I thank the Chairman and members of the committee for this opportunity to discuss the work of Fáilte Ireland with particular reference to our 2007 annual report. A copy of my statement has been circulated, so I will summarise it, if I may, in the interests of time.
The role and function of the organisation have already been outlined this morning. In essence, our job is to work with the tourism industry and others to ensure that the promotional promise given by Tourism Ireland and other agencies internationally is delivered on when visitors arrive here and during their stay. In other words, if Irish tourism was a factory, Tourism Ireland would be working in the marketing department and we would be the product development department. We focus our efforts on developing the tourism product and building capability to ensure tourism companies can perform profitably. We are concerned with the special development of tourism, in view of the fact that tourism is part of nearly every parish in the country and can play a meaningful role in the development of the regional and rural economy. Perhaps our greatest asset across all regions is our natural and built environment. As a prescribed body under the planning legislation we take an active role in the planning process as it affects tourism amenities. In view of the fact that tourism performance can be heavily influenced by the actions and inactions of other sectors outside tourism, both public and private, we play the role of advocate for sustainable tourism development with our parent Department and the other agencies.
Our origins have already been outlined. Prior to 2003 there were ten tourism agencies at a national and sub-national level. We have effectively reduced that to four, or really three — Fáilte Ireland, Tourism Ireland, Dublin Tourism, in which we have a controlling interest, and Shannon Development.
We had quite a bit of structural change in 2007, which was an atypical year for us, and our annual report reflects the first full working year of those changes. It is only a year and a half ago, but in view of economic developments we could almost be referring to another age. The sustained growth of the preceding six years peaked in 2007, but the picture today is quite a contrast, with projected revenue declines, cost curtailment and credit squeeze.
Visitor satisfaction levels in 2007 were high, at 93%, with 98% saying they would recommend a holiday in Ireland to a friend. It would be easy to become complacent with those impressive figures. Our work in 2007 highlighted a number of areas of concern outside the accommodation sector, particularly hotels, which had already had substantial investment. The required actions were highlighted in our tourism product development strategy of 2007. The strategy was supported by investment of €137 million under the national development plan and is currently being implemented.
Our initial priority was to work with local authorities to upgrade tourist amenities at local level. Over the rest of 2007 we invested €8 million in 130 projects throughout the country to improve the range of facilities for walking, cycling, angling, beach management and so on. To date, we have supported 223 such projects, with investments totalling €21 million. We have also begun the process of upgrading top visitor attractions around the country. All applicants receiving grant assistance must comply with a variety of conditions in order to safeguard the investment for tourism purposes. We have an internal compliance unit which closely evaluates all individual claims and also monitors the performance and use of grant-aided facilities post-grant payment.
Our investment strategy also highlighted the important role played by cultural and sporting events in broadening the range of "things to do and see". During 2007, our festivals and cultural events initiative, a Government initiative now in its eighth year, received 300 funding applications. We supported 270 events through an investment of more than €4.4 million towards their marketing and programming expenditure. In the eight years since the introduction of the initiative, we have supported some 400 events with payments of €31 million. As with the previous programme, final moneys are withheld until we receive a post-event report that justifies how the moneys were spent.
Our international sports tourism initiative, a Government initiative introduced in 2000, supported 16 events during the year with a budget of €5 million. Key among these was the inaugural Tour of Ireland professional cycle race which took place over 12 counties, and Rally Ireland, a major cross-Border event of international significance, organised in the north west and broadcast to 150 countries around the world. Since 2003, we have supported 100 such initiatives to the tune of €27 million. As is the case with festival grants, final payments for sports events are not made until we receive a post-event report. In the case of all large investments, a benefits study is undertaken prior to committing any investment.
It is one thing to have an attractive range of things to do and see but is quite another to operate them on a profitable basis. The tourism industry comprises approximately 17,000 enterprises, the vast majority of which are very small and operating on tight margins. We seek to engage with these businesses by offering practical support and assistance. In 2007, we expanded our business advisory service across the country and we believe that just under 6,000 industry personnel benefited from those supports.
Over 500 owners and managers joined one of the 27 tourism learning networks which are situated in every county. Over the three years of that programme, some 1,500 small and medium-sized enterprise owner-managers have participated in these networks. A number of additional services, outlined in our annual report, including a programme of e-business seminars and workshops, try to help small businesses get onto the web because that is where business is going. If one is not on the web, one does not exist in the tourism business. To date, 1,500 operators have participated in that programme.
