We will be considering Vote No. 35, the Supplementary Estimate for Tourism and Trade. The following timetable has been prepared: the Minister's opening statements to be ten minutes; spokespersons for the various parties and groups will have ten minutes and there will be a question and answer session for 20 minutes. Is that agreed? Agreed. Members should confine their comments specifically to this Supplementary Estimate.
Vote 35 — Tourism and Trade (Supplementary Estimate).
It is a great pleasure to come before this Select Committee once again to discuss the Estimates for my Department. As Members will be aware, the purpose of the Supplementary Estimate is to enable the early draw down of a total of £8 million funds for tourism promotion and development programmes in time to impact in the 1994 tourist season. This sum of £8 million encompasses the sums of £3 million made available in the Estimates this year and a further £5 million made available in the budget. Deputies will be aware how vitally important the tourism industry is for the future well-being of the country. The national plan recognises this and the recent budget provided concrete evidence of the commitments of the Government to give a timely and radical boost to the marketing of Ireland abroad. Over the past few years tourism has moved from being a Cinderella industry to one where there is a new and widespread awareness of the role tourism can play in helping us achieve the economic goals we have set ourselves.
Tourism is perhaps unique in the degree to which it is a labour intensive industry as well as being one which is directly pro-region and pro-local initiative. The sum of £8 million is, as it were, an experiment. It is an attempt to prioritise and push forward the marketing of Ireland in 1994.
This year provides a particular opportunity to promote Ireland in the United States. The clear signs of economic recovery in the US, the strengthened dollar and our participation in the World Cup provide an encouraging framework for a renewed marketing effort in the US. There is no doubt that a new push is needed. Ireland attracts only 400,000 US tourists annually, although three million Americans visit London each year and six million visit Europe as a whole. The £2 million fund will be complemented by an injection of £500,000 by the tourism industry matched with a further £500,000 of the moneys earmarked for private sector support from the Operational Programme for Tourism. An advertising blitz on Ireland will cover US television, newspapers and magazines over the next few months. The tourism industry is confident that this focused and carefully monitored advertising campaign will yield positive results. Our target is to see an increase of 57,000 US visitors to Ireland this year. Of this 57,000 we expect that 45,000 will be generated through this new campaign. It can be seen that the new campaign will complement and build on the existing Bord Fáilte programme for the US.
The disbursement of the funds for this US initiative will be subject to very rigorous controls. A management committee has been set up, chaired by a senior official of my Department and comprising representatives of the tourism industry as well as Bord Fáilte and Aer Lingus. This committee will sanction each item of expenditure and will approve all the actions to be carried out by a management team which has been retained to implement this US campaign.
I said earlier that what I am proposing is an experiment. However, it is not in any sense an unstructured or thoughtless exercise. This initiative was stimulated by and is fully supported by the tourism industry and I am confident that, through that stimulus, this concentrated advertising campaign in the US will yield a badly needed increase in the number of US holiday-makers. The results of our efforts in 1994 will be monitored and evaluated so that the tourism industry can itself see whether the results from this campaign are such as we would all wish. There is certainly no point in running a large scale advertising campaign unless we can evaluate the results. In any event, we stand to gain in real economic terms from this initiative. The United States is the most important generator of international tourism spending. Americans spend more on travel — domestic and international — than any other nation and we know that 39 million Americans claim some Irish ancestry. Let me clarify, however, that our US campaign is not aimed exclusively at the Irish ethnic market. While we are always delighted to see our transatlantic cousins visit the old country, in this campaign we are targeting holiday-makers.
I would like to turn now from the United States market to the Japanese market. Japan is a very wealthy country. Its citizens are taking overseas holidays in ever increasing numbers. It is estimated that we receive some 14,000 Japanese tourists per year. I am allocating from this £8 million, £100,000 to develop and expand our tourism marketing in Japan. Deputies will be conscious that £100,000 is not a lot of money in Japanese terms. However, we desperately need to accentuate in that country the awareness of Ireland's many attractions. The £100,000 which will be allocated to the part-time Bord Fáilte representative in Tokyo is a form of seed capital to gradually make the Japanese public more responsive to Ireland. For the first time, it will be possible to launch an advertising sequence together with the Japanese travel industry in the leading Japanese newspapers, which have a circulation of up to 7 million per copy. We will also be able to encourage leading Japanese media and travel representatives to visit Ireland so that by the end of 1994 we would aim to have a significantly greater number of Japanese people willing to consider Ireland as a holiday destination. It is estimated that an additional 5,000 Japanese visitors will come to Ireland this year as a result of these new funds and I very much hope that we can continue to focus constructively on this important market in the year ahead.
I am proposing also to allocate £100,000 for an increased effort in Australia. While we receive about 60,000 Australian tourists per annum this is small relative to the number of Australians visiting London. One of the priorities for the additional funds is to endeavour to ensure that more Australians avail of what is known as the “fly-free” concept. Under this procedure if an Australian is flying to London or Paris or some other major European destination they can fly on to a secondary destination, such as Ireland, at no extra cost, provided they book the tickets before they set off. The on-going task for Bord Fáilte in Australia is to get more people to choose Ireland as their “fly-free” destination. To this end, a special Irish “fly-free” holiday guide will be produced. The additional £100,000 under this Supplementary Estimate will be available to Bord Fáilte who will co-operate with local travel agents in highlighting certain events. It is expected that there will be an increase of 7,000 in the number of Australian visitors this year.
One of the major factors which impairs the profitibality of Irish tourism is that operators do not get a year round return on their product. Improving the seasonality of Irish tourism through greater utilisation of facilities throughout the year would greatly help the industry. I am allocating £800,000 this year for a special seasonality campaign to be operated by Bord Fáilte in conjunction with the industry to promote holidays in off peak seasons.
