John O'Donoghue (Kerry South, Fianna Fail)

I propose to take Questions Nos. 9, 11, 14, 342 and 343 together.

As I have often said, maintaining and growing competitiveness is the major challenge facing the tourism industry. The industry operates in a fiercely competitive environment and faces major challenges if it is to remain on the path of sustainable and well dispersed growth. Tourism policy has been reviewed and re-invigorated following the report of the tourism policy review group in autumn 2003. The challenges facing the industry have been well described and the path towards addressing them laid out in the New Horizons report on Irish tourism policy. New Horizons identified the restoration of competitiveness as one of the greatest challenges facing the industry. It set out a practical action plan with more than 70 recommendations. Good progress on the implementation of these recommendations was reported on in the final report of the tourism action plan implementation group, which was published in March 2006 and is available on my Department's website. The Irish Tourist Industry Confederation was closely involved with the work of the implementation group.

I have welcomed the Irish Tourist Industry Confederation's Report on Ireland's Competitive Position in Tourism, which is an intelligent contribution to the debate on the state of Irish tourism, as it reflects many of the issues and challenges that surfaced in the New Horizons report. The ITIC report puts forward a useful agenda for the tourism industry to lift its game and the various players involved need to give it careful attention. The tourism strategy implementation group, which I have recently appointed, will work with the industry and Departments and agencies to address a number of key areas, in particular, competitiveness, productivity and skills, sustainability, regional spread and product development. ITIC is closely involved with this process.

As for specific recommendations in the ITIC report on a tourism product and business innovation fund and a soft loan scheme, I will await the outcome of the work of Fáilte Ireland on its new Tourism Product Development Strategy 2007-2013, which is being finalised by the high level group set up by the body and chaired by Mr. Dan Flinter and which will be a valuable input to the work of my Department on the next national development plan. The tourism agencies continue to monitor Ireland's competitiveness as a tourism destination. Overall Ireland is not perceived as an expensive destination to get to but that there are issues about the relative cost of some on-the-ground amenities.

In 2005, Tourism Ireland undertook a pilot project that focused on benchmarking Ireland's availability on-line against our key competitors in the top four markets — Great Britain, the USA, France and Germany — regarding cost availability and choice of flights, hotels and car hire. Overall Ireland is very competitive in these sectors in the on-line arena. Fáilte Ireland's visitor attitude survey shows that the area of value, price and good all-round value for money remains an important prerequisite for visitors when considering Ireland as their holiday destination, as does the availability of reasonably priced accommodation and competitively priced air and sea fares.

The reality is that Ireland is not a cheap or low cost destination. The economy operates on a partnership basis and tourism is a services industry, which relies heavily on labour. Economic and social policy operates on the basis of seeking to ensure those in employment are paid fair wages, which impacts on costs. No one wants to turn back the clock in this regard. Nevertheless better management can secure greater productivity and more efficient uses of resources employed with a knock-on benefit in operating costs. Fáilte Ireland has a range of programmes to help the industry in this area.

At more than €140 million, Exchequer support for tourism is at unprecedented levels this year. The needs of the industry are increasingly reflected in Government policies and analyses across a wide spectrum. In addition to its economic benefits, tourism plays an important role in supporting the peace process where it is the leading area of North-South economic co-operation. Despite all of the shocks and uncertainties in the international marketplace over the past four years and the destructive nay-saying that is all too common in certain media circles, Irish tourism has managed to weather the storm and continues to grow. The official CSO tourism and travel figures for the first four months of 2006 reflect the healthy state of the industry. Visitor numbers increased by almost 13%. This follows on a record visitor number performance in 2005 with almost 7 million overseas visitors. However, despite the record performance, we cannot be complacent.

The industry, not the Government, delivers visitors. The industry has to aim, at all times, to operate at optimum competitiveness and to seek to deliver value for money and a good visitor experience. The Government has given an unprecedented level of commitment and support for the Irish tourism industry. It is working in partnership with the industry to help it meet its current challenges and will continue to do so in the future.

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