The Scottish Passenger Agents’ Association (SPAA) said travel agencies were being “pushed to the edge” as tourists shied away from booking trips away.
It said that in pre pandemic times, Scots flocked to book their summer holidays in the period between Christmas and New Year following the major travel operators’ adverts which are always released on Boxing Day.
However, it said that when high street travel agencies opened to the public after the Christmas break, inquiries and bookings have been at a virtual standstill. The SPAA called on the Scottish Government to create a “viable plan” and offer winter resilience grants to keep travel firms open.
Research on pre-pandemic years’ booking patterns shows that the number of daily travel bookings made in all countries increased by between nine per cent and 62 per cent in the days after Christmas, with some surging by 69 per cent in the post-Christmas week. Similar rises could also be seen in the first week of the new year.
Joanne Dooey, president of the SPAA said: “There’s no Christmas bonus for the travel sector this December. There is no post-holiday spike for Scottish travel agents, as holidaymakers’ confidence in travel has been shattered over the last 20 months.
“This will push travel agents who have fought tirelessly for almost two years to save their businesses to the edge. In 2021, travel agencies were operating at just 22 per cent of their previous annual revenue compared to pre Covid yet their fixed costs remained the same. Many of our members tell us they were operating at 10 per cent or less of previous years.
“Travel agents have become administrators; rebooking and issuing refunds while receiving no revenue and no grant support to help. We support those in all industries which have been told there is grant support there for them. But travel agencies are being pushed out of business by stealth. Restrictions around travel have been oppressively stringent, meaning people have no confidence in travelling.
“We need a structured plan to be drawn up by the Scottish Government in full consultation with all aspects of the travel industry which supports the future of Scottish travel rather than allowing it to wither and die.”
She added: “A viable plan would include winter resilience grants to keep travel businesses open and their staff in jobs. The return of some form of furlough scheme to give income support to the sector is also vital. Travel agents cannot simply close down as they need to remain open to continue to help their customers. Rates relief to all high street travel agencies ought to be extended. Agencies also require help with loan payments as they now face the repayments on the bank loans they took out at the outset of the pandemic after 20 months of negative income. They have spent all of their savings, dipped into their pensions and borrowed from friends and family. One of the key support measures we need is the lifting of restrictions and testing to allow people to get travelling again and to give them the confidence to do so.
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“As a small nation, Scotland’s connectivity is vital for our economy. And we’re not just talking about holidays. Routes to connect us globally are imperative for business travel, inward investment and inbound tourism – all of which will struggle to reach pre-pandemic success levels is we lose key flights.
“Under these circumstances it’s hard for the travel industry to watch other sectors receive support when their businesses are in critical positions.”
Hospitality businesses also warned of a “dismal Christmas trading period” amid ongoing Covid restrictions to stem the spread of Omicron.
First Minister Nicola Sturgeon confirmed in a virtual meeting of the Scottish Parliament that current restrictions on hospitality would continue to 17 January, adding that she recognise that the public health measures necessary to limit the spread of Omicron “have had a severe economic impact” on some industries.
She also outlined how £107 million is being allocated to support businesses impacted by the spread of the Omicron variant. A total of £16m will be made available to support public transport providers through existing Covid support schemes, £27m will go to the culture sector, and a further £17m will be given to the events sector. Meanwhile, £32m will be allocated to hospitality and leisure businesses, with an additional £10m for those parts of the hospitality industry most severely impacted by the requirement for table service. Nightclubs, which have been required to close, will be given up to £5m.
UKHospitality Scotland’s executive director Leon Thompson said: “The First Minister’s statement today sees Scotland’s hospitality businesses heading into 2022 with as little certainty for the year ahead as they had on entering 2021. Restrictions, closures, further cancellations, and jobs increasingly at risk is the Scottish Government’s new year message to hospitality businesses and workers. This all adds to a dismal Christmas trading period which was down by 70 per cent across the month due to restrictions and public health messaging.”
He added: “To compound matters, not a single penny of the promised support has reached businesses that have exhausted their financial options. Hospitality businesses need access to it now, not in a few weeks. As it is, the money does not compensate them for the enormous losses they have experienced this month. Our sector has lost more than £1 billion during December.”
“For those businesses able to operate, the extended period of self-isolation is a further challenge. The sector will now need to wait another week for an update on the current 10-day rule.” As businesses count the cost of a losses over Hogmanay, many today will fear the worst for their future.”
A Scottish Government spokesperson said: “We are all too aware of the impact that Coronavirus (COVID-19) has had – and continues to have – on business and the Scottish economy. The emergence of the new Omicron variant and the speed at which it is spreading brings even more economic uncertainty.
“That is why the actions we have taken so far, including extending non-domestic rates relief which is helping travel agents get back on their feet, are firmly focused on supporting businesses, protecting jobs and mitigating the continuing impact of Covid on our wider economy.”
He added: “The Scottish Government is acutely aware of the financial implications for many businesses and we are working at pace with business sectors and industry to develop targeted financial support for businesses that will be impacted by the restrictions, including those required to close.
“Businesses need the scale of financial support available earlier in the pandemic such as furlough which can only come from the UK Government, who has borrowing powers the Scottish Government does not.”