In many countries, capital cities are the engines of their national tourism, for example London, Paris, Rome and Amsterdam. The modern tourist is predominantly urban and used to a high level of service and choice. There is, therefore, a strong bias towards cities for their ease of access, the multiplicity of their attractions and for their cultural and entertainment riches. I believe that Dublin has been under sold in regard to its potential to develop Ireland's tourism. Although considerable strides were made during the millenium year of 1988 and the Dublin City of Culture year in 1991, there is still a number of serious gaps in the tourism infrastructure of the capital city. One of the major benefits in focusing on Dublin is that the tourism spin-off will be non-seasonal in nature. Cities offer year-round interest and are particularly suitable for short breaks.
I see considerable merit in asking organisations such as the Dublin Chamber of Commerce to become involved in the development of a new focus on marketing the capital. This could include, inter alia, the development of proposals for one or two major festivals such as a spring festival based around the St. Patrick’s Day period, and a Dublin autumn festival of the arts. The successful and innovative development of these festivals would provide a marketing focus for repositioning Dublin internationally as a great centre of culture and joie de vivre.
I am very pleased to have been allocated in the budget a further £5 million for tourism promotion and development. This sum will enable my Department to put in place a number of new strategies to boost tourism to Ireland. I would now like to indicate my plans for the use of this fund. I am particularly interested in looking at ways to intensify our promotion in Britain and in Continental Europe. This country has experienced a highly satisfactory growth in both tourist numbers and revenue from Britain and Continental Europe since 1987 (38 per cent growth in numbers and 59 per cent revenue from Britain, and 124 per cent growth in numbers and 209 per cent revenue from mainland Europe). Yet my belief is that there is still a great untapped potential in these markets. This will particularly be the case if, as we all so dearly hope, peace is achieved in Northern Ireland. It is therefore my intention to devote a considerable portion of the additional £5 million funding to the further development of these markets. Our approaches in these two markets may not follow exactly our approach in regard to the US. Once again, I do not wish to overlap with the efforts of Bord Fáilte in these markets. Instead, my aim is to complement and extend the promotion, to draw on good ideas from the industry and to devise approaches that will be innovative and will be tailored to the requirements of the particular markets. I am earmarking £2.25 million to these markets, of which £1.25 million will be for Britain.
I explained earlier the importance of "fly-free" or "common rating" concepts in attracting visitors from long-haul destinations such as Japan and Australia or New Zealand. I would like to see a more concentrated promotion of the "common rating" approach in all long-haul destinations where Ireland could reasonably expect to receive more tourists. Aer Lingus is at present in discussions with several long-haul airlines and I look forward to a major breakthrough in making Ireland a more accessible and, therefore, a more attractive holiday destination. The access committee of the Tourism Council is at present working on proposals in this regard. A sum of £1 million will be allocated to this area.
A further focus will be on associating Ireland's many leading sporting and artistic performances with tourism marketing. Ireland is a small country but I would wager a bet that per capita we have a high number of internationally successful sportsmen and artists. I am at present seeking to devise a means of using the popularity of these people to promote the image of Ireland. Needless to say, I cannot force leading personalities to co-operate but I hope that a way could be found to optimise this potential to everyone’s benefit. As the standard of sporting venues in Ireland is gradually improving I would hope to build on the success of the lady hockey players who have attracted the World Cup to Ireland later this year, by seeking to have further international sporting finals in Ireland. I am fully behind the bid to have the 1998 World Equestrian Championship in Ireland.
I am setting £1.25 million aside for these. In addition I reserve a sum of £0.5 million to enable me to take on board other good proposals from the Tourism Council. Ultimately I want to see a tourism industry which will stand on its own feet, which can finance its own development and can co-ordinate its marketing on a co-operative basis. The development of the tourism industry is at the heart of the Government's economic and employment growth strategy. The industry is being targeted to provide up to 50 per cent of the net increase in employment envisaged in the National Plan. This is a huge task which will require an effort on the part of all sectors of the industry. My task as Minister is to facilitate this level of performance.
The funds in this Supplementary Estimate will enable us to be innovative and daring in view of the tasks before us. We can achieve spectacular results this year if all sectors of the industry work together. We must not let these opportunties slip away.
I welcome this Supplementary Estimate of £8 million for tourism promotion which will be targeted at marketing Ireland abroad as a tourist destination. If we are to realise the increase in foreign visitors to Ireland, with the resultant increase in revenue which should lead to the creation of 29,000 jobs as projected in the National Development Plan, we will have to market Ireland more aggressively in the destinations with potential for growth so that we will increase our share of the market. There is vast potential for Ireland to exploit. However, we will be faced with stiffer opposition as other destinations emerge to compete for market share.
Ireland's share of world tourism has declined from 2 per cent to approximately .9 per cent since 1960 despite the good performances of recent years. Similarly, Ireland's share of European mainland tourism has declined. Indeed, the European share of world tourism has also declined. We are competing against very attractive destinations.
There will be new competition from eastern Europe where tourism has been identified for rapid development because of its foreign exchange earning power and job creation potential. The eastern European countries such as Poland, the Czech and Slovak republics, Hungary, Rumania, Lithuania, Latvia and Estonia are major new competitors. They have launched major marketing campaigns for their countries. Their tourism product is similar to ours — they have the scenery, culture and a folk tradition. They have a novelty factor which will be very attractive especially to tourists from Germany. They are also more accessible to the tourist producing countries of western Europe. In the case of Germany, for example, sea crossings are unnecessary. Germans can drive to those destinations. Even our American market will be threatened by these destinations. These countries have strong ethnic ties with north America which were cut off after World War II. They are now open again.
