I should like to thank you for selecting this issue for discussion on the Adjournment. I welcome the Minister of State, Deputy Flood, to the House to take this issue. Members will be aware that tourism is one of Ireland's most important industries. In 1991, for example, tourism was worth £1.2 billion in foreign revenue to this country. Everybody is also aware that the Government hope to double the number of tourists visiting this country over a five year period. In 1991 tourist numbers were down 2.5 per cent nationally. Dublin, however, experienced a 12 per cent increase and this would probably be due to the fact that the capital was celebrating its designation as European City of Culture. There are indications to date that tourism this year will be up 4 per cent nationally. Nevertheless, a number of problems have been identified in relation to tourism this year. Quite obviously the recession in the UK has meant that many tourists from that country are staying at home this year. There is also a weak US dollar and that means that visitors from the US are slow to leave their home country. In addition we have to compete with special offers being offered by US and UK airlines and there are diverting tourists from the UK to the US, people who might have come to Ireland in normal circumstances. More recently there has been the French road haulier strike which, apparently, has affected tourism here, particularly as regards the French market.
The B and B operators here are reporting a very bad year, which could partly be explained by the fact that it is estimated that there are 500 new B and B establishments in operation. There are also other reasons for the market being down. Problems are emerging in relation to the UK, French, Italian and Spanish markets and these are the traditional high spenders here.
The major problem, however, is that tourists are being turned away from this country by tour operators because they cannot guarantee them a hired car on their arrival. It has been estimated that up to 10,000 tourists could be lost over the six weeks beginning mid-July to the end of August and hundreds of bookings per week are now being turned away. To discover Ireland a tourist must have a car. That is the nature of tourism here and because hired cars are not available bookings are being put on hold. We simply cannot afford to lose this business.
There is a shortage of hired cars available for rent during the peak six week period from mid-July to the end of August. It has been estimated that this shortage could be as high as 500 to 600 cars. There are many reasons for this shortage. The Irish rental rates are extremely high which is not surprising when you consider that the basic cost of a car is between £9,000 and £10,000 coupled with very high tax and insurance costs. There is also the factor involving the collapse of the second-hand market for cars and this has meant that it is simply not economical for the car hire companies to increase their car fleet. The fleet last year was about 11,000 and this year it is about 13,200 but that is still not enough.
It should also be noted that Hertz and Avis have already pulled out of this country because of the problems which I have outlined. The solution is to allow for the temporary importation of cars from Northern Ireland and the UK for this crucial six week period. This would involve no additional cost to the taxpayer. These cars could be carefully policed and monitored and then resold outside the country. I know that the Department of Finance do not believe this but I suggest that they could be carefully monitored. This solution would not involve the distortion of the market here. I appeal to the Minister for Finance and the Minister for Tourism, Transport and Communications to consider this proposal very seriously.
In addition the following should be looked at and I referred to them already: the waiving of road tax, the waiving of excise duty on hired vehicles until resold for private use and a reduction in insurance costs. In general we simply need to encourage rental firms to increase their fleet. The Government have introduced a £1 million grant scheme for hire companies to increase their fleets but this has not been a success because of the high cost of motoring which I mentioned.
There are other issues which need to be looked at in general regarding this problem. The peak period for the European market is from mid-July to the end of August and the EC, in particular, should look at ways of spreading the holiday season over a longer period which would certainly help. It is generally recognised that because of the problems experienced this year we need greater communications between the tour operators and the car rental sector. This is a very serious problem because tourists simply will not come back to this country if they experience problems on their arrival in relation to costs, shortage of cars and so on.
Business for the rest of the season after August is now also being affected and operators, therefore, are taking their business elsewhere. There seems to be a credibility problem now regarding the Irish tourist industry. We live in a very competitive world and tourism is certainly very competitive. We are just one country among many and we cannot afford to shoot ourselves in the foot on this issue. We need an imaginative response fairly quickly.
There is one last issue in relation to tourism, that is crime. We have heard much about the high levels of crime but my understanding is that there is a great deal of awareness regarding this issue in which the general public, the Garda and all interested parties are getting involved. My information is that the crime rate in relation to tourists us now at a lower level, which is welcome. I appeal for an imaginative response to this acute problem which has emerged in relation to tourism.
