Thursday, 21 January 2016
National Tourism Development Authority (Amendment) Bill 2015: Second Stage
I move: "That the Bill be now read a Second Time."
The National Tourism Development Authority (Amendment) Bill 2015 provides for an increase in the level of capital funding which can be voted to the National Tourism Development Authority - Fáilte Ireland - for the purpose of supporting tourism product development.
Before moving to the detail of the Bill, I want to outline to the House the importance of the tourism sector, its significant contribution to Ireland's overall economic performance and the progress that has been made over the past few years.
When the Government came into office in 2011, it identified tourism and hospitality as a key sector in Ireland’s overall economic recovery. To support the sector, the Government committed itself to taking various actions to rebuild competitiveness, grow business and increase employment. The first of these measures to reduce value added tax, VAT, on tourism services from 13.5% to 9% was taken in 2011 and has greatly enhanced the competitiveness of the industry. This measure was complemented by a radical change in our approach to visitors from developing markets through the visa waiver programme. The programme has made travelling to Ireland and Britain easier and more convenient for visitors from these developing long haul markets, such as India and China, which are important markets for the future.
In 2013, we had The Gathering which, as Deputies know, was a highly successful initiative because it was backed not only by the Government but by communities in every county. It brought hundreds of thousands of extra visitors to events across the country, as well as a substantial increase in visitor spending.
In the 2013 budget, the Government extended the employment and investment incentive scheme to include tourism accommodation. The scheme allows investors to claim income tax relief on qualifying investments. It was extended for a further three years in budget 2015.
The zero rating of the air travel tax, announced in budget 2014, has also had a very welcome impact on increasing air access to Ireland. It led to the provision of additional capacity on many existing routes, as well as the introduction of more than 20 new services.
In tandem with the hard work of the industry and the tourism agencies, these initiatives have helped to support very welcome improvements in the numbers of overseas visitors and revenue. From a position in 2010 where the number of overseas visitors had fallen to a low of 6.1 million, we have seen their numbers increase every year since 2011. In 2014, we attracted 7.6 million overseas visitors to Ireland and these visitors contributed an estimated €3.5 billion to the economy. I am pleased to report that the picture for 2015 was, again, very positive. The most recent Central Statistics Office, CSO, figures for overseas travel show that there were more than 8 million visits, an increase of 14% for the first 11 months of the year when compared to the same period in 2014. Even without the final month’s figures, we know that 2015 was a record year for overseas visitors, with an expected figure of 8.2 million visits, surpassing the previous record year of 2007.
Spending in Ireland by overseas visitors has also increased strongly. It was worth €3.58 billion in 2014 to the economy, an increase of 22% on the 2010 figure of €2.9 billion. When combined with domestic tourism, the industry is worth approximately €5 billion a year. The figures for 2015 look very promising, with revenue for just the first nine months standing at more than €3.3 billion. I am confident that when the final figures are available, it will be another high point for Irish tourism.
The increased activity in the past four years has also meant that tourism has been a major contributor to job creation. The most recently published figures by the CSO show that employment in accommodation and food services in the third quarter of the year had increased by 18,800, or 16%, to 139,900 since 2011. In total, taking into account other areas of tourism and hospitality, Fáilte Ireland estimates 205,000 people work in the tourism and hospitality sector. These jobs are spread across the country, often in places where other opportunities are limited. These jobs are also available to people with a range of skills.
The great progress made in the past five years does not mean, however, that the Government can divert its attention away from the sector. We cannot become complacent or rest on our laurels. Continued growth is not guaranteed. To fully develop the potential of the sector in a sustainable way, we need to constantly review our policy and the investment required. With this in mind, I will turn to the new tourism policy which the Government has developed to ensure tourism will remain a central part of Ireland’s economic growth.
Last March, the Taoiseach launched the Government’s new tourism policy statement entitled, People, Place and Policy, Growing Tourism to 2025. It provides a framework for the tourism industry to thrive in a changing global tourism marketplace. The three headline targets of the new statement are: spending by overseas tourists in Ireland to rise to €5 billion per year by 2025, net of inflation; that there will be 250,000 people employed in the tourism industry by 2025; and that we attract 10 million overseas visitors to Ireland by 2025. To achieve these targets, we have looked at Irish tourism and asked how we can make the most of its two key strengths: its friendly and welcoming people and the quality of things to see and do. The new policy is focused on building on these twin strengths of people and place.
In this regard, the Bill is essential to delivering that policy because it will allow continued capital investment to develop and improve the attractiveness of Ireland as a place to come and in which to holiday. Fundamentally, it is the quality of the destination that is the primary factor which inspires potential visitors to come to Ireland or holiday at home. More specifically, virtually no one goes on holiday because of the quality of the hotel bed in which he or she sleeps. Important as that is, the real driver of holiday visitors is the number of places to see and things to do. Our challenge is to maintain and enhance the quality of our range of attractions and activities. Our core tourism offering must continue to improve and change to stay relevant to what potential visitors are looking for.
Tourism capital investment has been and will continue to be central to keeping Ireland as a great place to visit. Capital investment in tourism can improve the visitor experience and support economic development. When this will not happen on a commercial basis, the Government needs to step in to support it. As set out in the tourism policy statement, our focus in developing Irish tourism in the coming years will be on the most promising potential visitors in each of our priority markets. The new experience brands of the Wild Atlantic Way, Ireland’s Ancient East and Dublin - A Breath of Fresh Air have been designed with these potential visitors in mind. Accordingly, as set out in the new policy, future capital investment will support the development of these experience brands.
