Brian Hayes (Dublin South West, Fine Gael)
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Question 36: To ask the Minister for Tourism, Culture and Sport the progress made in addressing excess capacity in the hotel sector; and if she will make a statement on the matter. [44146/10]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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Economic circumstances are making trading conditions difficult for most businesses at present. These difficult conditions are exacerbated in the hotel sector by an overcapacity in supply. This is proving to be a complex situation to resolve and I believe that, inevitably, it will require a market led solution over time.

In recent weeks I have received copies of the IHF's pre-Budget submission to the Minister for Finance. I will certainly ensure their priorities receive due consideration in the formulation of next years' budget. As Minister for Tourism, Culture and Sport, I will continue to engage in regular consultation with the industry so that the support provided by the State tourism agencies and the Department are both relevant and effective.

In acknowledgment of the difficulties faced by the tourism sector, the Government, through Fáilte Ireland, is investing over €11 million in 2010 in the form of direct supports and advice for tourism enterprises nationally, including hotels. The key elements of Fáilte Ireland's enterprise development supports include:

A comprehensive €3.6 million Business Support Programme helping businesses to grow their 'top line' while also tackling their cost base through a combination of restructuring debt and building greater liquidity into their businesses, as well as permanently re-engineering their business processes;

A suite of Management and Skills Development training programmes to tourism clients;

Measures to better develop, manage and promote tourism destinations, including promotion of networks and marketing partnerships with trade groups in destinations;

Strong e-Business Supports to underpin Fáilte Ireland and industry marketing activities, the delivery of enhanced visitor services and the availability of new online learning tools for industry clients.

Tourism Ireland is continuing its marketing activities in Great Britain, Mainland Europe and North America this Autumn highlighting ease of access, great fares and offers from the industry, and showcasing the wonderful holiday experiences available here. In the US, a seat sale is currently under way in gateway cities promoting Autumn/Winter fares from as low as $199 each way. Meanwhile, in Europe, over 16 million potential visitors will see the 'Ireland – More for Less' promotion on the Ryanair website over the coming months. Car touring campaigns with the ferry companies are also encouraging visitors to take their own cars to Ireland. At home, Fáilte Ireland's €4 million home holiday marketing campaign is continuing with the Festive and New Year offering launched during November.

The Government has also set out significant plans to fund the further development of our tourism product offering. Fáilte Ireland has recently published a background briefing paper entitled "Recent Developments in the Hotel Sector and the Medium-Term Outlook", which is available on its corporate website www.failteireland.ie. This paper examines supply and demand side developments in the hotel industry, considers the medium-term prospects for the sector and presents some useful insights as to how the overcapacity issue may evolve.

When I met with NAMA in October to discuss overall policy in the Hotels Sector I gave them a copy of that paper. The Agency welcomed receipt of the analysis and I am pleased to say that NAMA will take account of overall tourism policy considerations as their own strategy development evolves.