Mary Hanafin (Dún Laoghaire, Fianna Fail)

I thank Senator Buttimer for raising this issue. The volcanic ash issue is not alone important in terms of its impact on us but in terms of its impact on the Irish economy, jobs and revenue.

The total value placed on the Irish tourism industry is approximately €5 billion, including domestic and international tourists to Ireland. Last year, seven million tourists visited Ireland. While this figure was down on the previous year, it is a significant number of tourists. The tourism industry provides employment throughout all the regions. Thus small and medium-sized enterprises are benefitting. The tourism budget for this year has been increased owing to the Government's commitment to ensuring this industry is supported and is in a position to attract people to this country.

Senator Buttimer mentioned some of the terms key to the industry, including quality. The quality of service we offer is something we are always happy to promote. The Senator also referred to the quality of our food, festivals and activity holidays. A range of new initiatives are being addressed. We are also focusing on promoting value. While 98% of people who came on holidays to Ireland said they were happy with their experience here, somewhat fewer, approximately 70%, believed they received good value, which must be addressed.

There is a robust policy framework surrounding Irish tourism. The Tourism Renewal Group examined the sector in 2008 and set out what would be the framework up to 2013. It examined issues such as the impact of current challenge and recovery actions in terms of trying to set tourism back on a growth path. We are vigorously pursuing this framework with huge co-operation from all the industry and agencies, including Fáilte Ireland and Tourism Ireland.

The tourism budget was increased by 2% to more than €150 million, maintaining funding in real terms for the tourism marketing fund. We also trebled the funds for product development. Again, there are some exciting proposals in this regard coming forward from far-flung regions of the country. Tourism was included in cost-cutting measures to support enterprises and jobs, including the employment subsidy scheme and credit review system, which will be important in light of the banks not freeing credit and liquidity, as Senator Buttimer stated.

Additional specific measures, including changes in excise duty on alcohol and VAT and the introduction of the innovative rail travel initiative for senior citizens visiting Ireland, will also help the sector. I believe the rail travel initiative has huge potential as it will mean everybody over the age of 66 years, irrespective of from what country they come, will be able to avail of free rail travel in Ireland. There is currently a huge marketing campaign in this regard.

This year will be challenging. We had already set a target of increasing the number of tourists by 3% when hit by bad weather in January and February. This was followed by problems with sterling, the poor economies throughout Europe and the eruption of the Icelandic volcano. There is no doubt but that we have met some serious challenges. The tourism industry is fighting hard for business. Tourism Ireland, as the body responsible for promoting Ireland as a visitor destination, is focusing on major markets likely to deliver immediate returns, in particular Great Britain, Germany and the US. Only last week I launched a €20 million summer marketing campaign focusing on those markets. Some 60% of our visitors come between May and September and, as such, we still have an opportunity to attract visitors to this country.

Fáilte Ireland has launched a €4 million advertising and promotional campaign to encourage holidaying at home this year. It will seek to boost promotion of business tourism and the opening in September of the new National Conference Centre which undoubtedly will enhance our capacity to attract international events. Fáilte Ireland has been provided with €20 million for its capital investment programme this year to improve attractions, activities and tourism related infrastructure. It will also invest in business, sporting and cultural events.

As the Senator mentioned, tourism businesses, like many others, are experiencing difficulties with regard to capacity, costs and credit supply. Some of these will be addressed by the tourism industry and others will be addressed by the Government, for example the supply of credit to businesses and the reduction in energy prices. The Government and agencies will continue to work to help the sector, whether in stimulating demand, helping to address costs and productivity, or securing access to credit. Of course, the tourism industry itself has made great strides to reduce costs and increase productivity.

Fáilte Ireland is working closely with tourism businesses throughout Ireland. Business supports assist key tourism businesses to increase their international customer base, better manage costs, improve overall performance and marketing particularly on the web and sustain employment levels. I mentioned the €20 million to be spent on marketing and that will be used on 41 different websites in 19 different languages. The most up-to-date facilities are being used for marketing.

I mentioned the volcano and the difficulty and challenges it has formed. The Senator mentioned the meeting we had yesterday and I must state the response of the tourism industry and the agencies has been very positive and we look forward to developing a customer charter which will be based and build on the good experience we had in the past month. The hospitality industry responded in such a way as to ensure that anybody who was delayed while in Ireland was well looked after; they did not face increased accommodation charges, many of them had their laundry done and they were given free access to activities. Building on that, we want to send a message throughout the world that in the unlikely event one is delayed in Ireland one will be looked after. We will do this confident that the Irish tourism industry will respond as this will be a voluntary code by the industry itself, supported by Fáilte Ireland and promoted well.

The message is that Ireland is open for business; we are accessible and we will look after people. It is a difficult time but with a good policy framework, the increased investment we have, the partnership between the public and the private sectors and the good State agencies we have I am quite confident that Ireland's tourism industry will rise to the current challenges. I genuinely look forward to continuing to work with it.