Thursday, 15 February 2007
Question 13: To ask the Minister for Arts, Sport and Tourism if his attention has been drawn to recent comments from the chief executive of Tourism Ireland that the ambitious growth targets in the tourism sector here could be jeopardised by some external challenges, but also by value for money concerns within Ireland and by a perceived deterioration in hospitality here towards foreign visitors; his views on these sentiments; the efforts he is making to address them; and if he will make a statement on the matter. [5549/07]
Question 20: To ask the Minister for Arts, Sport and Tourism if his attention has been drawn to new figures from Tourism Ireland showing that while tourism revenue increased in 2006, it did not equate to the rise in visitor numbers, due to primary growth coming from short stay visitors from eastern Europe; his views on this discrepancy; and if he will make a statement on the matter. [5548/07]
I propose to take Questions Nos. 8, 13 and 20 together.
The CSO has not yet produced last December's tourism figures, but all of the indications are that 2006 was a landmark year for tourism. We expect to have received a total of 7.4 million visitors in 2006, an increase of close to 10% on 2005. Figures from the CSO for the first nine months of the year show an increase of 11% in foreign revenue earnings. In respect of mainland Europe, the 11-month figures show numbers are up by almost 19% on the corresponding period in 2005.
Part of this impressive performance has been due to an increased number of visitors from central and eastern Europe and there is no doubt this region will be an increasingly important tourism market for Ireland. However, the bulk of our growth from mainland Europe in 2006 still came from our traditional markets.
Outside of mainland Europe, all of our major tourism markets have shown healthy increases in the first 11 months of 2006, with visitors from Great Britain up by 6.2%, visitors from north America up by 10.5% and visitors from other long-haul routes up by 7.8%.
Looking ahead to 2007, a growth target of 5.6% in overseas visitor numbers has been set. This represents a higher rate of growth than that predicted for international tourism this year. The target is particularly ambitious when viewed against the background of changing consumer preferences, tougher international competition and pressures on Ireland's relative competitive positioning. In particular, the continuation of the later booking pattern, changing consumer demands and the increased demand for authentic holiday experiences will pose challenges for the industry here.
This year, I was pleased to again secure record levels of Exchequer investment for tourism services, a total of €154 million. This will enable both Tourism Ireland and Fáilte Ireland to implement a comprehensive set of programmes to help ensure targets are met. In particular, the increased marketing fund of €45 million, an increase of 12.5% on last year's provision, will enable both agencies to significantly step up their marketing activities.
The indicators for 2007 are positive but it would be a mistake to be complacent. If we have learned anything from the past five years, it is to expect the unexpected. We do not know what we could face in terms of international developments and the Irish tourism industry and tourism agencies have weathered many storms over the past five years. We have learned to be flexible, to adapt and to take nothing for granted in the process.
It is a tough world in the international tourism marketplace and nowadays we have to run pretty hard just to stand still. In that context, it is gratifying we are doing so well. Our marketing investment has certainly been paying off but Tourism Ireland is indicating that we cannot live by marketing alone. Put simply, the product experience must deliver on the promise.
Competitiveness is still an issue and will continue to be, as it will for most high-cost destinations. The higher the cost of the product, the more emphasis we must place on quality and value for money. Visitors should be satisfied they are getting value for their money. Research shows that, in general, it is the basic cost-of-living items that impact most on visitors' awareness in terms of value for money, and not the basic tourism and travel components, such as the cost of transport and accommodation.
The friendliness of the Irish people and the welcome for the visitor is legendary and has been a pillar of Irish tourism for a long time. However, the pace of life and composition of our workforce is changing. Visitors to many of our hotels and restaurants, especially in the cities, meet fewer Irish staff. If visitors look forward to meeting Irish people and they do not have that experience, they may feel somewhat disappointed.
Our immigrant workforce in the hospitality industry provides a great level of service and has injected a new cosmopolitan dynamic into Irish tourism but there is that intangible Irish "thing" — wit, craic or the potential to be surprised by humorous insights or exchanges — that legend almost demands be part of the Irish experience and which is hard to manufacture. We are currently in a transition period and we have to manage that. Nevertheless it is important to point out that our traditional tourism pillars of people and place are still holding up as major sources of satisfaction in our visitor surveys.
Given the challenges, it is all the more important that we focus strongly on improving the quality of our service and product, as well as other issues that impact on the tourism experience. My Department and the tourism industry will continue to focus on implementation of the New Horizons tourism strategy and its associated action plan to ensure the current good level of progress is maintained.
Although our tourism figures have continued to rise, the length of stay has tended to decrease. This shows that notwithstanding people's pressurised lives, they find Ireland too costly and are staying here for a shorter period.
It is interesting to note that since 1999 we had a surplus of €650 million in terms of earnings from all visitors to Ireland versus expenditure by Irish visitors abroad. Now we have a deficit of almost the same amount. While the tourism sector is doing well, in relative terms it is not doing that well as the Exchequer is suffering with regard to overall spending on tourism, taking into account Irish spending abroad versus the spending of visitors here.
