and two-fifths of sites presently operate less than eight months of the year. There is an opportunity here to boost domestic tourism with year-round openings for all.

Thirdly, we should remove planning restrictions that prevent self-catering cottages being rented out as long-term lets during winter. These restrictions have a perverse impact, leaving holiday accommodation empty for many months of the year, with a knock-on effect for local pubs and restaurants, which see decreased trade. Over 80% of tourism businesses either were closed temporarily or have ceased trading altogether as a result of coronavirus. Some 92% say that their revenue has at least halved; 75% of their employees were furloughed, compared to just 24% in the jobs market as a whole. This is little short of a catastrophe for the industry.

The Government have the tools to help these businesses survive against the odds and to save jobs as the furlough scheme ebbs away. There can and should be a renaissance in domestic tourism here in the UK as well as a fresh look at how to offer the best to people visiting from around the world. Let us not shut out trade for the sake of arbitrary planning rules. Instead, we can hand much more power to local councils to make their own decisions over how to help the industry in their parts of the country.

I would welcome an initial response from the Minister to these suggestions since I intend to table amendments in Committee on all three subjects.

Business and Planning Bill

Baroness Doocey Excerpts

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Monday 13th July 2020 Lords Chamber

[The Deputy Chairman of Committees]

The noble Baroness, Lady Neville-Rolfe, has withdrawn from the list so I now call the noble Baroness, Lady Doocey.

[Baroness Doocey (LD) [V]]

My Lords, I shall speak briefly to support Amendment 42, which articulates an excellent idea and one that I hope the Government will take up. A similar amendment was moved in the Commons by my colleague, Tim Farron MP, whose constituency in Cumbria is very much at the heart of the tourist industry. His constituency has seen the biggest increase in unemployment in the country—up by 314% since March. Meanwhile, 37% of the entire workforce in that area has been on furlough. His constituency is just one of those in which the income from tourism has been decimated.

I believe that there is a special case for additional sectoral support for the industry, which would instil much-needed confidence in the many seasonal businesses and in the seasonal workers who depend on them. Most of these businesses operate on a profit margin of just about 10%, so many of them will not even be viable because, as a result of social distancing, they can operate at only 50% or less of their capacity. By signalling now that the industry’s safety net will not be cut away just when thousands of businesses and jobs may need to rely on it, the Government can avoid many damaging job losses.

[Baroness Uddin [V]]

I am pleased to follow the detailed observations made by the noble Baroness, Lady Anelay, and the noble Earl, Lord Clancarty. I shall speak in support of Amendments 42 and 78.

Extraordinary business support schemes have been put in place. I am mindful of the fact that these provisions make it easier for businesses to access government support in the form of, among others, bounce-back loans and the furlough scheme, alongside other forms of financial support. The review being suggested in the amendment is necessary to ensure the most impactful use of public funds. It is equally imperative that the Government should take this opportunity to make an impact assessment of these measures on the living standards of those working in this low-paid sector, as well as considering ethnic and gender differentials. They can then reassess the measures that will be required to mitigate the disproportionate effect on these groups, particularly among those who have not been able to access successfully many of the Government’s funding regimes. As a result, some otherwise successful business owners became unemployed overnight during the lockdown and they are now having to resort to applying for universal credit. It is a safety net, yes, but it is not adequate to meet the needs of any family.

I take heart from the fact that at its core, the Bill is about kick-starting the economy while keeping in sight all the prerequisite safety restrictions. The business owners I have spoken to welcome the support given by the Government to the hospitality sector and the economy more widely. The discretionary schemes which have been delivered through local authorities may have helped save thousands of companies from bankruptcy and thus will have protected jobs. However, I am duty bound to remind the Government about the large number of businesses which have not accessed any support at all because they have fallen outside the policy parameters.

Three-quarters of businesses operating in the accommodation and food service sectors have paused or stopped trading in response to the Covid-19 outbreak. It would be remiss of me not to say that I have witnessed at first hand how many curry houses have put aside their own pain while trying their best to survive by becoming the first source of free food supplies for first responders in the NHS and for the many food banks across our country.

--- Later in debate ---

Moved by

[Baroness Doocey]

50: After Clause 15, insert the following new Clause—
“Amendment of the Package Travel and Linked Travel Arrangements Regulations 2018
(1) The Package Travel and Linked Travel Arrangements Regulations 2018 (S.I. 2018/634) are amended as follows.(2) In regulation 2(3) leave out “at least one other at least two different types of” and insert “the carriage of passengers with”(3) In regulation 2(5) leave out “at least one other at least two different types of” and insert “the carriage of passengers with”Member’s explanatory statement
This amendment seeks to amend the Package Travel and Linked Travel Arrangements Regulations 2018 make transport a mandatory component of package travel. This would allow small local businesses to make a combined offer without incurring the responsibilities of a package holiday operator.

