Independent report

Terms of reference

Updated 14 September 2021

Applies to England

1. Purpose

This review aims to examine and assess how Destination Management Organisations (DMOs) across England are funded and structured, and how they perform their roles, in order to establish whether there may be a more efficient and effective model for supporting English tourism at the regional level, and if so what that model may be.

2. Objectives

The review will need to examine the extent to which the current DMO landscape:

• is economically efficient, effective and sustainable (with regard to funding, structure and performance)
• best enables the government to meet its leisure and business tourism policy objectives at a national, regional and local level
• engages within the wider local and regional economic landscape, and the current focus on English devolution and Levelling Up

Depending on the findings of this examination, the review will then need to make recommendations, to government, the tourism sector or both as appropriate, on:

• whether DMOs might be structured or funded differently, and if so how any proposals might maximise post-COVID-19 recovery and long-term success
• what the role of DMOs should be, bearing in mind existing other local structures such as Local Enterprise Partnerships, Mayoral Combined Authorities, local authorities and other similar local/regional bodies; and where these might intersect
• how DMOs should best engage with, and be engaged by, VisitEngland, VisitBritain and DCMS, as well as wider government/public bodies where relevant (e.g. Arts Council England; UK Sport)

3. Scope

This independent review will produce a detailed examination of the DMO landscape in England, focussing on a) current funding models; b) organisational structures and c) performance levels (both in respect to before the COVID-19 pandemic (‘the pandemic’), and since the start of 2020).

It will then try and establish whether the status quo is the most efficient, economically justifiable way of organising local and regional English tourism sectors, in order to maximise opportunities for supporting policy priorities on a local, regional and national scale, and, where relevant, internationally. These priorities include sector recovery, Levelling Up, and economic growth, as well as various local and regional priorities that are likely to differ from area to area.

Finally, it will then make recommendations on DMO structures, roles, funding model and engagement with other local and national bodies, based on the findings of the preceding steps. We anticipate that these recommendations could be for both the government at a national, regional, and local level, and the tourism industry.

The review will need to be placed in both a historical and an international context. This includes examining and evaluating the approach taken in England between 1999 and 2010, when regional promotion was carried out by government-funded Regional Development Agencies. It will also need to consider the tourism sector landscape in Scotland, Wales and Northern Ireland, as well as the approaches taken in comparator/competitor destinations globally.

The structure of the national tourism boards, VisitEngland and VisitBritain, will only be in scope of the review where it is relevant to the structures and funding of DMOs.

4. Stakeholder engagement

The review will aim to speak to as many of the estimated 150 DMOs in England as possible in the timeframe given, ensuring consultation with a diverse and representative spread of these organisations in terms of geographical location, size and nature of funding streams.

The reviewer will also need to engage with other local bodies/structures with an overlapping interest in the sector: these are likely to include Local Enterprise Partnerships, Mayoral Combined Authorities, where relevant, regional convention bureaus, and local authorities.

The reviewer will need to speak to a representative sample of tourism stakeholders. This includes commercial business representatives (e.g. hotels, attractions, event venues, hospitality venues etc), and wider organisations with an interest like heritage organisations, the National Parks, local transport bodies. This engagement will help to establish the views of wider stakeholders who have worked closely with DMOs both pre- and during the pandemic - as well as those who have not worked with DMOs before, or who may have started to do so only recently.

Finally, the reviewer will also need to consider the views of key stakeholder bodies in the sector, such as VisitBritain, VisitEngland and member bodies of the Tourism Industry Council, an industry-led board composed of representative organisations from the tourism sector that advises the Minister for Sport and Tourism. It may also consult wider Arm’s-Length Bodies and Executive Agencies (e.g. Arts Council England; UK Sport) to understand local funding structures in place across government for other sectors (such as ACE’s National Portfolio Organisations).

5. Governance

The review will be led by the current Chair of VisitEngland, Nick de Bois, acting in an independent capacity. Mr de Bois will receive administrative support from a secretariat based in DCMS. Mr de Bois will report directly to the Secretary of State.