Since 1985 the Government's allocation to Bord Fáilte has decreased in real terms from £35 million to £21.7 million in 1994. Bord Fáilte has been singled out for harsh criticism, some of it from the Minister and some from the industry. I have a copy of a survey in which Bord Fáilte is slated. In Bord Fáilte's defence, how is it supposed to operate with such a reduced budget? Of every $600 spent on the promotion of tourism and travel in America, less than $1 is spent on Ireland. That puts it in perspective. Bord Fáilte has, for example, no agent north of Los Angeles. We have nobody in the silicon valley promoting tourism although we attract a large number of industrialists from there and many of the jobs in the electronics industry here originated from there.
Jamaica spends 3.5 times as much as Ireland on tourism promotion in America. The British Tourism Board, along with British airlines and other interests, spends about 8 times more than Ireland promoting Britain as a tourist destination in America. As a result 3 million US tourists visited Great Britain in 1993 as opposed to 400,000 American visitors to Ireland. About 6 million Americans visited Europe. Ireland's share of US visitors to Europe has declined significantly in recent years.
We do not have the presence across America. They do not know we exist — they think we are part of Scotland. I visited America recently and people there thought that Ballybunion golf course was in Scotland. That is how effective our marketing campaign has been. We have not been putting sufficient money into it. A few years ago Dr. Tony O'Reilly said "for the effective launch of a single major product in the American market alone, we would require $100 million with a five to seven year payback to create a recognisable brand identity". This underlines the competitiveness of the international marketplace in which Irish tourism must compete.
The Minister, during a briefing of journalists last week on the manner in which he intends to spend the £5 million allocated in the budget for tourism promotion and development, said that there would be a new focus on the British and central European markets and that more money would be spent to allow tourists travelling from long haul destinations to, for example, London, to travel to Ireland at no extra cost. He repeated that today. I welcome that because, in a recent survey which I carried out — I will send the Minister a copy if he hs not got one yet — 36 per cent of the respondents, the highest number, sought an increase in the spend in the British market. In addition, 35 per cent sought an increase of the spend in the Continental market. In view of the response from the industry in that survey, the Minister is on the right track. The industry needs greater spending on those markets.
We are attracting only 4 per cent of the British market at present — the same as Cyprus and Portugal. Britain is our nearest neighbour and we should attract a greater number from the British market. If there is peace in Northern Ireland we will have great potential. In the past angling in Ireland was a great attraction for British tourists. However, the angling industry on the west cost of Ireland has been decimated by the occurrence of sea lice. That problem will have to be confronted by the Minister for Tourism and Trade as well as the Minister for the Marine.
With regard to the common rating of London with Irish airports, I mentioned that matter in the course of the Estimates last year. I realise that the Minister has been working on it and that Bord Fáilte has also given consideration to it. I am glad that the Minister is encouraging it. We have considerably increased the numbers coming here from Australia because of the common rating between Australia and London. It is the way for the future. There is no reason why common rating should not be introduced for destinations from Japan, South America the Far East and Canada which are lucrative markets from which there is no direct access.
Irish tourism has a challenging time ahead. The Minister must ensure that the national structures are in place to market Ireland and that there is money to support and guide the private sector's marketing effort. I agree with the Minister that the private sector should and will market itself and, through that marketing effort, will make Ireland better known. However, in every successful tourist destination the public purse is used to promote that destination whether by national government, as in the case of Britain and Spain, or state government as in Florida, or city government as in New York. They spend large amounts of money promoting their destinations.
The Minister must ensure that Government funding for marketing Ireland as a desirable tourist destination is increased to meet the challenge from the 150 competing countries around the world. This year, despite increases in funding for the Minister's Department, Bord Fáilte's budget has been reduced to £21.7 million. When one takes into account that it must pay personnel and other operating expenses from that budget, its marketing money has been reduced to a derisory sum. Last year it was said that Bord Fáilte ran out of money in April to promote Irish tourism in Germany. That was later denied by Bord Fáilte although I think it might have been denied as a result of fear of the Minister rather than anything else.
Bord Fáilte is underfunded and as a consequence is receiving a lot of criticism, some of it warranted but much of it unfair. The board just does not have the resources. Bord Fáilte, like every other State agency, has trimmed down and become more efficient. However, it will not be able to operate without enough money. It is important for the tourism industry that we have a good tourist board operating in the interest of the industry.
The Minister mentioned the streamlining and restructuring of Bord Fáilte various times and this created instability among the officials in Bord Fáilte. The Minister should make his decision sooner rather than later. If he intends to streamline Bord Fáilte he should do so and if it needs to be corrected it is his responsibility to do so. We need an effective national marketing board. Bord Fáilte has done much good unseen work in the past and it should not be reduced to an insignificant role. That role would seem to be affected or threatened in some way by the fact that the Minister's Department is taking £8 million to his Department.
The structures must allow for input from people who are in the tourism business. The new county enterprise committees must develop their tourism role and products in their counties and feed their policies through the RTOs into the Department or into Bord Fáilte. Tourism policy in the future will have to adopt a bottom-up approach, like the Leader concept, as it is important to get the feeling of what is happening on the ground. It is also important that Bord Fáilte's position should be clarified.
With regard to seasonality, it is important to have new products on the market. For example, the new Waterworld in Tralee is one attraction people can visit all year round. It is also important to have preferential rates in hotels, on public transport and preferential air fares into the country for tourists visiting in the off season. I agree that we should promote our cities but, on the promotion of Dublin, what is happening to the conference centre? That could attract 2,000 people every week.