[Baroness Doocey [V]]

My Lords, in moving Amendment 50, I will speak also to Amendments 74 and 75 in my name.

Amendment 50 seeks to modify the regulations introduced in 2018 around package travel, in order to support the recovery of small domestic tourism businesses and destinations. The intention of these regulation was to provide additional protection to those taking package holidays abroad, so that they do not lose their money if the tour operator goes bust, and so they can be repatriated to the UK. However, a sort of reverse loophole has emerged, where small domestic businesses working together to produce a value-added offer are caught up in the regulations and deemed to be tour operators.

The consequence is that if a B&B, for example, offers a deal to customers where meals at a local pub or a round of golf at a local course are included, that B&B finds itself legally responsible if the customer has an accident while visiting the other business. No insurance company will give a B&B insurance to cover that. This prevents the sort of constructive enterprise between small local businesses that is needed if the domestic tourism industry is to recover from coronavirus. The industry estimates that remedying this anomaly would boost domestic tourism by about £2.2 billion.

Unfortunately, there is a drafting error in my amendment, for which I apologise. It inadvertently seeks to leave out the words “at least one other”, which do not actually appear in the existing regulations. However, the important part of the amendment is about the carriage of passengers, and it is to those words particularly that I am speaking this evening.

The purpose of the amendment is to ensure that package travel should include the carriage of passengers—in other words, actual travel. That means that if you are offering a coach holiday with hotel accommodation included, that would of course count as a package because you are taking the customer on holiday and must be responsible for them. However, if a small business offering accommodation co-operates with another small business that is offering food, it is not taking someone on holiday. It is providing the customer with a value-added product while they are on holiday. With no actual travel involved in the transaction, under the terms of the amendment, it would not count as a package. This small measure of deregulation could save 47,000 jobs in the sector.

I know that the Government believe that the current regulations should not be prohibitive for small businesses because there is a rule of thumb which says that any tourism service providing accommodation must make up at least 25% of the total for the regulations to apply. This is unsatisfactory for two reasons. First, it is only a rule of thumb, so businesses do not have certainty about their obligations. Secondly, a small B&B could offer weekend accommodation for, say, £70 a night, and the food on offer at a local restaurant or pub might well have a value of £70 or more. So as things stand, co-operating on meals and accommodation for two people can easily trespass into regulated territory.

In considering this amendment, it is also important to note that the benefits it would provide come at no cost to the consumer as there is no erosion of consumer protection by removing value-added products as I have described from the package travel regulations. All that would happen is that two businesses would become separately liable for their component of the product. The principle that I have articulated, and what is intended in the amendment—making packaging hinge on whether an actual travel component is sold—is a better and clearer position which I hope the Government will consider carefully between now and Report.

Amendment 74 has been inspired by and closely follows the Government’s own proposal to expedite planning applications by varying planning conditions on construction hours. The amendment would speed up applications to lift planning conditions where they restrict campsites and caravan sites from being used for holidays in the winter months. After months when so many sites have been unable to operate, this would enable many of them to extend the holiday season, subject to a final but expedited say on the part of the local authority.

The present situation is quite unsatisfactory in that the Government say that local planning authorities can choose not to enforce their local regulations. This puts businesses in a very invidious position. My amendment would clarify the position because it would mean that in straightforward cases, an extension to this year’s season could be agreed quickly without the need to require an applicant to produce numerous documents. Crucially, however, local authorities would retain control over more complex cases. Where a council has concerns about an application to extend, it would have 14 days either to refuse or to agree modifications with the applicant. This seems proportionate and fair, and again it would make the regulations around domestic tourism much more equal to the task of helping businesses out of the Covid crisis.

Amendment 75 would give property owners and local authorities the same flexibility to remove planning conditions that prevent the use of their holiday accommodation for lets over the winter months, but it would give local authorities control. It would allow properties that are presently used for short-term lets over the summer to be let on a longer-term basis in the winter. The most common planning restriction at the moment is the 28-day maximum stay that is applied to permissions. Many of the properties affected are converted farm buildings where the farmer has sought to diversify his or her business. Industry figures suggest that up to 25,000 properties are limited in this way. Removing the 28-day limit would allow these businesses to operate longer-term winter lets, typically to temporary or seasonal workers, or to students.

For these businesses, gaining valuable winter income would go some way to levelling the playing field with their competitors in the sharing economy, such as Airbnb, while helping to make up for so much lost income this year. But without this support, many holiday cottages will be obliged to close only a few months after their reopening on 4 July. It is surely right to expedite these applications now to extend the season and, in doing so, to help good but struggling businesses to survive.

