HHA. Heritage Means Business Enabling Britain s Inspirational Places to meet new challenges

Transcription

1 HHA H I S T O R I C H O U S E S A S S O C I A T I O N Heritage Means Business Enabling Britain s Inspirational Places to meet new challenges

2 Foreword from the President of the HHA Richard Compton Historic houses, castles and their gardens are part of the character of Britain. Even before the Queen s Diamond Jubilee, the Olympics and Downton Abbey filmed at an HHA house they were the most popular attractions bringing people to the UK. Media coverage of the events in 2012 spread the news about Britain s unique heritage around the world. We now need to ensure that these wonderful places can be maintained and enhanced for every visitor. The national contribution of historic houses economically, culturally, socially and through education is enormous. Of 1,550 HHA houses and gardens, nearly 60% open their doors to the public, welcoming 13 million visitors a year. They are key drivers for tourism and economic activity, often in remote rural areas where there are few alternatives. They support 26,000 jobs and 52,000 suppliers in all regions of the UK. These special places are also central to our local identity, character, history and life. More than half of HHA houses host and support charitable and community events. They are embedded in their local communities and economies. However, these are very uncertain times for historic houses and gardens. Competition to attract visitors with reduced disposable incomes has increased; at the same time, costs have also risen. The legislative and tax framework for private owners is tougher and the challenges are considerable. Many historic house businesses face threats to their very survival. A great deal is at stake: a unique portfolio of lived-in and individual historic houses and gardens; a tangible experience of the shared history of Britain; a host of places where the creative industries flourish and new technologies are pioneered and the economies and communities that these houses support. Looking ahead to forthcoming elections, it is critically important that governments heed the practical needs of historic houses and gardens when designing and implementing their policies, not only for heritage, but also for taxation, tourism, town and country planning, energy and transport. The proposals in this document address these challenges. They would provide significant benefits, for the viability of historic houses and gardens, and for all those who visit them and all those whose livelihoods depend on their success. There is no need to wait, and the sooner action is taken, the sooner these benefits can be realised. Heritage means business!

3 Heritage is good at business Our unique historic environment is the most essential ingredient in the success of UK tourism, the country s fifth largest industry and one of the largest earners of foreign exchange. Historic houses are just as vital to domestic tourism, with heritage playing a central role in supporting the tourism industry s 3 million jobs 1. Moreover, heritage and culture are cited by international visitors as the most important reason for visiting Britain 2. Heritage-based tourism is now worth 26 billion to the UK economy 3 and without it Britain would lose a key part of the tourism industry s power to create jobs. Tourism accounted for one third of the net increase in UK jobs between 2010 and 2012 and is forecast to grow to 3.7 million jobs by Britain s historic houses, palaces, castles and gardens have an iconic power, capturing the public imagination and, together with events such as the Olympic Games and the Diamond Jubilee, create a uniquely engaging image of the UK. In providing character, distinctiveness and a sense of place, historic houses act as a magnet for investment for regeneration and growth, attracting high value enterprises to their vicinity, as well as generating opportunities for creative industries. Heritage is good business for the UK s local economies too. Many historic houses are the hub of their local economy, particularly in rural areas, where other opportunities for employment and business activity can be limited. HHA member houses not only support 26,000 jobs but also purchase from nearly 52,000 suppliers; many are local Small and Medium Enterprises 5. In addition, historic houses create highly-developed building and conservation skills within the economy, as well as opportunities to develop the skills-base in a wide range of businesses from hospitality and retail to horticulture and digital media. Front cover Blenheim Palace Family Bike Ride in Oxfordshire Hestercombe Gardens Education Centre, Somerset Eilean Donan in Wester Ross Left Concert at Leeds Castle in Kent Right Longleat in Wiltshire at Christmas