In recognition of VisitEngland’s independent statutory role to advise the Government on tourism in England, Mr de Bois will be able to draw on the advice, insight and expertise of staff working for VisitEngland during the review as required. However, the review will be considered independent and not the official view of VisitEngland. Wider VisitEngland employees and/or Board members will not be able to access any information that DMOs or other contributors share with the review team - including Mr de Bois in his independent capacity - during the consultation process. VisitEngland’s response to the review will be compiled and signed off independently of Mr de Bois, before he formally considers it in his role as Review lead. The final report with recommendations will be delivered to the Minister for Sport and Tourism and the Secretary of State.

Mr de Bois will be able to convene an experienced advisory panel to assist him with his review. He will speak to people, organisations and destinations across England and more widely to gain a fuller picture of the country’s diverse tourism industry (we currently envisage that this engagement will take place remotely, though there is the potential to explore a limited number of in-person meetings where deemed appropriate). The final report will draw on existing evidence and that submitted by interested parties during the course of the review to make recommendations to the government and industry.

Any recommendations would need to have regard to existing legislation, DCMS spending commitments and wider government policy, particularly the focus on Levelling Up our regions.

The response to the government recommendations will be led by the DCMS Secretary of State and the Minister for Sport and Tourism.

6. Report and timing

The reviewer will be tasked with conducting their review over spring 2021, before evaluating their findings and submitting a written report, including their recommendations, to the Secretary of State by summer 2021. The final report will be published on gov.uk and laid before both Houses. The government will respond to the review’s recommendations in due course, with the response led by the Secretary of State and the Minister for Sport and Tourism.

7. Context

7.1 DMOs

Destination Management Organisations (DMOs) are a common feature of local and regional tourism landscapes worldwide, and play an important role in the English tourism ecosystem. There are an estimated 150 DMOs in England, although these vary substantially in terms of activity, size, geographical area covered, funding models, structure and the degree to which they work with both the central government and the British Tourist Authority (BTA, trading as VisitBritain and VisitEngland).

DMOs are not the only local/regional organisations involved in place-based tourism policy and promotion - Local Enterprise Partnerships (LEPs) and local authorities can also play a role, as can Business Improvement Districts. It is not a statutory requirement for local authorities to fund tourism.

It has been suggested that the sheer variety and number of DMOs can make local tourism coordination and collaboration at a strategic level, in support of government policy objectives, more challenging, leading to duplication of efforts or, worse, a lack thereof, with subsequent impacts on the productivity and competitiveness of country’s tourism sector, even pre-COVID-19.

7.2 COVID-19

The government recognises that the tourism sector has been among the worst-hit industries by COVID-19 and that DMOs have been particularly hard hit, especially those reliant on commercial income. Many DMOs have been at risk of closure at a time when their business support role has become more important. At the same time, the government is aware that DMOs will have an important role to play in supporting the English tourism sector recover in the medium and long term, in line with government priorities around economic recovery and Levelling Up.

The pandemic has thrown issues with the current DMO landscape into sharper focus. So far, VisitEngland have made £2.3m available to support the survival of commercially reliant DMOs until March 2021, so that they remain viable to support government work on sector recovery. However, the government recognises that this is a short-term solution. The government also recognises that some DMOs have been forced to fold, while others have had to take cost-saving measures.

At the same time, the pandemic has highlighted strong examples of standardisation, collaboration and more agile working among DMOs.

7.3 Devolution in England

The government has set out a clear commitment to level up all areas of the country, and wants to devolve and decentralise to give more power to local communities. It intends to bring forward the Devolution and Local Recovery White Paper in due course, which will cover how the UK government will partner with places across the UK to build a sustainable economic recovery and set out our plans for future devolution arrangements. This work, combined with the fragility of the current DMO landscape, suggests now is a good opportunity to carry out a full-scale examination and assessment of the English tourism sector, to understand how it works currently and whether there is potential for it to work differently, in order to help strengthen the domestic sector through short and medium-term COVID-19 impacts, so that it can play a role in longer-term recovery.