Speeches

Speech by Minister for Transport, Tourism and Sport, Leo Varadkar TD to Seanad Éireann on Tourism, Wednesday 1st June 2011

01 - 06 - 2011

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As you will be aware, this is my maiden speech in the house. 
 
And the first thing I want to do is to congratulate you on your election as the 22nd Cathaoirleach of Seanad Eireann.  Your election is much deserved and I wish you every success in your office.  I would also like to congratulate all of the 49 elected members of the Seanad on their election to this house.  The Seanad campaign is a tough one.  I hope I never have to do it.  Though, if the Government has its way, I will never have the opportunity. 
 
I would also like to congratulate the Taoiseach’s 11 nominees.  There has been a lot of talk about political reform by previous Governments.  I think this Government has already shown that it is serious about political reform and the appointment of a large number of independents is evidence of that. 
 
I welcome the opportunity to address the House today on this motion, which highlights the importance that this Government is attaching to tourism as a key contributor to our economic recovery as well as the practical steps that the Government is taking to enable tourism to generate jobs and exports, right across the country. 
 
I have no doubt that the Seanad believes that the tourism sector will be a key driver of Ireland’s economic recovery.  Tourism makes a vital contribution to employment, economic activity and exports. It brings revenues into every part of the country and provides job opportunities for people across a range of skill levels.  Furthermore, tourism can play a vital role in shaping the international perception of Ireland –as we saw so clearly over the course of recent weeks.  That is why the Government has placed such importance on tourism as a vehicle for Irish economic recovery both within the Programme for Government and the recent Jobs Initiative.
 
The decision of the Government to reduce the level of VAT applied to a range of labour-intensive and tourism-related services to 9%, provides a much needed support to this sector of the economy by improving still further the competitiveness of our services for tourists – particularly accommodation and restaurants.  With VAT increasing across much of the European Union, it reinforces the message that Ireland does offer great value, particularly in accommodation– as confirmed only recently by Hotels.com
 
The Government is also helping businesses to enhance their competitiveness in the international tourism marketplace, by significantly reducing the cost of employing people by halving employers’ PRSI for those on modest wages.  I would urge businesses to respond to these opportunities and to continue their efforts to make sure that tourists get value for money.  We must make sure we continue to show that Ireland delivers a little taste of heaven without costing the earth.
 
Turning to my own areas of direct responsibility, the Jobs Initiative fulfils the Programme for Government commitments on overseas access by a three-pronged plan to promote inbound tourism through
  • abolishing the travel tax conditional on the airlines demonstrating a willingness to respond positively to this initiative;
  • the offer by the Dublin Airport Authority of significant rebates on passenger charges for extra passengers brought in by airlines; and
  • more targeted co-operative marketing of new routes from key source tourism markets by Tourism Ireland, DAA and the airlines to encourage more tourists to fly into Ireland.
By maintaining and rebuilding levels of access to and from overseas markets, we can help tourism play its part in the export-led recovery which will secure our long-term economic future. 
 
The first part of the strategy is the abolition of the travel tax.
 
The second part of the access strategy is an enhanced growth incentive scheme from the Dublin Airport Authority (DAA) for all airlines serving any of the three State Airports, Dublin, Cork or Shannon.  Together with the parallel extension of their existing support schemes, this represents a significant contribution from DAA over 3 years.  Tourism Ireland is also coming on board and will work with DAA to encourage airlines to increase services and capacity from our overseas markets for inbound tourism.  Tourism Marketing Fund resources will be made available for Tourism Ireland, working with the DAA, to promote visitor traffic through more targeted co-operative marketing of Ireland with airlines on new routes from key source markets, to encourage more tourists to fly into Ireland.
 
I am particularly pleased to be bringing together all the key players, from both the aviation and tourism areas, with the objective of restoring the levels of access we need to drive recovery in overseas tourism to Ireland.
 