4 Historic houses are good for people and communities The opportunities for public access to the nation s historic houses are substantial and broadening. Nearly 60% of the HHA s member houses open their doors to the public, whether through pay-at-the-gate visitors, special tours or by hosting events 6. Historic houses have diversified to become venues for conferences, plays, concerts and community events and nearly a quarter of all HHA houses now welcome weddings and civil partnerships. Historic houses stand at the heart of their local communities, contributing to their identity, character and history as well as providing a focus for community life. Historic houses make a very significant contribution to local communities with 54% of HHA houses supporting charitable and community events 7. Historic houses have a unique and irreplaceable cultural value, containing art and artefacts which have disappeared from their counterparts elsewhere in Europe. They are a tangible history and offer a wide range of educational opportunities, from art and design to science and technology. Indeed, they provide uniquely inspirational places for learning and HHA members are increasingly developing education and training programmes. The HHA s historic houses and gardens welcome over 300,000 educational visitors of all ages each year. Apprenticeship is re-emerging as an important route into sustainable employment and around 20% of all HHA member houses a high proportion compared with many other sectors drive skills development by employing apprentices 8. 1 VisitBritain (2013) 2 British Tourism Framework Review (2009) 3 Heritage Counts (2013) 4 VisitBritain (2013)

5 Independent stewardship: securing heritage for future generations The majority of the UK s historic houses are privately owned. The HHA alone has 1,550 member houses, about 500 of which open to pay-at-the-gate visitors, more than the National Trust, English Heritage and their equivalents throughout the UK combined. The care and conservation of Britain s unique cultural heritage are generally best managed by those closest to it and heritage in private ownership provides extremely good value for money. Privately-owned historic houses not only receive no public subsidy, but are contributors to the public purse. HHA members deliver considerable public benefits, not just to the national economy, but also to our sense of identity and community and to people s health and well-being. Successful independent stewardship is an onerous responsibility and is essential to securing our heritage for future generations. Lived-in and family-owned historic houses and their gardens provide the unique character of Britain s heritage. 68% of foreign tourists plan to visit a historic house, castle or garden during their stay. Domestic visitors consistently highlight the enjoyment of visiting historic houses where they can see and feel the presence of current and former owners 9. The efforts of others, such as the National Trust, to replicate this atmosphere in their properties simply reinforce the cultural value of a lived-in historic house. Historic houses are important to sustainability Environmentally, older buildings have a crucial role in moving to a low carbon future and looking after what we already have is an inherently sustainable way to live. Adapting our traditional stock without losing its character or creating risks to health can be done sensitively with knowledge, skills and new technologies. The government drive to reduce energy consumption should favour re-using existing buildings, but in the UK VAT currently reverses the incentive in favour of new build. Energy policy should be based on minimising overall whole life carbon impacts. Although there are some exemptions for listed buildings, dangers exist because energy performances tend to be miscalculated. Since older properties frequently perform better than the estimates used in energy policy formation, many will be unnecessarily adapted or retrofitted and this will be reinforced by financial incentives. This is a threatening policy area for historic buildings. Right Haddon Hall, Derbyshire, conserved using traditional leadworking skills 9 British Tourism Framework Review (2009)

6 Threats to our heritage The public benefits provided by historic houses, whether in terms of people and communities or tourism and the wider economy, are dependent on the viability of these properties. However, the conservation of listed buildings is an expensive business, as specialist labour and materials are needed to meet the standards of heritage regulation. Costs of conservation and compliance with regulation (including on health and safety and fire safety) have risen faster than incomes from visiting. The backlog of outstanding repairs to independently owned historic houses is now becoming critical. The 2013 HHA member survey reveals that the bill for urgent, essential repairs to member houses now exceeds 750 million (up from 390 million in 2009). At the same time, the findings show that the amount now spent annually on repairs has fallen, by 37m per year over the same period, to 102 million 10. Meanwhile, owners work within an increasingly unfavourable tax framework. In 2012 VAT was imposed on alterations to listed buildings and the following year a cap was imposed on Sideways Loss Relief (SLR). The cap has had a disproportionate impact on unincorporated historic house businesses, because they are taxed differently from historic houses owned in charities such as the new English Heritage or the National Trust which pay no income tax (or Inheritance Tax), or companies which have greater flexibility to spread costs. They are also taxed differently from other integrated business within the economy. Transferring ownership to companies or charities is not an option for many owners, either because of the capital gains tax charge or because of the loss of ability to take bold and long-term decisions. If ownership were transferred on a large scale the unique character that is provided by private ownership, and which is so loved by visitors, would be lost. Left Major repairs at Kinross, Kinross-shire Right Bowood House in Wiltshire 10

