Cynulliad Cenedlaethol Cymru

We'll move on to the papers to note. Are we happy to note the papers that we've got in front of us? Yes. Thank you very much. Great.

We'll move, then, on to our first substantive item of the morning. Welcome to our witnesses here. It's the ninth evidence session on the Visitor Accommodation (Register and Levy) Etc. (Wales) Bill. I'd like to ask witnesses to introduce themselves for the record. Shall I—? I'll start online, and then we'll come into the room. There we are. Roy, did you want to introduce yourself?

Yes. I'm Roy Church. I'm co-chair of WAVA, the Welsh Association of Visitor Attractions, which is a pan-Wales trade body for anyone involved in the attractions of the sector. I'm also director of Tourism Swansea Bay, the local trade association in the Swansea bay/Gower area.

David, let's go to you next.

I'm David Chapman, the executive director for UK Hospitality Cymru.

Fantastic. And yourself, Rowland. You don't need to do anything; you're fine.

Rowland Rees-Evans, chair of the Wales Tourism Alliance.

Thank you for your written evidence; we've read that with interest. But we'd like to go into more detailed questions. If I could ask for brevity; we've got quite a lot to get through—that is in questions and in answers as well. So, I'd like to start by investigating the purpose of the levy, existing policies and the reliability of the data. Probably a question to David first. You said in your evidence that

'it is disappointing that a valuable and supportive financial opportunity is in danger of being missed'—

and asked for the—

'purposes of the levy be reviewed'.

Could you elaborate on that?

Yes, of course. When the levy was announced, there were a number of contradictory elements that occurred at the same time. I'm thinking that some of the political communities saw it as a way of replacing lost money on public services, or adding money to public services, and some others saw it as a way of benefitting the sector. And there were other things that came about at the same time. I had conversations with politicians in which we were told, 'Don't miss this great opportunity; it'll really benefit the industry.' And in the first consultation session that I had, there was a senior finance officer there that said, 'This will be great; it will give us more money for health and education.' And that was, really, on day 1 of the process. And from that time on, we've had other similar sorts of discussions: whether or not this is a measure to assist the second home argument, whether or not it's something to do with boosting the local economy, and there hasn't been any coherence about the direction of where the levy was. 

Now, to go back to the original Labour manifesto line, which brought this about, it said:

'a tourism levy, ring fenced to support improving the visitor experience in Wales and to help the local economy.'

That's fairly straightforward, I think, and the word 'ring-fencing' is mentioned in there as well to achieve those purposes. But, as this process has evolved through different consultation areas, that has gradually been eroded and moved into a different position, and we now have, within the proposed legislation, four items of potential spending that are actually removed quite considerably from that original ethos, if you like. And I feel that—. I've lived all my life in Wales. We rely on public services. My family rely on public services. We use the health service. We're all in favour of extra money going into that, but the intention of this originally was to try to assist the industry moving forward to be a high-quality industry that would be, maybe, the market leader in the UK and help to benefit the economy in that way. I don't feel—my members don't feel—that, when you look at those clauses, they're not watertight enough to be able to prevent the money from being used in blocking the dam, in stopping in other areas. That's been the main—

I know Rhianon wants to come in on this. So, you'd be in favour of tightening up some of the things in the Bill to reflect more what was said at the outset.

I'll be quite simple about it, really. I think there's a great opportunity for all of us—that’s the industry, community and the public sector and the Government—to work together to create a new entity that would be dramatically to the advantage of the industry in its ability to grow and serve Wales. I think we could do with a much broader think around this, something to do with a sustainable tourism strategy that we could help with, and we could help deliver, and we could utilise that money to do it right across Wales for a huge benefit, so that the visitors come in and see this wonderful nation, this fantastic food-producing nation, and great places to stay. We can see it in the growth terms that we hope it could be, rather than just filling gaps, which I fear is how the money might be used.

I know Rhianon wanted to come in. 

Thank you so much for those comments. I’m slightly surprised about the comments that you've heard about health and education, because the clear intent of the Bill, actually its intended purpose, is around visitor tourism and how we appreciate and how we nurture that. So, that's absolutely been clear. Can you just articulate where in the Bill, then, you feel that it's shifted away from ring-fencing around tourism, because obviously that's its clear purpose and intent?

Yes, it's described as destination management and improvement in the local area for the spending of the money. Now, destination management—I'm using the VisitBritain description here—is for stakeholders to agree on a set of priorities and actions to grow and benefit the local visitor economy. Now, if that is the heading for the spending, the four things that come underneath, which are mitigating the impact of visitors, which is part of this activity—I feel it begins with a negative approach, if you like. There is the positive approach, which is encouraging more visitors to sustainably tour an area, but that's how the wording is at the moment. Maintaining and promoting the use of the Welsh language—well, we all 100 per cent support that concept, but whether this is the appropriate vehicle and the right place for that to happen is another one. Promoting and supporting the sustainable economic growth of tourism and other kinds of travel—that one is, very broadly, the only door entry point for what we thought the whole thing would be about. Whether or not that has the trap doors that could be used for other things—it's a very broad statement. We don't know. And the final one is providing, maintaining and improving infrastructure facilities and services for use by visitors whether or not they're also used by local people.

If you are of a mind to look to fill gaps in budgets and to replace and displace existing spending, then those four qualifying areas would allow you to do that. All we're really asking for is a bit more boldness and a way to look altogether. We're a small country; every single brain that we've got could be utilised here to make a fantastic new economic and growth opportunity, which we're a main player in in Wales.

So, just really clearly, then, Chair, you would like to see a little bit more weight attached to constricting that rather than making it flexible for local authorities.

Yes, a lot more, and I think I think we could do that together. There's no hostility here. This is really about what a wonderful opportunity we do have. We've got the people who are willing to do that. We've got fantastic entrepreneurial innovation and creativity within our industry. We can apply that. I know that Welsh Government have got a desire to see the industry grow, because that's why they invest in Visit Wales and the existing marketing plan. This is an opportunity to build on that really dramatically in a very short space of time and make our country a No. 1 destination. 

Okay, diolch. 

Thank you. I'll give you an opportunity to respond to that as well, the other two members of the witnesses there, but I'll maybe come to Rowland first on the next question, and if you wanted to reflect anything on that, then you can do. It was mentioned that recent policy changes have made it challenging for the tourism sector. How do you think the levy, combined with these policy changes, would impact the sector? If I come to yourself first and then I'll go to Roy on the screen, and then come back to David to summarise if there's anything further to add.

I think we're going back—. I think Alistair Handyside came here and he gave you 10 points. There's no point going over the same things again but I think the problem the industry has got at the moment is the fact that we're not getting back to our levels of 2019, which is our base level now, because COVID hit, the cost of living, then the 182-day rule legislation has been introduced, and that's causing huge issues within the industry at the moment as well, and I'm sure that's been well documented in other areas. And we feel from the industry point of view that the licensing and registration part is where we want to go—yes, no problem, the industry is all behind that—because that is going to give you valuable data, and not just the Government; it'll give the industry valuable data. We want the added value as well to make sure that everyone's on a level playing field so that those unregulated providers out there—. And there are some; we don't know who they are exactly but we know there are some out there, and that would obviously give us the confidence to move forward.

But with that evidence, then, just stand back a bit just until everything gets back to normal. We're not going to stop this levy, of course. We're not here to do that, we're here to try and get the best legislation that will work for the industry. I don't think we're asking a lot but we are asking for quite a big step for Government to just say, 'Let's get the legislation, registration and the added value, get that level playing field, get then all the information and data', and I'm sure that that would give the economists, the Government, the industry a way forward with far better outcomes, possibly. I don't know. Maybe the legislation would then have to change slightly; we don't know. But at the moment, we're going headlong into something that we don't know is going to work, how badly it's going to affect the industry, and this is on top of everything else. This cumulative impact that we're seeing across the industry at the moment, that isn't helping anyone.

As it stands now, the industry could lose 700 jobs, it could lose £40 million into the economy on top of everything else. That may not sound massive, but the impact across the industry is just those bits, incremental bits, just going up and up and up. I just feel that it would be brave of the Government to do it but I think it would be very good for the industry as well to work together. As an industry, we want to work with Government, of course we do; you are the decision makers and we want to get the best results for the industry. The better we are, the more tax we pay anyway. So, that helps in itself without a levy. I think from that point of view, the policy changes, mainly the 182-day rule is the one that's having the big effect at the moment. We don't want this on top of it causing more problems again with everything else. 

Okay. I'll come to Roy online—some thoughts about maybe those first two questions. They'll unmute you, hang on. If we could unmute Roy. Thank you. 

There we are. Thanks, Chair. Just picking up on what both Dave and Rowland are saying, we do need a broader collaborative approach to assess how we can raise more money to support tourism, really, right across Wales, and this is an opportunity to get together. The tax, in its present form, is a crude, almost blunt instrument just to gather some money from those local authorities that want to participate in a bed tax. It's unnecessary at this time. What's crucial is to look at what's going on in the industry. Some of these decisions are being based on data from 2019, which is hopelessly out-of-date now. There has been a huge structural change in the tourism industry over the last four and five years, with a succession of problems as we know about—COVID and so on. And coming down the line now is the additional costs that we're going to factor in in April, in terms of employment. What I can tell you at the coalface, talking to people, our members in Tourism Swansea Bay, and across WAVA for attractions, is that a lot of people are now planning for the worst. They're hoping for the best, but they're now starting to plan for the worst. They all can see they're going to have to cut costs. So, this is seen as an extra headache, if you like, further down the line again, of having to tax visitors.

Like Dave, I believe a collaborative approach is absolutely crucial now. We need to get together and decide where we're heading as an industry. Data collection has been a problem, and that can be solved with a simplified registration system. So, we're very pleased to see a proposal coming forward in this Act to deal with that, but, again, we think that needs to be streamlined a bit more—keep it simple, try and involve all participants in the industry to come forward. I know some smaller accommodation providers just looked at the registration system, the licensing system, and the proposed tax, and decided to give up. I've been told that over 20 properties that I'm aware of will be withdrawn from the market for holiday use. So, I think assessment of the data is crucial before we can move forward on deciding how any tax should work.

Okay. Thank you very much. Anything further to add to that, David? No. That's fine. Thank you. Rowland, you mentioned earlier about the registration, and I think, in your evidence, you've said that the Welsh Government

'has also deferred the policy of "weeding out" unregulated opportunists operating in the self-catering market, something which needed to be achieved before asking professional self-catering businesses to charge and collect a levy.'

Could you tell us what your concerns are about the enforcement of the registration requirements within the Bill?