The Deputy's time is up.
Ten minutes is a ridiculous amount of time to have to discuss this matter — I accept that is what we agreed —because there are many urgent issues relating to tourism to be discussed. There are many threatened structural changes that we cannot debate in this short space of time and I hope we will get some time afterwards to ask the Minister some questions.
It is unusual on 16 February, six weeks into the financial year and three weeks after the budget, to have a Supplementary Estimate before us. It does not bode well for public expenditure. However, the Minister is right in that if this money is going to be spent it is better spent now for the benefit of the 1994 tourist season. For that reason I will not raise any objection to the moneys being sought. I wish to draw attention to some aspects of this Supplementary Estimate which I raised with the Minister during Question Time today and which he said we could perhaps deal with here.
The Supplementary Estimate is curious inasmuch as it simply has the heading Revised Estimate. A Supplementary Estimate normally presented to the Dáil has the original Estimate, the additional sum now proposed to be voted and has the total sum now voted — it would have three columns. This Supplementary Estimate is curious in that it has one column but that is not the only curious feature. These are not just technicalities but have more meaning than might appear at first sight. It purports to be under subhead B.3, but subhead B.3 in the Book of Estimates is "Bord Fáilte Éireann Special Marketing Programme". The heading for subhead B.3 in the Supplementary Estimate is, "Payment to Tourist Promotion and Development Fund", which is totally different.
If one was producing a Supplementary Estimate to subhead B.3 one adds on something to subhead B.3 which is already there. The significance of this difference is that— I do not know if it is proper and perhaps the Clerk of the Dáil and the Comptroller and Auditor General should look into it — if one is having a Supplementry Estimate to vote additional money, how can the money be voted to somebody who is not mentioned in the original subhead? Should a new subhead not be opened? This underlines that Bord Fáilte is, to put it mildly, being sidelined, yet it is being done in a fairly heavy-handed way without a great degree of subtlety.
That is a matter I sought to raise with the Minister today in a question I put to him. He did not get around to replying to some aspects of it and he said that we might perhaps deal with those at this meeting. He spoke about the decentralisation of Bord Fáilte office. I agree with him; that is admirable and I congratulate him on such a proposal. I would like to know how far advanced that is. The Minister spoke this afternoon of a review of Bord Fáilte in the context of talking about consultant's reports. I urge him not to wait until we have another of these consultant's reports. One can hardly cross the road here without a consultant's report.
I agree with much of what the Minister said. At least he has the courage to stand back from one of these agencies for once — few Ministers will do so— look at it objectively and not be taken in by its institutional propaganda with which, as a Minister, one is inundated. However, to do some of the things he talked about this afternoon in a tentative way he does not need another consultant's report. He should tell this Select Committee precisely what he proposes to do and the sooner some of these things are done the better.
Deputy Deenihan got a little concerned about the fate that has befallen Bord Fáilte. I would not share his enthusiasm and I have a fair amount of experience from the other side of the fence. In the past few years it has improved immeasurably, but I recall that when I was Minister with responsibility for tourism about 13 or 14 years ago, there was a strong push by the Department of Finance to consider winding up Bord Fáilte on the grounds that virtually every tourist who came here would come here anyway. That is largely right because, unfortunately, most of our market is an ethnic market. The Minister adverted to that in saying that we will not be exclusively concentrating in the United States on the ethnic market. We virtually have done so because we hardly get any American tourism here that is not ethnic and when one sees the value of real American tourism in other countries it makes me lament somewhat that we get so little of it here. I resisted the Department of Finance at that time but it was not altogether wrong.
There has been an improvement in the past two or three years. Mr. Dully made an improvement and Bord Fáilte tried to come to grips with issues. The greatest waste in my view — I would ask the Minister to be careful of it in the context of this Supplementary Estimate —is on general promotion and advertising. The Minister mentioned in his speech that we will have an advertising blitz on Ireland to cover US television, newspapers and magazines over the next few months. That is a waste of money. It is particularly wasteful in Japan. He says that we will not have this unless we can monitor its results, but one can never monitor the results from that kind of general promotion.
My recommendation, based on some experience, is that this new management committee, which will now be spending the money instead of Bord Fáilte, should concentrate on particular specific areas of activity in which to advertise. A good example of that is golf. This country is much better positioned now than ten or 12 years ago to take full advantage of a great deal of money that is to be made from golfing tourism. I particularly recommend advertising that in Japan. The Minister is proposing to spend £100,000 in Japan. That is the equivalent of spending £1 in Dublin. What influence can that have? If one only has that tiny sum of money to spend in such an enormous market, one should pick the most valuable market of use to this country. That is clearly golf.
Two 747s a week fly into Scotland with golfers, and have done for many years past. We have never been able to obtain that business. In 1980 I failed to do so because the facilities were inadequate; not the courses but the clubhouses. They are no longer inadequate. Many of the long established, world famous courses in Ireland have splendid, magnificent modern clubhouses, such as Ballybunion, referred to by Deputy Deenihan, Killarney, Tralee, Galway Bay and many others on the west and east coasts. There are tremendous opportunties.
Rather than dissipating £100,000 in Japan, which would be a drop in the ocean, the Minister should concentrate on a specific sector where we could get a big return. Japan is the only country in the world where ordinary people can hardly ever play golf because they cannot afford it. Even ten to fifteen years ago Japanese people were booking weeks in advance to hit 100 balls in a driving range in Tokyo at 3 a.m. That still happens, although now there are more driving ranges. Japanese people could not believe that one could play a day's golf on an Irish course for as little as 1000 yen. I told them this and they thought I was leaving out some noughts.
Quite a few of our people do nothing else.
