Europe will Approve Help for Tourism

12.00.00am BST (GMT +0100) Thu 5th Jul 2001

Government claims that EU rules prevent it from giving direct financial help to beleaguered tourism businesses in Yorkshire have been flatly denied by one of the region's Euro-MPs, and she has accused the tourism minister of being misinformed or deliberately misleading.

Liberal Democrat Diana Wallis says that European Commission officials have confirmed that they are unlikely to have any objection to payments being made to businesses suffering as a result of the foot and mouth crisis, but that the Government has made no application to them.

The Isle of Man Government has announced that a lump sum of £6 million will be paid in compensation to businesses suffering from a loss of income due to the cancellation of the TT races, a step taken as a precautionary measure to safeguard the island from foot and mouth disease.

But tourism minister Dr Kim Howells has said that a similar payment by the British Government would "clearly be in breach of European state aid rules."

His words have been dismissed as nonsense by Yorkshire & the Humber Euro-MP Diana Wallis who says that the Government should make an immediate application to the European Commission for permission to provide emergency support to local businesses.

"The rules are intended to stop unfair subsidies which distort fair competition. They do not prevent help being given to businesses affected by foot and mouth disease," explained Ms Wallis.

"It would clearly be against EU state aid rules, for example, for the Government to subsidise tourism in Yorkshire with the aim of undermining holiday businesses around the Mediterranean. But that is not the situation. Businesses are looking for emergency relief not unfair subsidies."

The Liberal Democrat accused Dr Howells of using Europe as a scapegoat to hide his own Government's refusal to support the tourism industry.

"The test is simple. The Government should make an application to the Commission to waive the rules in view of the extenuating circumstances so that it can give direct financial support to businesses hit by foot and mouth disease. Officials in Brussels tell me that such an application would be favourably received."