'Weeding out' sounds a bit rough, doesn't it? I think we're back to the registration and the licensing. There are unregulated people out there—we know that; we don't know who they are. Most businesses, even the smaller, microbusinesses, if they're with agencies, then they've obviously got to comply with the agencies' requests. There are others outside that who aren't. But the big operators have got all kinds of legislation on them already, so it's not an issue to just get it all registered and up. And we'd be looking at things like insurance, health and safety, fire regs, gas, electric certificates—those sorts of things—to make sure you're complying. And Visit Wales would be delighted to market that: Wales is a safe place to come, we're a regulated industry, everyone is safe, come to Wales. That is a marketing tool, and I'm sure the Welsh—

So, there is a step in the right direction in the Bill.

Yes, definitely. But the added value is the bit that makes it a level playing field. So, if those 'rogue' operators are still in there, if they don't register, or if they do register and they can't comply, then they can't operate. And that makes sense to the rest of us, because they're probably undercutting us, or they're not paying those legislative costs that we're having to bear. So, I just think it just makes it sensible for the whole industry.

Thank you for that. Good to have that on the record. To everybody now, and I'll probably come to Roy first on this one: there has been concern about the reliability of the data—we've talked a little bit about that, so the data drawn on and the assumptions made by the Welsh Government regarding the levy. What are your views on this? I'll come to all of you; if I go to Roy first, and then come back into the room.

Yes, I think there's a need for a better analysis of what is being received into the economy. So, the Welsh visitor economy is very different from what's been looked at in the sessions before this committee. We're not Barcelona, we're not Venice, we're not an international destination. Our visitors come, 60 per cent, nearly, from Wales; the rest, mostly, from the UK. We have very few, proportionally, international visitors. Now, the significance of that in terms of assessing the data I think hasn't really been studied enough. So, for instance, if you consider that most of the people in Wales will take a holiday in Wales, then it's the same income that you've got—there's no new income here, it's exactly what we've got already. So, it feels a bit like shooting yourself in the foot when you tax a local person to go to take their holiday break in their own country.

The significance in our sector as well is the margins that we work at. We work, generally, with lower income families, basically. They're the ones who'll be taking their holidays with us, and this tax hits quite hard at their spending ability. So, doing some quick sums here: a family of four taking a five-day break in Wales, this tax is going to cost them £25. Now, it may not sound a lot, but that is the cost of potentially not spending money in the shop, not going for a visit to an attraction, of course. That £25 would represent an entrance fee somewhere. So, that reduction in their spending, I think, has not been reflected enough in the understanding of the data, and there should be some studies done on how that would factor into the true added value, if you like, that a visitor levy should raise. Personally, I think it'd be far better to concentrate on a more integrated scheme across Wales, and look at what our objectives are, and creating the tax that way.

Thank you very much. Anything further to add to that, Rowland?

I've got quite a bit to say on this, if that's all right, because I think this is quite an important part of the—

Yes. I'm just concerned about time, that's all, so, if you could be brief, then that would be great.

I know. To be realistic here—and even you, Chair, have said, 'I'm a big fan of data and making data-informed decisions'—the industry is, we all are—. I think that's where you get the best outcomes when you've got good data, and that's unfortunately lacking in the report. And even Professor Calvin Jones is, obviously, uncomfortable with what he's written, in a lot of what he's said. And if I may just read the last thing he said to you, or the last bit of what he said to you, last week. He said,

'The second point I'd make, and I think this is actually the much more important one, is: we know very little about how the tourism economy in Wales works. We know very little about productivity in tourism; we know very little about transactions that are happening on the supply side of tourism, in terms of between businesses; we know very little about what drives visitors to come to Wales; we know almost nothing about how much they’re spending when they’re here; we don’t really know what they’re spending their money on, so there isn’t even any data any more on the commodities they buy in Wales, how much is spent on accommodation, how much is spent on travel, how much is spent on recreation—we don’t even know that. And that’s a very uncomfortable place to start when you’re writing this sort of report, but it should be a very uncomfortable place for Senedd Members to be when they’re trying to make policy or audit policy on tourism.'

And that really reflects what we've all written. The industry has said it, and now he's saying it. So, I think this is the point that we're getting to now where if we can get the licence and registration, and the added value—if I can get that in—and then take a step back. You know, does it matter if this takes another year or two years to come in, if it's going to be good? Does it really matter to Government that we hold back to get that evidence—and I'm sure Professor Calvin Jones will be delighted to get that data—to put back through the models and see what comes out? You know, is there a problem with us as a Government, and the whole of the Welsh tourism and hospitality industry, hanging back just that extra year to get that stuff done properly?

So, getting the registration in place, get the data, so you have no fundamental issue with raising the levy.

Well, we can't stop it. And if I could, I would've done it two years ago. But no, to be realistic, if we're going to do it, let's do it properly. We've got a problem with 182. We've had a problem with the 20 mph legislation. The agricultural sector had a problem with the 10 per cent planting of trees. Fair play to the Cabinet Minister, he went in and sat with the farming unions that lobby, and they got a plan that worked. Why can't it happen to tourism? We're as big an industry, if not bigger, than agriculture, and our effect on the economy is big—10, 12 per cent of the working population, and 20 per cent in some areas. It's a big part of the industry in Wales. I'll leave it there. Diolch.

Thank you for that. I'll bring Rhianon in for some further questions now. Diolch.

I mean, I was just smiling to myself—we know that we do get international visitors to Wales, and we also know the importance of the tourism sectors to Wales in terms of the data that we know that we need to collate more efficiently across Wales. So, there are things that we do know—[Interruption.] No, that's absolutely fine.

I'm going to just move on to gathering thoughts, really, on the levy rates set out in the Bill. You've mentioned Barcelona, for example, and we do know that the Spanish do take breaks in Spain and that Germans do take breaks in Germany. In terms of your thoughts then on those levy rates, how would you articulate them?

I'll come in because UK Hospitality has done and awful lot of work on comparative tourism taxes across Europe, and also on VAT rates. And it has been used a lot in the conversation that we've had over the last few years, that other countries do this and so, 'What's the problem?' Well, I've got a list, which I won't, because of time, read out, but we have 17 different taxes that apply to our businesses. We are probably—in fact, I'm sure we are—the most taxed sector of any sector. We pay three times more than the relevant business rates that we should be paying, and that's because of the way the system has been changed over the years with the introduction of internet businesses and out-of-town shopping changing, and our bricks-and-mortar businesses are still in the same town-centre places or wherever they've been before, and we're paying, as a result, higher levels of rates. So, those 17 different taxes will soon become 18 different taxes. One of them is VAT and, as you know, we pay 20 per cent. Well, there are, I think, 23 countries in Europe where the VAT rate is 10 per cent or less for our businesses.

Sorry, with respect, can you talk about the levy rates?

Well, the reason I'm saying that is that, when you are at that high proportion of taxation, the levy rate that is applied on top of that means that you are then charging, per night, a level that is starting to become uncompetitive, particularly with other competitors who aren’t paying that level of rate, because you have to recover all of that level of outgoing in order to be able to sell a bed for the night. So, the levy rate at £1.25 plus VAT, which—. Just looking at you—I'm afraid I looked at your biography beforehand—you are, potentially, a family of six, I think. That family of six will cost £63 for a weekly holiday with this levy, plus VAT. Now, I feel that that's an awful lot of money, particularly as, as Roy said, the vast majority of our customers come from Wales. We don't have a very great economic background, and £63 a week may well be the breaking point between them having a holiday or not having a holiday, and I think that's not a good place for us—

So, in terms the levy rate question that I've asked—we've had this discussion in a different session, actually—would you be in favour of under-18s not having to pay?

Yes. The simple answer is 'yes'. In a number of countries, that happens—it happens in France, it happens in Germany. The reason I say that is not simply because it would be a business argument, but I actually think it's a humanitarian argument. And I think it follows the Welsh Government's health and well-being guidelines. I think it's part of the future generations work that you're trying to do. And I think it means that people from your constituency and other constituencies in areas where there isn't as much economic force, if you like, behind them, that they get a chance to go away. And I know that, when I was a kid, I'd love going to places like St Govan's head and Pembroke castle, and it made my life richer and it made me get into Welsh heritage and I understood the language, because I came from a council estate in Cardiff where we didn't speak Welsh. All those different things are very important for our children.

That's a case that you make very well indeed. I'm just going to move on to what you touched upon earlier, in terms of where you feel this is broadened, in terms of local authorities' abilities to, potentially, have any motivation to move outside of the mandate of the Bill, because, obviously, the mandate of the Bill is to invest back into the areas around tourism. So, what changes would you like to see in that regard, to be able to tighten that up? I don't know who would like to respond. Rowland.

If you want to make this work properly, I think the tourism part is important, of course, but I think it's the local communities as well, because they are going to be end users of whatever you do. So, I think that's important. And that brings a bit of a balance together or brings them more together, so that you know you're not just taking the tax to put it there and, 'These people here aren't going to benefit from it.' And I think, possibly, because—. Councillor Huw Thomas, I think, said, 'We're going to get £4 million.' This is what he said in his evidence. Well, obviously, we don't know how much on administration will go from that, but then he said, 'Oh, we’re going to use it for barriers, street cleaning and signage and things for events.' And I’m thinking, 'But that’s not improving it, because you’re already doing that'. So, technically, you’re saying that you’re already going to fail, because that money that’s left is going to move somewhere else, and that’s exactly what we’re trying to avoid, or you're trying to make sure that it goes into something that’s useful. And I know Huw personally—he’s from Aberystwyth, and his father used to teach in my primary school. But I just feel that that is the talk from the local government side already. So, we know that they’re going to move things around. Now, if you had a small committee, if you like, of people from the community, people from business and the local authority, and you said, 'Right, what do we want?', and we had a wish list, and we say, 'Right, we can afford to do that and that, but we can’t do the rest', that would be a way forward, possibly.

So, a forum. 

Yes, a forum. 

As it was described, I think, in some of the sessions last week, that additionality—

Absolutely. 

Yes. 

—rather than the baseline. 

Which Huw did agree with completely, by the way. [Laughter.] Okay, in terms of tightening that up, you would agree that—I don’t know if you all agree—you feel that there needs to be something more to constrain local authorities in terms of where this spend can go. That’s what I hear. 

It's about changing this sort of 'us and them' thing, I think. On the 'constraint' word—and I understand why you’re saying it—what we’d hope is that we could do this in a way that would be mutually beneficial and using all of our resources. If you look at, for instance, the business improvement district taxation that’s been introduced in Manchester, which is a Labour-led authority, where we have access into that process, and it’s looked at and the spending is led, if you like, but the industry—. On Huw Thomas’s comments, in which he said that the industry sees this as an inevitable tax, well, I would slightly disagree with him on that, but that’s part of where we should be beginning the conversation. If he wants to enhance events in the city centre, bring in the expertise of all of the people there who service the people who come into that city, to be able to utilise that resource in the very best way possible. And let’s not have it as, 'Councils are doing this'; let’s start to look at Wales.  

