John O'Donoghue (Kerry South, Fianna Fail)

Since I assumed responsibility for the tourism portfolio, I have had a consistent focus on the competitiveness of the Irish tourism product. My focus is not so much on price as on value and my message is not so much about high prices as value for money. The industry must monitor its prices by reference to the value it provides. However, Ireland has not been, for many years, a cheap holiday destination. It has never been, nor does it intend to be, on a par with the cheap mass market destinations.

However, Ireland was competitive in the 1990s. It has always been my view that, if Ireland's tourism industry is to restore the competitiveness it enjoyed in the boom years, a multifaceted approach by both the private and public sectors is required. Competitiveness is a function of the overall tourism experience and not price alone. We have put a new tourism strategy in place to address the key challenges facing domestic tourism to build on the report of the tourism policy review group. The review group recommended more than 70 actions that must be delivered if that new strategy is to be successful.

The first progress report by the high level tourism action plan implementation group, published last September, was broadly positive. Few people were surprised that strong areas of concern remain regarding the competitiveness and value for money available in wide segments of Irish tourism. However, in general, the industry is addressing the competitiveness issue seriously, which is a mark of how serious the pressure is on industry yield and profit brought about by a stronger focus on price and value for money in the marketplace. This is also evident in the wide range of special discounted offers available from the air and ferry companies and accommodation providers.

The strong euro and related weakening of the dollar and sterling present additional challenges for domestic tourism in terms of the perception of value for money. Levels of dissatisfaction are closely linked to exchange rate changes. A variety of trends are emerging from the analysis of 2004 performance figures that will require attention from the industry and the tourism agencies, if we are to achieve the rate of growth envisaged for the sector in the report of the tourism policy review group.

I have again secured a record level of Exchequer moneys for investment in tourism this year which, at €123 million, amounts to an 8% increase on 2004. The enhanced budgets for the tourism State agencies have enabled them to produce excellent operational and marketing plans for the year, which will help to enhance the overall competitiveness of the tourism industry through a range of supporting programmes and initiatives.

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