Patrick O'Donovan (Limerick County, Fine Gael) | Oireachtas source

I do not disagree with anything that Senator Feighan has said. I come from Newcastle West in County Limerick and up until recently we did not have a hotel that had any future, and still do not have a functioning hotel. One of our own who did well in Britain decided to come back and buy the old one, knocked it and it is now under re-construction. The reason is not too dissimilar to Senator Feighan's comments about a lot of passing trade where there is potential for local use such as communions, weddings and so on. The Senator is correct to say that the development of any town in the country requires a basic piece of infrastructure such as a hotel. It is soul destroying for a town when a hotel goes. The locals see that they cannot hold a meeting, a wedding or a wake for a funeral. There is no doubt that it is very difficult.

Part of what the Senator is referring to can be achieved by some of Fáite Ireland's initiatives. Reference was made to the Wild Atlantic Way. Fáilte Ireland is now in the process, with local authorities, of developing loops off that route, the first of which will be in the Shannon Estuary between Limerick and Clare. In parallel, one will be in the Burren to take people from the Wild Atlantic Way up in to north Clare and south Galway. Similarly the Mulroy drive, close to the Fanad Peninsula area in Donegal - I am sure the Senator knows it very well - is pretty much ready for Fáilte Ireland to brand also. In the west, especially in the counties referred to by the Senator, I believe the potential now needs to be driven through the local authorities and their strategies which, in fairness, I must compliment them on.

When I was appointed to this position I have said from the outset that there are areas in the middle of Ireland such as east Donegal, Cavan, Monaghan, Roscommon, Leitrim, Longford, Offaly, Laois, east Clare, North Tipperary, Limerick and right down into Cork that need assistance. The assistance should be driven locally by the local authorities, in conjunction with Fáilte Ireland. The blueprint for that is in place because there are strategies now in place. The local authorities know what they want to try and achieve.

From a current expenditure point of view, when it comes to festivals or upskilling people, Fáilte Ireland has been instructed by the Department that we want it to work with local authorities and to engage with them, particularly in those areas that have a deficit in respect of tourism numbers. The Senator is right when he says there are people who are driving in their droves through County Roscommon. I drove through it yesterday on my way back from Achill. There are some fabulous towns and attractions in County Roscommon, no more than there are in County Limerick. It is about how we attract people in, which is through branding, advertising and the leadership of local authorities. I thank the CEOs for that.

With regard to tax, I am not running down what the Senator is saying, but there were tax incentives for hotels before. We know some were built in areas where they should not have been built, with the associated problems. We are now at the other side of it where we do not have enough beds, especially in Dublin, but from a tax point of view we are already doing something. We reduced the VAT rate for the tourism and hospitality industry and we took a major punt on that. It was at a time when we had no money to do anything. We invested in an industry that was basically banjaxed and it wound up with 35,000 additional people working in that industry who never had the prospect of a job. We now want to spread that benefit. A lot of people criticised us at the time and said that we should not have done it. Some people still believe that we should not continue with the reduced VAT rate. There are some political parties that think we should reverse it. I do not agree with that idea. In my part of the country, in the midlands and in parts of the mid-west and north west we still do not have that robustness where we can remove that crutch. Pre -budget submissions are going to have to be made in the near future from parties and individuals around public expenditure and tax element.

The Department would be very open to any consideration, if it is properly costed. When one has a tax measure in place that is a labour activation measure and it does not receive the support that it should from across the House it makes our job in the Department very difficult if political grandees are on the sidelines looking to have it abolished. I believe it would be very helpful if we could get consensus on this tax measure in the first place. If we were to then look at opportunities, be it private investment of public-private partnerships or whatever, I am open to suggestions. Ultimately, however, tax breaks cost money. If one introduces a tax incentive, a tax reduction or a tax measure it is money that must be taken out from the central Exchequer pot because it must be paid for and we must ask what is the return on investment? We know the return on investment for the 9% VAT rate. It is a lot of people with work who did not have the work before, who have the dignity of it and are able to pay for a mortgage and rear a family. That is good value for money as far as I am concerned.