Are there any further plans to market to our native population, given the amount of time a traveller will be stuck in airports with security checks? What quality products can be offered? If one goes to Northern Ireland local people can be seen working in the industry. Will the Minister procure marketing or financial incentives to ensure local people here can be part of the product?
It is estimated that over the next six years, approximately 6,000 additional people will be required for the tourism industry here. The industry already accounts for more than 3% of GNP and has attracted approximately 246,000 to its workforce.
It is clearly important we ensure people are incentivised. In that respect I was pleased to announce this morning that we will make €148 million available to ensure the human resource element of the tourism industry is looked after, people are trained for the industry and businesses are in a position to adapt to changing circumstances.
With regard to domestic tourism and Irish people holidaying abroad, it is true that in any buoyant economy people will tend to go abroad on holidays. It is also true of a buoyant economy that people tend to take breaks at home, which is the reason we have seen a major increase in the number of Irish people holidaying at home. The industry earned approximately €4.3 billion from foreign sources last year, but it is sometimes forgotten that the income from domestic sources was €1.6 billion, giving a total of €5.9 billion.
In addition, statistics show that visitor numbers to this country to the end of November last year increased by 10.3%, but revenue for the first three quarters increased by 11%. There is now a definite correlation between the increase in the number of visitors and increase in revenue.
The Minister might answer the questions asked during the priority question that he refused to answer. He is very much into statistics and I am sure he will have those I am after. Will he outline specifically the percentage distribution of international tourism revenue between the eastern seaboard and the rest of the country for 2005 and 2006, as well as comparable figures for 2000?
As the Minister has mentioned, a number of foreign nationals now work in our hotel and catering industries, which we all welcome. What specific steps is the Government taking to ensure they are equipped with information, that they can give directions and that they understand the ethos of Irish tourism?
When will the building of the National Conference Centre commence? The turning of the sod will no doubt be a big event.
If Deputy Deenihan wished us to give the specifics, if available, on the breakdown of the amount spent on the east coast and west coast by visitors to the country, he should have put down a question to that effect.
What I can say to Deputy Deenihan is there is evidence of a substantial increase last year in the number of visitors coming to the regions. Of that, there is no question. There is a correlation between the increase in the number of visitors and the revenue. I have explained all of that already.
With regard to the national conference centre, about which Deputy Deenihan asked, I anticipate we should be in a position to close the deal on it in the very near future. Some loose ends require to be tied up and then I sincerely hope we will be in a position to proceed with it. A national conference centre is of immense importance because of the fact that we anticipate it will be worth in the order of €50 million in additional tourism revenue to Dublin and will attract anything up to 30,000 additional visitors to the city.
On the statistical questions which Deputy Deenihan asked, I will try to get the figures he requested. I cannot guarantee they are available but we will try to come as close as we can to getting them.
What prompted this question was a statement by the chief executive of Tourism Ireland, Mr. Paul O'Toole, to the effect that a number of factors could impinge on the ambitious growth rates for the future. He went on to talk about currency fluctuations, global socio-economic uncertainty and a number of other factors. He also referred to the decline in the value for money rating and the perception of tourists that the warmth of the Irish welcome was beginning to disappear. I accept I have not had an opportunity to see the statement released this morning about what is being done in that regard. What is being done to change that perception given the context of such an important person in the industry stating his concern about the value for money rating?
Given all the recent price increases for gas, electricity etc., the tourism industry will have to pass on some of them. What can we do to overcome the two factors referred to by the CEO? The Minister may reply that some discussion on this matter took place this morning but I am unaware of what was said because I was in Kildare at a function attended by the Taoiseach. I have not seen any press release on this matter.
It is understandable the chief executive of Tourism Ireland would make his concerns known on two very important issues. As Deputy Wall stated, one of these relates to competitiveness and value for money. The other matter relates to the warmth of the Irish welcome. Both factors are of pivotal importance in terms of advancing the cause of the tourism industry.
Ours is a free market economy. We have advised the industry on numerous occasions about the need to remain competitive and to offer value for money. To be fair, there has been a response. For example, the Restaurants Association Of Ireland introduced a value menu and, in general, several outlets offer reasonable bargains to potential visitors to their establishments. We have seen an improvement in the perception of foreign visitors where value for money issues and competitiveness are concerned. There is no question but satisfaction with all-round value for money has improved since 2004. However, I accept it remains below the levels recorded in the early years of the decade and it continues to be the most critically greeted aspect of the Irish holiday experience.
Overall, 14% of holidaymakers in 2006 were dissatisfied with the statement that Ireland offered good all-round value for money, but a much higher percentage, just over two in five people, or 41%, were satisfied with this aspect of their holiday. It appears the message is getting through. The comparatively negative view of good all-round value for money is reflected in how holidaymakers perceive the cost of living in Ireland. Almost half described it as higher than they had expected. The costs that caused most surprise related to eating out and alcohol, although there is also evidence of resistance to other costs such as food in shops and supermarkets, accommodation and car hire.
With regard to the Irish welcome, we announced a substantial fund this morning for human resources training under the new national development plan under the Fáilte Ireland tourism strategy. I anticipate this should result in far greater professionalism among new people in the industry.