So, you’d like a more constructive approach.

I think that we’re there for that, and I think that’s something which needs to be built into this, to encourage that participation.

Roy, you indicated you wanted to come in on this point.

Yes, I think one thing that’s not clear from the Bill as drawn is whether there will there be a consistent tax charge across Wales. There’s too much in it which would allow variation. The introduction of the premium, as expressed in the Bill, as well, would give the opportunity to have a variation of rates. I think that would be such a complex system then. One amount across Wales makes it easier, and, certainly, exempting children, and not just children but also anyone coming into Wales for educational trips, because that can also be older adults who can be here for educational purposes. I think it’s so important on the child aspect as well, as Dave has touched on. Today’s children visitors are tomorrow’s higher spending visitors who’ll be able to afford the tax.

So, I think any charge should be targeted at those who can afford to pay it, and that’s clearly not Scout groups or educational groups. I think it’s imperative that both Plaid and Labour rethink their thoughts on this—the taxing of children is not going to go down well in the press, if they ever get the wrong handle on that. So, these are important points right at the preliminary stages of deciding how we’re going to take this forward.

In terms of the premium and the range across Wales, I hear your comments, but I don’t know if there’s any synergy. And, also, just a quick comment in terms of pitches and campsites, in terms of that as a sort of budget option—any views around that.  

I’ll just say, if you get a premium and a local council says '£3'—. Can I ask: do we have to have VAT on tax? I’ve never heard of VAT on tax before. It sounds awful, because tax is tax.   

I think it's the way it's set up—it's VAT-able. 

But it is—

Can I help you? Petrol. Petrol is taxed, and there's VAT on the petrol charged after tax. 

Thank you. But if someone did go to £3—one authority—then the £63 that David was on about for a family of six, it goes to £126. Then it becomes—. Well, these families are not going to go there, are they? They're going to either go to somewhere where they're paying the £63 or they're not going to come to Wales at all, or they're not going to stay in Wales. If you're in this part of the country, there's the other side of Bristol down there, and there's a coastline down there as well. So, that's what we're up against as an industry that might or might not happen; we don't know, obviously.

And also in terms—just briefly, if I may, Chair—of the length of duration of the levy, have you got any view on that?

I think that it was suggested in one of the sessions last week that it would only apply—. Somebody was suggesting that it would apply for five days, and, if somebody stayed for seven, it wouldn't apply for the last two or three days, so it's something where it's time-limited, so it would encourage people to stay longer. That was the comment. 

We'd welcome that. 

That has got to be good from our point of view. 

Okay. Thank you.

Great. Sam, I'll bring you in.

Thanks, Chair, and thanks for taking time to be with us this morning. It's appreciated. I just want to ask a couple of questions on the economic impact assessment that we've received evidence on. I'll perhaps come to you, Roy, first of all, because I guess the members that you represent, who are part of your organisation, aren't necessarily going to be directly impacted because they're not necessarily overnight stay providers. But I'm interested, of course, because the impact could have a knock-on effect to your membership. I wonder if you'd be able to describe a little bit the economic impact that you might expect. And also, in your written evidence, you referred to the evidence provided by Professor Calvin Jones about the potential economic impact. Perhaps you want to talk to those points for a moment, please.

Yes. Going back to what I've said before, if you take money off a family for the levy, they've got that much less to spend. So, to put it in simple terms, as one accommodation provider said to me, 'Well, if they're now going to be handing over £25 as a levy, they haven't got that to spend with me on the retail side of my business in the shop, buying extra ice creams.' All that will go. So, our level of visitor spend and collection will drop, and I think that that needs to be taken into account in the assessment of the data of the inputs and outputs that Professor Calvin Jones looked at. I didn't think that there was enough emphasis, really, on the likely impact of the lower spend that will occur. And that will have to be reflected throughout the Welsh economy, given that nearly 60 per cent of the visitor spend is from people already in Wales. 

Okay. Thank you. I just want to come back to a point that I think David raised earlier about the potential if the levy is raised and the way it could be used to make Wales great again, perhaps. I asked the question to Bluestone last week, because they estimate that the levy would mean about £1 million a year that they would be handing over to the local authority. And I asked the question to William then, 'Are you confident that they could spend £1 million on marketing your part of the world better than you could spend that £1 million marketing your business?' Do you think that your members would spend the money better than Welsh Government on these issues?

I think our members, obviously, would spend the money better in regard to that particular business area. They know the business and they know where—. In fact, they're really, really good at bringing people into Bluestone, and they've got a very sophisticated sales system there that does that. However, there is a bigger argument and that is that we need to look at bringing visitors into Pembrokeshire and visitors into Wales as well, and it's about a balance there. And that's where I was arguing earlier that I felt that, when you have this great opportunity, it would be much better to use the combined skills and abilities of the people involved to be able to evolve a system that would be much more effective, using all of the resources available to make those three points work. And I think, at the moment, we're in a position where it is more of an 'us and them' situation, and it does put a lot of pressure onto local authorities to do an awful lot of work very well with that money to make the most of it. Let's not do that; let's widen it. 

I think Mike Hedges wanted to come in.

Diolch, Cadeirydd. Talking about Bluestone, which Sam raised and you talked about, three nights in Bluestone this month for a family of four is £1,065.

Three nights?

Yes, Friday, Saturday and Sunday. Do you see a tourist levy of the level that's being talked about having a material effect on people deciding to go or not to go there?

You'd have to, really, talk to Bluestone about that, because I'm not that—

I did.

—I'm not that aware of their price sensitivity. But what I do feel is that, when you look for a holiday, and this is what I do, you look for a destination and then you look for a price. That's what I think most people do, and if that price—. It's a psychological thing, maybe, but the price has an impact, and so anything that puts the price up—. And I should say that we are facing very big national insurance rises coming up. Eighty per cent of businesses, I think, in our survey, show that they are considering cutting back as a result of that, because they don't have any room anymore, they feel, to push the price up, given the state of the economy, on people buying holidays. So, anything that adds to that top end is going to make it very difficult for our businesses to be able to maintain and create the levels of employment at which they are at the moment. 

I think one of the great things—just to finish that point, looking positively forward—about statutory registration is that, for the first time, all the political process will be able to see just how big and important this industry is. If you look at Calvin's report, he's stumbling around to try to find information. We'll be able to provide that through the statutory registration process, and that information will reveal just how much this industry is the backbone of the Welsh economy. And it was appropriate, I think, that—

Sorry, just on that point in particular, because Rowland said, 'I like data', and I've said it quite a bit: you'd therefore be fully in favour of the Welsh Government making the data available to people like the professors to be able to do that analysis, which might not have been available, just because of the frustrations I can hear from the evidence that you're giving. 

There are obviously areas where there is commercial confidentiality, and that would be taken into account, but, yes, what we will have is an enormous bank of information that would demonstrate just how vital this industry is. I do think it was a really good reference, because we are the petrol of the economy. So, unfortunately, we both might be taxed, but we are the powerhouse that, actually, in the Welsh economy, every single community produces economic ability to grow, which is what everybody's ambition is.

I'll go back to Sam.

Thanks, Chair. Just on this broader point about understanding the sector, Rowland, you referenced earlier the approach by the Cabinet Secretary in regard to farmers and the agricultural sector in Wales. David shared that, currently, hospitality and accommodation businesses already pay around 17 different taxes already, so contributing a huge amount to public services in Wales. Are you confident that the Welsh Government understand your sector at the moment?

Understand—?

Your sector.

I don't think anyone does. I don't think we do as an industry, to be honest, because we haven't got quality data, and I think that's the No. 1 step we need. Because I'm sure Calvin Jones will be delighted to get hold of this data, because he'd have 22 authorities, all the breakdowns of everything within each authority, and then he could model whatever he wanted, and he'd come back here and he'd say, 'This is what we're going to do.' And I think we as an industry would say, 'Fine, we can't argue with that', because it would make sense. But what we've got at the moment, I'm afraid the industry is very, very cagey about this and very upset, because the data doesn't really add up, and it doesn't give us confidence, and we need the confidence to move forward as well, to be with Government. 

It would take a really big step for Government to step back, I know, but it would be the best step they've ever done—and I mean that—in Wales, because we're a small nation, and we need to get this right. It's not stopping the levy—we're not talking about stopping the levy. If we're going to do it, let's do it properly, because the benefits might be worth it, but, at the moment, what we've got in front of us says that we might actually be using public money to collect tax, and that's not very good—that's not good in any Government, in fairness. And that's no disrespect to Government; it’s just what the information is telling us that we’ve got in front of us, and I just feel we need to be bigger as a country. We’re a proud nation, we’re a very proud nation, and we’ve got so much to sell as well—and David was going on about it—the hills, the sea, the rivers; we’ve got it all. And no, we haven’t got the bucket and spade and the sand and the sun and everything, but I think we just need to be a bit braver.

Just to expand on that point a little bit in particular, I think, Rowland, you or WTA have raised concerns in relation to the cost estimates provided by Government in the explanatory memorandum for the Bill. There were some specific concerns that you had. Could you just outline those concerns regarding the Government’s approach to estimating the cost of delivering this Bill?

I think our document had about 30 points in it, but I think the main ones, really—. The local authorities have been told that they’re possibly going to have to find it in their budgets to set all this up. We know how tight budgets are in the public sector. Well, you two have been councillors, I’ve been a councillor, we’ve been there, we know the fat has come off, we’re now down to the bare bones and further. We know that there are issues in local government, and it’s been going on for 10 years and more—12 years probably, now. So, how are they going to manage that for a start? Is that going to be frontloaded by Government or not? Is there a cost there somewhere for someone to go through, annual running costs? We don’t know what they are going to be for the local authorities.

The WRA obviously are another big piece of this jigsaw, and we don’t know—. Well, they’re saying they need two and a half full-time equivalents to cover collection, compliance, remittance and enforcement. Well, even at the low end of 16,000 units here, that’s an awful lot of work to get through for two and a half people, I would suggest. If you had four people—. I’m sure you'll hear more later, because I know, when I was chair of Mid Wales Tourism, I think them and north Wales, they’ve got about four people running the Visit Wales helpline, so you’re already in a position where that isn’t right, so there’s an extra cost, or there could potentially be extra costs there.

We don’t know what the cost to the industry is going to be. How are we going to have to operate this? Are we going to be given software that we can fill in easily enough to do our declarations? We don’t know. And who’s paying for that? Is the industry having to pay for that as well? So, I think it’s the unknowns more than what’s in the report; I think it’s what we don’t know is what’s worrying us as well. And that’s not to say we’re not ready for it; we'll have to deal with it when it comes, but it would be nice to know what it is.

