SCOTTISH tourism is facing a “devastating, gaping hole” in funding, putting many holiday hotspots at risk of closure, according to industry figures.
A staggering 43% of Scotland’s Destination Management Organisations (DMOs) face going into administration by the end of the year with the number rising to 67% in rural and island areas.
Skye, Scotland’s second most popular tourist destination behind Edinburgh, is forecasted to lose its DMO by the end of 2024.
A DMO is a group or company that promotes a location as a travel destination and manages its tourism. DMOs benefited from government funding made available through Highlands and Islands Enterprise at the end of the pandemic.
Mark Crothall, chief executive of the Scottish Tourism Alliance, told The Scotsman that the government must help protect the DMOs most at risk of folding.
He said: “There is often the misconception that tourism just happens, when in fact our DMOs are working hard behind the scenes to market and manage their visitor destinations, ensuring tourism acts as a force for good.
“The loss of our DMOs would leave a devastating gaping hole in our tourism eco-system, significantly harming Scotland’s ability to drive its strategic and economic agendas, including the ambitions of our national tourism strategy, Scotland Outlook 2030.”
Crothall added: “More than ever, we need our DMOs to be at the heart of ensuring tourism happens in a sustainable way. We urge the Scottish Government and its agencies to intervene to protect many of them from going under.”
SkyeConnect, the Destination Management Organisation for Skye and Raasay and Lochalsh, reportedly has reserves to last until the end of this year.
Cuts to funding come as tourist numbers hit record levels with 857,000 visitors to Skye in 2023, up nearly 30 per cent from 2019.
Sarah Maclean, chief executive of Outer Hebrides Tourism, said staff numbers are likely to be reduced to two in 2025. Subscriptions from around 500 local businesses are now the main source of income for the DMO, she revealed.
She claims the group would last another two years maximum if the funding issues continue.
“We have a couple of years to play with and we are looking at all the alternatives,” she said. Ms Maclean said the loss of the DMO would have a “seismic” impact on tourism in the Outer Hebrides.
“It would be massive,” she said. “There would be a huge gap and at the moment I’d say there is not a public agency who could fill it.”
A Scottish Government spokesperson said: “We acknowledge the difficult situation faced by some Destination Management Organisations and would encourage those facing issues to make use of the support offered by our economic development agencies.”
