Highlands and Islands Enterprise (HIE) has welcomed a new programme of support for the tourism sector as it continues to feel the impacts of the pandemic.
The £14m Hotel Recovery Programme was announced today (Wednesday 29 July) by Finance Secretary Kate Forbes.
The scheme, which will be managed by the enterprise agencies and VisitScotland, aims to protect larger hotels which have been especially badly hit by the impact of the pandemic. The fund is due to be open for expressions of interest by the end of August.
HIE, Scottish Enterprise and South of Scotland Enterprise will begin taking expressions of interest for the programme in late August.
Businesses that meet the criteria will be eligible for both grants and a holistic business review with bespoke support based on their individual needs.
Charlotte Wright, chief executive of HIE, said: “Hotels are at the heart of our tourism sector, which is central to our regional economy and a vital source of rural employment.
“The hotel recovery programme will help protect these jobs and support this important network of businesses across our region recover from the impacts of the past few months.
“We very much look forward to working with our partner agencies to maximise the programme’s effectiveness over the coming months.”
Today’s announcement also included a further £1m grants programme run by Visit Scotland for self-catering businesses that have not received any other Scottish Government COVID-19 support. This is also expected to benefit many businesses in the Highlands and Islands.
Applications will open in early August and VisitScotland will work with The Association of Scotland’s Self-Caterers (ASSC) to review applications received.
UKHospitality has welcomed the Hotel Recovery Programme but fears the programme is not sufficiently resourced to deliver the scale of support required by the hotel sector.
Commenting on today’s announcement, UKHospitality Executive Director for Scotland, Willie Macleod said: “The £14m programme is a positive sign of intent, but it is going to be a drop in the ocean for the sector. The reality is that any programme of recovery intended to keep hotels in Scotland open and staff in jobs, will need to be much bigger and much more wide-ranging. It must be hoped that this is an initial step in supporting these businesses and that further resources will be made available in the likely event that the programme is over-subscribed.
“These are businesses that have been devastated by the pandemic. Almost all of Scotland’s tourism and hospitality businesses ground to a complete halt over the Spring. Not all businesses are yet open and those that have opened are operating below capacity and have concerns about medium-term profitability. The future of many hotels and so many jobs around the country is still in the balance.
“Support will need to be much more extensive to ensure it reaches all businesses who need it. UKH estimates that there are around 950 larger hotels in Scotland, with a rateable value over £51,000, which did not qualify for grants that were available to smaller businesses. Many were unable to access government-backed loans or the Hardship and Pivotal grants provided by Scottish Government. On average, hotels had to meet £60,000 each month during lockdown to cover fixed costs.
“As the Government has identified, these businesses employ lots of people and support a long supply chain. A budget of £14m may mean that only 50 businesses, 5% of larger hotels, will be supported if each qualifies for the maximum sum. This is not enough to avert the crisis facing the sector.”Reaction from UKHospitality has been added since this article was first posted