I propose to take Questions Nos. 8, 18 and 31 together.
The tourism sector continues to play a significant role in supporting the State’s humanitarian effort in response to the unjust Russian war against Ukraine. In June 2023, Fáilte Ireland carried out a detailed analysis of data provided by the Department of Children, Equality, Disability, Integration and Youth concerning the bed stock under contract to accommodate Ukrainian beneficiaries of temporary protection and international protection applicants and established that 13% of the tourism accommodation stock nationally that is registered with Fáilte Ireland was under contract to the Department. An additional quantum of tourism-type accommodation that is not registered with Fáilte Ireland is also contracted to the Department of Children, Equality, Disability, Integration and Youth.
The data identified that in five counties more than 20% of the registered stock is used for humanitarian purposes, peaking at 33% in County Clare. The analysis shows that in certain counties, such as Offaly, Mayo, Leitrim, Meath and Clare, the scale of accommodation stock displacement is significant and is a factor in downstream economic impacts. Recent research undertaken by Fáilte Ireland looked at the impact of stock displacement on tourist attraction and activity providers operating within those regions most affected. The overall findings are that most attractions, experiences and activity providers experienced a drop in business volume compared to 2019 across all three markets and that nearly 20% of businesses surveyed have been substantially impacted, with a decline of at least 30% in business volumes compared to 2019. The evidence collated suggested that bed stock displacement was one of the main factors that has led to the decline in business volumes.
As the businesses impacted are varied and range from small and micro-sized enterprises to family-run businesses, there is no one-fits-all solution to address the issues they are facing. For this reason, I have secured funding to implement a broad range of supports. As part of the budget settlement that I have secured for tourism in 2024, up to €10 million has been identified for a comprehensive programme of supports targeted at downstream tourism businesses experiencing particular trading challenges linked to the reduction in footfall to activities and attractions in regions most impacted by tourism bed stock displacement. This programme of supports includes investment in sustainable tourism development and promotion, industry digitalisation, promotion of domestic tourism and festivals, and recruitment and retention initiatives.
I have also asked Fáilte Ireland to engage with impacted businesses to consider the scope for a specific business support scheme that could help the most affected tourism activities and attractions and to report back to me on options and recommendations in four weeks’ time. A strong evidence base will be critical in this regard, and I have asked the tourism sector, particularly activities and attractions, to engage with Fáilte Ireland to provide direct and verifiable evidence of how tourism accommodation stock displacement has negatively impacted their businesses.
While the precise breakdown of the €10 million in funding I have secured to support downstream tourism businesses will not be finalised until I have received Fáilte Ireland's report, I will be ring-fencing specific funding to the organisation for sustainable tourism development to help tourism businesses improve their energy efficiency. This investment will help businesses to reduce overheads and dependency on fossil fuels while supporting the sector in the delivery of its climate targets by reducing carbon emissions.
Examples of the types of activity that can be supported under this sustainability heading include assistance to activity providers to extend their season, encouraging visitors to travel in April, May, September and October. Such businesses range from surfing providers to walking and cycling operators, and an extension to their seasons greatly benefits them and their surrounding communities who provide supporting services. I refer as well to media partnerships with specialist websites, brands and publications in key markets such Germany and the United States, plus media visits by key travel and tourism journalists, and building linkages between Irish tourism industry providers and large tourism travel associations. Additionally, there is building awareness of the move by inland cruisers on the Shannon away from fossil fuels to the use of hydrogenated vegetable oil, which will reduce carbon emissions by 92%, and help to extend season business for the inland cruisers sector. I also intend to target additional funding to support ongoing work under Fáilte Ireland's employer excellence programme, which aims to address the current recruitment and retention issues.
Tourism businesses are in every region of the country and sustain people living and working in areas where often there is no other industry operating.
This is a three-year programme that has, since 2022, supported 390 tourism businesses and Fáilte Ireland will now be extending the scope of the programme to engage and support businesses with fewer than 20 employees, with a particular focus on attractions and activity providers. This funding will get more small businesses into the programme, which will help them to attract and retain workers. With this investment Fáilte Ireland will continue to build on this important work through a range of innovative initiatives to support industry in the recruitment, retention and upskilling of staff across the sector. This will comprise multifaceted campaigns to target key cohorts of talent and to reposition the industry as an attractive workplace, the roll-out and development of the new learning management system, including an extensive programme of skills and professional development, and a programme of activity to target second-level students and their key influencers.
Most funding directed towards Fáilte Ireland’s digitalisation initiative will continue to assist businesses to tackle low levels of digitalisation, which result in poor online visibility and, by extension, low levels of e-commerce activity. An effective way to assist destinations to increase dwell time is by enabling visitors to book more product in advance of arriving in destinations. Fáilte Ireland will commence a further intake of tourism businesses into its digitalisation programme over the next year. In addition, it will prepare an industry digitalisation strategy to support businesses to harness the power of new and emerging technologies such as AI and virtual and augmented reality. On the ground this will help Irish tourism businesses to maximise sales from online channels and increase reach and bookings through connected distribution. Officials from my Department, Fáilte Ireland and Tourism Ireland continue to engage with the sector to support tourism development at home and among overseas visitors, while supporting the continued recovery of the sector.