Leo Varadkar (Dublin West, Fine Gael)

I thank the Acting Chairman. This is my maiden speech in the Seanad and I am delighted to make it. First, I would like to congratulate the 49 Senators who were elected to the House. The Seanad campaign is a tough and gruelling one. Candidates probably get to see the country in a way most tourists do not get to do. I hope it is a campaign I never have to do. If the Government had its way, it may even be one I never have the opportunity to do, but we will see about that another day.

I would like to particularly congratulate the 11 Taoiseach's nominees. Both the Taoiseach and the Tánaiste did the Seanad a service by appointing a large number of people from outside the traditional party political networks. Governments in the past have spoken a great deal about political reform. This Government has shown it is serious about it by the Taoiseach appointing the 11 Senators in the way he did. There are also the changes to the number of committees and the many measures that have already started.

I welcome the opportunity to address the House on this motion. It highlights the importance the Government attaches to tourism as a key contributor to economic recovery as well as the practical steps it is taking to enable tourism to generate jobs and exports right across the country. I have no doubt the Seanad will agree that the tourism sector will be a key driver of Ireland's economic recovery. It makes a vital contribution to employment, economic activity and exports. It brings revenue to every part of the country and provides job opportunities to people across a range of skill levels. Furthermore, it can play a vital role in shaping the international perception of Ireland, as we saw over the course of the last few weeks. That is why the Government has placed so much importance on tourism as a vehicle for economic recovery both within the programme for Government and the recent jobs initiative.

The decision to reduce VAT as applied to a range of labour-intensive and tourism-intensive services to 9% will provide a much needed support to the sector and will further improve the competitiveness of the services we provide for tourists, particularly in terms of accommodation and restaurants. There is a perception internationally that Ireland is an expensive country to visit but that has changed in the past year or two largely as a consequence of the recession. The fact that we are reducing VAT for those sectors will help a little bit more. I am glad to note that Hotels.com has confirmed that Irish hotels are among the cheapest in Europe.

The Government is also trying to help businesses by enhancing their competitiveness by significantly reducing the cost of employing people, by halving the cost of employers' PRSI for those on modest wages. I urge businesses to respond to both the VAT and PRSI cuts by reducing charges to consumers and ensuring services become even more competitive.

Turning to my area of direct responsibility in regard to the jobs initiative, it fulfils the programme for Government commitment to an overseas access scheme which, essentially, is a three-pronged plan to promote inbound tourism. The first prong is the abolition of the travel tax on the condition that airlines demonstrate a willingness to respond positively to this initiative. That is why it has not been commenced to date. There is also an offer from Dublin Airport Authority, DAA, of significant rebates. Any airline that brings in additional passengers in any of the three airports will not pay passenger service charges in respect of those additional passengers they bring in. There is also a targeted co-operative marketing campaign between Tourism Ireland, the airlines and the DAA. By maintaining and rebuilding levels of access to and from overseas markets, we can help tourism to play its part in the export-led recovery which will secure our economic future.

The first part of the strategy is the travel tax, the second part is the revised growth incentive and the third part is co-operative marketing between Tourism Ireland and the DAA. The tourism marketing fund has €41 million in total for this year and we wish to maintain our investment in the overseas marketing of Ireland so that it can fully implement its 2011 marketing plans. As well as the direct investment in advertising and marketing, it is estimated that Tourism Ireland's general overseas publicity campaign will generate very positive media coverage for the island of Ireland.

On the issues raised about flights, I take on board what Members said. When we are talking about flights in and out of Ireland, it is important to note that flights go out as well and we have to bear in mind that tourists leave the country. For example, connections to the Canaries and Malta probably take more tourists out of the country than bring tourists into it. It is important to bear that in mind.