Okay. Thank you. And perhaps one last point from me, Chair, before we move on. You’ve all expressed support for mandatory registration of the accommodation providers, and we’ve had discussions about that already, but is there any particular piece of information that you think should be in the register that perhaps might not be in the thinking of Welsh Government at the moment?

And then perhaps also, just briefly on this point—Roy, again, and perhaps David as well—a lot of the organisations you represent aren’t necessarily overnight accommodation providers, but to get a full picture of understanding what the tourism sector is like in Wales, is there an opportunity to include, somehow, people who aren’t overnight accommodation providers, to have an idea of how the impact of tourism is in Wales, or is that just not necessary at all? A couple of points.

I think it's a massive opportunity, and I think the essence of it is that we need to encourage people to participate as quickly and as simply as possible. We could do with an internet portal that would have simple questions that would be related to the business, the accommodation and the standards that they adopt, and I think that’s probably almost enough—to give standard information about its visitors and its basic activity. Because, if we go further than that, then it becomes more of an administrative obligation. There are plenty of time draws on businesses; they may then be slower to respond. But also what we don’t want to see happen is for this to develop into a further and extended area of bureaucracy that goes into local authorities.

I’ve just got one more point I’d like to raise, and that is, going back to what I said at the beginning about sustainable tourism, I think it’s vital that we address some of the core issues that were behind this, and that is that there was concern in some local authorities about impacts on public services, and those impacts are largely because of day visitors, and we need to incorporate—. If you think about it, toilets are provided in all of our properties, and I'm talking about UK Hospitality here, I'm talking about pubs, cafes and hotels, and many of the other facilities that are provided in the public domain are already provided internally. One of the things we do have to look at is how we don't take a sticking-plaster solution by taking money off of the efficiently run, sustainable businesses that exist, and try to use it just to bolster resources where there is a demand from day visitors. That's where I think a bigger strategy is important.

You directed one of the points at Roy as well, so I'd just like to hear if you've got anything further to add there, Roy.

Yes, a couple of points. On the cost of administration of a levy, there are other models around the world that show that the trade can actually take the lead on this and even collect the levy. That's a much cheaper way of achieving the collection. I've seen systems where as little as 2 per cent of what's been collected has been used in the administration of it. The Manchester model's been mentioned: that's another way of administering collection; that's run separately, I think. In all the consultations that have gone on and in the modelling, we haven't seen anything put forward as to, 'Is there another way of collecting this?' The trade bodies that exist could potentially collaborate with the Government on a far more effective and cheaper system.

With regard to more visitor data in the attraction sector, we do have a voluntary scheme you can join, run by Visit Wales. It's a quality-grading scheme. If you join that, there is a whole series of questions there that the trade provide, about volume, retail trade—is it up, is it down—where your visitors have come from. So, that can be collected in the quality assurance scheme. Potentially, you could take this registration system outside of just the accommodation, and potentially have a registration system for other sectors of the leisure industry as well, so you'd get a broader picture of the data and certainly some consistency in what data you're trying to collect as well. Those would be my thoughts on it.

Thank you. I think Rhianon's got a short question, and I'll come to Mike then.

Just a very short question. How much of this is predicated around a sense of local authorities, in a sense, muscling in on trade body work? Do you feel that there's any synergy with that comment?

So, with the—

In terms of the administration—

Local authorities' responsibilities around this. Does it feel like they're muscling in into your area? I don't know, I'm just throwing it at you.

No, I wouldn't feel that. I think it's an opportunity here to work more collaboratively with your local authority. If you're going to delegate this to the local authority level, then we would certainly embrace working with them in terms of the collection of it, and, obviously, on the premise then that that gives us more of an opportunity to say how it's going to be spent, what it could be used for. So, certainly, we are becoming detached from this whole process, and that's a concern that's coming out in the formulation of the policies and the procedures set out in the Act. It's almost as if we are being put aside; we don't want to be put aside, we're ready, willing and able to talk with whoever's going to administer this and take part in that system as well.

I think there's a role for the trade to play in this. I'd certainly be very keen to take this back to my trade association members and say, 'Look, this is happening, but we can take part in, perhaps, the collection, the administration and then ultimately in the destination of these funds as well.' That would be a huge step forward, working more closely with—. However you're going to administer it, whether it's through local authorities, whether it's through some regional bodies, I think it's a great opportunity to work together more constructively here.

There we are. Mike has waited patiently with some questions, I'll bring him in now.

I've got questions on price. I believe, in fact I know, that hotel prices in Cardiff go up dramatically if there's a major event. If you tried to book a hotel when Taylor Swift was there or one of the rugby internationals was there, it would be substantially higher than if you tried to book a room now. So, this is minuscule in terms of comparison with the variation in price by hotels, guest houses and other chains, isn't it?

From a hotel point of view, yes, it's not a big tax. I think it's the tax that's on the families, the family thing that is hurting, from that point of view, yes.

I agree with you that charging children is wrong, and I'm sure that the committee will be saying that at a later stage. But, coming back to the price effect, again, when you were talking, I again checked, I could book accommodation of almost any level in Blackpool for half the price of going to Cornwall. Why is the queue on the M6 going the other way?

Well, you've hit the nail on the head, haven't you? It's about demand, isn't it? And that's exactly what you were referring to with the Cardiff hotel situation. And, from the industry's point of view, it's unfortunate that we haven't got Taylor Swift in town every night, because then the hotels would actually be able to expand and employ more and do better, but we don't. What we have are an awful lot of days when we are Taylor Swift-less, and it means that the rates come a long way down and we still have to pay all of our staff. While there's been 48 per cent wage increases since 2020, which we are proud of, it's obviously a test when it comes to trying to make the books balance and to try to look at reinvesting into properties. So, when you have a limited bed stock, inevitably demand will say that that price goes up, but we need to have a more reassuring economic climate around those hotels to guarantee that the great people who work in them have a job to continue in.

My daughter lives in Bangor, so I spend some time in north Wales, and for a budget hotel in Caernarfon, I've paid £120 for a room for one night and I've paid just over £40 for the same room for one night. I mean, prices move all the time, don't they, and they move based on demand.

And I think that's the argument, that if it's at £40, that means that not very many people want to be there on that night, so if it goes to £46, as a result of a family moving in there, then even fewer people want to be there that night.

Okay. I think we could have a long economic discussion about the price elasticity of accommodation, but now is not the place to do that—the Chamber, maybe, later on. My final question is: how should the impact of the legislation be monitored and assessed if the levy is implemented?

That's a really interesting point, I think, because it goes back to the potential for us to be able to use this for the good of the nation as well as the industry. And I think it's vital that we keep regular monitoring of the impacts of the tax, but not only limited to that, but to actually look at other areas where we've got far more information about visitors and visitor trends and visitor spend, and areas that we can make better together. We're short of that information generally, so this is an opportunity, when it goes through, for us to have a wholesale change in data and to utilise that right across the board.

Back to data, Mr Chairman.

Just finally, if everybody else has finished—. Oh, Roy, I'll come to you first.

Yes, sorry. Just one follow-on point from the Taylor Swift discussion, actually—

We've had Taylor Swift so much in this committee meeting today, but there we are.

Yes, I know. This is an important point, I think, because this isn't really covered in the Bill, either: it's what do you do when there's a sudden surge in demand? So, what happens in Cardiff, what happens at the times of the Urdd, for instance, in north Wales? When there's a surge in demand, you have something happen, which is called 'pop-up accommodation'. And I myself have witnessed this many times. If you go in to a big event in Cardiff, you can see people on their phones finding accommodation anywhere, and people literally letting out their properties just for one night, and there are thousands of instances like that. Take that back to the Urdd, for instance, there is a historic pattern there of people letting their houses out. There doesn't seem to be any mechanism for dealing with that. Are you going to ask everyone to register their home, if they feel that they've got to let it out for one night to support a big event, perhaps? And that issue of the pop-up hasn't really been covered by this Bill, or even taken into account in a lot of the modelling and consultation. And it is becoming more significant, because of the success of the bigger events going on in Cardiff and elsewhere. And, a growing part of the Welsh tourism offer is the events. Even Welsh Government are trying to get into this, aren’t they, with the Green Man event and so on? So, it is a significant issue. How do we cope with the need to suddenly provide a lot more accommodation than we’ve actually got, and that we’ve got on the register? Once again, any registration process might need to look at that.

It’s certainly a question that we can ask the Cabinet Secretary when he comes before us again. I know we’ve just gone over time, but I’ve just got one follow-up question for Rowland, but for the rest of you as well. You say the delay would be beneficial to embed. In the evidence that we’ve had so far, the earliest this could come in is 2027, because of the registration and then the consultation locally. I think the earliest would be 2027. If there was to be a delay, how long beyond that would you be feasible to be able to—?

I think it’s how long it takes to get the data. If you get that data and get everyone registered within six months, then it’s six months, because I don’t think it’ll take Professor Calvin Jones a lot of time to put it back through his modelling. He’s been working with his hands tied behind his back. He says it in there, doesn’t he? 'I didn’t have this data. I’ve made assumptions.' And you’re thinking, 'Oh, is that—?' It wasn’t good. I mean, I’m not being funny, you were a bank manager in a previous life?

In a previous life, yes, many years ago.

If someone brought this to you and said, ‘Look, will you lend me some money against this?’, I know my bank manager, she would say, ‘Go away, will you? This is not good enough.’ It’s not good enough to put in front of—. I honestly don’t think that we should—. You know, if we can, it would be brilliant, because it would allow the industry to come up to speed, more than anything else, and the information would be great. The local authorities would love it. The WRA would have far better information for their modelling, and obviously the Welsh Government. As an industry, then we would be able to get far more feedback back in to see where our markets are going, because we’re second-guessing all the time. We’re all working in different areas of the country. We’re all marketing in different ways. But this information could well help us all. Diolch.

Thank you very much for that. Diolch yn fawr iawn.

Diolch.

It's very useful to have you in and to go through some of your evidence and to flesh out some of that, so we appreciate you making the time available this morning to come in.

We'll take a short break now and reset the room for our next session, so we'll go private for a few minutes. Diolch yn fawr iawn.

This is the tenth evidence session. We have a room full of witnesses. It's good to see you, and thank you for making the time to come and give evidence. And thanks for the evidence that you've already supplied for us in written format as well. I'll just go down the line and ask you to introduce yourselves and your organisation. Iwan.

Bore da. I'm Iwan Thomas. I'm the chief executive of PLANED, which is a community development charity covering west Wales, and I'm also a director of Visit Pembrokeshire as well.

Lovely. Jim.

Bore da, pawb. My name is Jim Jomes. I'm the CEO of North Wales Tourism. It used to be the North Wales Tourist Board. It's been around for 33 years. Previously, I was also the head of tourism, communities and public transport at Conwy council for probably about 25 years.

Thank you very much. Croeso.

