Oireachtas Joint and Select Committees

Wednesday, 23 June 2021

Joint Oireachtas Committee on Transport, Tourism and Sport

Issues facing the Aviation Industry: Discussion (Resumed)

Ms Elaina Fitzgerald Kane:

I thank the Chairman for his question. I thank the members for this opportunity to speak with them. We appreciate their time and interest. With respect to Covid, ours is a decimated industry that operates in a symbiotic relationship with aviation. We ran at a level of 30% of our overall revenue last year. We have had five months of closure. We are taking baby steps into recovery as part of the quasi reopening we have in so far as we are open to residents only or for outdoor service. To give members an indication of the summer months, what would be considered the peak season of June, July and August, hotel occupancy in Limerick city is running at 16%. Essentially, that means only one out of every ten bedrooms is occupied. Ours is the worst performing region in the country despite all the fantastic amenities we have. It was great to see Fáilte Ireland's development plan launched this week.

In essence, hotels across the country, in the main, are only existing because of the life support they have been on from the Government perspective. The outlook is poor. We could not be confident about it, particularly in the context of international travel. There is some uncertainty about the sector reopening on 19 July. If the reopening goes ahead, and everybody hopes it will, we also hope public health plans will progress, but what will that look like for the sector? We are cognisant a number of southern European countries, in particular, announced very early when they would reopen. They have made some progress ahead of us. There is also a sense of progress markers. At what points will we see changes in that respect?

As Mr. Thompstone mentioned, our tourism industry is worth €9 billion. Some €7 billion odd of that comes from overseas and less than €2 billion comes from the domestic market. Irish people have been fantastic in supporting hotels across the country last year when they could but Covid has had a major impact. During the worst period of the pandemic in our 270,000 job-strong tourism industry, some 160,000 jobs were lost.

In the areas represented by the Shannon, Limerick, Clare and Galway chambers, 50,000 jobs in the tourism sector alone would fall within those areas. If we were to extend that along the western seaboard and take into the consideration the other regional airports, for which the case is also being made today, we would be talking about hundreds of thousands of jobs. Tourism represents one in ten of all jobs in Ireland and 70% of those tourism jobs are outside Dublin. As many members know from their constituencies, sometimes tourism is the only show in town. It has a significant impact on suppliers and the retail sector. When we had the first lockdown, in my home village of Adare, the shops closed very soon after the hotels just before the lockdown. They are very interlinked. That is the reality of it. Reference was made to the business community and foreign direct investment. We cannot exist without it. Regional airports such as Shannon, Cork and the others are the lifeline to the area. We are really feeling the hit.

To answer the question regarding doubling the tourism marketing fund, that was something suggested initially as part of the tourism recovery task force, of which I was a member. To give an idea of its scale, in previous times, every euro Tourism Ireland spent on overseas marketing led to €130 in tourism revenues. If that ratio of 130:1 is not return enough, it tells its own story in terms of the ability of tourism to contribute. Prior to Covid, tourism contributed €2 billion per annum to the Exchequer. We believe the impact of tourism is critical in terms of supporting Shannon. The Irish Tourism Industry Confederation, ITIC, has suggested, as has Mr. Thompstone in his report, that recovery may not come until 2024 and as an island nation, we have a lot more to do, particularly given that the restrictions have been a bit tougher than what was experienced across Europe. Particularly from a regional perspective, this is a really proactive approach. It is three-pronged and looks at multi-year capex. As Mr. Thompstone mentioned earlier, airlines simply have no income. It also looks at the doubling of the Tourism Ireland marketing fund and an industry activation fund because one cannot exist without the other. The last piece is the TRSS. The merits of it speak for themselves. The impact of the visitors to the area, not to mention the business community, is the glue that ties our whole region together. The committee will see a similar glue in the other regional airports as well. Hopefully, that answers the Chairman's question.

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