Orkney and Shetland MP, Alistair Carmichael, has spoken out in a parliamentary debate on hospitality, calling for recognition of the integrated nature of the industry in rural and island communities and the need for long-term support for the recovery. Mr Carmichael reiterated the case for a long-term cut to hospitality VAT and the need for any end to fiscal support to be varied region by region and industry by industry.
Speaking in the House Mr Carmichael said:
“The hospitality industry is of enormous importance to the Northern Isles, and an integral part of our well- developed visitor economy. Hospitality is something that comes very naturally to us in Orkney and Shetland. Indeed, we were described by one visitor to me a couple of years ago as being “dangerously hospitable”—I know exactly what he meant.
“This time last year, those in the visitor economy and hospitality industry were saying that local businesses feared that this situation would last for three winters [in a row]. When it arrives, recovery will not come at a uniform pace. For self-catering businesses in Orkney and Shetland, business returned easily last summer, but for the bed and breakfasts and hotels, it was a much more difficult path back to recovery.
“In communities such as mine the hospitality industry and the visitor economy are integrated with just about every other sector in our local economies. The craft industries, such as knitwear and jewellery manufacturers, depend on it. We have also seen the depression of hospitality across the whole of the United Kingdom; in Orkney and Shetland, that means that the premium producers of beef and lamb and the fish and shellfish producers are also suffering, because the restaurants are not open to take their products.
“We have all had a year on a life support machine, as far as the visitor economy is concerned. Even as we emerge from that, it is still going to be necessary for some of the intensive care to continue. That means that we cannot have immediate withdrawal of things like the furlough scheme. The reduction of value-added tax for the hospitality industry has been of massive importance, and indeed there is a strong case for it to become permanent. I do hope that that is something that the Treasury will now consider.”