Meeting of the Parliament 28 May 2024
I thank the Local Government, Housing and Planning Committee; the minister and his bill team; the Parliament’s legislation team; and all the organisations that have given evidence to shape the bill that we have before us.
For the best part of a decade, we in Scottish Labour have called for a visitor levy. We are pleased to see that the Scottish Government has listened, and we are happy to support the passage of the bill at stage 3. We believe that local authorities should have as much control as possible over the implementation of the levy, simply because that reflects our commitment to push power out to local communities.
The visitor levy is a particularly good example of where that approach works, given the diversity of Scotland’s tourism sector. Some local authority areas are much more frequently visited than others, which are likely to see potentially negligible returns from any levy. We welcome the flexibilities in the bill that allow councils to implement a levy if they so choose and to design it in a way that suits their local circumstances, in consultation with relevant stakeholders.
Throughout the passage of the bill, the committee and other interested parties have attempted to balance support for local government with maintaining economic growth and supporting sustainable tourism. It is clear that the tourism and hospitality sector has faced significant difficulties over recent years, with the Covid-19 pandemic and the associated lockdowns and the subsequent cost of living crisis. The committee came to the view that the levy “would be unlikely to” deter visitors. We agreed that a small additional fee on top of accommodation costs is seen as part of the normal tourist experience in many other countries and could help to ameliorate the potential negative consequences for communities when tourism becomes unsustainable.
While we support the levy, however, we have said that implementation must not place too great a burden on businesses or local authorities. In particular, we are keen to ensure that smaller businesses are not disproportionately affected by the application of any future levies that are decided locally. The levy will be a shot in the arm to hard-pressed local authorities that are currently struggling with the pressure on local services that is brought about by large numbers of visitors. Crucially, however, revenue must not be used to replace funding for core local services. For more than a decade, Scottish local authorities have seen their budgets stripped to the bone, which has left libraries closed, rubbish uncollected and services for some of our most vulnerable people shut down and never reopened. The levy cannot be a substitute for money lost due to a reduction in the general revenue grant to local authorities, and it cannot be about plugging a gap.
Accounts Commission figures show that between 2010-11 and 2021-22, revenue expenditure on culture and leisure fell by 23.6 per cent; spending on roads dropped by 16.1 per cent; and spending on environmental services dropped by 12.8 per cent. In the face of those swingeing cuts over which this Government has presided, any revenue that is raised must be used to improve the tourism offer, and the services that tourists appreciate and for which they visit Scotland.
The levy, while it is welcome, will not touch the sides of the £6 billion black hole that the Government has created in local budgets, and the Government cannot pretend that it will act as a replacement for the fair core funding settlement that communities need. Scottish Labour has a different vision for local government that will guarantee a fair funding settlement and protect vital local decision making so that local people have a say over the services that affect their day-to-day lives most.
We also see tourism as a key part of our wider business case for Scotland, where it encourages economic growth through the promotion of brand Scotland and by ensuring that our country becomes a vital destination for business and leisure travellers. The visitor levy forms a key part of our commitment to implementing a new tourism strategy that builds cultural links with key markets and develops brand Scotland’s reputation on a global stage. We have proposed similar levies in previous manifestos. We have identified that such a levy could be a key part of the fiscal framework and the democratic accountability of local authorities. For those reasons, we will support the bill at decision time.