The success of the Wild Atlantic Way shows the potential of this approach. It has already exceeded our expectations in how quickly it has caught the imagination of tourists, as well as communities along the route. We are continuing to invest in the route and the things to do along it and its profile gets stronger every year. The lessons learned during its development have guided the development of Ireland’s Ancient East, the aim of which is to build on the rich history of the south, east and midlands in places such as Clonmacnoise, Newgrange, mediaeval Kilkenny and Waterford. The vision is that it will give visitors the opportunity to experience 5,000 years of European history in a small, compact area. It is early days but it has the potential to attract a significant number of visitors to these areas and generate revenue and jobs in many rural communities. As with the Wild Atlantic Way, businesses and communities in Ireland’s Ancient East need to become fully involved to make the most of the initiative. If they do, I have no doubt that it will be a big success.
Dublin also is the subject of a major brand experience project. We all know that last year was a really good one for tourism in Dublin, with the city thronged with tourists and hotels full throughout the summer. However, we need to look to Dublin’s long-term appeal and guarantee that, whatever happens in external markets or however currencies fluctuate, it will continue to attract visitors and compete with other city destinations overseas. The new brand for it will show off its unique position as a vibrant capital city that is also incredibly close to mountains and sea, an experience not found in most other cities. Capital investment will support this brand development.
Future capital investment focused on these key areas will play a vital role in developing Ireland as a destination, as it has done in the past.
Since Fáilte Ireland was established, almost €140 million has been invested in projects such as walking and cycling routes, tourist visitor attractions and facilities for visitor activities. Among the notable projects that have been allocated grant aid are: the Dublin heritage trail; Waterford Viking triangle; Sliabh Liag cliffs in Donegal; Athlone Castle; Mizen Head Bridge in west Cork; the great western greenway; King John’s Castle in Limerick; Castletown House in County Kildare; the historic towns initiative; the development of the Wild Atlantic Way and Ireland’s Ancient East; Killarney House; the medieval mile in Kilkenny; and Spike Island.
Spread across the country, these investments have enhanced their local areas and regions and strengthened their tourism sectors. It is essential to provide for capital investment in such projects into the future and this gives rise to the need for the Bill before the House today.
I will now deal with the purpose of the Bill in detail. The National Tourism Development Authority Act was passed in 2003 to dissolve Bord Fáilte Éireann and CERT Limited and establish the National Tourism Development Authority, Fáilte Ireland. Section 24(1) of that Act gives the Minister for Transport, Tourism and Sport, with the consent of the Minister for Finance, the power to advance, out of money provided by the Oireachtas, such sums as the Minister may determine. Section 24(2) limits the total amount of money over a series of years that can be advanced by the Minister to Fáilte Ireland as capital expenditure on projects or enterprises. However, annual funding allocations are made in the normal way through the Estimates and budgetary process. This limit on total capital funding was originally set at €65 million but was later increased to €150 million under the National Tourism Development Authority (Amendment) Act 2011.
Taking into account the 2016 capital allocation to Fáilte Ireland, investment in tourism capital is now approaching that limit. Once the spending limit has been reached, no further voted capital moneys may be advanced to Fáilte Ireland for tourism capital investment projects. Accordingly, it is prudent to legislate now for an increase in this limit. Taking into account the allocations under the Government’s capital plan - Building on Recovery Infrastructure and Capital Investment - the Bill proposes raising the limit to €300 million to cover anticipated annual allocations over the life of the plan. The Bill also clarifies that it is now with the consent of the Minister for Public Expenditure and Reform, rather than the Minister for Finance, that the Minister may advance moneys to Fáilte Ireland. I am introducing this Bill to make these necessary legislative changes and I commend it to the House.
I thank the Minister of State for bringing the Bill before the House. Fianna Fáil will be supporting the Bill, which is technical in nature. Its purpose is to enable the Department of Transport, Tourism and Sport to advance a higher aggregate budget allocation to the National Tourism Development Authority, Fáilte Ireland, for the purpose of supporting enterprises and projects relating to the development of tourist traffic and also tourist facilities and services from €150 million to €300 million. I have sought this in the past and it makes eminent sense. We support the increase in the advance budget cap for the authority and will support the passage of this Bill.
Ireland's tourism industry has seen its visitor numbers grow consistently in recent years. Overseas visitors spent an estimated €1.535 billion in the State in the first half of 2014. Revenue from overseas visitors grew by nearly 9% between January and June of this year, which is an additional €123 million compared with the same six-month period in 2013.
We are always concerned about visitors' length of stay. I understand visitors have been staying longer in recent times. The number of nights spent in Ireland by overseas travellers increased by 13.4% in the second quarter of last year compared with that period in 2013. Much of this is testament to the fact that throughout Europe, people are moving out of a recessionary environment and the concept of controlling their spending to a great degree. We are well poised to benefit from that. During harsher times and times of austerity, even people who have money are much more controlled in how they spend and they limit their holidays to an absolute minimum. That has reduced the number of nights people stay.
Fianna Fáil in government launched A Strategy and Action Plan for Irish Trade, Tourism and Investment to 2015, many of the proposals of which have resulted in the upswing in tourist numbers in recent years. We are pleased that the Minister of State, Deputy Ring, has worked on that strategy document and added to it as he saw appropriate. We have largely taken a bipartisan approach to this aspect of our economic development.
