Most of Britain will stay at home over Christmas, as the recession and falling pound make overseas holidays more expensive and fewer decide to travel within the country.

Three million are going overseas and almost ten million plan an overnight trip within Britain. A survey by the AA found that almost a fifth of people who travelled over Christmas last year decided to change their plans and stay at home for the festivities.

The Association of British Travel Agents (ABTA) said that many of the three million travelling abroad over Christmas booked their holidays months ago, before the economic downturn and serious job losses started to kick in.

“Usually we see year-on-year growth in bookings over Christmas. While bookings are steady, the growth has stopped. With this particular downturn, a lot of people had already booked their Christmas holiday when the downturn seems to have hit,” said Frances Tuke, of ABTA.

Julie Darroch, of Cumbria Tourism, said that bookings were similar to last year, with Christmas vacancies in the Lake District but strong bookings over the new year.

“We are hoping to start the new year with a flourish,” she said. “We are viewing 2009 as what could be a potentially great year for UK tourism. With volatile fuel prices and a weak pound, you just don’t get the same value for money going overseas.”

European breaks can now cost up to 30 per cent more than this time last year. One year ago, travellers enjoyed an exchange rate of 1.40 euros to the pound; now the pound is close to parity with the euro.

Tour operators are also reporting a change in the type of destinations people are choosing for last-minute breaks and for holidays next year. Instead of cancelling holidays, it seems many are choosing all-inclusive deals or cheaper options such as camping.

Thomson, the travel agency, said: “The vast majority are still travelling and wanting to get away. What we are seeing is a significant increase in the bookings for all-inclusive holidays that allow people to budget.

“People are also looking at places such as Turkey when booking for next summer, outside the eurozone but not too far away.”

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