7 These unincorporated historic house businesses there are about 350 of them in the UK constitute the greater part of Britain s heritage of lived-in historic houses. Typically, they are part of broader businesses, encompassing related enterprises, but managed as one. These related enterprises generate additional income which is then used to help support the maintenance of the historic house. The problem is that the tax system requires the historic house business, farming and letting all to be taxed separately, with the result that the costs of the historic house part of the overall business cannot be set against the income from the others. SLR enabled unincorporated historic house businesses to set exceptional losses against income from outside the business. The relief has been capped at 50,000 (or 25% of total income) and this does not go far when compared to the cost of a new roof or against the effects of a poor summer like Many of these 350 key historic house businesses are now finding it extremely difficult to fund essential annual maintenance, let alone the costs of major restoration. This contrasts with the position in the English Heritage portfolio, where the Government is, rightly, providing additional support 52m for much needed maintenance. If private owners have to close parts of the property, for safety reasons, the cultural and tourism value of their houses will decline a vicious circle. Should their businesses fail or be sold and then close, the effects on local employment and incomes will be multiplied, in fragile rural economies. The closure of Torosay Castle, on Mull, quickly led to the closure of the nearby tourist railway and ancillary shops. There is no relief from national and local government s red tape, either. The need for regulation is not in dispute, but excessive or inappropriate regulation undermines the viability of many historic houses, particularly those which depend upon tourism revenue. Successive governments have promised much on deregulation, but there is still a great deal left to do.

8 Proposals The HHA is looking for recognition, by all political parties, of the contribution the independent heritage sector makes to the success and well-being of the nation, and the very real threats to the future of our historic environment and the benefits delivered. 1. Removing excess regulation The HHA calls on government to implement the outstanding recommendations of the Tourism Regulation Task Force. We urge the government to encourage, enable and support tourism and hospitality businesses and ensure that tourism signs are used strategically to assist heritage visitor attractions. 2. Fulfilling the potential of Lottery funding The Heritage Lottery Fund (HLF) does a remarkable job and heritage should remain one of the good causes in the National Lottery after Broadening eligibility and raising the ceiling on grants awarded within the Our Heritage programme (available to privately owned heritage) would help fulfil. the HLF s potential to support all forms of heritage and to deliver benefits to the public. 3. Securing heritage protection and advice Major changes are taking place in the way that government agencies and local authorities across the UK deliver heritage protection and related services. It is essential that the provision of expert advice to owners and local authorities is sustained and that the already diminished budgets for restoration grants are not further reduced. The HHA calls for confirmation that resourcing of all these services will be safeguarded when the new Historic England replaces the heritage protection functions of English Heritage in A fair tax framework for privately owned historic house businesses Either, the removal of the cap on Sideways Loss Relief (SLR) in relation to historic house businesses would enable these businesses to survive and would cost no more than 10m per year, before positive account is taken of the additional tax revenue that would follow. Or, the alternative would be the introduction of a tax regime that allowed unincorporated historic house businesses to pool income and costs from the related economic activities that are managed in common within the overall integrated business. Any potential Mansion Tax must not drain historic houses of the funds desperately needed for their maintenance. There must be heritage exemptions, including for historic houses opening their doors to pay-at-the-gate visitors, weddings, tours, charitable community or other events. There is also a strong case for reducing VAT on repairs to older residential buildings. Conservation of such buildings (in place of new build) minimises carbon emissions and preserves the character of our communities. Historic Houses Association 2 Chester Street, London SW1X 7BB Telephone info@hha.org.uk