In order to remain competitive in the global tourism market, Ireland must ensure that the quality of our services remain high, that prices remain reasonable and that access to our ports and airports increases. The savings created by the retention of the 9% VAT rate for the tourism sector must be passed on to the consumer. Obviously, with an upswing in certain sectors of the economy, the people in that sector must be mindful of the burden placed on a particular sector to provide that 9% VAT rate.
At the time of its introduction, I disagreed with it being taken from the pots of private pension holders, putting many of those pension funds in a perilous state. Many people are only now realising that measure will reduce their pension delivery in perpetuity. Even though the money was only taken for a three-year period, it was taken from the capital base of those pension funds and will impact on the pay out from those funds for the lifetime of those receiving them. It is vital that the industry is cognisant of the burden placed on those people and that it continues to pass on the savings from that reduced rate.
While the tourism experience offered in Ireland is unrivalled, we cannot rest on our laurels. Since The Gathering, the Government has neglected tourism product development and domestic and overseas marketing. I do not say that ignoring the context in which the Government had to manage its budget. As the economy is starting to recover, the focus must be on the development of the product. As sure as night follows day, tourists will not come back for the same experience, save in very rare circumstances. They want to see enhancements, new developments and new opportunities. Even those who have the greatest connection to this country expect to see the experience enhanced and evolve with modern thinking and generational expectations.
This is reflected in a 17.5% reduction in funding since 2012. While recent trends in tourism are encouraging, there is a risk that a proportion of the increases in visitor numbers is due to the euro devaluation against the dollar and sterling. While we can all complement ourselves - I can do so in respect of the previous strategy that was developed and the Minister of State, his party and the Government can take credit for their input into that strategy - collectively, we must all be mindful of external factors such as the cost of oil, which provides cheaper access to the country by air and sea. Reduction in fuel prices at the pump encourages and increases domestic activity. From a broader perspective the differential between euro and sterling and the dollar certainly makes Ireland attractive as a destination in addition to what we have to offer. We must be cognisant of that in coming years.
We cannot afford to neglect the overall quality of the tourism offering in the country. The Government has a key role in supporting tourism product development, regional balance and domestic and overseas marketing. I am minded of a product development fund of approximately €50 million that existed in the past. Even though it was done under the Administration I was part of, at the time I felt the money was spread too thinly - trying to have something for everybody, which is a frequent tendency for any Government.
In the future, we need to look to the big bang approach. We need to be very careful in the spending of such money. It should not be seen like the sports capital programme, which is important in terms of putting money into every community. I might have differed with the Minister of State on the exact way some of the moneys were spent.
It was based on per head of population and the Department used a pro rataalgorithm to disperse funding. We cannot take the same approach to a product development fund from a tourism perspective. We have to look at the country as a whole and the major attractions that would increase the tourism influx to a greater extent if we had these signature offerings. If the Minister of State occupies the same portfolio after the general election, I hope he will give cognisance to major signature attractions that would benefit the entire country. Then with the smaller tourism opportunities we can target people when they are here. Nationally, we have to portray ourselves to an international market that is looking at the major attractions. Further innovative projects such as the Wild Atlantic Way are required, with the goal of increasing tourism numbers overall and, more especially, promoting a more even distribution of tourists across regions. Undertaking targeted initiatives to promote a more balanced regional distribution of visitors is a key plank of Fianna Fáil’s tourism policy.
The figures for overseas tourists are strong, with an 11% increase in 2015 compared to 2014. Those of us involved in politics should not be taking all of the credit. We must recognise the staff of Fáilte Ireland and the fantastic work they do. It is comparable to the work done by IDA Ireland in attracting foreign direct investment. Fáilte Ireland does an excellent job in marketing and targeting particular sectors overseas. At over 8 million, the number of overall trips to Ireland was up 14% in the first 11 months of 2015 compared to the same period in 2014. The number of visits from mainland Europe grew by 15.9% in the period January to November 2015 to 2,850,000. North America registered an increase of 14.2% in the same period, with almost 1.5 million visits. The number of visits from Great Britain was up by 12.5% to over 3,250,000. We had a difficulty for several years in working the UK market. Some of this was due to the fact that parts of the United Kingdom were suffering the same economic circumstances as we were. The differences between the sterling and euro exchange rates have been helpful in rectifying this. However, we need to build on it. The number of visits from the rest of the world, mostly from long-haul and developing markets, totalled just short of 500,000 for the first 11 months of 2015, which represented an increase of 13%. There is a considerable amount of latent capacity in the Middle East and Asian markets. It is an area we have failed to capture and not mastered, as well as our neighbours in the United Kingdom. There are issues around visas and access, but we should not exclude it from our sights. I know that it is a costly market to target, but our ex-pat community could be energised more in spreading the word and encouraging activity from these regions.
The figures should primarily be seen as a vote of confidence in the quality, attractiveness and novelty on offer from the Irish tourism, hospitality and food sectors. Without doubt, the 9% VAT rate has helped to keep costs more manageable in the sector in the past few years. However, I have heard many outlandish claims by Fine Gael and Labour Party Deputies that the special 9% VAT rate is the sole reason for the surge in the tourism industry this year. It is a contributory factor for sure, but it is not the sole reason.
