Government urged to rethink London tourism cuts

- Last updated on GMT

Related tags: Tourism, London

London generates £16bn in tourism every year
London generates £16bn in tourism every year
The tourism industry and the British Hospitality Association (BHA) have written to London Mayor, Boris Johnson, the Business Secretary, Vince Cable, and the Chancellor of the Exchequer, George Osborne, urging them to consider the risks of funding cuts to London’s tourist industry ahead of the Olympic Games.

In two separate letters sent over the past week, the groups warn that VisitLondon could face closure following the withdrawal of its £12m annual funding as part of the government’s spending review.

In its letter to Boris Johnson and Vince Cable, BHA points out that VisitLondon is the marketing organisation for London, and is crucial for encouraging both leisure and business visitors to the capital.

“We are therefore very concerned that funding to promote London is in danger of ceasing altogether in March next year, not least with the Olympics fast approaching,” said Ufi Ibrahim, BHA’s chief executive.

“Without a tourist board, London will lose out badly as a world tourism destination in the coming years.”

In another letter sent last week, leading hospitality businesses urged the Business Secretary and the Chancellor of the Exchequer to open dialogue with the Mayor of London in order to identify alternative funding sources to sustain VisitLondon and its activities. Signatories to the letter included Accor, Hilton Hotels, Mariott Hotels, Travelodge and Park Plaza Hotels.

Facts and figures

VisitLondon currently receives £11.7m in public funding via the London Development Agency. This unlocks a further £6m in private funding, received through organisation membership fees.

According to the organisation’s own data, its work delivers a return of £300m in annual tourism spend in the capital. Since its establishment in 2003, VisitLondon says it has delivered an incremental £2bn in revenue for the nation.

Overall, London’s tourism industry earns over £16bn in income annually, and employs around 400,000 people.

The government’s spending cuts means that VisitLondon’s primary funding source will be removed after March 31st 2011.

Hope for alternatives

The organisation told BigHospitality that it is currently in negotiations with the Greater London Authority (GLA) and the mayor’s office to find alternative funding.

Although nothing is as yet secure, both the tourism industry and the BHA are pushing for more dialogue, and VisitLondon said it is “hopeful” that a solution can be found to allow it to remain in business.

In preparation for the Olympic Games alone, VisitLondon has a number of ongoing projects that risk cancellation. These include: The Games legacy for tourism; London’s 2012 Fair Pricing Charter; Pre-Games global media exposure for London; Olympic benefits for small businesses; Post-Games legacy for Olympic venues.

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