The tourism industry generates £155 billion per annum for the UK economy, but this contribution is in peril because 92% of these businesses say that their revenue has at least halved during the coronavirus crisis. I hope that the Government will give a helping hand by modernising the regulations on packages and allowing domestic businesses to extend their usual season into the winter months. Without these changes, many businesses simply will not survive and thousands of jobs will be lost. I beg to move Amendment 50.

[Lord Redesdale (LD)]

My Lords, I refer to my interests in the register and will speak to Amendment 74 because I have just been appointed as an officer of the new all-party group on holiday parks and camping sites. My noble friend Lady Doocey has covered many of the points that I was going to raise and at this hour, of course, brevity is much to be commended so I will raise only one point. It is to hope that the Government could agree to write a letter to local authorities, setting out the benefits of relaxing planning laws. This is something that many local authorities have undertaken, including East Lindsey District Council in Lincolnshire. Its local development order for the coastal zones authorises 12 months’ operation for the next two years.

To be brief, the problem that many campsites across the country face is that while they are starting to reopen, at the moment there is a degree of caution among those undertaking camping. So, they are running at about 40% of the capacity they were expecting; the season will therefore be quite short for them. Extending the season would make a great deal of difference. It would also show some clarity, because the Scottish Government have already advised their local authorities that a

“temporary relaxation of planning controls will help businesses to re-start.”

They cited enabling

“seasonal businesses such as holiday parks to continue to operate beyond any conditioned limits to their seasons”

on 29 May, under the heading “Changing business practices during physical distancing restrictions”. The Welsh Assembly is also looking to write a letter. I hope that the Minister can give us an assurance that the Government will raise this issue with local authorities as being beneficial to their local economies.

Business and Planning Bill

Baroness Doocey Excerpts

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Tuesday 14th July 2020 Lords Chamber

[Lord Greenhalgh]

I thank the noble Lord; he got a second chance to speak but had very little to say. The coronavirus pandemic has caused a lot of firsts; it is good to share in that endeavour. I am pleased we were able to assuage a lot of his concerns.

[Baroness Doocey (LD) [V]]

My Lords, I thank the Minister for his response, particularly in respect of caravan parks, which sounds good. I would obviously like to see the detail, but it is definitely a step in the right direction. I do not at all accept the points he made about the package not coming to 25%, but I do not honestly think this is the time to talk figures with him; I would much prefer to do it privately afterwards. I think that not taking the opportunity to help small local businesses work together is a mistake that has been allowed because of this anomaly in current legislation—but I hope to persuade him when we speak privately that the figures I put forward are right.

It is also deeply distressing that the holiday cottages will not be included after the vast amount of money they have lost during the coronavirus. The difficulty is that this sector has been hit so badly that it will definitely end up with thousands of people losing their jobs and livelihoods. I know the Government feel as strongly as I do that this should not happen, so I really hope they might be able to reconsider after we speak. Meanwhile, I beg leave to withdraw the amendment.

Amendment 50 withdrawn.

Business and Planning Bill

Baroness Doocey Excerpts

Report stage & Report stage (Hansard) & Report stage (Hansard): House of Lords
Monday 20th July 2020 Lords Chamber

Moved by

[Baroness Doocey]

55: After Clause 15, insert the following new Clause—
“Amendment of the Package Travel and Linked Travel Arrangements Regulations 2018
(1) The Package Travel and Linked Travel Arrangements Regulations 2018 (S.I. 2018/634) are amended as follows.(2) In regulation 2(3) leave out “at least two different types of” and insert “the carriage of passengers with at least one other”.(3) In regulation 2(5) leave out “at least two different types of” and insert “the carriage of passengers with at least one other”.Member’s explanatory statement
This new Clause seeks to amend the Package Travel and Linked Travel Arrangements Regulations 2018 make transport a mandatory component of package travel. This would allow small local businesses to make a combined offer without incurring the responsibilities of a package holiday operator.

[Baroness Doocey (LD) [V]]

My Lords, Amendment 55 standing in my name aims to modify the package travel regulations, retaining protection for consumers travelling abroad but removing barriers which stop small businesses working together in the domestic market. The amendment does so by stipulating that, for something to constitute package travel, an element of travel must be part of the package.

Visitor numbers in the domestic tourism industry are down by 30% to 50%, and research shows that only a third of families intend to take a domestic holiday this year. Tourism in the UK is by definition a feast and famine industry—a feast in summer and a famine in winter. What small businesses in the sector face this year is the famine of the lockdown, followed by the seasonal famine of winter. The industry therefore desperately needs to attract trade and to persuade people to start taking holidays in the UK.