While the 2015 numbers are remarkable, without a well placed strategic vision for tourism development and promotion, there are significant risks to future growth in the sector. It is a constantly evolving market and we need a Government that understands the role of tourism policy. Rather than smugly trumpeting short-term gains in tourism figures, the Government needs to put in place a strategy for developing new products and capturing new markets. Current tourism policy strategy is not well placed to develop new tourism products and respond to changing tourism patterns. After all, there are significant risks to achieving the 2025 target of attracting 10 million overseas visitors. Fáilte Ireland’s chief executive, Mr. Michael Cawley, recently highlighted the risks when warning of a possible downturn in tourism figures due to capacity issues, potential price gouging and a lack of regional balance. Record numbers of visitors in 2015 were due to a low VAT rate and the strength of the dollar and the pound. According to the Mr. Cawley, the 11% growth in visitor numbers last year was "fuelled largely by factors external to the tourism industry," including the weak euro, in particular. This, he said, "masked an underlying cost creep" in the tourism sector, something we need to address. His background is well recognised and his capacity for cost containment in growing markets, particularly given his experience in the aviation sector, is legendary. When someone like him expresses these concerns, it is not done on the basis of something he has read but is innate to his DNA.
We need a more ambitious tourism policy. The recently announced national tourism policy, People, Place and Policy: Growing Tourism to 2025, is lacking in ambition. The Government aims to increase the number of overseas visitors to 10 million per annum by 2025. However, it should be more ambitious, given the wider outlook for tourism in Europe. With additional resources, we believe Tourism Ireland and Fáilte Ireland could be well placed to meet these targets by 2020. The long-term sustainable growth of Irish tourism is being put at risk by a lack of adequate funding for tourism marketing and development. I hope increasing the borrowing limits may provide the agencies with greater capacity in this regard. Since 2012 annual Government funding for Fáilte Ireland and Tourism Ireland has been cut by 17%, or €25 million, to €119 million, resulting in significantly constrained budgets for tourism marketing and development. With the economic upturn, more revenue is available and it is important that we fight for a fair share of the funding at the Cabinet to develop this important sector of the economy. This has come at a time when tourism has shown itself to be an excellent investment, contributing over €6.45 billion to the economy annually and employing 205,000 people. Every euro spent on tourism marketing and development by the State supports €54 in tourism revenue in the economy, an excellent return on investment by any standard.
Tourism is a changing market and we need to develop new products to reflect this. The current tourism policy strategy is not as well placed to develop new tourism products and respond to changing tourism patterns. We especially need to spend on research and marketing budgets to tap into new markets. The Asia-Pacific region will be one of the fastest growing outbound tourism markets in the next 15 years, expanding by 6.5% a year. Visitors from this region are particularly attractive for Ireland. On average, they stay twice as long, spend and travel more within the country than visitors from nearer markets. However, we do not know nearly enough about tourism patterns to tap into new markets to take advantage of emerging trends. As Mr. Michael Vaughan, former president of the Irish Hotels Federation and a fellow Clare man, said:
We know more about the travel patterns of the 6.8 million cows on the island than we do about the 6.5 million visitors to our shores each year. It is shocking how little we know about tourism.
He is right about that. This is expensive. The infrastructure and architecture that was put in place to track our livestock was built up over years with a good deal of investment. We need considerable investment not only in our analytics but in our data capture and in our approach to capturing that information. It would be money well spent and provide a valuable resource to the marketing gurus within the various State agencies and those in the private sector who act also as ambassadors for this State.
While Fáilte Ireland has set aside €5 million specifically to promote conference tourism, it is unfortunate that we have a major catch up to play in this area with the loss of the Web Summit next year. I am on record on this and the Minister of State and I have largely agreed on the impact its loss will have on our reputation internationally and it is difficult to know what impact its ultimate loss will have on tourism to the capital and the rest of the country next year. However, it is unlikely that Fáilte Ireland even with this new budget will be able to make up for the loss of such a prestigious, high profile event as the Web Summit. It has put Ireland centre stage for the past four years, bringing the chief executive officers of large multinationals as well as the small start-ups from the world's most innovative technology companies and has shown them the best that Ireland has to offer. It also represents a huge loss from the tourism point of view with an immediate loss of €100 million to the economy next year. It is unfortunate that more was not done to keep the Web Summit in its home and that the Government, and more specifically the Taoiseach, could not step up to the mark and secure its future for Ireland.
I do not want to get into the politics of it and we have talked about it in the past. It is a significant loss from a reputational point of view and it shows to some extent a lack of flexibility, notwithstanding perhaps the difficult demands that were made at the time. As the Minister of State will be aware, requests were made several times to have four specific issues addressed to secure the long-term future of the summit in Dublin. These included traffic management, public transport, hotels and Wi-Fi, all which were raised constantly during the last four years with the Government. None of these requests should have proved insurmountable. The Government has failed Ireland with the loss of this highly reputable global event. It has failed to secure future business in Dublin worth over €100 million annually. Ireland's loss is certainly Lisbon's gain. In the medium term I am sure the bed nights will be filled some other way. The prestige attached to the Web Summit had benefits that far outstripped the bed nights or the restaurant covers that are lost.
Another pressing challenge facing the industry is the need to attract more visitors to the regions. Unfortunately, recent growth in overseas visitors has not been spread evenly across the country and many rural tourism businesses continue to face tough trading conditions. Tourism is one of the world's fastest growing industries, and its potential for the Irish economy is very significant. As a labour-intensive sector, it has a strong role to play in employment creation across a range of skill levels in every part of the country. This is a major challenge given the vital social and economic role that tourism employment plays particularly in rural areas outside the main urban centres.
Developing further regional initiatives such as the Wild Atlantic Way in an effort to spread the increasing tourist numbers across the country are a key priority in the area of tourism for our party. A regional balance in tourism visitors makes sense from the point of view of promoting sustainable tourism as well as increasing the benefit to under-developed local economies from the sector. Initiatives designed to distribute tourism across regions will also ease congestion in particularly popular areas at peak season.