Bore da. My name's Emma Thornton, and I'm the chief executive of Visit Pembrokeshire, which is the official destination management organisation for Pembrokeshire.

Fantastic. Thank you. 

Zoë Hawkins, chief executive of Mid Wales Tourism. We cover the whole of Powys, Ceredigion and Meirionnydd.

Fantastic. I appreciate some of you have travelled very far today, so I do appreciate you coming. Thank you very much. There will a transcript for you to check after the session, just for accuracy.

I'd like to start by looking at the impact on the tourism sector and comparison with international tourism taxes—that sort of aspect of the Bill and what's being proposed. So, probably as an opener for you all, how do you think the levy could affect the tourism sector's competitiveness in attracting visitors to Wales? I'm going to start there and work across, so we'll start with Zoë.

Obviously, we've got concerns about the competitiveness of Wales. I'm concerned about the reputational damage that it could potentially have with the public relations perception that Wales is expensive as a holiday destination. There's been a lot of comparisons about the likes of Catalonia, I've heard. These aren't really comparable markets to Wales. It's twice the population of Wales. It's got 18 million international visitors compared to our 800,000 international visitors. We need more visitors into Wales, not fewer. Catalonia could afford to lose a few, I believe. It's a concern for us.

You mentioned, actually, in your evidence, I think, that the Bill's been introduced without an updated tourism strategy. Maybe if you touch on that, and then I'll come along there.

The tourism strategy has expired now, I believe. So, without that, I don't know what we're trying to achieve with it. We could really do with an updated strategy and then bring in legislation that then is going to complement that, going forward. Are we looking for an increase in visitors, or are we looking for a decrease in visitors at the moment? With the levy at the moment—the information that's come out—we're looking at potentially a decrease between 2 per cent and 10 per cent on visitors. Is that the strategy for Wales? Are we looking to decrease, or are we looking to increase? We need a plan, going forward, I would say, before we introduce any more legislation for our tourism sector.

Okay. Thank you very much, Zoë. I'll go to Emma. Could you limit it to anything extra to anything you've heard, or if you agree? It's just from a time point of view, that's all.

Understood, yes. Okay, building on what Zoë has just said, I think the key thing is around consistency, a level playing field across the UK. Given that a high proportion of visitors to Wales are within Wales or across the border, there's a concern that, yes, Wales will be seen as less attractive to visitors, so that's a key element and, I think, just recognising that visitors are down to Wales across the border. I think it's about 23 per cent in the last year, so, 'Is this the right time?' is the issue.

I think the PR, the positive PR, is really important about this. We want to ensure that Wales is seen as welcoming to visitors. It's the Year of Hwyl, it's the Year of Croeso, and we're going to need to work really hard to maintain that, I think, in the context of this.

Okay. Thank you. Jim. 

Thank you, Chair. I'm very, very concerned about our tourism and hospitality sector, and the viability of it now and going forward. I'll just go back to 2019, when we were on a high. We promoted ourselves as the adventure capital of Europe, we had a lot of support from the Welsh Government and from Visit Wales, and the economy was growing. Obviously, nothing could be done about COVID, and our sector was the hardest hit. However, since COVID, it's just gone from bad to worse. We have a lot of members, over 1,000 members, and they're telling us that they are suffering, not just with the day-to-day costs that we're all incurring, but just for their mental health. I believe that the Welsh Government haven't got a plan for the economy, they haven't got a plan to increase the tourism and hospitality sector, which it should be, because, in north Wales, we haven't got a lot but tourism and hospitality. I've just come back from Japan.  They've got a plan, a big plan. They have 30 million international tourists. Their plan is, by 2030, to double it to 60 million, and they've got a plan in order to do that. They have proper overtourism issues that they have to deal with, but their plan is how to mitigate that and bring visitors from all over the world, because they recognise the importance of tourism and hospitality to their economy. Our businesses are struggling and, seriously, you do need to hear that.

Mike, did you want to come in briefly on that?

You mentioned Japan. Prices in Japan are substantially higher than in Wales, aren't they?

In some cases they are, yes.

Can you tell me anywhere in Japan where I can book a hotel, in Japan, in the Tokyo-Kyoto region, which would be, on a normal day like tomorrow, cheaper than going to Bangor, for example?

But there's a difference between going to Bangor and going to Japan, isn't there? I can tell you, in Tokyo, because we're looking at this moment in time, that there are prices that are quite competitive with the prices within the UK. Obviously, there are some really expensive hotels there and you have to pay the price, but when you look around—bear in mind we're just talking about Tokyo—and when you start to go out of Tokyo into the conurbations and so on, you'll find that the prices are relatively cheap in some cases.

Well, that's something that I and my friends have not found. But when you say you compare it to the UK, are you comparing it to London or the median in Wales?

Well, Tokyo with London, but rural Wales with some of the rural areas of Japan.

And you're telling us, on the record, that prices are the same or similar?

Absolutely. I've been to Japan enough times to know that, and, as I said, I've just come back now, and I'm saying they've got a plan. We haven't got a plan for our economy here, apart from taxing, which seems to be the only way out, and it's the same with local authorities.

Out of interest, do they charge a levy? Do they have a tax?

They charge a levy, but their VAT is 10 per cent. Most of the cases, most of the cities across Europe that have been quoted, their VAT is probably round about 10 per cent. Ours is 20 per cent. I stayed last night in the St. David's hotel. I paid my tax—£21 VAT. That's what I paid last night. So, I'm already paying a tax as a visitor to Cardiff, and I think the only way out—it seems to be the only way out—is by taxing everything. It's the same with local authorities. There's no plan for local authorities to get out of the mess that they're in at the moment, apart from increasing council tax, and in my local authority, which is Conwy, another 10 per cent this year, possibly.

Thank you for that. I'll bring Iwan in.

Diolch, Cadeirydd. Not to repeat what my colleagues have said, but you talked about the question around impact and, from my perspective, the impact that we're most concerned about is around communities across Wales, in terms of the ripple effect that we will see in terms of any negativity around a levy, because if you look at our tourism industry, it's one of the key drivers of the rural economy, particularly the costal economy in Wales, as well as areas of urban parts of Wales as well. And if you look at our communities, that is where our labour comes from for the industry, where the skills come from, but also the supply chains as well. And if we see a drop in visitor numbers, which is the risk that many people allude to, then that ripple effect is going to impact on households within our communities. And where you look at rural communities, particularly in areas where there is a considerable lack of infrastructure, there is going to be a detrimental effect unless we look at a way in which we can safeguard the jobs and the skills through a proper implementation of any levy, should that proceed.

But it's communities, certainly, where I think there's the forgotten impact if this levy is not done in an effective way where there could be ring fencing, there could be a greater dialogue with the industry, but also with communities at the same time to make sure that there is transparency in terms of how any funds raised by the levy is spent, and it is done so to the benefit of the industry but also to the communities who provide the welcome and hosting for many of our visitors as well.

Rhianon, did you want to—? 

Yes, just picking that up, really, this isn't a zero-sum event; it is a sausage machine, and it needs to work well and it needs to be implemented well. You've mentioned infrastructure and the whole concept around additionality in terms of being able to plough back into that local tourism sector, which is absolutely key to this. Does that not in any shape, sense or form make you feel that this is going to be additional to that area of tourism that will attract more people to Cardigan bay, the Cliff Hotel? Is there nothing there that attracts you? 

It's around messaging and it's around communication to demonstrate the value that it could offer. Now, if you look at the infrastructure, as I've talked about before, to get to west Wales you have to make a concerted effort. The M4 stops at junction 49 at Pont Abraham. To get to Pembrokeshire and to the St Davids peninsula, it's a further hour and a half if not a two-hour drive. There are no direct trains. The buses are infrequent, if at all. So, if you put a levy on top, many people will be thinking, 'Is it worth that additional effort for the additional cost?' Now, if it can be done in a way where the benefit is seen and it is beneficial, then people will make a concerted effort because they want to support local opportunities and local enterprises. But it's not easy to get to west Wales. I'm a resident there, I know what it's like, and I think you have to make a concerted effort to get to west Wales. We've got fantastic facilities, beaches, tourism attractions, the same as in north Wales and mid Wales, but putting on an additional cost will make people think twice, and the ripple effect into communities in terms of jobs, skills, infrastructure will be something that we need to consider as a ripple effect of this levy.

Jim, you talked a little bit about my next question, so I'll probably go to somebody else first. You talked about some of the policies, either local government policies or Government policies that impact the tourism sector. Could you tell me—if we come, maybe, to Emma first—could you tell me about any policies that you feel are impacting the tourism sector or Welsh tourism, and what those impacts are? 

Yes, certainly. Thank you. I think probably the biggest one that won't be a surprise to you that we're feeling in Pembrokeshire is the cumulative impact of things like the 182-day policy. Certainly, particularly in our more rural accommodation providers, it's been really challenging to meet those requirements, and what we're trying to do as a destination management organisation is encourage people to explore further and away from the honeypot areas of Saundersfoot, Tenby, St Davids. Obviously, that becomes more challenging. Inevitably, those are the honeypots and those are the areas that people are attracted to often, and they don't have an issue or less of an issue with the 182-day rule; there will be some exceptions to that. 

So, I think there are some of those accommodation providers that are now facing a 200 per cent, potentially, in time, 300 per cent increase in council tax premiums. So, it's the cumulative impact of those policies, I think, which seem to be impacting more negatively accommodation providers, tourism providers, and then, as my colleagues have highlighted, the ripple effect that is, I think, concerning for visitors.

And, of course, the added issue, in terms of the context, in terms of the visitor numbers not quite coming back to the levels that were experienced two or three years ago. So, we don't have an over-tourism issue. We're really keen to support sustainable tourism. We want to see investment. But I think that's the concern; it's the timing of and the impact of the cumulative policies—obviously, the additional elements are not Welsh Government, but—in terms of the impact of the UK budget policies as well. So, it's across the board. I think it's just quite a painful period.

Any other policies, Zoë?

Well, yes. I echo what Emma said. I think the other thing we need to remember is that 90 per cent of our businesses in mid Wales are microbusinesses. With all of these impacts—. Okay, we lose one microbusiness, that's not too bad—they say, 'Look, this is too complicated, this is too difficult, we'll just close.' But you start losing 10 per cent, that has a huge economic impact across our region. We're only talking about 240,000 residents across Powys, Ceredigion and Meirionnydd, but we've got 40 per cent of the land mass. Our residents alone can't support our town centres, our jobs, our communities. It's the second-largest employer in mid Wales, tourism. So, you start losing 10 per cent of those businesses, because they go, 'Do you know what? Actually, I just can't do this', where does that leave our rural communities? Where's the investment going in? Where's the industry coming in?

