I move that the Bill be now read a Second Time.
The principal purpose of the Bill is to enable increased funds to be made available to Bord Fáilte Éireann for the development of the tourist traffic industry. At present, the amount of the annual grant is limited to £500,000, from which the Board have to meet the cost of overseas publicity and advertising, as well as other activities such as the financing of hotel staff training schemes, the promotion of conferences and congresses, the improvement of angling and other sporting amenities, the carrying out of improvement works at holiday resorts, road signposting, the provision of access to national monuments and other places of public interest, the development of the native souvenir industry and the payment of grants to meet interest charges on loans for hotel and resort development. The Board have represented that valuable results would be likely to accrue if the rate of expenditure were to be accelerated for a limited period of time. The Bill provides, therefore, that, instead of the present maximum annual grant of £500,000, the Board may receive grants not exceeding in the aggregate £5,000,000. In my view, this global sum should meet the Board's requirements for a minimum period of seven years commencing with the present financial year.
The marked expansion in international travel which developed after the last War has been well maintained. Intra-European traffic is increasing at the rate of about 10 per cent per annum, and American traffic to Europe is expanding at very nearly the same rate. It is estimated that last year more than 800,000 American visitors came to Europe and that by next year the figure will have reached one million. The growing tendency towards longer paid holidays for workers, the increase in individual incomes and the favourable economic conditions which exist in many countries provide grounds for the expectation that the tourist traffic industry will continue to expand for many years to come.
Expenditure by visitors to this country makes a very valuable contribution to our balance of payments. Last year, for example, visitors to Ireland spent £42.4 million, almost 50 per cent. more than in 1953 and 30 per cent. more than in 1957. There is no doubt that this income is capable of being substantially increased. Our share of the American traffic to Europe has increased from six per cent. to 10 per cent. within the past 10 or 12 years, but I am satisfied that, if more advertising and promotion were undertaken in North America, the proportion could be increased to 20 per cent. Our proximity to Britain and the freedom of travel between the two countries place us in a very favourable position to attract more tourists from that source. At present, out of 30,000,000 British people who take a holiday away from their home each year, only about 300,000, or one per cent., come to Ireland. If, instead of one per cent., we could attract two or perhaps three per cent, the effect on our tourist earnings would be electrifying.
Bord Fáilte are satisfied that, if we are to achieve a substantial expansion in tourist traffic, it will be necessary to intensify our overseas promotion and publicity. The increased competition between countries for this traffic and the rising costs of advertising indicate the need to spend more money on promotion, both in the British and the United States market. The Board hope to open new tourist offices in those countries and to engage in more effective promotional activity. This will entail increased expenditure on printed publicity and films and on the sponsoring of visits to Ireland by foreign journalists and writers whose published articles can provide good propaganda for Irish tourism. Good results have already been achieved by Bord Fáilte as a result of promotional efforts undertaken in certain limited fields such as coach tours and angling holidays, and the Board believe that an increase in general tourist promotion and publicity abroad would bring significant results.
Efforts to attract increased tourist traffic must be accompanied by commensurate efforts to improve the standard of amenities for the reception of visitors. As Deputies are aware, generous grants are already being provided towards the cost of the extension and improvement of hotel accommodation and the development of major tourist resorts. There are, however, many other development activities the tempo of which must be increased. These include the provision of schemes for the training of hotel staff, the development of angling and other sporting attractions, the signposting of roads and the provision of easier access to beaches, rivers, lakes, scenic views and other places of special interest to tourists. It is obviously desirable that development schemes of this kind should be carried out as quickly as possible. Because of insufficiency of funds, however, the present rate of progress is too slow. The new arrangements proposed under this Bill for the financing of the Board's activities will enable a faster rate of progress to be achieved.
The Bill contains a number of provisions dealing with the guaranteeing of loans for the expansion and improvement of holiday accommodation and the development of tourist resorts. The power to give guarantees in respect of loans was originally limited by the Tourist Traffic Act, 1952, to a period of 5 years, but this was extended to 10 years by the Act of 1957. The 10-year period will expire in July, 1962, and, as the scheme is operating satisfactorily and constitutes a valuable incentive to private enterprise to undertake hotel and resort development, I am proposing that the power to give guarantees should be extended for a further 5 years, that is, until July, 1967.
The Act of 1952 imposed a limit of £3,000,000 on the aggregate amount of loans which may be guaranteed. The total amount so far guaranteed, or recommended to me by Bord Fáilte for guarantee, is approximately £2,500,000 and as there is a definite possibility that the limit of £3,000,000 may be reached within the next year or two, I am proposing a new limit of £5,000,000.
Grants are payable by Bord Fáilte to meet interest charges on guaranteed loans arising during the first five years of the repayment period. Interest grants are also payable in respect of loans raised otherwise than under Ministerial guarantee for the construction and improvement of holiday accommodation. There is at present a statutory limit of £75,000 on the aggregate amount of such grants which may be paid by Bord Fáilte in any financial year. As a result of the various incentive schemes which have been introduced for hotels in recent years, many new development projects have been put in hands which may involve the Board in interest grant commitments in excess of the statutory limit. I am, accordingly, proposing that the limit be removed.
In promoting this Bill which envisages increased expenditure by Bord Fáilte, I am conscious of the fact that Government expenditure on the promotion of the tourist traffic industry has been running at a rate which is not inconsiderable in relation to our economic resources. I should like to emphasize, however, that I am envisaging under this Bill an increase in expenditure on tourism which will be confined to a limited period of time. The view of Bord Fáilte is that an accelerated rate of promotional and development activity during the next number of years will be likely to result in a substantial expansion of the tourist traffic industry, and the proposals contained in the Bill have been prepared on that basis. I hope that the Bill will make an important contribution to the development of the tourist industry over the next few years, and I recommend it for the approval of the House.