Support for the tourism industry after the Covid-19 lockdown

Tourism and the UK economy

Tourism contributed £59.7 billion to the economy in 2017. This was 3.2% of total economic output in the UK.

There were 1.6 million jobs directly supported by tourism in the UK in 2017, which was 4.8% of employment in the UK.

The tourism industry in the UK supports overseas visitors coming to the UK, UK residents visiting other parts of the UK (domestic tourists) UK residents going abroad (for example airports serve this kind of tourist). In 2019, there were:

• 93.1 million visits by UK residents abroad.
• 40.9 million visits by overseas residents to the UK.
• 122.88 million domestic overnight trips by UK residents to somewhere in Great Britain.

Overseas tourists spent £28.4 billion on visits to the UK in 2019. Domestic tourists spent £24.7billion.

Tourism in 2020

Overseas travel to and from the UK slowed significantly during Quarter 1 (Jan to Mar) 2020. Visits to the UK from overseas decreased by 16% compared with the same period a year earlier. Visits overseas by UK residents decreased by 24% compared with the same period a year earlier. 

VisitBritain has forecast significant falls in UK tourism. In 2020, VisitBritain forecast:

• a 73% fall in visits from overseas, compared with 2019;
• a 79% fall in spending from overseas tourists, compared with 2019;
• a 49% fall in domestic tourism spending, compared with 2019. 

Government support

The Government has introduced measures to support businesses, workers and individuals during the coronavirus outbreak. In the main, these aren’t specific to the tourism industry. They include:

• the Coronavirus Job Retention Scheme
• the Self-Employed Income Support Scheme
• Business rates reliefs and grants
• Government backed financial loan schemes
• Deferring tax
• The Eat Out to Help Out scheme

More specific to tourism: 

• VAT for hospitality, accommodation and attractions has temporarily been reduced to 5% from 20%
• A £10 million Kick-starting Tourism Package is supporting communities that depend on tourism. Small businesses in tourist destinations can receive grants of up to £5,000 to help them adapt their businesses following the coronavirus pandemic.
• Grants, repayable finance and capital investment are being provided to national cultural institutions and organisations, and heritage sites
• £1.3 million of funding was provided, between April and June, for Destination Management Organisations (DMOs) at risk of closure. DMOs takes a lead role in managing and developing tourism in local areas.