I've got manufacturing in mid Wales that buy houses because there isn't enough accommodation provision. This is going to affect inward investment. We've just got to be careful that we don't look at it as, 'Okay, 75p and £1.25'—at the moment, and we won't talk about the premium for a second. But it's not really that, it's the complications that are going to be on our microbusinesses. How are they going to manage this? What systems are going to be in place? Cardiff, with the big hotels, absolutely—they're going, 'Happy days'; this will be easy for them. But our microbusinesses aren't so fortunate to have those big systems that they can do this, that they can manage it. So, yes, we've just got to be—. Yes. Sorry.

No, no. Absolutely. In terms of your latter point, the evidence that we've heard is that it will be simplistic, it will be simple, it should be being done anyway, in terms of health and safety and all the rest of the certification. That's what we hear. So, you don't trust that.

No, absolutely. The registration—I think the industry has been for registration for years. We should have a level playing field, and businesses should be registered. But in terms of the levy—. We need the registration first. How do we even know what economic impact this is going to have? How do we know how many businesses are closing, what effect it's having, unless we actually know how many businesses there are trading at the moment? It seems to be very uncertain. You've got statutory registration, but we've got no detail around this.

But you'd welcome a level playing field—

Absolutely, 100 per cent.

—in a sense, an audit of where we're at.

Absolutely. We keep hearing about Airbnbs. Airbnb isn't a business model; Airbnb is a website. If you have somebody staying, a paying customer, in your residence, you have to—. There's a legal requirement—you have to adhere to the same laws and requirements as a self-catering. But, at the moment, what's happening is they're under the radar. The 182, it's disproportionately affected the registered businesses, because we already have an issue. Local authorities have enforcement powers at the moment. They don't use them, because they haven't got—I assume; you'll have to ask them—the resources. So, how are we going to make sure that we've got a level playing field this time round, with this policy? Where's the enforcement coming in? Who's paying for that enforcement? We haven't seen any details about this. Sorry.

No, no. Thank you. I'll just come to Iwan and Jim—anything further other than council tax and 182 and what we've heard already? Any other aspects of policy that you think are having an impact?

I think I mentioned it before: we've been there, we know what it takes to vitalise an industry and an economy. And I say, 2019, pre COVID, we had lots of investment, lots of innovation, we were striving for excellence, and then, all of a sudden, it's come to a standstill. And what we're witnessing now across north Wales—which, as I mentioned, in north-west Wales, we rely heavily on tourism and hospitality—is very little investment coming into the area. There's very little confidence for people and businesses wanting to invest into their accommodation, for example. And I know quite a bit is out of your control, but the UK Government—. With the national insurance that's coming on stream, it's really, really worrying, especially to the big businesses. So, the 182, I feel, is cruel, in terms of the size of 182, to try and get businesses to reach that target. In Llandudno, maybe you're lucky to get away with it, but, down in the Conway valley and other places in rural north Wales, it's very, very difficult to get to 182, and that is hampering a lot of people's businesses. It's causing a lot of mental health issues; I know that because I talk to them, and I'll give you a quick three examples. We've got a farmer who was encouraged to diversify in the Conway valley. He's got six self-catering accommodations. He said now, with not being able to reach 182 days, his council tax has gone through the roof. You've got a policeman who retired with his pension to Beddgelert, and he said, luckily, he's still got some pension left, because he's not making any money at all now, with the 182. And only last week in Rhos-on-Sea, I was in a business that has seven apartments, and the council is starting to say the one that they use for storage is also a self-catering accommodation and that needs to be counted in the 182; he's struggling to get through to the Valuation Office Agency, he's struggling to get through to the council. And these are all real issues that are affecting our businesses right across, not just north Wales, the whole of Wales. I just think we're turning a blind eye to that, and what we need to do is turn the curve and start to think how to invest in an industry that, potentially, can bring so much money into Welsh Government and the UK Government.

Okay. Thank you. Iwan, anything further to add? I'm just conscious of time, that's all.

Absolutely. I think, again, not wanting to repeat what colleagues have said, but perhaps another angle to consider as part of this—you asked for something around additional, which hasn't been considered—is around skills. Now, our tourism industry can be often seen as seasonal, and it often isn't seen and promoted as a career pathway that is sustainable and offers progression. Well, actually, there are fantastic progression opportunities within our tourism industry, but, again, it depends if the tourism industry is supported in the first instance. Often, there is this negative perception, particularly amongst our young people across Wales, that it is not a career pathway that adds any value to them individually, when, actually, the reality is, when you scratch below the surface, there are fantastic career pathways.

Certainly, I'm in a privileged position. For the last three years, I've been chair of the governing body of Pembrokeshire College, and, working in Pembrokeshire, where we have such a strong tourism sector, we are seeing instances where many employers, both large and small, are struggling to fill vacancies. Again, there's an issue there in terms of, well, is there something, again, that Welsh Government can do to support. Yes, we've got pathways through the skills and education directorates, which are there supporting certain programmes, but is there something that we can do, through the levy, potentially, to support the industry directly in terms of skills, recruitment, but, more importantly, retention and development, which allows our businesses across Wales to make sure that they have the right skill sets and we remain competitive within the market and we support those individuals—and, again, coming back to communities and their sustenance as well.

I'll bring Mike Hedges in now, but, just on that point, do you think, then, that, under I think it's section 23, the proceeds of the levy—(c) there—which is

'promoting and supporting the sustainable economic growth of tourism and other kinds of travel'—?

Is that the type of—? Is that tight enough, I suppose, to be able to say, actually, helping for apprenticeships, or something like that, would be something that the local authority could use the money for? Or would you want to see further enhancements within that section to say, actually, a bit more specific? 

Well, I think, you know, certainly in the response provided by PLANED in terms of from that community angle, we certainly advocated ring-fencing a percentage of the levy. Obviously, it'll differ in terms of value in each local authority area, but to ring-fence that, and for that money, then, to be independently overseen by the DMO, by people from the industry, but also from the community, to then look at how it can then be ploughed back in, appropriately, whether it's through skills apprenticeships or grants for some of those microbusinesses. As we've heard from our colleague in mid Wales, often these microbusinesses struggle, and if there is a reciprocal grant pot that they could apply to and it's directed at those within the tourism and hospitality sector, it'll help, then, alleviate some of the pressures around 182 and all the other things, which many in the industry face. But, certainly, it can help in terms of skills and supporting our further and higher education partners as well, who are often at the forefront of working with industry and the future and current labour market within the sector.

Diolch, Iwan. Mike.

This is to Zoë Hawkins. You said that a levy could potentially have a disproportionate effect on rural areas like Powys, Ceredigion and Gwynedd. I don't know whether that's true or not, but that's—

Well, as I said previously, because we're, you know, microbusinesses—

But the point I'm making is that those councils do not have to levy it.

No, they don't. And, you know—. But what will happen is—. We've got to be realistic here. Does a visitor understand the border? Do they know where Powys is or Ceredigion is, or wherever? If they see in the national press that there is a visitor levy in Wales, they see Wales as Wales. They're not really going to know the border differences between Ceredigion and Powys. So, you know—. It's—. It will—. Even though they might not be charged in those counties, the knock-on effects of it would still impact us, we'd expect.

Well, I was in north Wales last weekend and I stayed for two nights in Caernarfon, and it was the price I looked at. If there was a tourism levy or not a tourism levy was totally immaterial to me: how much was I going to pay? And if price was the driver—and I've said it to everybody who's come in here—Blackpool would be full and Cornwall would be empty. And we know that, on the M6, most of the traffic for holidaymakers is going south to Cornwall, not north to Blackpool.

I mean, you know, it's the research that's come out that you're looking at a 2 per cent to 10 per cent reduction in visitor numbers. Those are the numbers that we've been quoted that we can see in the research that you've done. So, we will see a reduction in visitors on the back of this, according to your research, and we've just got to be careful. If we're going—. Okay, well, say £1 billion of revenue is coming in, if you lose 2 per cent of that, you're talking £20 million. Where's the economic case for this, you know? If, tourism, Welsh Government figures are saying it's worth £3.6 billion—it depends how you work the figures out—it's a risk.

Everything's a risk, I think, but—.

And with very little gain, as far as we can see at the moment. I mean, the cost—. If you're talking about £33 million being—. You know, it's—. Sorry, am I being—?

That's fine.

Jim.

Thank you, Chair. I think our biggest worry is they won't turn left on the M6, they'll carry on going to Cheshire and the Lake District, which are our biggest competition. And that's the worry that we have with the perception—not just with the tourism tax, with the anti-visitor rhetoric and everything else. That's a real big concern for us in north Wales, and that's my worry, that they'll carry on going up the M6 to the Lake District and to Cheshire.

Well, until they actually bring in a tourism levy as well, which I think is almost certain for the Lake District. But I think if you want to talk about anti-English rhetoric, which we're not allowed to, 'English Go Home' written on walls and written on big boulders as you're travelling through Gwynedd certainly doesn't do much for people wanting people going there.

It's what I was saying at the beginning: it's the cumulative effect of everything since COVID. It's not just that, which was rife during COVID; it's all these other policies. You know, when they brought the minimum wage in, that had a huge impact on some of the big businesses, which all of a sudden made 50 people redundant on the back of that. Now, you know damn well that national insurance is going to have that effect when it comes in in April. But it's that and everything else. And I think we're just missing the point, which is to look at growth rather than look to—as you know we say it—the race to the bottom.

Okay. I'll move on.

You mentioned the levy should also apply to day visitors to ensure fairness. How do you think that could be achieved?

Who said that?

Mid Wales Tourism and North Wales Tourism.

Yes. I think it would be a virtual impossibility to try and put a tourism tax or anything on day visitors, and they already contribute to our economy.

It's not impossible, but you could only do it in certain areas. You could do day visitors into, say, Cardiff, for example, and possibly into Tenby; it would be very difficult to do it in most of mid Wales.

Yes. I think logistically it would be an absolute nightmare. And it's like us coming into Cardiff—would we be expected to pay some form of tax just for coming into Cardiff? So, I think day visitors already contribute a huge amount to our economy; they go to our cafes, they go to our restaurants, they go to our attractions. So, they're already paying a fair penny to come and visit the area, so I think it would be very, very difficult to even think about taxing day visitors.

I mean, obviously, day visitors are a concern. They use the parking. It's just targeting, at the moment, accommodation, because that's, obviously, the easiest one to target, because you know how many visitors are coming into there. But I don't know what consideration has been given to a voluntary levy scheme. That could be well publicised. That fits very well with our culture in mid Wales—you know, do good things. So, that messaging is flipped on its head: not, 'We’re taxing you coming into Wales', how about, 'You're in here, you want to support the local community'? That messaging could be very different and, potentially, you could have a voluntary scheme, you could put one single system in place that the WRA could collect, and then it could go into the visitor attractions. There could be nice PR around that, and we're asking the visitors to—. There are options.