Senator Healy Eames asked why more planes do not stop in Shannon. The answer to that question is simple; airlines are not compelled to do stop there any more. They will only do so if people want to get on or off planes there in large numbers. If airlines cannot fill planes to about 75% of capacity, it is not economic for them to do so. There are some cases where it is right to subvent air travel but they are relatively few. It is inevitable that when one subvents air travel, one subvents many people leaving the country and many people on business trips and not necessarily tourists coming into the country. That must be borne in mind.

The Cork-Swansea ferry was mentioned. I have given Cork Port permission to invest further in the Cork-Swansea ferry service, but it will be limited by state aid rules. It is not possible to subvent ferry services - if money is given to one ferry service to Cork, it could be at the expense of a service to Rosslare - but we have approved an investment, which does not fall under state aid rules.

In recent weeks, we have been greatly boosted by the visits of Queen Elizabeth II and President Barack Obama. These visits have helped to promote Ireland and tourism from overseas. There have been more than 1,000 downloads of media packages from the Tourism Ireland website on the locations visited by the Queen and the President. Tomorrow, I will travel to London to follow up on the state visit and to take part in a series of engagements organised by Enterprise Ireland and Tourism Ireland. Later in the month, I will travel to Frankfurt with Tourism Ireland to tap the important German market.

These efforts in accessing markets are being complemented by a radical change in our approach to visitors from new and developing markets through the new tourism visa waiver system. From my visit to India in March, I know there are real opportunities to attract high value, high spending visitors from rapidly growing countries like India, China and Russia. Although they are the fastest growing outbound markets for tourism, their tourists generally require visas to enter Ireland, as they do for all of our neighbours. Moreover, given the distances involved, it is not realistic to expect many visitors to travel to Ireland only. Most will combine their trips with visits to the UK or another European country. The measure we have introduced is essentially a UK plus visa, in that it allows people from the aforementioned countries and approximately 14 other states to visit Ireland without Irish visas, as they will be using their UK visas. This will work well and come into operation soon. Even though it will be marketed around the London Olympics, it will run on a trial period for more than one year to determine how well it works. It will probably be introduced this summer and run until the end of next year. We will see how it goes.

We would like to join the Schengen Agreement or have a Schengen plus visa, but that is not possible because of the UK free travel area. The UK is clear in that, were Ireland to enter into the Schengen arrangement, the free travel area would be no more. This would mean setting up passport controls with Britain and Northern Ireland. This is not something we are willing to contemplate.

I agree with and endorse the comments on the boomerang principle. We are working on bringing the Olympic torch South. The House may have heard some of the Taoiseach's recent comments in this regard. I do not want to speak out of turn on the matter, but the discussions are progressing satisfactorily.

Senator Quinn's points about the Asian markets are valid. It is something I have witnessed in Ireland. In light of the number of Asian people who descend on shops like Brown Thomas and so on during sales periods, I encourage retailers to provide whatever support they can.

The suggestion re the ex-pat network is a good one. If the Senator could put together a detailed proposal, it could be considered later this year at the Farmleigh II conference, which is the gathering of important Irish people from around the world.

It is important to point out that tourism is not just a source of invisible exports. It can help to keep money circulating in the economy. Domestic tourism - Irish people visiting their own country - is worth more than €1.3 billion to the economy annually. With the Ministers of State at my Department, I was pleased in recent weeks to launch a strong package of measures for domestic tourism that avail of the synergies stemming from bringing tourism and transport into one Department. The Discover Ireland summer 2011 campaign goes hand in hand with Irish Rail's offer of 50% discounts for anyone travelling by rail on Saturdays and some Sunday services. I look forward to working with the CIE companies - Irish Rail, Bus Éireann and the others - to get them to contribute as much as they can to boosting tourism.

Other elements of the jobs initiative will support tourism. For example, regional and local roads are vital for ensuring tourists can reach every part of the country and experience all that Ireland has to offer. In terms of synergy within the Department, when we consider road programmes, we ask whether a road serves a tourism area, for example, and could we get more tourists into that part of the country if it had better roads. The jobs initiative contains some proposals for tourism internships. Fáilte Ireland is actively engaging with tourism enterprises to ensure they take advantage of these schemes.