The development of our canals, walkways and forests as further tourist attractions should be a priority in this regard. The success of the greenway in the Minister of State's county of Mayo is a good example of innovative thinking resulting in increased tourist numbers in the regions. A significant amount of work has been done in developing a lighthouse on Loop Head in County Clare and it has created a nice attraction and has attracted quite a few visitors. Clare County Council also recently purchased an island, Inis Cealtra, on which there was once an ancient monastic settlement. The island is located on Lough Derg and the intention is to develop it as a tourism attraction. That will require money from the State. If I am fortunate enough to be re-elected to the next Parliament, I will push whoever is in government to secure appropriate funding to develop that attraction and the ancillary services that will be required. As it is an island, significant investment will be needed on the shoreside to put in place an interpretative centre for the island and to provide visitor access to it. Many of these types of initiatives grow from local interests, from small local groups getting together to identify potential. That needs to be very much part of the thinking around product development.
Internationally, the Ireland brand does not distinguish between North and South so our tourism strategy should also look to greater co-operation on tourism on both sides of the Border.
Another good example of an initiative to distribute tourism was the Wild Atlantic Way, a tourism trail on the west coast. The 2,500 km driving route passes through nine counties and three provinces, stretching from County Donegal's Inishowen Peninsula to Kinsale, County Cork, on the Celtic Sea coast. Along that route there are places and attractions previously little known to tourists, which have been designated as points of interest for travellers. The creation of the Wild Atlantic Way has increased tourist numbers along the route and has acted as a counterbalance to the pull of Dublin to tourists.
There is a need for the tourism agencies to identify, appraise and pursue new areas of potential in regions with low tourism numbers, which may have a particular competitive advantage, including food tourism, eco-tourism, film and television production, cruise tourism, the wider Irish diaspora, music, literature and the arts and the niche markets, for example, retired travellers, activity tourism and the health and wellness sector.
One of the Government's signature achievements in tourism marketing, The Gathering, was thought-out and developed in 2009. The Government has worked well with that strategy. If our party is successful in the election, I am sure we will continue to embrace and build on any of the work the Government has done with that strategy that was developed. That is in keeping with that bipartisan approach to tourism development in this State.
Similarly the comprehensive interdepartmental policy, A Strategy and Action Plan for Irish Trade, Tourism and Investment to 2015, was a blueprint of my party when it was in government and was published in September 2010. Many of the recommendations contained in this strategy were implemented by the Minister of State and I compliment him on that. Those include the excise tax reductions on short-haul flights to encourage visitors from price sensitive, established markets, particularly the United Kingdom, Germany, France, Italy and Spain; increasing return on investment in attractions by enhanced packaging, joint marketing and by making access easier through times, passes, tickets, transport, signage and websites; enhanced opportunities to market and compete for business tourism, including packages specifically promoted such as meetings, incentive travel, conferences and events, and trips that result from more generic promotion where the trip includes both leisure time and business time, an example being the development of the Conference Centre; and the promotion of cruise tourism which included gateways as well as some of the rural harbours and ports and some expansion of that especially in Dublin.
As a country, we have many challenges in continuing to make our cities, towns, villages and countryside some of the most attractive places in the world to visit. For the most part, it is the people who are working in the tourism and hospitality sector, as well as the people of Ireland, who will do the most work to meet this challenge. However, the Department, the tourism agencies and local authorities have a key role in devising tourism promotion strategies and policies. For all these bodies, we cannot get carried away with the success we have had in attracting tourists during the past number of years and we must not rest on our laurels.
I welcome the opportunity to speak on this Bill. Tourism is ferociously important right around the country. In fairness, in recent years many proactive initiatives have been taken. Many times we come into the House and attack Ministers for things that are not done but, in fairness, the Minister of State, Deputy Ring, has been proactive. I refer in particular to the VAT rate which has been of considerable importance to struggling hoteliers around the country.
I am sure the Minister of State shares my concern about bed spaces in Dublin. The prices are rising. Increased numbers of tourists are coming to Dublin but there are other places around the country that might not have benefited to the same extent. It is necessary to strike the balance and to remain competitive. We cannot return to the previous high price of hotel beds. We must be competitive in order to encourage people to keep coming to the country rather than going elsewhere. We must be aware of the balance required once the price of beds begins to get out of control. We must also ensure that we focus on the areas that have not benefited as much.
That is a challenge that faces the country.
As a nation we must ensure that if one sector begins to improve, we do not lose the run of ourselves and damage the sector. There have been tourism benefits due to the strength of sterling and the dollar. We must ensure we take an aggressive approach in order to capitalise on getting more people from England and America to come here. This country is an attractive destination at the moment and we must put our best foot forward and sell the country well.
When a film was being made on one of the islands many do-gooders were trying to stop people from going there. We must ensure that we encourage the film sector and other initiatives which will benefit the country's tourism in any way. That is of the utmost importance. Many people visit Scotland and there may be things we can learn from the Scots.
The Wild Atlantic Way has been a great success. It is a trophy project that can be shown to all. In that context we must ensure that the likes of Knock Airport becomes a hub for people, which will boost the area as well. The River Shannon has considerable potential. In the context of the recent flooding I suggested constructing a canal from the Atlantic Ocean in order that cruisers and other boats could move along the Shannon and along the canal to Dublin. That could be a new tourism initiative and is worth thinking about. Initiatives are required on the rivers Shannon and Suck, as County Roscommon needs a boost.