It is not uncommon for Japanese people who want to play golf to pay between £5,000 and £7,000. This is a glorious opportunity but dissipating £100,000 in a huge market is a waste.
Similarly in the United States we should concentrate on those areas of activity where we are strongest because we are weak in many areas. I am not clear whether the figures quoted by the Minister on tourism from the United States are accurate. One figure sticks in my mind. In 1969 Ireland had 4 per cent of all American tourists to Europe. Now we get 2 per cent despite there being more people travelling. That is a huge loss. If we could again have 4 per cent of American tourists it would make a great difference to the Irish economy.
The Minister understands the significance of tourism, which was not understood by many of his predecessors. The great advantage of tourism is that if one is successful in that field it generates economic activity extremely quickly. It is unlike industrial development where one often waits up to ten years for benefit to flow from the investment. That is why tourism is so valuable. There is also a low import content in tourism.
Further, it has huge regional connotations here. By definition the more remote places will benefit most from it. That is commendable in Ireland which is biased in favour of the development of Dublin and has damaged itself as a result.
There are other aspects I would have discussed if I had more time available but I have dealt with the issue as rapidly as I can. I ask the Minister to deal with my points in his reply. No doubt we will be able to ask him questions when he has replied.
On the face of it the measures proposed in the Supplementary Estimate seem sensible. No one would quarrel with having sufficient funds available for tourism promotion and development programmes in time to impact on the 1994 season.
As Deputy O'Malley said, it is important to increase the number of tourists from the US market. That market declined last year, mainly because of the slump in the first six months. One factor highlighted by tourist industry insiders is the continued unresolved difficulties at Aer Lingus. There is a view abroad that because the industrial relations problem has been solved we need not be concerned with other aspects.
At the peak selling period last year, the depth of the airline's crisis was becoming apparent to the US travel trade. Americans are used to once famous names in the travel trade going out of business overnight, such as Pan-Am. It is significant that of the Americans who travelled to Ireland last year, 58 per cent came via London. Therefore it is important that the future of the airline be put beyond doubt.
Aer Lingus is currently in discussion with several long haul airlines about a common fare rating for Ireland and a number of European destinations, especially London. Perhaps the Minister has information on that. The importance of common fare ratings can be seen in the big increase in Australian visitors, for example. For the long term development of Irish tourism, long haul visitors from Japan and America as well as Australia should be able to avail of a common fare structure.
The counter-seasonal measures mentioned in the Estimate are to be welcomed. A more even spread of tourists throughout the year would make the industry more competive.
The employment potential of a significant increase in tourism is enormous. According to the chairman of CERT, targets of 35,000 new jobs in tourism during the next five years are tough but can be realised. It is nevertheless true that many jobs in tourism tend to be rather low paid and exploitative, involving antisocial hours and poor working conditions.
I am sorry to interrupt you, Deputy. I suggest we adjourn discussion of the Supplementary Estimate until such time as the vote in the Dáil is complete.
Sitting suspended at 5:10 p.m. and resumed at 5:15 p.m.
When Question Time was interrupted today we were trying to get some answers from the Minister on the references that have been made publicly about the possible restructuring of Bord Fáilte or a change in its role. I do not have enough knowledge about it to come down on either side of the argument Deputy O'Malley and Deputy Deenihan presented. However, it is important that we know about the future of Bord Fáilte and where it fits into the overall tourism industry. The Minister, it seems, has set up a rival in terms of the new Tourism Council. I am not sure if that was the traditional role of Bord Fáilte and that its board was carefully selected to provide the type of input the Minister now seems to be seeking from the Tourism Council. I am not sure of the distinction and why we need to duplicate it. Deputy O'Malley also referred to the point that it appeared Bord Fáilte was being sidelined in an unsubtle fashion. In The Irish Times of 22 November 1993, Jim Dunne directly quoted the Minister with reference to the £3 million provision for the American market:
. . . . "The move indicates a new era in Irish tourism," said Mr. McCreevy, who recently criticised Bord Fáilte for behaving like "an independent republic".
There is nothing subtle about that. I would be interested to hear the Minister elaborate on that point. It is a pointed criticism of the body that has been charged with this responsibility over the years. What exactly is the Minister saying? He said in the Dáil today that there could not be any doubt about who was responsible for tourism policy, he and his Department are responsible. I am surprised by that, although I am not commenting on whether it is right or wrong, because, in his former incarnation, the Minister would have been the last to recommend that civil servants should take over the running of an important industry. I am surprised, therefore, that he seems to be arrogating so many of the functions that were apparently the responsibility of Bord Fáilte to himself and his Department. It may be, given the manner in which the Cabinet posts were restructured last year, that it makes sense that this should be done. However, I have not heard a clear statement of philosophy on it.
The Minister said in the House that Bord Fáilte would now be the executive arm, that policy would be made in the Department and that Bord Fáilte had not managed to stay abreast of changing markets in terms of developing a strategic response. That may or may not be true but it is a critical question on which we need to be clear.
Recently articles have appeared in the newspapers to the effect that Bord Fáilte has been sidelined, Its head office could be moved out of Dublin and there is a question as to the manner of its survival. For example, will it be greatly slimmed down with an exclusively promotional role, led directly by the Minister himself it would appear, rather than the chief executive, which may be desirable? It is an area that should be teased out given its importance. If it is the case that Bord Fáilte Éireann has not managed to keep abreast with the times, so be it and let the matter be addressed. Having considered the Minister's opening remarks, I note that he does not deal with the matter in any great detail.
The Committee has set aside 20 minutes for questions and answers with the Minister. Are there any Deputies who would care to put a question to the Minister?
