Seanad debates

Tuesday, 11 March 2003

Adjournment Matters. - Tourism Industry.


2:30 pm

Mary Henry (Independent)
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I welcome the Minister of State and at this late hour will not keep him long. Since he comes from a county where tourism is so important, he will understand what I am talking about.

There is apparently a huge downturn in the tourism business. I have received figures which show that bookings are down by 30% to 50%, mainly in sectors which would have booked well in advance such as the corporate sector, conventions and large groups. I keep hearing those involved in the tourism business appealing to the Minister to do something. I wondered if they could not do more themselves.

I have frequently been involved in bringing conferences to Ireland which is a very popular destination. These sorts of groups which are coming for a specific purpose are less likely to be afraid to come because of President Bush's proposed war in Iraq than many casual tourists. I am involved in one conference where the date of closure before incurring a cancellation fee is 14 March. No decision has been made in the United Nations regarding whether the United States will go to war in Iraq, regardless of whether there is a second UN declaration. It is very hard to get people to put their money down if they know they will lose it in the event of war and they feel they should not travel.

Perhaps the Minister will encourage the airlines and large hotels and conference centres to be more flexible over cancellation fees. All they need do is extend the dates by one month. It is particularly important that they do so because our competitors in the United Kingdom, France, Spain and Canada have done just this. I know the Minister cannot make private enterprises do anything but perhaps he will suggest they look to helping themselves on this very important issue. I am expecting a group from William and Mary University in July. It is important to recognise the corporate groups which come to conferences are very big spenders. Not only are we losing numbers of visitors, we are also losing big spenders.

The airlines, hotels and conference centres must reconsider cancellation fees and be more flexible. We may end up with no one, just the cancellation money.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I thank the Senator for raising this matter on the Adjournment. It gives me little pleasure to speak about the challenges facing the tourism sector when, for the third year in a row, the industry is facing economic and financial pressures caused by events completely outside its control. The Senator's motion calls for encouragement of the airline and hotel industry to adopt flexible practices in relation cancellations during the current volatile market situation. Obviously, this is a commercial matter for each business to decide, as appropriate, given its particular circumstances and relationship with its customers.

As Members of the House are aware, responsibility for the airline industry falls within the remit of the Minister for Transport and his Department. Obviously, as air access is key to tourism development, the Department of Arts, Sport and Tourism is keeping in close and regular contact with the Department of Transport as contingency plans evolve for a possible Gulf conflict. The Minister has been informed that Aer Lingus is following recent practices adopted by US carriers in order that customers wishing to postpone their travel plans to and from the United States will be issued with vouchers that can be used at a more opportune time. To date no changes are envisaged in other markets and the relevant companies are keeping the situation under review.

As regards the hotel sector, only last week the Minister for Arts, Sport and Tourism attended the annual conference of the Irish Hotels Federation where he heard at first hand the very latest developments and approaches being adopted by hoteliers in order to sustain their business this year. I know they have responded very positively to calls for flexibility and I am confident they are unlikely to take any action which would weaken the very good relationship they have with tour operators whom they regard as valued customers. I understand each hotel will decide on what practice to follow, which will protect their business in the longer term while meeting their customer needs as best they can.

There is no doubt that the tourism industry has learned a great deal from the recent experiences of foot and mouth disease and the events of 11 September 2001 which should stand it in good stead. Similarities with the previous Gulf War do not necessarily apply now. In the early 1990s the US consumer felt safer at home. Whether that is still true to the same extent, having regard to the impact of the events of 11 September 2001 and other terrorist attacks worldwide, is difficult to judge. Today's more well informed independent traveller might not be as easily deterred from travelling as previously. The tourism sector in Ireland is a mature and resilient industry which has a proven capacity to deal with external shocks. The major difference between the previous two crises and the Iraqi situation is that the industry has had good notice.

No one can predict with confidence how the current situation will unfold or how long it will take to resolve. We are, however, forewarned and the Minister is confident the tourism agencies and the industry are well placed to implement whatever contingency plans are necessary to deal with the difficulties and challenges that lie ahead.

As the House will know, the Minister recently initiated a major review of tourism policy and performance under the chairmanship of Mr. John Travers, the outgoing chief executive of Forfás, in order to chart a new direction for tourism. This is the first such review in ten years and the Minister is particularly pleased that such an eminent group drawn from within and outside the tourism industry have given their services to undertake this important work. The group is consulting widely and the agenda is wide-ranging, covering product utilisation and innovation; business capability; competitiveness and standards; marketing; access transport; infrastructure and environmental requirements; research and planning; and institutional arrangements, including regional structures and the co-ordination of support measures. The Minister looks forward to receiving the report of the review group later this year.

The industry is facing genuine difficulties but the resilience that it has clearly demonstrated over the past two seasons has proven its capacity to address external shocks. I am certain that it will be sensitive to the Senator's call for flexibility in relation to cancellations arising from a possible conflict in the Gulf and that it will take careful note of her suggestions which I will bring to the attention of the Minister and his officials.

The Seanad adjourned at 11 p.m. until 10.30a.m. on Wednesday, 12 March 2003.