Martin Ferris (Kerry North, Sinn Fein)

I thank the Labour Party for the time allocated. We support the general thrust of this motion and the proposal to withdraw the air travel tax. It is true, as the statistics prove, that the tourism sector has experienced a considerable downturn during the past two years, which has had an impact in terms of business closures and job losses. However, it is also a sector that has the potential to recover more quickly than others, given the apparent recovery in the economies of some of the countries from which many of our visitors come. Indeed, it has been noticeable that there seems to be, anecdotally at least, somewhat of an increase even in recent months in visitors from some European countries.

We have completed a report on the sector and Senator Doherty hopes to submit it to the tourism committee. Some of the findings in the report would indicate there is potential even in the current climate to expand, particularly if the economies of some of the countries from which many of our visitors come are ahead of us in terms of recovery.

The motion also refers to the Office of Public Works and the development, or lack of development, of public sites. This was another theme that emerged in the report. There is significant potential not only to develop existing heritage sites, but to expand the whole area of cultural tourism. During the Great Depression in the United States, the Democratic Administration under President Franklin Roosevelt established similar commissions as part of its efforts to stimulate growth and recovery. Not only did it provide people with employment, but it also contributed to the creation of much of what the American people have today in collections of folk music and so on. Such an approach would require the Government to turn its back on its current austerity measures and use its imagination to stimulate growth across a range of sectors, including tourism.

Many areas of unique interest attract people to Ireland, including music, literature, sport, family and local history, folklore and so on. It might be possible to develop these to a greater extent and to employ people locally in schemes to develop sites, create cultural centres and do family and historical research. The evidence from places where this has been done would indicate it has been a successful approach. Perhaps that might be something that could be done instead of closing down community schemes as is currently the case and either leaving people with nothing to do or giving young people no option but to leave the country.

I would be concerned that the reference in the motion to the joint labour committee is part of a concerted effort to undermine wage levels further in what is already a low paying sector of the economy. There has been intensive lobbying by businesses, including from within the hotel and catering sector, against the minimum wage and against the rates set by regulatory orders. This has been successful to the extent that the Government is proposing to allow businesses to opt out of wage agreements by claiming that they cannot afford to pay people what are already fairly basic levels of pay. This argument needs to be resisted, as does the argument that sectors like tourism are dependent on paying people low wages.

Hotels did well during the good years and at a time when wage levels did not rise above the rates seen in other sectors. Wages within the tourism sector still remain low. The minimum wage of €8.65 per hour is paid to a substantial number of tourism workers. The average hourly wage is only €10.57 for people with more than ten years experience and €10 for those with less than four years experience. Given the high cost of living, a 40-hour average working week makes it difficult for many workers in the sector to make ends meet. The average weekly earnings for workers in hotels and restaurants in the last quarter of 2008 was €481.38, which represented an increase from €411 in the same period of 2004. Further cuts in wages and the erosion of conditions and standards of employment would not be acceptable to most people in the sector, something that is emphasised by unions representing its workers. Cutting wages and undermining working conditions therefore ought not to be seen as the means to help the sector to recover.

The argument for cutting wages and abolishing the minimum wage is also dishonest. As we all know, many people who have children and are earning low wages are entitled to claim the family income supplement, FIS. In effect, what this means is that low wage employers expect the State to subsidise them by making up the difference. By paying FIS, the State is recognising that the minimum wage is insufficient to maintain a family in any reasonable way. The Government is dishonest in proposing to allow employers to drive down wages when it knows it will need to pay their employees from State funds.

Other cost factors could be considered. As the motion mentions, many businesses within the tourism sector are subject to the same credit constraints affecting many other indigenous businesses, making it difficult for them either to survive the downturn or to lay the basis for recovery. This is a considerable problem for small businesses, not least of all those involved in the tourism sector, as they are being crippled by credit constraints. The same banks are now in the dock or rather ought to be in the dock over the manner in which they loaned out massive amounts of money to property speculators who had far less of a strategy than most of the smaller businesses now being rejected out of hand when they apply for loans and that were often rejected at the same time because the money was being squandered, leaving us in our current mess.

This matter needs to be examined, not only in respect of the tourism sector but overall, especially given that the banks have benefited from the generosity of the taxpayer thanks to the measures introduced by the current Government. Given that the State has stepped into the banking sector in this way, it ought to be able to insist that the banks extend credit to those businesses that believe they are capable of expansion. It has been argued that the State has no role in this area, but surely if the State and the taxpayers are responsible for saving the banks and some of those to whom they lent, it ought to be able to intervene and ensure that the banks serve the public interest instead of doing as they have been up to now.

The motion also refers to the issue of the so-called zombie hotels. These are hotels that were built by property developers to avail of tax concessions and anything up to an estimated 200 of them could effectively come into public ownership after being transferred to NAMA. Most of the hotels in question are not viable, but the fact that they exist is contributing to the vast overcapacity in the sector, estimated at 15,000 too many hotel beds, and adding to the difficulties facing the genuine operators that must compete with them. It would be a ridiculous situation if the taxpayer was to carry what are, with a small number of exceptions, loss making hotels. NAMA should close any loss making hotels that end up on its books and sell the properties if there is a market for them. Alternatively, it could use the buildings for other useful purposes. However, if that occurred, it should not be the signal to push hotel prices back up to where they were. Hoteliers rightly make a case about the zombie hotels undermining their businesses, but some of them also forget that, when things were better and before the sharp decline in tourism, many in the sector overcharged and increased prices way above anything justified either by demand or costs.

The tourism sector is one that has great potential and my county has benefited much over the years from the revenue and jobs tourism, both from overseas and domestic visitors, has brought about. It is important to have a strategy to ensure that the sector not only survives, but that it is in a position to take advantage of any economic upturn and a potential increase in numbers travelling from abroad.

As part of this strategy, some of the areas referred to in the motion need to be addressed, including access to credit. However, I would strongly argue against any attempt to impose wage cuts on those who are already working in what is on average a low paid sector of the economy. There also needs to be a concerted effort to increase this country's potential as a destination for cultural tourism. There is a huge opening in that sector if it is marketed properly and developed. That could also tie in with job creation within communities. Every community in Ireland has something to say and heritage sites and local history and culture could be further developed.

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