Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

I am glad to have the opportunity to talk about the budget and how it affects the Department of Transport, Tourism and Sport. As Deputies will be aware, my Department has a budget of €1.188 billion, which was due to be reduced by approximately €76 million. My Vote has been reduced by that amount, but as a result of the additional funds provided to my Department as part of the capital stimulus programme, I expect to see a small increase in 2014, which is a reflection of the fact that the Department has taken very severe cuts, particularly to the roads budget, in recent years. The increase is entirely on the capital side and not on the current side, where reductions remain, as I will explain further later.

With regard to the roads budget, the extra €50 million is extremely welcome but it still means a slight net reduction in the roads budget for next year as things stand. Therefore, my priority will be maintenance and repair of local and regional roads in particular, but also of national roads. The additional money does not, unfortunately, provide any scope for any additional road improvements beyond those that were already planned or committed to.

The planned reduction in the subvention to CIE will go ahead but we have requested that there be no further reduction in 2015 or 2016. This will be the last cut to the subvention for the public transport companies. However, the long-overdue and long-delayed savings that we need in Bus Éireann and Irish Rail are still required. The planned increase in spending on public transport investment under the capital programme will go ahead next year.

With regard to sports, contrary to some commentary in the press and from certain quarters, the total sports budget is actually increasing next year. The sports budget will go up from €74.6 million to €93.5 million, which is a substantial increase. However, the increase is very heavily on the capital side. Work will begin on the indoor arena at the National Sports Campus, which is the missing piece of sporting infrastructure in this country. The increase will also allow the Minister of State, Deputy Ring, to initiate a new sports capital programme, providing grants for local and regional facilities around the country. We will have to go ahead with a cut in current spending through a cut to the Sports Council budget. That cut currently stands at around €3.5 million but I hope to be able to alleviate that somewhat through some adjustments within my own Vote. However, I will have to see the details of the council's plans before doing so and get approval from others.

In the area of tourism, the budget is also going up on the capital side but down on the current side. Overall, the budget for tourism next year will be €131 million, as against €139 million last year. The investment in the Wild Atlantic Way is extremely welcome. The route will be fully signposted by March and we will be able to put in a lot of the viewing points and give the route a lot of additionality this year, which is very positive. The development has been very well received already and features on the front cover of the German travel agent DerTour's brochure for next year.

On the current side, we are looking at a €12.9 million cut in the budget for Fáilte Ireland and Tourism Ireland. A good chunk of that is because The Gathering is not happening next year. A special allocation of €7 million was made for The Gathering, but the cut is still more than that. Again, I hope to be able to alleviate that to some degree from within my own Vote, but that will depend on the spending plans of Fáilte Ireland.

One of the big successes in the budget from the point of view of my sector is the retention of the 9% VAT rate, which has been broadly welcomed and has been very positive. I thank the Minister for Finance, Deputy Noonan, the Minister for Public Expenditure and Reform, Deputy Howlin, and the Taoiseach for their involvement in that. They are people who understand tourism and its benefits and I am very pleased they made that decision. I would also like to acknowledge the tourism team, for want of a better term, involving groups such as the Restaurants Association of Ireland, the Irish Hotels Federation and the Irish Tourist Industry Confederation, which organised a very effective but measured and evidence-based lobby on the issue, which made a huge difference. I hope the 9% rate will remain in place for the duration of this Government.

A decision has been made to suspend the travel tax starting in April. The travel tax was originally €10 but this was subsequently reduced to €3. It will now be reduced to zero, but the legislative provision for the tax remains in place. The tax is not being abolished; it is just being reduced to zero. We will carefully monitor the response of the airlines over the summer period.

Ryanair announced today at 3 p.m. that it will increase the number of passengers travelling into Irish airports by 1 million next year. I look forward to seeing the details of this and analysing closely to see whether they are inbound tourists coming to Ireland and, therefore, helping to create employment here. I will also be eagerly awaiting the response from the other airlines to this decision. It is open to the Minister for Finance to re-introduce the travel tax at €3, €5 or even €10 next October should the response not be satisfactory. The increase of the VAT cash threshold from €1.25 million to €2 million will assist cash flow for businesses in the tourism sector.

The current budget for regional airports will be reduced from €10 million to €9 million and the capital budget from €4 million to €3 million. This was all previously planned. We still have to deliver a reduction in the roads budget. This means the focus will be on maintenance and repair, not new projects other than those already planned. We have made some savings in PPP, public private partnerships, operational payments but more will have to be spent on the new Coast Guard helicopters which will all have arrived within a few months. While they are expensive, they are providing an excellent, much faster and wider-ranging service. They are also able to do much more including hospital and emergency transport which was not done before. The cost of these helicopters will rise from €51.48 million for last year to €58.9 million in the year ahead. I am not reducing the Coast Guard budget which will remain at €4.36 million. This budget will not be reduced at all during my term in office. The same goes for the grants my Department pays to the RNLI, Royal National Lifeboat Institution, mountain rescue teams and the Commissioners of Irish Lights.

There is a €9 million increase in the budget for the NTA, National Transport Authority, for public transport infrastructure provision in the greater Dublin area and a €15 million increase in the public transport safety and development programme which mostly goes to Irish Rail for improving line speeds, taking out level crossings and repairing the railways. The planned reduction in smarter travel and carbon reduction programmes will go ahead with a budget of €11.1 million rather than €17.4 million.

The public transport works that will go ahead as planned include the Luas works in Dublin which are already under way. The Bus Éireann and Dublin Bus fleets will continue to be updated and modernised. The active travel towns will go ahead, as well as the national cycle network, green schools and smarter travel areas in Dungarvan, Westport and Limerick. We expect to see the completion of the Belturbet- Ballaghaderreen bypass scheme in the next several months and the continuing work on N11 Arklow-Rathnew and Newlands Cross. We still expect to begin work on the N17-N18 Gort to Tuam road next year, as well as the completion of the R402, the Enfield to Edenderry scheme.

As can be expected, the inevitable focus has been on the individual budget measures and how they impact on people. This is a tough budget and it does impact on people and their pockets. However, there is a bigger picture. It is the first budget in seven years that will record a primary surplus which means we are once again paying our way in the world. It is also the budget which will allow our national debt to peak next year and start falling. There is nothing we can do that would be of more benefit to future generations than getting on top of that debt which almost crushed us.

This budget is pro-growth. For the first time since the crisis began, capital budgets are increasing again, a significant development. It also contains positive measures for tourism, construction, agriculture and other areas. For the majority, the budget will be broadly neutral. A PAYE worker’s payslip will be exactly the same in March as it is now. Pensions and basic social welfare weekly payments have been protected once again. There has been no increase in VAT or excise on petrol, diesel or home-heating oil, as well as no cut to child benefit. While there are cutbacks for some sectors of society which will affect the money in people’s pockets, for the broad range of people the budget has been neutral. I hope it will allow us to restore some confidence in the economy and assist a rise in consumer confidence in the months ahead.

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