May I suggest that it might be better if the Minister were to reply to the comments that have been made and then follow with the question and answer session? Otherwise we will be repeating ourselves.
There is time set aside at the end for the Minister to respond to comments.
Perhaps the Minister should reply to our comments first.
The Committee will proceed on that basis.
I will start by answering some of the questions raised. This Committee is addressing the Supplementary Estimate. Question Time has dealt with gender and other aspects of tourism. I have concentrated on the Supplementary Estimate, but some questions on other topics have been raised which I will endeavour to answer.
I will address Deputy O'Malley's comments on the subhead first. This format was agreed by the Department of Finance. Given that there were two separate sums, £3 million in the original Estimate and £5 million announced in the budget, the logical step to take was to merge them into one subhead. There was nothing sinister about this and it was undertaken with full consultation with the Department of Finance. The reason both sums appear under subhead B.3 is that this was the most straightforward way to proceed. A new subhead B.7, could have been opened, but this would have entailed making a number of changes to the subheads. Therefore, the step was taken for administrative reasons.
Although the original sum of £3 million was shown as a grant-in-aid to Bord Fáilte Éireann, it was always my intention, as I announced when I gave the details of the £3 million, that the money would be spent by my Department in this way. The difference between this and other Supplementary Estimates is that this has to be taken in advance of the main Estimate to allow the draw-down take place immediately, which is necessary if we wish the fund to have any bearing on the 1994 season.
There was a need for a Supplementary Estimate as this was a new service to be provided. As Deputy O'Malley would be aware, when a new service has to be provided and there has not been a subhead in respect of it, the money cannot be spent until voted on by the Dáil. If we were to proceed in the normal way, this subhead would not become effective until November or December 1994. In view of this, it was decided to proceed on this basis. There was nothing sinister about it.
Deputy Deenihan commented that part of this £8 million will be directed to common fare rating. As Minister for Tourism and Trade I have emphasised that there is no point in fooling ourselves that all the major airlines will fly to Dublin, Shannon or wherever and that therefore common rating, or the free flight concept is the way to go.
The Deputy mentioned Australia; the numbers have increased enormously in respect of this market but, surprisingly, although the facility is there, many people coming from Australia are not aware of it and pay to go to Europe and then fly on to Dublin. It is not very well advertised. The facility has been in existence for some time and has contributed to the upsurge in the numbers. Part of the money we are giving this year to tourism from Australia is to boost the resources given to common fare rating, or fly free, so that more people will be aware of it.
This is the way to go in this area. If one estimates all the people who come to Europe, from South America and Asia, etc., most of them travel to London or Paris, and our task is to get them to fly onto Dublin. This brings me to the point raised by Deputy Rabbitte. Much of this £8 million will be going to the common fare rating ideas which have been introduced. My Department, the Department of Transport, Energy and Communications, Aer Lingus and Bord Fáilte Éireann have been in negotiation with some of the major operators to extend it to other areas. Hopefully, therefore, in 1994, more airlines and more destinations will come under the common fare rating facility.
Deputy Deenihan raised the issue of the conference centre. I would like to be in a position to advise the Deputy that I will be officiating at the opening of the centre sometime this year, given that it has been discussed for a number of years. This will not happen but, hopefully, the location will be decided upon and matters will be put in progress to have it operational. As the Deputy is aware, the conference centre has been suggested for some time. I have provided a sum of £25 million under the National Development Plan, 1994-1999, but the decision on the location of the centre has been delayed.
Some years ago an interdepartmental group was established under the auspices of the Department of the Taoiseach which heard submissions from outside experts from a variety of bodies. They concluded that the preferable location would be the RDS site at Ballsbridge, Dublin. Unfortunately, there have been other problems with the centre. The Taoiseach has answered questions on the matter and I hope these issues will be resolved in the near future. We must get moving because, as the Deputy has correctly pointed out, a proper conference centre should mean a considerable increase in visitors, and in high spending visitors. The money has been provided and it is a matter of dealing with the other details which are causing some difficulty.
Deputy O'Malley made some interesting remarks on tourism, which is not surprising as the Deputy is from the midwest region. The Deputy implied that I was none too subtle about my activities with respect to Bord Fáilte Éireann and suggested that I was going to control money in this area. While I could not be accused of being too subtle, Deputy O'Malley would not be considered the most subtle politician to sit in Dáil Éireann. I made my views clear as to how I see tourism policy develop in the future. In response to Deputy Rabbitte, I believe public servants, whether they be public servants in the general sense or civil servants, undertake an effective job for which they are trained. However, I believe strongly in business and giving responsibility to those who make their pounds and pence.
As I outlined in the Dáil at Question Time today, I have reviewed a wide variety of activities in my Department, I have established various new structures and I have made no secret about the fact that I am considering the role of Bord Fáilte Éireann. Recently I said that in the near future I hoped to make an announcement on this matter.
Regarding Deputy O'Malley's comments on whether we have enough reports and recommendations, my response is yes and no, yes, in the sense that I could fill this room with reports on the tourism industry in Ireland compiled by my Department. These reports were commissioned from State agencies and Government Departments, but the greater number were commissioned from outside bodies at considerable cost. At this point action must be taken; in that given the ideas I outlined in the Dáil today on the role I envisaged for Bord Fáilte Éireann, it may be necessary to have an outside group examine the ways in which this role may proceed in the future because there will be a need, for some considerable time, to have Ireland marketed and promoted by an agency of some kind. However, I envisage a greater role for those in the business of tourism, who make their living from it, being involved in promotional activities.