I agree that bed space has been a major problem in many counties. During the recession hotels got in trouble and were closed or taken over by the banks. In fairness, many of those premises are starting to open again and we must ensure we have incentives in place. In fairness to Roscommon County Council, it is helping people to get up and running step by step.
I would like to see a renewed focus on counties that do not get as many tourists. Every county has something unique about it. We must put our heads together to see how we can ensure tourists who are in Dublin for a day will go to Mayo, Kerry or Roscommon for another day. We must get the most out of people while they are here. I am involved in a hotel project in Roscommon which with a bit of luck will be open in the next couple of months. It is like building a house in that one must put in foundations before one can bring people there. There are some great people involved in the hotel industry. For example, Gleesons in Roscommon has constantly gone abroad to promote the area. Fáilte Ireland must liaise more with such people.
We must ensure we have the infrastructure in place. For example, it would be of great benefit if we had rail links to ensure connectivity. In the west there has been a missed opportunity in the context of trans-European transport networks, TEN-T funding, as we might have been able to extract some money from Europe to put infrastructure in place.
The web summit will be a loss to this country but that will not be felt this year or next year because bed spaces are full. I do not wish to get into the blame game of who lost or won it but we must ensure we learn from where we went wrong in that regard and see whether we can rectify the situation. Sometimes one must swallow one’s pride and go to a person and get him or her on board again. There will always be toing and froing and arguments but ultimately, it is about getting people into the country.
In the west, Roscommon, for example, has potential because of the rivers Shannon and the Suck. Fáilte Ireland must try to work with people. One issue on which I was vocal as I found it very hard to accept is the approach taken by the Department of the Environment, Community and Local Government to planning. It made life difficult for businesses that wished to put up signs. The Department took a hard line with people who put up roadside signs advertising that they were open for business for meals or other services. We must ensure that we are not foolish in that respect. It does not make sense to tell a person to take down a sign when it is for their business and they are generating money. We must ensure that things are done properly but we should not obstruct people at a time when they are trying to get off the ground with their business. People need to advertise their businesses in all parts of the country, especially in those areas where fewer people travel.
Infrastructure is of the utmost importance around the country. The tourism sector is going in the right direction. Tourist numbers are on the increase, which is good. It is a success story and I will not give out about it. However, if one is going well, one must ensure that one has a plan to go even better. Fáilte Ireland and the Minister of State, Deputy Ring, if he is in the job after the election, or whoever else is in the job, must keep up the pressure. We are starting to develop something that can be even greater if we keep exploring new approaches.
I welcome the opportunity to speak on the Bill. The investment of an additional €150 million in the tourism sector is a very good story. However, I must ask who knows about it. We are inside in our little bubble but there is very little traction for this in the real world. I have my own view on how Fáilte Ireland does its job and it is not always positive. I have some experience of it over the years dating back to a time before I was a public representative when I was the head of the tourism body in Clonakilty district Chamber of Tourism. The experience of Fáilte Ireland is that it is overly bureaucratic, there is too much paperwork and too much use of language which puts challenges and difficulties in people’s way.
This country’s most unique selling point is our people. Visitors who come here love the scenery but what most of them talk about is the friendliness of the people. Tied in with that is our unique community spirit. The allocation of an additional €150 million to Fáilte Ireland is a missed opportunity. I would much prefer to see even a third of it - €50 million – going to communities. The Minister of State, Deputy Ring, oversaw one of the most successful ways of tapping into community spirt and getting a real return for money, namely, sports capital grants. Every community is involved and goodwill is engendered. Many good ideas come together and people work together to generate new sports initiatives. I would like to see a similar approach taken to tourism.
West Cork is the area I represent and it is heavily reliant on tourism revenue. There are many wonderful community groups with good ideas for generating tourism products but their hands are tied because there is no opportunity to get funding. Fáilte Ireland refers to iconic movements but it does not deliver to communities on the ground that want to grow products in order to attract people to their areas. We are all very proud of what we have to offer. We have wonderful scenery in west Cork, amazing heritage, history and geography but we want to sell it. I would love to see these funds being passed down to smaller communities to harness the enterprising spirit not just of people in west Cork but all over the country. However, that will not happen with Fáilte Ireland because in my experience it is too difficult to access funding for community groups.
In fairness to local authorities, they are very proactive but their funding stream is minimal. It is very difficult for people to access funding to develop a capital project to grow a tourism product.
In west Cork we are trying to develop the west Cork walkway which I envisage will one day rival the Camino in Spain. One will be able to get off an aeroplane at Cork Airport and walk all the way to the Mizen Peninsula. We will not build greenways or anything like them; rather we will provide signage and take some very low-key safety and practical measures to allow people to have a real and genuine experience in west Cork. There will be massive demand for such a product. I have been talking to Fáilte Ireland, but it is impossible to get any encouragement from it. It uses a lot of jargon and highfalutin language, but I get no concrete assistance from it. To be fair, I have asked the local authority to head up a local forum to include Cork Airport, the council and a number of other bodies in the area, to try to progress a west Cork walkway as an aspiration. The CEO, Mr. Tim Lucey, and his team have been extremely proactive and helpful in trying to develop the concept. It would be a real product and I use this occasion to commend everything that has been done.
