Seanad debates

Wednesday, 31 May 2017

10:30 am

Photo of Patrick O'DonovanPatrick O'Donovan (Limerick County, Fine Gael) | Oireachtas source

Ar dtús, ba mhaith liom buíochas a ghabháil leis an Chathaoirleach Gníomhach agus leis na Seanadóirí as ucht an tseans chun cúpla focal a rá maidir le cúrsaí turasóireachta in Éirinn faoi láthair.

I thank the Seanad for this opportunity. These statements on tourism are coming about as a direct result of a number of Commencement debates. I told Senators from both sides of the House that, if they wanted a genuine and robust discussion on the development of tourism, I would be delighted to return. As such, I welcome the opportunity.

We must consider the current context. The performance of the tourism industry has been exceptionally strong in recent years. Last year, a record number of overseas visitors - more than over 9.5 million - came to Ireland. That was almost 11% more than in 2015, which was itself a record year. It is worth mentioning that the 2016 numbers were an amazing 59% higher than the corresponding figure for 2010. Good growth was recorded from all our source markets, with Ireland's market share growing ahead of that of its competitors. Overseas visitors contributed more than €4.5 billion to the Exchequer and the economy, representing a 9% increase on the previous year. This helped to sustain more than 220,000 jobs in communities across the country. It is fair to say that that figure is closer to 230,000 jobs now.

In 2017 to date, the performance has remained robust. It is a concern, but not a surprise, that the number of visitors from Great Britain has fallen in the early part of the year. I will speak about Brexit shortly. By the same token, it is encouraging that numbers are up from virtually every other market, with North America increasing by a considerable 25% for the most recent quarterly period. It is worth pointing out that, while the greatest number of overseas visitors to Ireland come from Great Britain, individual spend from the North American market delivers a higher return in respect of revenue.

Clearly, 2017 has started well. The challenge for us now is to maintain that growth. There is no room for complacency, particularly given the highly competitive nature of the global travel industry and the uncertainty that exists in some markets. Our capacity to sustain growth will depend on, among other factors, Ireland maintaining its competitiveness, effective marketing and the continued development of iconic holiday experiences.

The Government's ongoing commitment to tourism was reflected in budget 2017. Despite demands on the public purse, the 9% VAT rate on tourism services was retained and funding of €122 million was secured. This will enable Tourism Ireland to continue its effective marketing overseas and Fáilte Ireland to continue its work in developing our industry on the ground. Although most Senators will know, it is worth pointing out for the record the differences between the two. Tourism Ireland is an all-island body established under the Good Friday Agreement whereas Fáilte Ireland is the national tourism development authority for this jurisdiction.

Following what was a record year for overseas visitors to Ireland in 2016, recent figures published by the Central Statistics Office show that overseas visitor numbers from February to April 2017 were slightly up on 2016. While there was strong growth from the North American market, which increased by 25.7%, the number of visitors from Great Britain decreased by 10.7% year on year. This is obviously a cause for concern. It is too early to state definitively what the reasons are for this decline and whether it will carry through to the remainder of the year.It is clear, however, that the sterling depreciation following the Brexit referendum result has made Ireland and every other eurozone country more expensive for British travellers than had been the case previously. Furthermore, research has indicated that British consumers are likely to scale back on overseas holiday activity this year.

The tourism action plan is committed to seeking to restore the tourism marketing fund to pre-recession levels on a phased basis. Budget 2017 included increased funding of more than 2% for the tourism marketing fund this year and the Minister and I will seek further additional funding for next year to mitigate any negative effects of Brexit on tourism. Tourism Ireland will continue to focus on protecting our market share in Britain, while seeking to increase diversification into other markets, particularly those that deliver higher tourism revenue.

Maintaining overall competitiveness in the tourism industry is also vital at this time. While the industry acknowledges its primary responsibility in this regard, I will endeavour to assist by seeking to maintain the lower VAT rate for the tourism industry and to keep the air travel tax at zero. The aviation sector is critical to Ireland and tourism. As an island with an open economy, the sector is essential for our trading relationships, all of our industries, especially tourism, manufacturing and retail, and our participation in the global economy. Brexit, unless accompanied by some form of agreement replacing the impacted traffic rights and associated regulations, will affect the existing rights of Irish licensed airlines to fly between the United Kingdom and the European Union, within the United Kingdom, and between the UK and a range of other third countries, including the United States and Morocco.