Regarding Japan and golf, like Deputy O'Malley my first visit to Japan was in 1987 as a backbencher and I was amazed to see people playing golf in the middle of the night. It would have cost £500,000 to join the most expensive golf club in Japan at that time, a frightening statistic.
At that time it cost £0.5 million — I converted the figure from Japanese yen — to join the most expensive golf club in Japan. That gives one an idea of the potential for the Irish golf market and I have looked at what could be done in that regard. However, there is one snag. The concept of holidays and time off is not foremost in the minds of Japanese. If a chief executive or the equivalent of a secretary in a Government Department took 4 days off, it would be a matter for resignation. A colleague of Deputy Deenihan's accompanied me on that trip. He is now a Front Bench member of that party. At lunch one day he spoke to a man who was the equivalent of a secretary in a Government Department. He asked him how many weeks holidays did he get. The man told him he took three days the previous year. Deputy Deenihan's colleague replied that in Ireland we regard that as a long weekend.
No wonder he plays golf in the middle of the night.
That is the only problem we face. As I said, the £100,000 which is to be spent on the Japanese market is a small amount. In the past two years we involved a travel tour operator in the promotion of Ireland. Previously a consultant operated on his own. That is why there has been an increase in numbers. Although £100,000 is a small amount, we are channelling it in a different way. It is regarded as seed capital to assist this person. In Japan £100,000 would not provide someone with a good weekend away because it is an expensive place to live.
Bord Fáilte's core function is to promote and sell Ireland. Although there has been criticism of it, a lot of good work has been done over the years. A question which must be asked of any tourism agency is whether it brings people to Ireland? Deputy O'Malley said 12 or 13 years ago he resisted a recommendation that Bord Fáilte should be wound up. It was believed that the tourists who came to Ireland would have come regardless of Bord Fáilte. Some people in the business would say that is still the case, everyone will agree Bord Fáilte has done a good job in recent years. Any agency which promotes tourism must be judged on its contribution to tourist numbers and also the money they spend.
I would like to take issue with Deputy O'Malley's point. Scotland is an example of the fact that marketing works. It attracted 200,000 more visitors than Ireland over the past ten years. Britain attracts three million visitors from America each year, while we only attract 400,000. Many Americans do not know where Ballybunion is located.
The product is rather different.
Perhaps. We have ethnic connections with that country. I know people of Irish ancestry who never see this country promoted in America and this influences people. I take the point that most British tourists have ethnic connections with Ireland and that we have lost the real British tourist. However, we must sell Ireland in America and on the Continent where we have few ethnic connections. If we do not do this, we will lose out to our competitors.
As regards Bord Fáilte — I do not want to labour this point as I know the Minister is evading the matter because he cannot be too upfront — we need a stong marketing board. England and other countries have strong tourism marketing boards. Could the Minister outline the role of the board of Bord Fáilte? It had a major role in the formulation of policy and an advisory role, but that has since been taken over the Tourism Council. Does the board of Bord Fáilte have any role other than to supervise staff and appoint an executive? Are these people just wasting their time or are they a group of political appointees?
The Minister referred to the World Cup. After that event in Italy in 1990 there was little direct input from Bord Fáilte to increase the number of Italian tourists travelling to this country. As a consequence of the behaviour of the fans and without a formal marketing push, we secured a large market. How does the Minister intend to maximise the fans who will be an attractive asset in helping to increase the number of Americans travelling to this country? If this is not done, the money which he has made available may not be effective? Does he propose to use the fans as part of the marketing structure?
Subsidise their airfares and give them free tickets.
Mr. O'Keeffe
I believe the Minister is taking a step in the right direction. We have been critical of Bord Fáilte for many years and the Minister is now doing something outside of it. He has an allocation of funding which will help the tourism industry. Bord Fáilte is a bureaucracy and it is slow to make decisions. As the Minister said, the core function of Bord Fáilte is to sell Ireland abroad and this has not been done successfully in recent years. There has been a fall-off in tourist numbers from different countries. A more vigorous approach is needed and the £8 million will solve part of that problem.
A point was made about indoor activities. I will not quote a famous American president who spoke about our windy and misty isle. If there are insufficient indoor activities, it is not attractive to visit this county because of our climate. Attractive water world projects are popular in many parts of the country. The south-east, from Tramore to Bantry, does not have a facility of that nature. I understand a project has been mooted in the famous seaside resort of Youghal, County Cork. I ask the Minister to examine it and to get funding from Bord Fáilte or Cohesion or Structural Funds to get it off the ground. This area is well developed in the outdoor sporting area, for example, golf courses, etc., but there is a void in regard to indoor activities. Many race meetings are held in that area.
I do not criticise the Minister for making £100,000 available. He mentioned seed capital. We are trying to develop a niche market and are seeking to attract those who play golf. Investment, encouragement and promotion are needed. What the Minister is doing is welcome. This is a breath of fresh air for the tourism industry. The Minister is the first to take Bord Fáilte in hand. I welcome his suggestion that there may be a need for decentralisation because this may enable it to get out of the present environment; it has lost its way in many respects because of its thinking.
The Minister's replies were vague. Unfortunately, like many people last week he was more interested in talking to the press than to this Committee or to the House this week. This is a pity but there is nothing we can do about it. It is the age in which we live.
The age of PR.
There were also the events of Tuesday morning for the same reason; it was the same syndrome. The Minister stated that the World Cup will make a great impact and can be of great value to us. Deputy Creed mentioned the impact that the last World Cup in Italy could have made and, perhaps, did make. Without spending money, there was a huge upsurge of tourists from Italy after Ireland had done well in the World Cup. The Minister, his Tourism Council and management committee and Bord Fáilte should bear in mind that in Italy the World Cup was of profound interest to literally every man, woman and child there. In America it is a matter of total indifference. Most Americans do not have the slightest interest. I was talking to Americans in the last week or two who asked me was it rugby or Gaelic football which was played in the World Cup and whether American football would be played in it. They have no idea what it is about and have no interest in it. Of the 50,000, 60,000 or 70,000 who will attend a match, 95 per cent will be non-Americans.
