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Welsh tourism leaders warn policies driving sector into crisis

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TOURISM businesses across Wales say they are being pushed to breaking point by Welsh Government policies, with new figures showing sharp falls in visitor numbers and confidence.

The Professional Association of Self-Caterers (PASC) UK Cymru has raised alarm following the publication of the Welsh Government’s own Tourism Business Barometer for June 2025, which highlights a significant downturn across the sector.

Pembrokeshire County Council has ruled out introducing the levy during the current administration, but industry leaders say the very prospect of the charge is fuelling uncertainty across the sector.

Visitor numbers down

According to the data, 47% of self-catering operators have reported a fall in visitor numbers this year. Only 16% of businesses say they feel “very confident” they can remain profitable in 2025, while more than one in five directly blame government policy for the decline.

The figures follow another Welsh Government report published in April which showed overnight stays in Wales dropped by 29% between 2022 and 2024.

PASC’s Welsh policy lead, Nicky Williamson, said the figures reflect what operators on the ground have long been warning. She said: “These reports lay bare the economic damage being inflicted on Welsh tourism. What we are witnessing is the avoidable erosion of a vital sector, one that sustains jobs, communities and Welsh culture.”

182-day rule under fire

The group says the controversial 182-day rule, which requires holiday lets to be rented out for at least 182 days a year to qualify as a business, is hitting small operators hardest. Many, it says, are being forced to slash prices unsustainably or leave the market altogether.

“This is not a policy designed to support genuine businesses,” Williamson said. “It’s devastating rural and coastal communities without achieving its aims.”

Concerns have also been raised over the planned Tourism Levy, with warnings it could cost up to 730 jobs, and Article 4 planning restrictions being introduced in Gwynedd, which PASC says are undermining confidence in the sector.

Political response

Mims Davies, Conservative MP and Shadow Secretary of State for Wales, has backed PASC’s position. She said: “Wales is already one of the most expensive destinations in the world due to its ever-increasing tax regime from Labour governments in London and Cardiff. Instead of adding burdens, the Welsh Government should be working with businesses to build a thriving, year-round visitor economy.”

Davies said her party has committed to scrapping the Tourism Levy if elected.

Calls for action

Despite good spring weather and investment by businesses, demand has remained flat or declined in most regions. Operators also report fewer advance bookings and an increasing reliance on last-minute trips, making it difficult to plan staffing and services.

PASC UK is calling for an urgent economic impact assessment of the 182-day rule, a lowering of the threshold to 105 days, a pause on the Tourism Levy, and clear guidance on Article 4 planning powers.

Local impact

Tourism remains one of Pembrokeshire’s most important industries, with thousands of jobs reliant on visitors filling holiday cottages, caravan parks and coastal campsites each summer. Operators here say the policies at the heart of PASC’s warning are already being felt on the ground, with businesses struggling to keep afloat and communities fearing a knock-on effect on local shops, pubs and services.

Business

Festive fun as Milford Haven Christmas market returns to the waterfront

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Traders, lights and family entertainment to kick off Pembrokeshire’s Christmas season

THE FESTIVE spirit is coming to life in Milford Haven with markets, lights and family fun as the town gears up for a packed Christmas programme along the waterfront.

Milford Waterfront is preparing for a busy season of events, starting with an indoor Christmas market in the Link Building from November 21 to 23, featuring handcrafted local gifts and festive treats.

Lucy Wonnacott, head of communications and marketing at the Port of Milford Haven, said: “Every year the berth holder community, Milford Waterfront businesses and residents all get involved in making the whole place sparkle, so we encourage people to come and see their efforts and enjoy the lights, soak up the festive cheer, and visit the amazing businesses around Milford Waterfront.

“We’re delighted to host so many activities this festive season to support the independent business community here. There will definitely be something for everyone, and new to Milford Waterfront this year, the indoor Ice Rink at Sybil House will be very special – we’re looking forward to seeing everyone getting their skates on.”

The festive programme includes Santa by the Sea on December 6, when Father Christmas will arrive by RNLI lifeboat before heading to Milford Haven Town Hall for the town’s official Christmas lights switch-on.

The event, running from 12:00pm to 3:00pm, will feature live music, entertainment, face-painting and family activities.

Young artists aged three to twelve can take part in print-your-own Christmas card workshops at the Waterfront Gallery on November 22, 29 and 30. The sessions are free but must be booked in advance by calling 07949 763100.

From December 12 to 14, visitors can enjoy an indoor ice-skating experience at Sybil House, next to Phoenix Bowl. The synthetic rink will be open from 12:00pm to 8:00pm and is suitable for all ages.

The festive fun continues with Pure West Radio’s Purely Magical Christmas Grotto in the Link Building on December 7, 13, 14, 19, 20 and 21. Tickets must be booked in advance and include a visit with Santa and his elves, professional photography, chocolate gifts and more.

Throughout December, the waterfront will be illuminated by the annual Christmas Lights Competition, organised by Milford Waterfront, Milford Marina and Visit Milford Haven. The contest features decorated shopfronts, balconies and boats, creating a vibrant festive atmosphere across the area.

Visitors are encouraged to make the most of the season by staying overnight at the Tŷ Hotel Milford Waterfront, overlooking the marina, to enjoy the full Christmas experience.

