SCOTLAND'S national tourism body has been plunged into crisis after the country's biggest draw decided to withdraw its cash and go it alone.
Edinburgh City Council will announce this week that it intends to withdraw annual funding worth £500,000 a year from VisitScotland. Insiders claim the national tourism quango offers poor value for money and believe they can attract more visitors by s
pending the same amount of cash themselves.
Scotland on Sunday can also reveal Glasgow and Shetland are to withdraw six-figure sums from VisitScotland and more councils are likely to follow.
VisitScotland was created five years ago when area tourist boards were abolished. Discontent has now reached crisis proportions because many regional tourism chiefs believe the body has "lost touch" with them and concentrates too much on trying to establish a whisky-and-golf dominated national brand.
A senior industry source said: "The whole system put in place by the old Labour Liberal Executive is now unravelling. There are some areas that are just not happy with what they get from VisitScotland in return for their money.
"They include Edinburgh and Glasgow, which between them account for more than 80% of people who arrive in Scotland."
Edinburgh's plan will focus on developing the capital as a destination for holidays, business, study and investment.
The new body, called Destination Edinburgh Marketing Alliance, will combine public and private-sector funders, echoing the set up of the old area tourist board for Edinburgh and the Lothians.
Kenneth Wardrop, the new body's chief executive, said: "The whole international trend is now for tourism marketing to be focused on city regions. What we are seeing is that a lot of people who live in one city region – urban sophisticates – want to visit another city region."
The new Edinburgh body will still buy services from VisitScotland, where and when it thinks it needs a national or an international presence.
Glasgow began separating from VisitScotland as far back as 2005, when it set up its own Glasgow Marketing Bureau. The body is officially tasked with luring business visitors but has effectively built Glasgow's image among leisure travellers, using its "Scotland with Style" brand.
Glasgow is now looking at cutting its remaining contribution this coming financial year and reviewing it completely in 2010-2011.
A senior source at the authority said: "The truth is that VisitScotland just doesn't have a very good reputation in local government and, when things are likely to be tight, we want to make sure we are getting value for money."
Shetland Council has also effectively declared independence from VisitScotland, withholding more than £400,000 from the organisation and setting up its own marketing system. Gripes include different managers at VisitScotland giving time off to different employees at Lerwick's tourist office, leaving it short-staffed.
VisitScotland gets about a 10th of its nearly £70m annual budget from councils and commercial bodies. The agency yesterday insisted that it was more than flexible enough to tailor its marketing messages to reflect Scotland's diversity.
Ben Carter, the agency's head of strategic relations, said VisitScotland was comfortable with councils redirecting funding, as long as the money went to boost tourism.
Carter said: "We are not precious about every penny having to be channelled through VisitScotland. We want to see councils involved, that makes sure we get the biggest bang for our buck."
The agency and its national strategy was backed by Lewis Macdonald, Labour's tourism spokesman in the Scottish Parliament and a former minister in the last administration. He warned that break-away regions could weaken Scotland as a single brand.
Macdonald said: "There are one or two particular sub-brands that are quite strong but none of them are as strong as the Scotland brand as a whole.
"If VisitScotland is in danger of disintegration, then ministers need to look very urgently at what they are doing."
Some tourism experts had long predicted that Scotland's centralised tourism bureaucracy would come apart. One was Eddie Friel, a former chief executive of the old Glasgow and Clyde Tourist Board and now a professor of tourism at Niagara University in New York State.
Friel said: "City regions are what the world of tourism is all about. Regions across Scotland are seeing how well Glasgow has done with its own marketing bureau. They see how many tourists Glasgow is getting despite the economic situation. And they want to do that too."
Other regions, including big tourism destinations in the highland and islands, are watching Edinburgh, Glasgow and Shetland carefully.
Fay Thomson, the regional organiser of the Federation of Small Businesses in the Highlands, said: "We are not surprised that local authorities are moving away from VisitScotland. The feedback we get from small businesses is that they are not up to the job."
