The Rush To Legalise

If a week is a long time in politics, in the politics of tourism it can seem like an eternity. The negotiations regarding the formation of the next government in the Balearics drag on and on, maintaining the period of uncertainty for the island's immediate (and perhaps longer) tourism future and leaving up in the air issues to do with possible policy and current projects - anything from all-inclusives, tourist tax, legalisation of hotel places and investment to the Palacio de Congresos convention centre.

There is an admission that there are "thorny" topics that the negotiations have had to contend with. One of them is the eco-tax. Though PSOE had said in their manifesto that they would consider this, they would do so only in the context of general financing arrangements for the Balearics. If these are to alter, they won't do until after the general election. PSOE, aware of the hash that was made with the old eco-tax, would really rather not go there again unless they are forced to.

One of the issues that has received considerably less attention than others has been that of the legalisation of hotel places. You may or may not be surprised to learn that there are such things as illegal hotel places, rooms or entire floors that were created without the requisite permission having been obtained. These illegal places have been proving to be a useful little earner for the regional government: making them legal demands payment, and the funds raised have gone into the tourism ministry's special fund for use on resorts' infrastructures. Applications to legalise places have been proceeding calmly for several years. All of a sudden, however, there has been an avalanche of requests. There were almost as many in May alone as there were for 2013 and 2014 combined. The reason for this flurry of activity is obvious: hoteliers fear what a new government might do in preventing legalisation and indeed what the ultimate sanctions might be.  

The hoteliers have also feverishly been putting in place what they can for projects to expand hotels. They are reckoning on restrictions being introduced but are also bargaining on the fact that any new legislation would take a few months to enact.

As yet, there is no way of knowing precisely what a regime of the left would do with regard to all-inclusives and holiday lets. On the latter, a more permissive regulatory regime would be highly likely, and APTUR, the Balearic association for holiday apartments and accommodation, has worked out that some 15,000 apartments would be legalised under changes that a pact of the left would introduce. As for all-inclusives, does one detect an attempt to pre-empt any moves on behalf of the tourism ministry, from which the minister and others will soon be departing once new government jobs have been divvied up?

The ministry has issued some stats about all-inclusives, and quite frankly they appear to be a complete work of fiction. According to the ministry, the past three years have witnessed a change in strategy on behalf of hotels, i.e. abandoning all-inclusive. So much so that all-inclusive equates to only 12% of the entire hotel stock.

First thing to ask about this is, has the ministry, therefore, received all the information about all-inclusives that it said it was going to under a registration plan announced only a few weeks ago? Seems unlikely. Second thing to say is that this registration was supposedly coming in because there hadn't previously been one. In which case, how can the ministry state with any accuracy that the last time it counted - in 2010 - all-inclusive amounted to 18% of hotel stock?

Thirdly, and rather more importantly, the ministry says that the 18% in 2010 was made up of 165 establishments in Mallorca which offered all-inclusive - a total of 81,078 hotel places. That would mean that there were in all 450,000 hotel places in Mallorca. There weren't and there still aren't: the figure is around 290,000: 30% all-inclusive is the number which has generally been quoted over the past few years

Even this number is hard to believe, and it certainly doesn't apply to specific resorts. There may indeed be some decline in the level of all-inclusive because hotels are realising they can make more money by not offering AI, but the ministry's figures are not to be believed. If the intention had been to try and make the "problem" of AI seem less great than it is, it hasn't worked.