I agree with all previous speakers on the great successes of the tourism industry. I was elected not only to continue in the current vein but also to question what we do, how we do it and whether we could do it better. Capital could be expended better and allocated better to communities. We could better tie in with the community entrepreneurial spirit to grow the product in local areas because there is a wonderful spirit of volunteering throughout Ireland. Unfortunately, as I have no faith that Fáilte Ireland will do this, I would like the Minister of State to examine the proposal and the possibility of introducing something like the sports capital grant in order that every community would be aware of the available moneys and be able to apply for them to develop a tourism product in order that Tourism Ireland could be even more proud to sell the product abroad.
I welcome the Minister of State and acknowledge his enthusiasm. He seems to be present at every event associated with tourism or sport in which he encourages people to become actively involved.
Like Deputy Jim Daly, I will speak more about what Tourism Ireland could do locally rather than nationally. More than 8 million people visited Ireland in 2015, but one must remember that there is an indigenous local tourism industry. Instead of travelling abroad, people stay in Ireland - most families stay local. I will focus on where the sume of €15 million could be spent locally. We have a very good body in Kildare - Kildare Fáilte. It struggles to obtain funding from local authorities and would love to get its hands on some of the additional €150 million being given to Fáilte Ireland. The body which is run by Phil Donnelly of Newbridge Silverware and which also involves Bridget Loughlin in the Kildare heritage office has identified a number of facilities in Kildare where funding could prove useful. There is Ireland's Ancient East and Castletown House which we have identified. There are so many things around Castletown that people could visit, but there is no funding available to Fáilte Ireland for local projects, something at which we could look.
When I look at what Kildare has to offer, two of the main thoroughfares through it are the Royal Canal and the Grand Canal. I welcome the transfer of funding from Galway to Maynooth and Mullingar. The Grand Canal links Dublin almost the whole way to Waterford and one can either walk or cycle it. We need funding to open it up in order that people will be able to use that facility, whether they are local or from outside. Last week I highlighted Arthur's Way which extends from where Arthur Guinness was born in Leixlip to where he is buried in Oughterard, along the Grand Canal. It is a great facility, but we need to extend it further.
Many tourists pass through Kildare on their way from Dublin to places like Westport and do not have an opportunity to stop. We would like them to stop at the facilities we have available. I will list them. As Deputy Jim Daly said, they receive very little support from Fáilte Ireland. There are racetracks such as Punchestown where a well known international meeting is held every year and which brings attracts tourists from all over. It works hard at this, but it needs assistance from Fáilte Ireland. We have bogs such as that at Lullymore which is a tremendous facility. We also have the National Stud and, as I said, the canals. I would like the Minister of State, if possible, to transfer some of the money going to Fáilte Ireland to the NTA in order that it could open up these routes, whether for international or local tourists who use the facilities all the time. It is important that funding drop down to organisations such as Kildare Fáilte which could distribute it to local communities and which is actively encouraging people, locally and internationally, to use the facilities mentioned.
We are privileged to have a Minister of State with such vision and calibre in the Department who can listen to people like Deputies Jim Daly and Anthony Lawlor and me and take on board our views. Deputy Jim Daly is correct and I thoroughly concur with him on the ability of Fáilte Ireland to deliver, in the case of Cork, a strategy and joined-up approach to the promotion of the tourism region in Cork. From my experience, Cork city and county councils have been very proactive and are willing to engage and, to borrow the cliché, walking the talk in terms of investment and plans. The Bill is about advancing moneys to Fáilte Ireland for the tourism sector, but for some time I have been saying both to the Minister of State and in public that we must, in the case of Cork, market it as a single destination and the gateway to all of Munster when it comes to attracting tourists. I accept that we are getting closer and that some work has been done.
Next week the Cork strategic tourism task force will launch at Cork Airport a collective strategy for growing tourism in Cork. Having a collective strategy is key. We must use this opportunity to in the next decade market Cork as one region, including west Cork, the city, Blarney, north Cork and east Cork. The marketing of Cork has not been treated with the urgency it has deserved by Fáilte Ireland. With the new strategy, we must have in place an implementation team to put it into action. In the news this week the DAA, Mr. Kevin Toland and the Minister, Deputy Paschal Donohoe, extolled the virtues of Dublin Airport and the Dublin Airport Authority. In the south we have a duty to represent and advocate for our region. Do the Minister of State, the Department and Fáilte Ireland have responsibility for ensuring the strategy being launched for Cork is a success? Deputy Jim Daly made reference, both directly and indirectly, to the fact that nobody had legal responsibility for growing tourism in Cork. Fáilte Ireland will state it deals with the bigger picture regionally and nationally. The two councils have put strategies in place. In Cork City Council Mr. Damien O'Mahoney and his team have been tremendous advocates and workers and have a great blueprint and vision to promote and develop tourism, but who is responsible? To whom do we go and who we do hold to account on tourism numbers and for the promotion and marketing of Cork? We can have all of the tourism strategies in the world, but if the buck does not stop with someone, the strategy will gather dust on a shelf and not be worth the time and effort given to it.
We now have an opportunity to develop what Deputy Jim Daly wants in west Cork and what I have done in the city. The Deputy has been a tremendous advocate for west Cork and Cork Airport, as I have been in the city. If we can do it on our own and hold meetings with stakeholders and engage to get buy-in, why can Fáilte Ireland not do so? The time has come for the reports that have been compiled, talked about and launched to be put into real, concrete action. This is about a Government which delivered for the tourism sector in its first budget. This month we all received e-mails about the hospitality sector increasing hotel room rates in this city.
After the direct benefits given to the industry, is this what will happen over the next five years? I challenge the hospitality industry to be realistic and not to be part of rip-off Ireland any more.
