Molaim: "Go léifear an Bille don Dara Uair."
The Bill provides for increasing the statutory limits on the total amount of grant-in-aid which may be paid out by Bord Fáilte for development purposes. The current statutory limit on grant expenditure for amenity development will be reached before the end of this year while the limit on Exchequer grant assistance for the development of tourism accommodation will be reached sometime in 1988. Consequently, it is necessary to increase the amenity limit immediately to permit Bord Failte to make full use of its capital allocations for 1987. It is also appropriate at this stage to increase also the accommodation limit.
The statutory limits were last raised to £30 million and £14 million respectively by the Tourist Traffic Act, 1983. The increases of £6 million and £4 million on accommodation and amenity limits, respectively, now being proposed in section 2 of this Bill, under present policies, could be expected to cover grant payments until at least 1990. That seems to be a rational situation.
I want to emphasise that this does not imply continuation of existing grant schemes or introduction of new schemes in the foreseeable future. The existing schemes are subject to review each year during the annual Estimates exercise and their continuance would be subject to rigorous appraisal and also require approval by Dáil Éireann.
I should like to articulate further the importance of tourism for our economy and the Government's strategy for its development. Sustainable increases in employment numbers and opportunities are the Government's number one priority. To achieve this we must develop those sectors where we have a natural advantage or the materials to develop and sell a good product in international markets.
One such sector is tourism which has been singled out by the Government as a target area for the generation of wealth and jobs. Tourism is one of the fastest growing industries in the world. If present trends continue, it will, by the end of this century, be the largest single industry in the world. I repeat, it will be the largest single industry in the world. It is difficult to believe that manufacturing industry claimed the headlines in this area hitherto. They used to say what was good for General Motors was good for the USA, and what was good for the USA was good for the world. Tourism will soon be the largest single industry in the world. Provided we can produce a good quality product at the right price and market it professionally, there is no reason why we cannot increase our share of this rapidly growing market.
Within six weeks of coming to office the Government had agreed the broad strategy for developing the tourism sector. It has five essential elements: to revive confidence in the industry by demonstrating the Government's commitment to it; develop and improve the competitiveness of our existing products; expand the range of products we offer in line with changing tastes and new demands in international markets; provide extensive and cheap access to Ireland for foreign tourists; and, I want to emphasise this, to be more selective and aggressive in our marketing of Irish tourism. The Government's package announced on 3 May was the first phase in implementing this strategy. It has worked magnificently well. Confidence in the industry has revived and all the major operators have offered significant price reductions to improve our competitiveness. I would like to pay a tribute to them for having done so. They realised this was in their best interests and they did it. The contents of this Bill mainly deal with product development. Grant assistance is only one of a range of incentives provided to stimulate investment in product development. These incentives include concessionary loan finance run by the Industrial Credit Corporation in conjunction with the European Investment Bank and availability of funding from the National Development Corporation.
Meanwhile the extension of the business expansion scheme to export tourism provided for in the Finance Bill currently before the House will act as a further stimulus to investment by the industry in tourism. I have received many congratulatory messages about the extension of the business expansion scheme to export tourism. Obviously people were anxious that this should happen and they are now ready, willing and able to participate. It completes what is now a very comprehensive and attractive series of investment incentives for tourism. However, incentives and a willingness on the part of the industry to use them are not in themselves sufficient to ensure maximum return for the national economy on resultant investment. Investment must be directed at developing a range of products for which there is clear demand and a well organised marketing strategy.
The tourism sector is complex and diffuse and, consequently, more dependent on the State than other sectors for the overall leadership which is now an absolute pre-requisite for success. The application of the business expansion scheme to export tourism will be designed to channel investment into the kind of tourist facilities which offer the best possibilities for a speedy return to the economy in terms of foreign revenue, tourism numbers and jobs created. It is my intention that a similar sense of market sensitivity will also be applied to the future allocation of grant assistance.
For too long the tourism sector has been left bereft of the strong, forceful leadership it urgently needs. Although the international tourism market has been growing rapidly over the last decade, our share has been declining. To realise the full potential for job and wealth creation of this sector we need not only to recover lost market share but to increase substantially our performance in a market currently projected to double between now and the year 2000.
Already the Government have shown quite clearly their determination to give the kind of leadership the sector needs for a return to growth. On assuming office we carried out a full appraisal of the targets which Bord Fáilte had set for the 1987 season. We were frankly shocked by the complacency and lack of ambition which they showed for the sector. The new revised targets which have now been set by the Government reflect more accurately the industry's capacity for growth, and the current opportunities in the market. If we do not set out seriously to pursue and seek growth, then we will not achieve it. We are perturbed about the continental market, particularly the German market. We want to target that market and increase the numbers of tourists coming from that area.
The amalgamation of tourism with transport in one Department at this time of change, especially in international aviation, provides unique opportunities to encourage and facilitate increased foreign tourist traffic. Our policy is to ensure that the benefits of increased competition are, first and foremost, concentrated in our main tourist markets. Our success in persuading the carriers to agree to sponsor the attractive fare packages on key tourist routes announced in the Government's 1987 tourism programme provides powerful testimony of the Government's determination to implement its drive for tourism growth with greater efficiency and competitiveness in the transport sector. Government efforts in providing an additional £1.25 million for foreign promotion this year provides further proof of our commitment to this sector.
