Diary of a Shopkeeper, 30th March
The annual polishing of the cathedral coincided with the first liner of the year: 1st April 2025
Rural areas, far from large centres of population, must work with what they have when it comes to building an economy. For centuries what we had was land and sea, and we made the most of the opportunities afforded by farming and fishing. Until the mid-nineteenth century, that was largely a subsistence economy: we grew crops, raised livestock, and caught fish to put food in our own mouths.
Improved transport links in the 1840s and ‘50s – in the shape of steamers to Leith and rail lines heading south from Wick – made it possible to turn agriculture and fishing into exporting, cash-generating, commercial industries. (In other words, we became capitalists.) Navies in two world wars took advantage of Scapa Flow’s natural harbour. The military-industrial infrastructure needed to protect and supply them brought employment, money and concrete, lots of concrete. The proximity of North Sea oil fields and the flow of well-paid employment through Flotta reversed population decline in the 1970 and ‘80s. Other sources of energy – wind and water – are all around us in great abundance. In previous centuries they were subsistence sources of power for milling; now they’re cash generators (though where the cash goes is not always clear and often not to Orkney’s benefit.)
Many generations have used their ingenuity and hard labour to make a living in these islands, but on one way or another they’ve all been based on the natural resources around us. This may sound like a platitude, but in fact there’s a profound difference between city and island economies. City economies thrive by harnessing the input of the vast numbers of people who live there; as long as there’s a motorway nearby, where they’re located is largely irrelevant. For us, location is all important.
There’s one more industry that’s crucial to our economy, and increasingly so. Like the other major industries listed above, our location is crucial to its success. I’m talking about tourism. There are many beautiful and interesting areas in the country, but Orkney’s location, combined with its natural environment, its history and archaeology, and its profusion of independent businesses, make it uniquely attractive to visitors. This is a great blessing to our economy, and for young folk who want to live and work here. The ripple-out effects of tourism are enormous. Think of the butchers, bakers and wholesalers who supply hotels and restaurants; brewers, distillers, cheesemakers and confectioners whose goods fill shops like mine; jewellery makers, ceramicists, knitters and artists whose creations populate the craft shops. But tourism is also a curse, as all big industries are. They change our lives, leave their footprints on our landscape, and make demands of us. All had to be managed to bring as much benefit as possible while doing as little damage as possible.
Tourism is no different, which is why the current debate about levies is so important. Tourism has been around as long as commercial agriculture – those same Victorian transport links brought visitors north while the kye went south – but global trends have made it a booming trade, whereas agriculture is holding its own, at best. Destination Orkney’s recent survey on the council’s proposed Visitor Levy is an invaluable contribution to the debate over the future of tourism in Orkney. Its findings crystallise the debate around how to maximise benefit and minimise harm from the industry. When 94% of respondents are against a proposal – the introduction of a per-night fee for visitors staying in Orkney – that’s a good indication that the proposal is seriously flawed.
The levy scheme as currently mooted seems to me flawed not just in one way, but in many. I’ll name just a few.
It could deter visitors, and specifically those thinking of staying for a long rather than a short holiday, as a levy would have to be paid for every night stayed here. Surely we should be encouraging longer stays, not discouraging them.
Collection of the levy is proposed to rest with the more than 600 accommodation providers across the isles, most of them small or micro businesses. Yet another piece of onerous bureaucracy for people already struggling with increasing regulations! And levies collected have to be reported to the tax authorities, potentially pushing smaller business over the VAT threshold – more paperwork and more cost that will have to be passed onto guests.
Cruise liner passengers don’t stay overnight, so wouldn’t have to pay the levy. Seeing as they account for about half the tourists who visit Orkney, that is an enormous missed opportunity. My shop benefits greatly from cruise passengers – sometimes more than it does from self-catering visitors, who arrive with a carful of food, or drive straight to a supermarket – but that doesn’t mean I think cruise people should get a free pass. We should certainly charge them a levy too.
Tourism isn’t going to go away. It’s a major industry suited to the islands – and there aren’t many of those. We should welcome it. But we should also take a strategic view of how best to manage it – including rejecting approaches that work in southern cities but not here. Otherwise we risk losing out on the benefits of tourism, while having to live with the damage.
BACKGROUND
Destination Orkney provided the following summary of their survey:
94% of tourism businesses oppose an accommodation-based levy, citing concerns over fairness, economic impact, and business viability.
89% fear that a levy of 3% or more would threaten their business, with VAT thresholds being a significant concern.
Over 85% expressed frustration that cruise passengers and motorhome users who wild camp would remain exempt, despite their impact on infrastructure.
69% believe the levy would harm Orkney’s wider economy by discouraging high-value overnight visitors and increasing local costs.
71% support a fairer point-of-entry levy, applied at ferries and planes, exempting local residents, essential workers, and friends and family.
Given these industry concerns and OIC’s previous opposition to an accommodation-only levy, Destination Orkney will be strongly urging OIC to reconsider its approach. We support:
Putting any levies on hold until the outcome of the current Cruise Levy consultation is known.
Pushing for the fairer point-of-entry levy which would include all visitors to Orkney arriving by ferry, air and cruise liner but would exempt locals and their visiting family. The Scottish Government has put this option back on the table recently.
Ensuring any levy aligns with a long-term tourism strategy, rather than short-term revenue needs.
This diary appeared in The Orcadian on 3rd April 2025. A new diary appears weekly. I post them in this blog a few days after each newspaper appearance, with added illustrations, and occasional small corrections or additions.