If managing tourism really is contemplated, explicit responsibility must be assigned in respect of developing and growing the local tourism brand, about which the Minister of State has spoken passionately and which he has implemented in his Department. Aside from the Minister of State, a tsar also is needed to work with Fáilte Ireland and to resource that body and the councils, which are being asked repeatedly for matching funding. There is only so much funding councils can give to promote tourism when there is an umbrella body, namely, Fáilte Ireland. I question the role of Fáilte Ireland in training people to work in the hospitality sector and in promoting the regional and the local. I commend those who work in that agency, many of whom I know well. While they are tremendous people, there appears to be a collective managerial buy-out about developing the local and the regional and this cannot continue.
To revert to Cork city and county councils, I invite Members to consider the marketing focus they have brought to bear with regard to west Cork and Cork city. They should consider the tremendous success of Cork City Council's Glow Christmas celebration this December, which brought people into a hive of activity. Cork held a Christmas market and people wanted to visit and to be there, to sample the atmosphere and to engage in the festivities. While unfortunately the weather was not so good, Members should note what it achieved. Moreover, they should consider what the aforementioned councils do in respect of many other initiatives and festivals in Cork city and county. I will provide the Minister of State with a simple example, namely, a website for Cork. Where do tourists who wish to visit Cork go to see, to explore and to engage online to plan their trip before coming? Fáilte Ireland has set up a group to put together the strategy for developing Cork. While it has great tourism potential, it really is time to see boots on the ground in terms of tourist numbers and it is about time that the opportunities were examined along the lines of the Grow Dublin task force. There have been years of false starts and the Minister of State might forgive some Members for being sceptical but they wish to see such an approach embraced.
I refer to Cork Airport because having a proper tourism strategy also will help efforts to continue to grow passenger numbers at that airport. I commend the airport management, which has been highly proactive and has engaged globally in its attempts to attract new passengers and new airlines, to open new routes and to generate new business. In recent months there has been a significant series of announcements and the airport management has expressed confidence and is hopeful about the growth in passengers in the next couple of years and next year in particular, arising from new destinations and new airlines. The most striking announcement was that of Norwegian Air International's plans to operate a direct Cork to Boston flight from May 2016, as well as a new Cork to New York route in 2017. This is something towards which Cork Airport has been working for many years and when it comes to pass, it will pay a huge dividend in tourism and business for the city and county of Cork and the areas beyond them in Munster. I raised the matter yesterday with An Taoiseach on the Order of Business and was delighted with his response to the effect he has raised the matter at the highest level in the United States. It is a matter for the US Secretary of Transportation. While I have not yet had the opportunity to speak to the Minister of State in this regard, I have spoken to the Minister, Deputy Donohoe, and I believe the Minister, the Minister of State and the Taoiseach should not merely approach the ambassador, H.E. Kevin O'Malley and the US Secretary of Transportation. They also should go to the White House and speak directly there to ensure that Cork Airport gets this transatlantic link. The US-EU Open Skies policy agreement is about facilitating airports such as Cork Airport to have this type of business, which is no threat to Shannon or Dublin airports at all. Other recent announcements in respect of Cork Airport include direct flights by CityJet, which is offering regular flights to London City Airport. Moreover, for the summer of 2016 it will fly to La Rochelle and Nantes in France. Aer Lingus also has increased its capacity in 2016 in respect of Paris, Barcelona, Palma and Faro. It is a positive development that Cork Airport is beginning to achieve passenger growth and this can be augmented and increased by a proper tourism strategy.
I conclude by expressing my complete agreement with the remarks of Deputy Jim Daly - he and I may be singing from the same hymn sheet - by reiterating that furthering tourism in Cork will require Fáilte Ireland to change its cultural and attitudinal behaviour with regard to Cork and the surrounding region. There is buy-in from the councils, the Department and public representatives but what is needed is the prioritisation of Cork as a tourism destination. Cork has the urban streetscape, the shopping and retail and will have a convention centre. It has a tremendous road network and rail line, hospitality, food, scenery and the céad míle fáilte of its people. What is needed is for the authority, that is, Fáilte Ireland, finally to come on board and agree to deliver together with the people in Cork. I am confident that with the leadership of the Minister of State, this will be delivered. This represents a wonderful opportunity for Cork and is a once-in-a-lifetime opportunity for the next 20 years to project and promote Cork in Ireland, across Europe and the world in order that it can be a gateway for Ireland. This opportunity should be used and that strategy should be developed.
That is correct. I am delighted to have the opportunity to speak on the National Tourism Development Authority (Amendment) Bill 2015. It is a short Bill but is quite important because it will double the amount of the State subventions that can be made available for enterprises and projects relating to tourism traffic and tourist facilities nationwide. That is important because although we had a good year in 2015, for which I offer congratulations to the Minister of State and his senior Minister, nevertheless it is a sector that can be highly fragile and that always has received good support from the State. This was demonstrated in 2011 when the Government entered office through the reduction by one third in the VAT rate charged in the hospitality sector from 13.5% to 9%. This was welcome and certainly incentivised and stimulated much tourism and tourist activity and I note we have reached a figure of approximately 8 million visitors per annum. However, I do not believe the hospitality sector has responded in kind. At the time the Government introduced the VAT reduction, Ireland was one of the cheapest hospitality sectors in Europe but is now one of the dearest. In particular, the price of hotel accommodation has shot up and I note figures from Trivago suggest an increase of 28% in a 12 month period in Dublin, making it the ninth most expensive city in Europe. Moreover, when one considers the exorbitant charges that are being put in place by the hotel sector, I am sure this is getting worse by the day.