Senator Mooney was correct about statistics. We are only getting quarterly statistics, not monthly statistics. This is a problem, in that we are also getting them a quarter late. The statistics we would receive today would be for January, February and March. The tourism business changes rapidly and we need to be able to respond just as rapidly. For this reason, we will have meetings to discuss the matter with the Central Statistics Office, CSO, and to explore the Senator's suggestion of using students or interns from the tourism side to assist in collating the statistics. Obviously, statistics must be collated well, as those that are not collated properly are of no use to anyone.

Regarding the Opposition amendments on the joint labour committees, JLCs, and employment regulation orders, EROs, no Government decision has been made on the matter. No decision will be made until later this month and following consultations with employers and unions. The radical reform of these sectoral agreements would be beneficial to the tourism sector, which is affected by EROs extending to, for example, hotels, restaurants, cafes and golf courses. The system is antiquated, outmoded and riven with anomalies. As Senator Healy Eames mentioned, the hotel ERO applies in all parts of Ireland except the cities of Dublin and Cork. It is not just a capital versus the rest situation either, in that the ERO does not apply in the Fingal, South County Dublin or Dún Laoghaire-Rathdown council areas. The legal minimum rate in a hotel in Blanchardstown or Swords is much higher than the legal minimum rate in Santry or the Shelbourne. This unusual situation is due to the fact that, when JLCs were originally set up, the cities of Cork and Dublin had highly unionised hotels that did not want a JLC, since they were doing better through collective bargaining. How these situations turn over time is interesting.

The system needs reform. In contrast with many other areas of the economy, wages in the ERO sectors have increased. For example, wages in the retail sector have increased while 25% of its jobs have been lost. Other areas have seen greater flexibility. I do not want to say more on the matter. The Duffy-Walsh report has been published and the Minister for Enterprise, Jobs and Innovation is consulting with the social partners on it. He will revert to the Cabinet with detailed proposals on which a decision will be made.

I thank Senators for their contributions and I will undertake to consider the constructive ideas that have been and will be put forward throughout the course of the debate. One issue on which discussion is difficult but necessary is that of budget cuts. It is not realistic to believe there will be no cutbacks in the tourism budgets. Of course there will be. Anyone who watched "Prime Time" and saw the impact of budget cuts on carers, the disabled and those who are dying will understand how difficult it will be to justify spending on, for example, tourism and transport while people are suffering. Difficult decisions will be made, for which reason we need to know for certain that any investment in transport, tourism and sport will produce an economic return quickly. It is money that is not going to someone who could die next year or whose child needs a special needs assistance. I would be interested in knowing Members' ideas as to which of the sector's budgets could be reduced while doing the least damage.

It is not enough for a parliament to say that all of these areas should not be touched and that a government should put more money into this or that. It is incumbent on a parliament and on an intelligent, sensible chamber such as this one to discuss some of the provisions that could be cut without the sky falling down. For example, I would be interested in Senators' views on how the capital budgets could be reprioritised. Should we aim to put the money into a small number of attractions that would attract a large number of people or should we continue the current policy of spreading the money over a large number of attractions and counties? I would also be interested in Senators' views on how to restructure the tourism agencies. There are many such agencies which operate on a North-South basis and at national, regional and local level. I would be interested in hearing the views of Senators on that matter. I would also be interested in hearing their views on any other initiatives the Government could introduce in order to stimulate tourism. What we have done in the context of the jobs initiative represents a very good start. It is, however, only a start and we intend to do a great deal more, particularly by bringing forward initiatives which would not be expensive to put into operation. People bring forward great ideas, but they always involve spending money up front with the promise of a great deal more being generated down the line. However, the real world does not tend to work in that way most of the time. As stated, I would welcome any ideas which Senators may wish to bring forward.