The Mafia are very interested
This should be borne in mind. The most important aspect of the World Cup from our tourism point of view is that there will be 20,000 empty seats on aeroplanes returning to Ireland in June and these should be marketed very cheaply. There is no point thinking we can sell a huge message in the belief that the American nation will be throbbing with interest in the World Cup. They do not have the slightest interest in it. Television rights are being mainly sold to the remainder of the world. While the matches are on, many Americans will watch cartoons or other programmes, they will not be watching the games. Advertisers will not take advantage of the World Cup because there is no market and it is of no interest to them. It is a worldwide, and not an American, phenomenon.
Bord Fáilte, like Aer Lingus, will be one of many bodies represented on the management committee. Aer Lingus, particularly in the context of what the Minister said about free fly onwards, should not be the only airline to be represented.
It is not.
I am glad to hear that.
This is not my responsibility but I agree with the Deputy.
It should not be the only airline to be represented on this management committee or on similar ones. The Minister explained at some length how the £100,000 will be spent in Japan. I do not want to make an issue about such a small sum but it is so small it will only have an effect if it is spent with a specific purpose in mind. The Minister said that we desperately need to accentuate in that country the awareness of Ireland's many attractions. This is globalising the issue. The biggest problem Ireland has in relation to Japan, as I know from being there many times, is to explain to them that it even exists. I have spoken to the chairmen of some of the biggest companies in Japan, which are also the biggest companies in the world. They thought Ireland was like Yorkshire. They have a fixation that there is a country called the British Isles. They were probably taught this at school 40 or 50 years ago. They think Ireland is a little division of a country called the British Isles, which has component parts called Scotland, Yorkshire — they always mention Yorkshire — Ireland, Wales and London. They think these are provinces or prefectures, as they would see it, in a larger country. To talk about Ireland's many attractions is a waste of time in a market like that.
We must target people who will be able to identify Ireland with a specific thing. Golf is of consuming interest to many of them. Some of the best golfers in the world come from, and play in, Ireland. The way to sell Ireland to people in Japan is to sell something with which they can identify. They do not identify with places like Connemara, Kerry or Donegal because they are too vague and they do not know where they are.
I call on the Minister to conclude. We agreed a timetable. Unfortunately, the time allocated to each speaker is extremely short. We have an agreement and I am not going to depart from it.
Chairman, you should give me a few minutes as I had to go to the Dáil for a vote.
No, I will not. An agreement was made. This is most unfair.
The agreement was made before the vote took place in the Dáil. This is very unfair.
Your convenor and spokesperson were here when this agreement was reached.
Maybe the Minister will give two minutes of his time to Deputy Sheehan.
I would rather not agree to this. I call on the Minister to respond.
The increase in the number of tourists from Japan was related to Irish participation in the World Cup because people saw the Irish fans in Italy. It was not planned in advance to sell Ireland. The good behaviour of the fans contributed to an enormous increase in the number of tourists from Italy. The additional £8 million will not be spent on any promotions in relation to the World Cup. Bord Fáilte already has plans to assist Irish people going to the World Cup.
An interesting point was raised about the seats that will be available when the planes return from Amercia. We have asked Aer Lingus to offer packages in this regard. This could contribute to an increase in tourist numbers. Deputy O'Malley is right in saying the World Cup is of total disinterest to most of the United States population. I was there in the last year and they did not know what we were talking about when we spoke about the World Cup. None of the £8 million is related to specific gimmicks and the World Cup. Bord Fáilte has already put in place its own promotions operation, which includes tee-shirts. We will see how this will work. The Italian experience was great because of its spontaneity rather than a pre-arranged plan. We would not like all our fans to encourage people to come to Ireland because it would not work.
Deputy Ned O'Keeffe mentioned the problem of all weather facilities. I am aware of the Waterworld project in Youghal. There is no money left at the moment but it will be considered in the next operational programme. Youghal is in a part of the country which does not have such facilities and I am sure we will give sympathetic consideration to this project.
Deputy Deenihan asked about the role of Bord Fáilte. It remains as it always was. It was set up in 1939 and there has been various tourist traffic Acts since then. Its role is to promote Ireland and to get people to come here. Despite what some people might have thought over the years, the Minister for Tourism is the only person responsible for tourism policy and Bord Fáilte is the agency which carries out the policy decisions of the Minister and the Government.
Does it have an advisory role?
That has always been its role. With regard to the Japanese market, Deputy O'Malley is correct that it would be a waste of money to spread a campaign over a large market such as Japan. This will be specifically targeted at companies which we are co-operating with in Japan. For example, a large numfier of Japanese VIPs and tour operators will be coming to Europe for the opening of the Channel tunnel. Some of this money will go to bringing them here because they will be selling holidays. Most Japanese have never heard of Ireland and those who have think it is either Iceland or somewhere near London. However, we are going to try to target a number of specialised tour operators to make them aware of Ireland. A global campaign would be a waste of time.
Report of Select Committee.
I would like to thank the Minister and the Deputies for their cooperation. I propose the following draft report:
The Select Committee has considered Vote 35 — Tourism and Trade (Supplementary Estimate). The Supplementary Estimate is hereby reported to the Dáil.
Is that agreed?
Report agreed to.
Ordered to Report to the Dáil accordingly.
The Select Committee adjourned at 6.15 p.m.