Here Comes A Fontella-Super Nova

When a bigwig from the world's second largest tour operator makes a pronouncement, the Mallorcan tourist authorities, hoteliers, town halls should all take note, and in the case of the tourism minister, it looked as though he had been made to - with some force. Manny Fontenla-Novoa, chief executive of Thomas Cook came, spoke and put a dirty great VAT cat among the pigeons of the regional and national governments. In addressing hoteliers in Palma, he was clear that proposals for rises in IVA (VAT) were, shall we say, less than advisable. Damn right they are.

Governmental coffers are less than flush at present. Spain has been one of the countries worst affected by recession, and will - in all likelihood - be one of the last to limp out of it. To remedy the deficits the government is running, they have come up with increasing indirect taxation (IVA/VAT) as the solution. Badly though revenue may be needed, this could well be counterproductive. As far as the tourism industry is concerned - bearing in mind that in other countries, such as France, there has been a reduction in VAT as it is specifically applied to tourism - any increase is bound to push up prices. These are not necessarily the prices of holidays, but those that would be charged in the bars and restaurants and so on. At a time when spending is falling and when one hears all those stories about high or higher prices, a VAT increase is the last thing that's needed. To add to this picture of woe, Thomas Cook are saying that the level of all-inclusive packages is set to rise next year, by a factor of 20%. That's a perfectly believable increase. Furthermore, as noted in "The Bulletin", Fontenla-Novoa has reserved some criticism for the promotional spend by the Balearics authorities. It is around 30 per cent of what Egypt, for example, dishes out. The comparison is not entirely fair as Egypt is a country; the Balearics are not, you may have noticed. But we get his point, even if also Egypt is diverting massive resources to establishing its place as a tourist destination. Yet of course in this regard there is a pretty fundamental issue. If tourism is so important not only to the Balearics and to Spain as a whole, why is not more promotion undertaken and why are measures adopted that positively have a negative effect on tourism, to which we must now add an increase in IVA?

From today in "Talk Of The North", you will be able to read a thing I have written about the season. One point I make is to question the tourism authorities' belief that the summer tourism model - the bread and butter of tourism - is working ok. It clearly is not, and recession and the pound are not the only factors. Thomas Cook would seem to agree, and rather pertinent, I felt, was a probably unintentional photo that "The Bulletin" had of those at this meeting in Palma. But it was terrific - in the centre, Fontenla-Novoa, a tall man with an easy smile and one suggesting just a hint of superiority or of having made his point, to one side of him the head of Iberostar looking ever more fabulously like a long grey-haired Red Indian, and to the other, shorter than the Thomas Cook boss, Miquel Nadal, tourism minister, with an expression as though he's just been given a severe ticking-off in the head's study but is required to pose for the school photo.


QUIZ
Yesterday's title - The Police, http://www.youtube.com/watch?v=gXU8kCrRHJY. Today's title - why and therefore who?

(PLEASE REPLY TO andrew@thealcudiaguide.com AND NOT VIA THE COMMENTS THINGY HERE.)