More information about this year’s programme of events is available on the Milford Waterfront website.

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Business

Letterston Village Stores on the market after 50 years of family ownership

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A WELL-KNOWN family-run village shop in North Pembrokeshire has been put up for sale after more than half a century of ownership.

Letterston Village Stores has been instructed for sale through specialist business property adviser Christie & Co, with a freehold asking price of £465,000.

The popular store was built in 1974 and has been run by brother and sister duo Gerwyn Howells and Marilyn Griffiths for the past 20 years. The pair have now decided to retire.

The detached property includes a spacious sales area with scope to expand the business by introducing new product lines, as well as a large three-bedroom apartment above the shop, which could be used as owners’ accommodation or rented out for additional income.

Marilyn Griffiths said: “I have really enjoyed running the store. Our customers are fantastic, and I have made many friends over the years. It was a very hard decision to sell, but the time has come to think about the future and retirement plans. I have instructed Matthew McFarlane from Christie & Co to manage the sale process for me.”

Matthew McFarlane, Business Agent at Christie & Co, added: “We are delighted to have been instructed to sell this business by Marilyn and Gerwyn. It has been in the family for over 50 years and offers an exciting opportunity for either a first-time business owner or a multi-operator.”

The property is available freehold at £465,000.
For more information, visit: www.christie.com/3410544

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Business

Private care providers ‘making hay’ as plan to restrict profits ‘backfires’

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A WELL-INTENTIONED policy to restrict profits in children’s care in Wales has backfired, allowing remaining providers to “make hay” and double their costs, a committee has heard.

Jake Berriman, leader of Powys Council, warned an “unforeseen” consequence has left councils with no choice but to cough up because other providers have fled the sector.

In February, the Senedd passed a law aimed at “eliminating” private profit – with looked-after children only cared for by the public sector, charitable or not-for-profit organisations in future.

Cllr Berriman said the Welsh Government’s phased move to restrict profit has seen private providers leave the sector and others have simply doubled their costs.

“We have to pay because there is no choice within the market,” he warned. “I think they are making hay while it is there to be made and the sun is shining.

“We’re paying the price for that and that was unforeseen.”

Giving evidence on the Welsh draft budget to the Senedd’s local government committee on November 13, councils pointed to the increasing demand and complexity of social care.

Jane Gebbie, the deputy leader of Bridgend Council, said: “We’ve got one placement for one young person across Wales at the minute, that’s £20,000 per week – that is excessive.”

Mary Ann Brocklesby, the Labour leader of Monmouthshire Council, added: “We’d all like to say that’s unusual – it’s not, it’s becoming standard. I don’t think there is a local authority across Wales that is not facing that kind of singular cost pressure.”

Cllr Gebbie said people are rightly angry about council tax rises amid a cost-of-living crisis, with poverty increasing demand for public services across the board.

The Labour councillor warned funding for prevention and early intervention has been cut over the years, with councils forced to focus on statutory services.

Cllr Berriman said: “There’s a great deal of nervousness around the potential of a roll-over budget of around 2%. Even at the 2.5% that has been modelled, that is opening a gulf – a shortfall in budget projections due to in-year pressures.”

He warned of £560m of pressures, “which clearly won’t be covered” by the 2.5% average increase for councils proposed in the Welsh Government’s draft budget.

Cllr Berriman added: “We’re looking nervously across the border at authorities in England which have had section 114 notices [effective bankruptcy] on them and we’ve seen the devastating effects that has as those authorities lose control over their budgets.”

The Liberal Democrat stressed: “We want to avoid that at all costs.”

He called for a “meaningful” funding floor to ensure no council receives an increase less than a certain amount, “reducing the impact of winners and losers out of the settlement”. Ministers have proposed a 2.3% funding floor in the 2026/27 draft budget.

Calling for an increase of at least 4%, Cllr Brocklesby told the committee council tax makes up nearly 40% of Monmouthshire council’s revenue and “we cannot keep increasing it”.

She said councils are expecting no let-up in constraints before the 2027 local elections.

The councillor told Senedd Members: “A roll-over budget, with a 2.5% increase, doesn’t give us confidence that we will be able to collectively meet all the challenges.”

The Welsh Local Government Association (WLGA) has warned of a funding gap of £436m based on a 2% increase, the equivalent of 14,000 jobs or a 22% average council tax hike. Adjusted for the proposed 2.5% increase, the budget shortfall would be about £400m.

Cllr Brocklesby also expressed concerns about increasing national insurance costs, which the Labour Welsh and UK Governments have only partially covered.

She told the committee: “It does mean we have to consider various cost savings across the board, including looking at our workforce. For some councils, that will lead to redundancies… in others it will result in reduced services.”

Cllr Berriman added: “Those frontline services, as ever, are suffering this year and will be suffering next year as a result of this unexpected cost and other cost pressures.”

He warned of a “painful picture”, with every 1% less in the settlement from central government resulting in a 3% council tax increase in Powys.

The council leader told the committee: “The cost pressures… are such that we are diminishing the local government offer and we just can’t carry on on that basis.”

Asked how councils will bridge the estimated £400m gap, Cllr Gebbie bluntly said: “I think the Welsh Government needs to tell us what they don’t want us to do.”

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