John O'Donoghue (Kerry South, Fianna Fail)

Recently, I launched the review of the North American market. The survey was comprehensive and established that visitors to Ireland are generally happy with accommodation prices. Only 10% complained about accommodation prices. According to the review, the three issues about which people complained most were eating out in restaurants, golf and car hire. However, while people complained about Ireland's competitiveness in those areas, it is interesting to note that when comparing Ireland with other destinations, their complaints were not as robust. They understand that while Ireland has become more expensive, it is not fair to say it has become more expensive than many other similar destinations.

Ireland will never be a low cost mass destination; it never was. Our product is for a more discerning, sophisticated customer and that has been the tradition. Nonetheless, the competitiveness issue is important and must be watched carefully. One in seven holidaymakers remains critical of Ireland's value for money and that negative trend has continued for the past few years. This relatively critical view of value for money is also reflected in how overseas tourists see Irish prices compared to prices in their own countries, with 16% of holidaymakers in 2005 considering Irish prices to be higher than expected. However, holidaymakers are less critical when comparing prices in Ireland with those of other competing destinations. Accommodation does particularly well in that regard.

It is important that everybody in the industry understands the need to try to keep prices down in so far as possible. It is not possible to discuss what will be in the budget. However, I have been in discussions with the Minister for Finance for some time with regard to business tourism. He has been examining whether it would be possible to do something about VAT for business tourists. The existence of VAT on conference business, overnight stays and so forth puts us at a disadvantage in comparison with some of our competitors. In that context, the building of the new national conference centre will be an enormous boost, particularly for Dublin. I anticipate that it will attract an additional 30,000 business visitors each year, which will be worth €30 million to €50 million to the Dublin economy.

It is particularly important that prior to the completion of the conference centre, at the latest, we should resolve the issue of VAT on business-related visits. Naturally, I wish the matter would be resolved earlier rather than later. We are having discussions in that respect.

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