Jim O'Keeffe
Question:57 Mr. J. O'Keeffe asked the Minister for Arts, Sport and Tourism his views on whether investment from the Exchequer in tourism is adequate to reverse recent adverse trends. [22512/02]
Other Questions. - Tourism Industry.
Given the nature of its ownership, investment in the tourism sector is primarily from private sources. The challenges facing tourism cannot therefore be solved solely or mainly by the State. That said, it must be acknowledged that strategic Exchequer investment in tourism has contributed significantly to the emergence of Ireland as a world-class tourism destination.
A recent economic report prepared for the Irish Tourist Industry Confederation by Tansey Webster Stewart & Co. estimated that the combined public and private sector investment in tourism during the 1989-1999 period was of the order of €4.3 billion. Of this, 35% came from Exchequer, EU and IFI sources and 65% from the private sector. Much of that investment was stimulated by various fiscal incentives and two EU Operational Programmes for Tourism. It is estimated that the two tourism operational programmes generated €1 billion in investment between 1989 and 1999.
This investment has clearly contributed to the phenomenal growth in tourism in Ireland. Over the past ten years or so, total foreign earnings from tourism have more than doubled and stand at almost €4 billion a year. It is estimated that domestic tourism earnings are of the order of €1.2 billion. The industry now supports up to 150,000 jobs in the economy and is a major contributor to regional development and regeneration.
In the National Development Plan, 2000 to 2006, there is a commitment of more than €460 million for tourism programmes under my aegis. This represents a substantial level of commitment to the tourism sector in terms of Exchequer investment in tourism this year. Also, 2002 has seen the largest ever budget being deployed for the international marketing of the island of Ireland. Tourism Ireland Ltd., which was successfully launched towards the end of last year, has a total budget of €50 million this year, of which €27 million represents direct programme spend. This is supplemented by substantial budgets for regional and product marketing by Bord Fáilte, of the order of €25 million.
Shortly after my appointment as Minister for Tourism and following consultations with the industry and tourism agencies, I decided to reallocate a further €3 million in funding for front line marketing activity. With the help of that funding, Tourism Ireland extended its marketing activities in those markets with the best prospects for generating visitors and revenue in the short-term, targeting in particular Great Britain, closely followed by Europe and North America. In addition, Bord Fáilte has put an unprecedented level of investment into campaigns in the domestic market.
Additional informationOn the basis of feedback from the tourism agencies, this investment, combined with the marketing activities of the industry itself and their special value offers, will produce a positive over all performance this year. We are well placed to recover much of the ground lost in 2001 as a result of the foot and mouth disease crisis and 11 September setbacks. In particular, the British market, which is traditionally our biggest market, has held up well with estimates of up to 6% growth in visitor numbers. This confirms the wisdom of Tourism Ireland's strategy of targeting Britain as a market that could yield immediate and significant results this year.
In relation to Exchequer resources available next year, I am particularly pleased that the Government has maintained the overall tourism budget and, within that, increased the allocation for the Tourism Marketing Fund by 20% to €30.4 million, its highest allocation to date. This is a clear recognition by Government of the importance of the tourism sector to the Irish economy and in particular, the benefits of marketing Ireland in an increasingly competitive international marketplace. This funding will enable a strong programme of international marketing activity to be rolled out in 2003.
There is a 14% downturn in visitor numbers from America this year and the Minister admitted today Irish tourism has not performed in the continental market. Surely it is time for a reappraisal of investment in our product. Does the Minister agree that much of the product provided in the period referred to, 1989-2000, is now stale? In some cases tourists no longer find our product attractive. We also have a new type of tourist, given attitudes change as generations change. Has there been any analysis of the kind of product tourists want?
There has also been a reduction in the budget for the film industry despite the fact that 14% of American tourists came to Ireland because of our film industry, according to a recent Bord Fáilte survey.
There is no doubt tourists have become more discerning. They want value for money and a high quality product and we must remain competitive. However, other factors must also be looked at, including whether our marketing strategy is appropriate, whether access should be improved, whether our environment and infrastructure can be improved and whether the product needs a greater level of sophistication. These and other issues will be addressed in a review I announced which will be completed by next spring.
I agree there is a new type of visitor and that people are booking holidays at a far later date. It is now almost the norm in some markets for people to decide two weeks in advance to take a break. Regarding the improvement of our market share in continental Europe, despite budgetary constraints this year I have ensured that the tourism marketing spend will be increased to its highest level ever. The increase year on year will be 20%, which is indicative of the seriousness with which I and the Government regard marketing. I hope it will yield the dividends we anticipate.
The Minister referred to the advantages of tourism when it comes to regional development. The waterways are a major bone of contention with me. We are not doing enough to attract tourists to our waterways, although we have marvellous canals and the Shannon. We never seem to attract the numbers of tourists it is possible to attract to those areas. The Minister may not have the relevant information with him but he should look at this area as adventure tourism activities such as hill walking, mountain climbing and waterway use are areas we have not exploited.