Our preparations for the impact of Brexit are continuing at both political and official level in order that we are ready for the challenges it may bring for Irish tourism. Tourism Ireland's market diversification and rebalancing strategy is already paying dividends as we can see, with mainland Europe now clearly the star performer in terms of delivering tourism revenue and North America overtaking Great Britain in terms of its contribution to overseas visitor revenue in the Republic. Many tourism businesses have already successfully rebalanced their marketing emphasis to reflect the new reality and I expect that others will follow in the coming months. That said, Britain is our nearest market and will continue to be the most important market for tourism to Ireland for a long time to come.

Fáilte Ireland continues to deliver on its commitment to the industry, providing a suite of targeted training and business supports to enhance the competitiveness, enterprise capability and sustainability of the tourism sector. It is also placing a strong emphasis on assisting the tourism sector to increase the geographical spread of activity and lengthen the tourism season beyond the peak summer months. It is working on a number of fronts to assist the diversification and development of our tourism industry and the attractiveness of our tourism offering. Fáilte Ireland is also rolling out a new Brexit response programme that will focus on delivering a capability building programme for tourism businesses.

The Government’s tourism policy statement, People, Place and Policy - Growing Tourism to 2025, brought a particular focus to what is perhaps our greatest potential tourism offering, namely, where the aspects of people and place converge at the level of the local community. Senators will be aware of the success in 2013 of The Gathering. Local authorities were the essential link that enabled community effort to be supported by State resources. The success of The Gathering has provided a foundation on which to develop a more structured role for local authorities in support of community initiatives in tourism. In this regard, it has been a priority of mine to ensure local authorities are encouraged to support communities in tourism development and will co-operate with neighbouring authorities, as appropriate, to maximise tourism opportunities for their region as a whole. Accordingly, I was delighted at the end of March to attend a local government tourism conference in Enniscorthy, County Wexford, under the heading, Collaborate Locally to Compete GlobaIly, and, crucially, for the first time to officially launch tourism statements of strategy and work plans for each of the 31 local authorities.

A key element of the reform of local government was the strengthening of the role the sector plays in economic development. Tourism is recognised as an important driver of the local, regional and national economies and is, therefore, a central component of the economic ambitions of all local authorities. A local economic and community plan has been prepared for each county and city area throughout Ireland and these set out clear objectives, specific goals and actions to support the tourism sector in each county.

It is more important than ever that we create what we describe as "stand-out" for Ireland in our markets by rolling out inspirational Ireland destination messaging. This essential destination sell will be supported by the promotion of our iconic holiday experiences, namely, Ireland’s Ancient East, the Wild Atlantic Way and the Dublin brand. I will discuss these later if Senators have questions on them. All three experiences are major themes for Tourism Ireland this year, as is the promotion of touring holidays, city breaks, festivals, events and activities. Work is continuing with airports and airlines to encourage the creation of new routes and expansion of existing services to the regions.

As Senators will be aware, Ireland is bidding to host the Rugby World Cup in 2023. After much preparation, I understand the IRFU will lodge its bid with World Rugby tomorrow. The hosting of a Rugby World Cup on the island of Ireland has the potential to be very beneficial, both in terms of visitor numbers and the political dimension of an all-island tournament. It would have considerable tourism potential as it would take place during Ireland's shoulder season for overseas tourism, namely, between the middle of September and end of October. In terms of tourism earnings and jobs, it would provide increased business for hotels, restaurants and tourism businesses during the shoulder season. A successful bid for the Rugby World Cup would have the dual advantage of promoting sport and tourism. I wish the IRFU and the committee charged with lodging its bid every success in the coming months in their dealings with World Rugby and the individual rugby unions, many of which I have met.

I hope I have given the House an overview of the tourism industry, which has a proven track record in creating employment throughout the country and driving growth in the economy. As I stated, last year was a record breaking year for tourism. While this performance is encouraging, we are determined that growth will continue in line with the ambitious targets set out in the tourism policy, People, Place and Policy - Growing Tourism to 2025, which was adopted by the previous Minister and Minister of State in the Department, Deputies Paschal Donohoe and Michael Ring.

Brexit is a significant challenge but the tourism sector has overcome great adversity in the past and I am sure it will do so again. I look forward to working with the tourism industry and all the State agencies, including local authorities, to ensure we build on the achievements of recent years. As the Senators present will be aware, we take seriously all suggestions made in the Seanad and we are open to Senators' proposals on how we can grow the tourism industry. I look forward to their contributions.


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