These cooperative marketing efforts will complement the very significant overall investment in promoting Ireland overseas by Tourism Ireland.   The Tourism Marketing Fund has a provision of over €41m this year, to maintain our investment in core overseas marketing of Ireland, and will enable Tourism Ireland to 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 this year will generate positive media coverage for the island of Ireland.
 
This has of course been greatly boosted by the significant value of the recent visits by Queen Elizabeth II and President Barack Obama in promoting Ireland and Irish tourism overseas, which are now being built on by Tourism Ireland’s overseas marketing efforts.  There have been over 1,000 downloads of media packages from Tourism Ireland’s website on the locations on the itineraries for Queen Elizabeth and President Obama.  Tomorrow, I will travel to London to follow up on the State Visit and will 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 access and marketing are also being complemented by a radical change to our approach to visitors from new and developing markets, through a new Tourist Visa Waiver Scheme.  I know myself from my March visit to India the real opportunities that exist for Ireland to attract high-value, high-spending visitors from rapidly growing economies like India, China and Russia.  However, while these countries are the fastest-growing outbound markets for tourism, they generally require visas to enter Ireland – as they do for all our neighbours.  Moreover, given the distances involved, it is not realistic to expect many visitors to travel to Ireland alone. Rather most will be combining the trip with a visit to the UK.  This imaginative measure will encourage visitors to our nearest neighbour to extend their trips without the cost and hassle of applying for an Irish visa – as well as recognising that the island of Ireland is one tourism destination.  I expect the tourism agencies to make the most of this golden opportunity this year and particularly in 2012, to encourage people from these markets to come to Ireland and experience our hospitality for the first time in conjunction with the London Olympics but also in the months before and after the event.
 
But tourism is not just a source of invisible exports – it can also help to keep money circulating in the Irish economy.  Domestic tourism generates more than €1.3 billion annually, so it makes perfect sense to build on this base.   I was especially pleased to launch – with the two Ministers of State at my Department - a strong package of measures for domestic tourism in recent weeks, availing of the synergies of bringing tourism and transport into one Department. The Discover Ireland Summer 2011 campaign goes hand in glove with Irish Rail’s offer of up to 50% discounts for weekend travel. I look forward to an ongoing positive commitment from Irish Rail to the further development of Irish tourism.  
 
Of course, other elements of the Jobs Initiative will support tourism.  For example, regional and local roads are vital to ensure that tourists can reach every part of the country and really experience all that Ireland has to offer.  I also believe that tourism can benefit very significantly from the Government’s new programme to encourage work placements and internships in the private sector.  I have asked Fáilte Ireland to actively engage with tourism enterprises to ensure that they take advantage of these schemes – particularly to drive more business from overseas visitors.
 
In relation to the opposition amendments on JLCs and EROs, I would like to point out that no decision has been made on this matter by the Government and no decision will be made until later this month following consultations with employers and unions.  I do wish to point out, however, that a radical reform of these sectoral agreement would be beneficial to the tourism sector which is affected by EROs extending to hotels, restaurants, cafes and golf courses, for example.  The current system is antiquated and outmoded and is riven with anomalies.  For example, the hotels ERO applies to Dublin County but not Dublin City so legal wage rates in Swords are higher than on St Stephens Green.  The system has also shown itself to be inflexible.  Wages have actually gone up in many of the sectors covered by EROs while wages fell in almost all other sectors of the economy. 
 
The scale of job losses in the hospitality, retail and construction sectors has been on a scale much greater than average.  For anyone who doubts the link between unemployment and inflexible labour regulations coupled to up-ward only rent reviews this is your answer.
 
I look forward to the contributions on this subject by members of the House and undertake to consider any constructive ideas put forward in the course of the debate.  With budgets likely to be cut in the coming years, I am genuinely interested to hear Senators views on what budgets could be reduced in the coming years and not just which ‘should not be touched’, how capital budgets should be reprioritised, whether we should invest more in fewer attractions or continue to disburse money to a large number of projects, how we might restructure or reorganise the agencies working in the area, what other initiative the Government could introduce to stimulate tourism. 
 
Thank you.
 

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