Apologies, my last question is also to you.

Oh, there we are.

Your written evidence stated that up to 40 per cent of the estimated £33 million revenue collected from the levy could be consumed by administrative and operational costs. How do you calculate that?

Well, you've got two—. Well, you've got the WRA, initially, collecting it, so you're going to have administrative and management costs at that stage, and then you've got the local authority. So, you've got two sets of admin and management costs. Generally, with projects, you're looking at about 20 per cent management and administrative cost. The WRA have come out with £30 million to £40 million, I think, over 10 years. So, they're looking at about 10 per cent. But, within that, they haven't got any information about the enforcement. That's going to be the biggest cost that you're going to see here. Who is paying for that and whose budget is that coming out of? So, is that the local authority, WRA? Nobody knows.

On the system side of things, they're talking about building it in house. It seems to be a bit vague at the moment as to what the costs are. They've put in four full-time helpdesk staff. You've got an estimated 16,000 to 50,000 businesses—that's very vague—and you've got four full-time members of staff that you think are going to cover every quarter, every annual inquiry that you're going to get—

But we are outliers, aren't we, in Wales, in not having a tourism levy, compared to the rest of Europe? France had it at the beginning of the last century. So, we are outliers. Any idea how much their administrative costs are in other countries?

No, I do not know. Do you know?

[Interruption.] Yes. I also know what the income tax is, so if we wanted to go through a taxation discussion, which the Chair won't let us do—

Not with the time we've got anyway, even though it would be fascinating. But, Emma, do you want to come in?

I just want to add that point—I think I made it at the beginning—about consistency across the UK. I think that's really key. I know we can't get that, but that's one of the challenges. I think if we had a consistent decision across the UK, we'd be in a very different place.

Of course, Scotland's bringing it in now.

Scotland are doing it, exactly. Exactly. England may well, as you rightly say. I think that's potentially on the cards. So, I think that's the challenge we've got in this piecemeal approach.

Okay, thank you very much. I'll bring Sam in now, thank you.

Thanks, Chair, and thank you all for taking the time to be with us this morning. It's appreciated. I'm just wondering what confidence you have that any levy collected would, first of all, be spent on additionality in the parts of the world that you represent, and the organisations you represent. So, confidence that it's going to create additionality. And, secondly, what confidence you have that it'll be spent on tourism-related projects.

Sorry, yes. Go on.

This is really a key area, I think, for us. We are a business-led, public-private partnership in Pembrokeshire. I think we're the first of its kind in Wales. So, we have got a structure that brings together the business community, the local authorities and also local communities. I think the key thing is, somewhere within the legislation—. In answer to your question, sorry, I probably don't have a lot of confidence at the moment, in the way in which the Bill is drafted currently. I think there's really some key learning from business improvement district legislation, in terms of the governance model, the consultation model, and how all those parties have the opportunity to influence the spend. If you could get that partnership model across Wales, I think it would be really powerful. And I think it's actually a really key success factor with the levy.

As Zoë mentioned, 99 per cent of businesses in Pembrokeshire are microbusinesses. Even if Pembrokeshire County Council are minded to explore the levy, which I'm sure they probably will be, then we've got a very diverse myriad of politicians in Pembrokeshire and they all represent local communities, and I think they will be lobbied very hard not to support it without that shared governance and shared influence, if you like, in terms of what is spent.

I think also, just going back to the BIDs legislation—I know it’s different, and I’m not suggesting that’s the model—BIDs have been in place since the millennium, there are probably nearly 500, 600 BIDs across the UK now, and they all have to go for a re-ballot in five years, but it’s no coincidence, I think, that something like 98 per cent of BIDs are supported after that initial five years. And that is because there is that shared governance, and trust and influence, in what the money is spent on. There’s a shared business plan.

So, we have a destination management plan, which was developed very much—. It’s Pembrokeshire’s plan; it doesn’t belong to Visit Pembrokeshire. We’ve got a strategy. A lot of it’s unfunded. So, in my evidence, I’ve acknowledged that there are some things that have a very uncertain future without a levy, which, potentially, this could support. But I think the community at large would want to have, written in the statute, the ability to influence and shape, not just consultation—that is too vague.

And you mentioned, Chair, about the different areas that are currently drafted as what the levy would be spent on. I think it’s important to have that flexibility, because every destination is different, and this levy can respond to the particular challenges in that local destination. So, it’s important that it has that flexibility of interpretation, but where you’ve got the safeguards is that governance and influencing model in terms of how it’s spent.

Just if I may—and I'll bring you in afterwards, Rhianon—on that point, you have flexibility, but then you have a concern then about it not being additionality. So, it’s how do you—

It's difficult, and I think—

How you do that, basically, is the difficult bit. 

Yes, absolutely. 

And how you build those relationships within local authorities.

It’s building that trust, and, I think, when business improvement district legislation was first drafted, it was built in that it had to be additional. But that’s had to evolve over time, because some of the things that local authorities used to be able to do they can’t do. But those partnerships have, collectively, built that trust, so they recognise, actually, 'What's the landscape going to look like without the investment, and what’s it going to look like with the investment?' So, sometimes, you will see BIDs funding street cleaning, extra policing, or police community support officers. So, that’s evolved over time, but those are local decisions by those most affected, and having that structure and that trust that a partnership can influence and shape what that money is spent on.

So, that, for us, is the biggest thing that’s missing in the current draft of the Bill. At the moment, it’s consultation, which is really too vague. It needs to be a mechanism through which the destination at large can influence the decision making on what it’s spent on.

Rhianon, did you want to come in on that?

It was, basically, that particular point.

It was the same question, was it?

But in terms of just trying to sum up, because we’ve had opposite evidence earlier to say, ‘No, we want to tie this down, we want to make sure that there’s no wiggle room in terms of an ability to move outside into non-additional areas in terms of this spend.’ Because, let’s look at this properly: the holy grail is the spend at the end, for your local area, to be able to promote your local area. That’s the whole purpose. So, what you’re saying is that the way to do that is to keep that flexibility, but to have a vehicle or a mechanism within that, on governance and influence, so that that local board can influence.

Absolutely. Absolutely. 

Okay. 

And is that a sort of consensus view?

I think, from Emma’s organisation, that’s quite a new thing to do. But if you look at the demographic across north Wales, we’ve got six authorities. Not all six authorities are going to go with the tourism tax levy. They’re going to be quite different. And, I think, the issue that we’ve been talking about for some time is just having the trust that any levy, if generated, will be ring-fenced for tourism and hospitality. That’s the biggest worry.

And that's the tension we were talking about there, isn't it?

Exactly. But don’t forget, we already have the enhanced population grant, which no-one’s really talking about. And the question, really, to the Welsh Government is: will local authorities still receive the enhanced population grant? More visitors, more money that’s meant to go into the infrastructure. But with all the pressure on local authorities at the moment—adult social care, education—I don’t think it’s going where it should go, and that’s the worry with the tourism levy as far as the industry is concerned, that it goes directly to local authorities, and it’s not going to be ring-fenced for tourism and hospitality.

Okay. Thank you. Sam.

Thank you, Chair. Thanks for your responses. My colleague has just described that, perhaps, the holy grail is to see your areas promoted as a result of this levy. Do you think that, if you had that cash yourselves, you'd be able to do a better job of promoting your area than a local authority?

Yes. I think the way that Manchester do it is that the trade receive a lot of that money to promote Manchester, with their tourism tax generation, and I think that we're an organisation—. I mentioned our having been around for quite some time. We were the north Wales tourist board. If the money was offset or a contribution was made to us in order to market the area, then that would be a bonus. That would be something a little bit different. But then again not all local authorities in north Wales, unless they're forced to, are going to adopt the tourism tax. So that, then, would be a little bit fragmented. 

Sam, I think Iwan wanted to come in there.

Diolch, Cadeirydd. Just picking up in terms of the question around local authorities, the split and the trust element, I think if you go back just a few years, we've got an abundance of examples across Wales in terms of where funding was derived from the EU, as it was then, in terms of the LEADER funding particularly, which automatically went to some local authorities. But, in some counties in Wales, we've got fantastic examples of where there was a transparent and open partnership between the public, the private and the third sectors to look at that funding model and to allocate funds to community groups, organisations or small microbusinesses.

In Pembrokeshire, for example, PLANED, we oversaw the LEADER fund, which was a fund in excess of £3.6 million over a three-year programme. The local authority was part of the partnership, as were the National Farming Union, local colleges, universities, community groups, et cetera. And we funded 66 projects over the course of two and a half years on four key themes. So, again, going back to that localism in terms of identifying, 'Right, for Pembrokeshire, this is what we need; for Powys, that's what they need; for Gwynedd, that's what they need.' There is the ability. We've got the history in Wales of how we've allocated funding on a bespoke basis, but to a common thread that we're all signed up to through legislation or guidance. And I think that perhaps there is a naivety in thinking, 'This is going to be something new, it's additional.' We've done it before, we've done it very successfully across Wales before, and I think that we can look at models that we've already inherited to infer and support the future direction of how we can use the levy funding, potentially, on a more bespoke basis, but with a common thread all the way through about how it should be applied and who the main actors in each county should be, to make sure that that is realised sustainably and transparently.

Is there an argument, then, about where the levy is applied? At the moment, it's at the local authority level, and the argument was made very clearly that, as an administrative area, that's—. But talking back then to what you're saying about being targeted, well, you might want to target it at a certain honey pot, as somebody talked about earlier, or not. So, it's just an understanding of, you know, how you would tackle that when it comes to—. You'd get money in for a large county like Powys, but then you'd target it, or the income from that would potentially be used in one part rather than to support other communities. Is that a challenge, or is that something that can be worked through, or has it worked through in previous aspects?

It is a challenge, because you will always have some localities who will have louder voices, a brighter light in terms of where the argument may fall, but collectively, if it is done as the legislation currently proposes, on a county-by-county basis, then there is a maturity within each county to bring the applicable actors together around the table to look at what's best for the whole county and the ripple effects. If you're talking in terms of the three shires within Powys, or you're talking across the six counties of north Wales, or you're talking within even Pembrokeshire, where you've got a clear split, often, between coastal, urban, rural, it's having the right people around the table who just have people's interests at heart. And if you've got that transparency and set of values, you can then make sure that it's applied in the right way. Some localities might get more of a lion's share, yes, that's to be acknowledged, but how can we then see the ripple effect, as Emma talked about before, in terms of how it spreads to other communities in terms of the supply chains, the skills, the ancillary services? All of these things are not just fixated on one location, but that location can act as a ripple to benefit other communities equally as well.

Emma, you wanted to come in briefly.