A key area of concern for Fáilte Ireland is the provision of core skills to all those who choose a career in tourism. In 2007, we invested approximately €15.5 million in direct skills training and college-based education programmes geared towards accredited qualifications. All our skills programmes are accredited within the framework of the National Qualifications Authority of Ireland and the vast majority of our trainees and students receive an award from the Further Education and Training Awards Council, FETAC. We have two channels providing these training services. In 2007, 4,000 trainees went through our four permanent training centres in Dublin, Waterford, Cork and Limerick. In addition, we fund a range of education programmes through the institutes of technology network where, in 2007, some 2,100 students attended these courses across ten institutes.
The integration of the regional tourism authorities within Fáilte Ireland brought regional development centre stage within the enlarged organisation in 2007. Under the new structures, each region has five boards that are, in effect, sub-committees of the Fáilte Ireland authority, comprising industry representatives, local authority representatives, county managers and an independent chairperson. All these functions are subject to the same public sector guidelines, policies and procedures governing Fáilte Ireland and are audited as such. During 2007, we prepared new three-year regional strategies for each region and we are currently implementing those operational plans. We invested €14 million in regional development, including the operation of our tourist office network comprising approximately 70 tourist offices. That was an increase of 22% over the previous year.
With the establishment of Tourism Ireland as a cross-Border institution for promoting the island of Ireland overseas, the task of promoting domestic tourism within Ireland is assigned to Fáilte Ireland. In recent years, the home holiday market has become very important to many sectors of the industry. It has grown by 48% since 2003 and is likely to remain very important over the coming years in light of the difficult trading environment in our key markets overseas. In 2007, we developed a new Discover Ireland – Right Here, Right Now campaign. Our research indicates that this campaign has worked well in stimulating awareness and facilitating holiday booking. Irish people took 4.2 million holiday trips in Ireland in 2007 and spent €1.02 billion.
An area of increasing importance to Fáilte Ireland and the industry is the sensitive development of the natural and built environment and the adoption of environmentally friendly policies in Irish tourism. During 2007, we developed and published an environmental action plan for the years 2007-2009, setting out the key objectives and actions relating to environmental protection and sustainable tourism. We established an advisory group on the environment which brought together the Environmental Protection Agency, Sustainable Energy Ireland, the Heritage Council, the Economic and Social Research Institute, the Marine Institute and Dublin Institute of Technology. The theme of our 2007 national conference was Tourism and the Environment — Current Climate, Future Trends. We completed on a feasibility study on the identification of scenic landscapes which was submitted to the Department of the Environment, Heritage and Local Government and, in turn, it contributed to the proposed national landscape strategy. We also continued to discharge our functions as a prescribed body in the planning process by providing detailed comments to local authorities on eight county development plans as well as on a number of key planning applications.
In his letter the Chairman asked me to outline the internal audit and risk management functions in Fáilte Ireland. I am pleased to report that Fáilte Ireland has in place a robust audit and risk management function. The internal audit function operates under the direction of the authority's audit and risk policy committee and carries out audits in accordance with a rolling four-year plan which is overseen by the committee. The internal audit work is reviewed annually by the committee to take account of changes in the business environment as well as annual risk assessments. The plan is designed to ensure that higher risk categories are monitored particularly closely. Internal audit reports are prepared and submitted to the audit and risk policy committee, which meets at least four times per year. The report of the committee is a standing item on the agenda of the Fáilte Ireland authority. Internal audit reports are also reviewed by the finance policy committee, an executive committee that I chair, as Accounting Officer, which includes all senior managers and the financial controller.
Fáilte Ireland's risk management function has developed considerably in recent years, in line with the governance requirements for State bodies and our own internal requirements. A key initial task was the development of a risk register, which has been completed. The register is kept under constant review to ensure that it continues to reflect the key risks to the organisation's functions. More recently, the focus has shifted to include the integration of the risk management process with the organisation's strategy and annual planning process. This is being put in place at present. Like the internal audit function, the risk management function reports to each meeting of the finance policy committee and also to each meeting of the audit and risk policy committee and through the latter to the Fáilte Ireland authority.