There are strong indications that Government action on tourism is working. Reaction from the tourism industry has been overwhelmingly positive. This is underwritten by their willingness to offer significant price reductions, something I mentioned already, to complement our programmes for this year. Prospects for the 1987 tourist season are excellent. The director general of Bord Fáilte has stated that Irish tourism is on target for one of its best ever years with great buoyancy being shown in all sectors — both foreign and domestic.
We should not forget the domestic market. We hope to strongly emphasise the importance of this market, so that holiday money which might go elsewhere will be spent at home. Preliminary results for the first quarter of the year show that traffic from Britain grew by nearly 19 per cent. Traffic from America jumped by 24.6 per cent over the same period last year, which was not a good year for US tourist traffic. I should point out that the period to which I am referring, in which we had a 24.6 per cent increase over the same period last year, was before the Libyan crisis and the Chernobyl disaster. Those two events had a great impact on our tourist industry last year, to its detriment.
Continental European traffic grew by over 8 per cent, making an overall growth of overseas visitors of 17 per cent for the January-March period. The figure of 8 per cent is not satisfactory as far as continental European traffic is concerned and we intend to target that sector very strongly with a view to substantially increasing it. I had a meeting today with a French based group and they indicated that they would be bringing 20,000 visitors to Ireland in the autumn, which is very welcome news and shows considerable enterprise on the part of the south of Ireland tour operator.
Preliminary results for April show that this trend is continuing; inquiries at Bord Fáilte overseas offices are up, while air and sea operators and the large tour operators and organisers of travel to Ireland from our main markets are all confidently forecasting growth on 1986. I do not want to emphasise 1986 because it was not a good year for the tourist industry.
This momentum will be maintained. There will be no let-up on the Government's part. I intend to put in place in time for the 1988 tourist season a strategy which will build on this year's success and guide expansion in the sector up to 1993. We are promising a new era for Irish tourism.
Returning to the Bill now before the House. I should explain that the main elements are contained in section 2. Section 2(1) deals with the limits on grant aid to holiday accommodation. Grant assistance of over £5 million has been provided by the Government, through Bord Fáilte, for the development of holiday accommodation since the limit was last raised in 1983. This grant expenditure has had a positive effect on the upgrading and expansion of our accommodation stock. Specific grants have been available at various stages for the hotel and guest-house sector, the caravan and camping sectors, town and country homes, farmhouses and also for the expansion of the youth hostel network.
Accommodation schemes in operation at the moment are for caravan and camping and for the supplementary holiday accommodation sectors which cover town and country homes and farmhouses. There is a special need in these areas to continue to improve standards and upgrade facilities. They represent a very important element of the accommodation sector and are particularly well suited for growth, in line with the trend towards more outdoor-activity type holidays.
The scope of the supplementary holiday accommodation scheme was extended earlier this year, and now applies nationwide. Previously the scheme excluded County Dublin and premises within a seven mile radius of Cork city and a three mile radius of towns of over 3,000 population. How far is Kilkenny from Cork? However, the widening gap between standards of similar accommodation in urban areas and in rural areas in recent years justified this extension.
This particular accommodation category has the highest satisfaction rating from foreign visitors of any accommodation product and we are most anxious that this level of satisfaction be maintained. It is interesting to note that all the information coming to Bord Fáilte indicates that the degree of satisfaction is very high.
By the end of this year Bord Fáilte will have paid out almost £29.6 million in grant aid for accommodation since first introduced by the Tourist Traffic Act of 1959. This leaves less than £.4 million remaining before the statutory limit of £30 million in reached. I, therefore, propose that the statutory limit be raised now from £30 million to £36 million. This will be adequate to cover existing accommodation schemes until 1990, at the earliest, as well as allowing some leeway for their extension or possible introduction of new schemes should the House decide that this is warranted.
Section 2(2) deals with grant expenditure for the development of tourism related facilities and amenities. The existing statutory limit on grants of this nature is £14 million and expenditure up to the end of 1986 amounted to almost £13 million. The 1987 allocation for this type of grant expenditure is just £1.2 million, bringing aggregate expenditure on amenity development by the end of this year to over £14 million. The current statutory limit of £14 million must, therefore, be increased now to ensure completion of this year's amenity development programme.
Since 1983 the Government, through Bord Fáilte, have provided almost £4 million in grant assistance for the development of tourism amenities and facilities in the non-accommodation area. This expenditure has stimulated the development of a wide variety of facilities including angling — of great interest to my area — inland waterway development projects, heritage centres and the upgrading and extension of the local tourism information network, which has been marvellously improved. Other areas of major grant expenditure include water sports facilities, equestrian centres, historical and cultural sites, parks and great houses and gardens.
As I said earlier, the statutory limit covering this particular area will be reached during the current year and I am accordingly proposing that the limit be increased from £14 million to £18 million.
Tá áthas orm an fhaill a bheith agam teacht anseo chun an Bille seo a mholadh don Dáil. Tá a fhios agam go mbeidh tacaíocht le fáil agam ó na páirtithe éagsúla chun tionscal seo na turasóirechta a fheabhsú, a fhorbairt agus a chur ar aghaidh. Dá bhrí sin, molaim an Bille don Dáil.