The primary purpose of the package travel regulations is to protect consumers who take package holidays overseas by making the tour operator legally responsible for the package and ensuring that the holidaymaker can be repatriated if the tour operator goes bankrupt. These are very valuable protections. The problem for small domestic tourism businesses is that the definition of a package holiday has been poorly drafted so that the smallest B&B working with a local pub or a local golf course to offer a discounted deal ends up being deemed to be a package tour operator. The consequence is an intolerable legal jeopardy for the small business concerned, because the regulations make the B&B owner legally responsible for what happens to the customer while they are at the golf club or in the pub. If the customer suffers any injury there, it is the B&B owner who is sued. Small businesses simply cannot get insurance to cover them, which makes the financial risk of offering deals too great. The customer then loses access to discounts and the businesses are unable to stimulate sales.

In addition, the regulations require the B&B owner to be a bonded travel company, which is expensive, or to use a trust fund so that payments can be withdrawn only after the customer has visited. Anyone who has ever run a small business knows that this is not a sustainable way to operate. These problems are why most accommodation businesses in the UK do not offer discounted deals. The Government have said that the significant component element of the package travel regulations guards against the problems I have outlined. These provisions are totally unsatisfactory, because they require a business to guess whether a consumer would or would not have bought their product without the additional benefit of the deal. Furthermore, the 25% element is both inadequate and invidious because standard deals can easily exceed the 25% level, and a percentage threshold disadvantages those parts of the country with the cheapest accommodation.

This simple amendment preserves all the protections for customers taking holidays overseas while freeing up small businesses here in the UK to provide discounted added-value deals to their customers. A survey by the Tourism Alliance estimated that this modest change would increase domestic tourism expenditure by £2.2 billion per annum, which is enough to protect 40,000 jobs. This is not a boost that our domestic tourism industry can afford to wait for. We cannot wait out the winter while the Government consider this further. The famine is now, so the time to change the law is now. I beg to move.

[Lord Redesdale (LD) [V]]

My Lords, I have added my name to this amendment and I will speak in support of it. I shall be brief, considering the time of night. I am pretty certain that my noble friend will not press this amendment, but I hope that the Minister can give some assurance that, although changes to the legislation will not come about through this amendment, he will agree to meet with representatives of the travel industry to look at how the law can be reformed. The regulations that underpin this area are part of European Union law and, as we leave the EU and start to look at British iterations, this is the perfect time to address the issue. I hope that the Minister can give an assurance that his officials will meet with members of the travel industry to discuss these matters.

--- Later in debate ---

[Earl Howe]

My Lords, Amendment 55 tabled by the noble Baroness, Lady Doocey, and the noble Lord, Lord Redesdale, seeks to alter the package travel regulations in a manner similar to the amendment tabled in Committee. The noble Baroness is right to identify the difficulties facing the UK tourism sector, in particular the many SMEs in the sector. It is therefore right that we do all we can to support this sector through the crisis.

On 3 June, we announced a £10 million kick-starting tourism package, which will give small businesses in tourist destinations grants of up to £5,000 to help them adapt following the pandemic. As of last week, the VAT rate applied to most tourism and hospitality-related activities has been cut from 20% to 5% for six months to help the sector get back on its feet. We have launched the “enjoy summer safely” national marketing campaign to encourage British people to enjoy UK tourism. Ministers and officials have been meeting representatives from the tourism sector regularly via the Tourism Industry Emergency Response Group. We are actively considering all the recovery ideas suggested to us by stakeholders, including schemes to promote domestic tourism.

In that spirit, I would like to follow this up by arranging a meeting with the sector representatives that the noble Baroness, Lady Doocey, has met to explore the points she has made about domestic tourism and package travel. I hope that offer is welcome. As confirmed in Committee, the Government have indicated that we will undertake a further review of the package travel recommendations. As these are EU laws, this review is better conducted when the transition period with the EU is over. I say that with some emphasis, as the EU Commission has recently commenced infraction proceedings against several member states that have amended laws in contravention of the package travel directive.

It is also important to reflect, as the noble Baroness recognised, on the balance to strike between business flexibility and consumer protection, so it is important to consult a wider range of interests. For the reasons I have given, I am not able to accept this amendment, and I hope the noble Baroness feels able to withdraw it.

[Baroness Doocey [V]]

I thank the Minister for his response, for offering to review the regulations and for the meeting that he suggested. It will definitely be followed up. If we wait until January 2021 in order to start reviewing the regulations, I fear that tourism will be pushed to the back of the queue behind so many other issues that the Government will need to resolve after Brexit is complete. I therefore suggest that the review should take place now in readiness for legal change as soon as possible in the new year. I hope the Minister will consider this, that we can discuss it further at the meeting he suggested and that he will engage further with me and the industry on this critical point of timing. However, at this stage I thank the Minister for the constructive way in which he has engaged with this issue, and I beg leave to withdraw the amendment.

Amendment 55 withdrawn.