Yes, I was just going to emphasise, from our perspective, I think it's around that shared governance. It's not saying that it's just Visit Pembrokeshire per se, but Visit Pembrokeshire represents a model that I think could well inform a mechanism for governance and decision making. Whether that might a be step too far, I'm sure it probably is, but even if there's a proportional percentage of the levy where you've got an organisation that has broad representation that has the opportunity to influence and shape what that is spent on, that's the key message. And I think there is some learning from business improvement district legislation. I acknowledge it's very different and it's not the same as visitor levy legislation, but there is some really good learning from that in terms of what's worked well that I think could be taken forward to inform the final draft of this legislation.

Thank you. Sam.

Just moving on briefly to the role of accommodation providers to interact with the Welsh Revenue Authority, Zoë, you mentioned earlier, perhaps, the lack of understanding of the resource required by the WRA to service this new levy. But, from the other side, are you confident that providers will be able to deal with the requirements of the WRA successfully in terms of registration and the collection and payment of the levy?

Well, we obviously haven’t seen any of the detail regarding the registration at the moment, or the systems or what’s going to be really required from them. But they are going to struggle from their system end. You’ve got a lot of booking systems out there. They’re going to be expected to have the number of people who are staying per night. That’s got to then display on the booking system—whatever they’re using. That’s got to go across to the customer. They’ve got to be able to keep track of all of that. The administrative burden of that is going to be a nightmare. Some haven’t necessarily got the digital skills to be able to—. We do worry that they will just simply drop out. I’ve lost three members already this year who have said, ‘Do you know what? Actually, it’s too complicated’, even though it hasn’t even come in, and I’ve tried to reassure them, but they’ve gone, ‘Do you know what? With the 182 and with the thought of the tourism tax—’, they’re just leaving the sector.

So, there is a real concern that that administrative burden on businesses is going to be huge. And there’s going to be a lot of training that’s going to need to be done, and has that been built into the costings? I haven’t seen any costs around the amount of training that’s going to have to be done individually with businesses.

Okay. Thank you. And then perhaps just one more question from me. Emma, in your written evidence, you noted that the comprehensive registration scheme referred to in the consultation and supported by you is not reflected in the draft of the Bill.

I think it’s more that we acknowledge that there’s a commitment from the Welsh Government to introduce that comprehensive statutory registration, which Zoë has said, which I think the trade wholly supports. It does provide a level playing field. I think the concern is that the detail of when that would be introduced is not clear, and that’s what our businesses are exercised about. So, the requirements at the moment are just name, address and bank details, rather than the compliance with health and safety, and gas safety, electrical safety, et cetera. So, that’s the concern, I think, that that should be in place before the levy is introduced.

Thank you. Could I ask one more question on that, Chair?

Yes, and then I'll go to Rhianon.

We heard from others last week that they proposed there'd be a registration scheme across all of Wales before, then, individual local authorities would make a decision on whether to implement a levy or not, rather than a piecemeal approach of a registration scheme in one county and, perhaps, a year later, another registration scheme in another county. Do you have a view on what might work best? Would it be better to have an all-Wales registration so that everyone's in the same place—that level playing field that you were talking about—or do you think it's down to local authorities to do it as and when they feel it's right?

I think it should be comprehensively across Wales, yes.

Thank you. Thank you, Chair.

Thank you. Rhianon.

Thank you very much for the comments so far. We've mentioned a few thematics: trust, negativity, perception. You could almost argue that there is a role for everybody in this room, because this is going to happen, in that we should be going out there, trying to encourage people to sign up and to get in there and make this work for Wales.

I'm going to move on to this line of questioning, however: the Bill makes provisions for local authorities to apply that dreaded premium, bearing in mind that local authority doesn't even have to go there in the first place, but it's there, and what are your thoughts on that? We were just talking earlier about—I hate to have to mention it—Taylor Swift and the wonderful premium that delivered to Cardiff and the expense of all of that. What's your view on the voluntary premium?

If I may go first, I think the concern initially was just that it wasn't mentioned in the initial consultation. So, that was one point. I think, secondly, if that were to be introduced, I think there needs to be more detail in terms of what the business case would need to be from a local authority to introduce a premium—you know, what are the criteria?—so, more detail to give broad stakeholders the confidence that that would be really well informed and it would be needed, and also that there would be some robust consultation on that. So, again, it's around building that trust that all partners are part of the decision making, to make sure that any decision is well informed and it has a positive impact on that destination and the communities within it.

Anybody differ in terms of this?

No.

Just on the premium and just to explore a little bit further, if I may, the premium, I think, as written—and I'll have to just double-check—would apply equally across the local authority, rather than it being targeted maybe in overheated areas. Everything's successful and Wales is on the up and, like Jim was saying there, there was a real bump in 2019, when things were really going well, where you might have—as we heard earlier—Taylor Swift arriving here every week. Are there criteria around the premium, that it wouldn't just apply generally to everything? Would you be more inclined to look at it either on type of accommodation, or locality, so a tighter locality than something else? So, just some thoughts around it if it was as it's written—what would you like to change, if it's still in there?

I think we've got to be careful with the premium, that you've got different messaging for different areas—like I say, visitors tend not to know what county they're in—and that we don't end up with competition between local authorities as well, with, 'Well, come here because we're cheaper.' We're a tiny country. So, I think, we've got to be careful with that, and, as Emma said, there needs to be criteria around that. We would love  a Taylor Swift in mid Wales, but it's not just not going to happen.

She's watching. [Laughter.]

She's watching: please come to mid Wales. [Laughter.]  So, I can see how, potentially, some areas could see it as an advantage and as a benefit to them, or to see it by sector, but we've just got to be really careful over the messaging for that.

But I think the point I'm trying to make is, on the face of the Bill, what would you like to see in there as some of those safeguards? What would you like to see as that criteria, or how would you see that criteria being developed, I suppose?

I was just going to say I'd like to see the economic case for it.

Yes, I think so—the economic business case for it and potentially an impact assessment from it as well.

Thank you very much. Sorry, Rhianon; I was just cutting across you there.

That's fine. We've heard a lot in different witness sessions in regard to whether under-18s should be exempt or not, and also in terms of educational placements or establishments, and also we've touched upon pitches, campsites. Just very, very briefly, what are your views on under-18s being included, or otherwise, in the levy?

I think they should be excluded. I think they should be exempt.

Anybody differ?

No, I think it's going to be a nightmare.

You've heard a lot about that.

That's absolutely fine. And then, finally, we've had some context in terms of the flexibility around local authorities and an ability as local forums and tourism bodies to be able to influence and, potentially, have a percentage of spend to be able to utilise. What further policy details would you like to see included in the Bill to improve this to make it work for localities?

I think I probably made some suggestions earlier. There have been suggestions around a certain amount of ring fencing and perhaps a grant scheme, which could also be very well supported and really add value, but, fundamentally, I think, 'Aim for the stars'. I would say we would want to see, ideally, a mechanism where a decision across the board in terms of what the levy is spent on is shared between public, private and third sectors. Now, there are models in place that would facilitate that. We have one in Pembrokeshire. I appreciate that's not across Wales, but that would be what we would aim for. So, it's looking from that at what is implementable, but, certainly, at the moment, the current provision is inadequate in that regard.

Anyone differ?

For me, I think there should be a delay on the implementation—

Why?

—because we wait until the tourism and hospitality sector recover. They haven't recovered yet. We're finding already that places are closing, they're going into liquidation and, before you realise it, it will be too late.

So, to play devil's advocate with you, if I may, Chair, briefly, if your levy in your area where those establishments are closing is going into marketing those properties and actually delivering a grant to those properties, do you not see there's any synergy between the two?

If I believed that's where the levy would go—

That is its intent, yes—

—then I could see it helping, but I just think there should be a completely different strategy than taxing what's already overburdened with everything else that's hitting our sector at the moment.

So, you fundamentally disagree with it.

Yes, 100 per cent, and I don't think we're ready for it. I'm not saying never do it; I'm just saying that, at this moment in time, within the sector, you really need to wake up and see what's going on there because people are struggling, their mental health is struggling and they've got no money.

And you see no way that this could help those individual businesses.

I don't. Personally, no matter what we've said, how many letters we've written, I don't think it's going to make a blind bit of difference, you're going to implement it anyway.

And any other policy changes?

Regardless of whatever timeline this comes through, one thing that I know, in terms of the community aspect, they don't feel, perhaps, is being connected up to the discussion around the levy—and apologies if it's already been articulated previously—is around the Welsh language and culture, to see whether, within the ring fencing, there could be an element that supports the localities in terms of making sure that—. Whilst communities do welcome visitors in, as they want to see those visitors come down the track because they support jobs, they support the wider foundational economy, often, within those areas, is there something, also, we can look at, perhaps within the legislation, that acknowledges and reinforces the importance of the Welsh language, Welsh culture, because, often, communities at the moment—it's across Wales, but particularly in west Wales—feel perhaps they're getting left behind? Communities are taking it upon themselves to actually secure key local assets to be retained for the community and not become, as we heard, Airbnbs.

We've got an example in the last nine months within Pembrokeshire—a chapel in Newport, Pembrokeshire. Newport, Pembrokeshire is a fantastic little town/village, very picturesque and it attracts a lot of people. Bethlehem chapel decided to close, it went on the open market and there was a severe risk that it was going to be bought by people who weren't from the locality and they were going to turn it into an Airbnb. So, this local asset would be lost. But the community rallied together—and you're not talking about a very affluent community—and they raised £150,000 to then go to an auction on a Friday night and secure the top bid at £145,000, and that is now going to become a local Welsh language heritage and community centre, which will be very much open and welcoming visitors from all parts of the world. But it is something that the community has taken upon themselves, without any Government support, any local authority support, whatever—

But that could fit in to this locally influenced model.

And that could fit in to support those types of initiatives, so people within communities see the benefits not only of the people coming in, which we want to see—we want to attract those people in to spend their pound locally—but also is there something within the levy that can support communities to retain and support those local assets and infrastructure for wider use?

And this is where, similar to what they've got in England and Scotland, the community—the right to buy, basically, to be able to buy those assets.

Yes.

At an open-market value, but have that first right of refusal. So, again, other policies that could dovetail into this.

Can I just say that one thing I would like to see in the policy is that enforcement, more details about that. Whose actual responsibility is it for the registration? Is it the WRA? Is it the local authorities?

Some clarity.

More clarity—absolutely. Clarity on that and then, obviously, the detail, then, around what are actually the minimum requirements for registration.

Okay, thank you.

Thank you very much. Thank you very much for your time this morning. I do appreciate that you've all had long distances—well, most of you, anyway have had long distances to travel. And I hope your stay in Cardiff was good as well. But we appreciate you making the time and coming in, and also the work that's gone into your submissions beforehand as well.

So, under Standing Order 17.42(ix), I resolve now to exclude the public from the remainder of this meeting, if that's okay. There we are. Thank you very much. Diolch yn fawr.