Last night I was dealing with the serious recession in the tourism industry which was pinpointed clearly in the Irish Independent of last Friday. This is so serious for the industry and the economy generally that it should have the immediate attention of the Minister, Bord Fáilte and the tourism industry.
There has been a grave downturn in the numbers of American visitors to Ireland. I understand it could be running as high as 30 per cent less than the 1990 figure. A 25 per cent downturn would, according to the industry, represent a loss of £67 million in the season. At this point, therefore, with a 30 per cent drop, the losses to the industry are substantial. Because of its importance to employment, to the industry and to the economy generally, this should have the very urgent attention of the bodies immediately concerned and the Minister responsible.
It has been contended that the Gulf War was a major factor in the anticipated downturn in tourists from America. This is too simplistic an answer. There are factors which run deeper that require thorough investigation so that we can capitalise on the immensity of the American tourist market to Ireland in the context of the vastness of its resources and the ethnic Irish population of about 42 million people.
The means of travel and the cost of travel are the two most vital aspects for consumers travelling abroad. Currently Irish tourism has a major handicap in that only two major transatlantic lines serve it, Aer Lingus and Delta. It is regrettable that Aer Lingus did not proceed with servicing the west coast of America, particularly San Francisco, which has a very large Irish population. Britain has a minimum of ten scheduled flights per day with a multiplicity of chartered flights. The latest estimate of American tourists to Britain is five million. Britain is a primary tourist centre; Ireland is secondary. The cheaper air fares offered by some of the airlines servicing Britain directly from the States must be a factor in the decision of American tourists to go to Britain which should be thoroughly and objectively examined.
The next point I want to make is of considerable importance. In the context of the numbers of tourists going to Britain, there is an absence of a cohesive strategy to give American tourists an incentive to combine their visit to Britain with a visit to Ireland, even for one, two or three days. If we properly developed that type of sales strategy with the good will and co-operation of all airlines serving Ireland, a substantial volume of additional American trade could be converted to benefit Irish tourism. I would strongly urge the Minister and Bord Fáilte to examine this possibility very thoroughly.
When British Airways discontinued its service to the Republic last February I contended that it was of major significance to Irish tourism and to Irish business and that consideration should be given to initiating an alternative service to replace it. British Airways are one of the most prestigious airlines in Europe and spend colossal sums in marketing and advertising in every centre they are servicing. We suffered the loss not only of the service but of the benefits of the promotional activities of British Airways. A clawback of American tourists coming indirectly to Britain will be more difficult to achieve because of the loss of frequent flights to Ireland by British Airways. Nevertheless, it is an area that must be tackled for the sake of Irish tourism and the Irish economy, because I am quite sure that with the proper strategy and with proper incentives a substantial number of that five million plus could be attracted to Ireland. American tourists have travelled 3,000 miles and are within 45 minutes of this country. What I am suggesting could be done, and I urge the Minister to give a lead to the industry. It would give a fillip to Irish tourism if we could clawback some benefit from the very substantial volume of American visitors coming into Britian.
The next point I would like to make is in regard to marketing and promotion, where we are spending far too little. I am conscious of the budgetary limitations but there would be an enormous return from moneys spent in promoting tourism. The return would be at least six times — it might even be as high as eight times higher than the return on money invested in other developments. In 1990 the industry put up £56 million while the State put up £18 million for the marketing and promotion of tourism. While I welcome this investment by the industry in conjunction with the State, I should like to point out that the majority of those involved in Irish tourism are small family businesses. They do not have the capacity to keep pumping money to the tune of £56 million per year into the promotion and marketing of tourism. In view of the returns in terms of jobs, wealth and the expansion of the industry, the major onus rests on the State to invest money in this area.
We have tremendous products to sell in the area of tourism — friendly people, our relaxed way of life, a variety of excellent sporting activities, open roads and unrivalled scenery. I do not think any other country has such a variety of products to offer. However, we have to accept that all countries are competing for tourists and unless we promote and market our product properly we will lose these tourists. It has long been accepted that we will not have a boom in our tourist industry in the absence of American tourists.
Last February the Minister sent me a copy of the Bord Fáilte Marketing Campaign for 1991, which states:
Apart from a two-week 10 city series of workshops in North America held earlier this month Bord Fáilte has put a hold on its advertising and other promotional plans earmarked for North America and is likely to divert some of the funds for such operations into increased activities in Britain and Europe. These funds will augment the additional £1 million allocated to Bord Fáilte in the recent budget for increased promotions in Britain and Europe. Bord Fáilte is in negotiation with tour operators, air and ferry companies and representatives of the various tourism sectors here in Ireland in order to build additional incremental advertising and promotional campaigns for those markets.
Looking back in hindsight at the decision of Bord Fáilte to put their promotional activities in North America on hold, one wonders if there would have been an increase in the number of American tourists visiting Ireland this year if they had proceeded with their promotional activities. Naturally, nobody can answer that question with certainty. However, we should never abandon the American market. This market contains a huge ethnic Irish population who would be interested in visiting Ireland. I am advised — I speak subject to correction — that there are no flights from Boston to Ireland on Tuesdays and Thursdays. Having regard to the huge Irish population in Boston, I believe there would be consumer support for flights to Ireland on these days. The price of air fares and the frequency of service are two of the fundamental aspects which have to be taken into consideration in the promotion of our tourism industry there.
I hope the Minister will undertake an immediate review of our tourism industry. There has been colossal investment in tourism in terms of improving buildings, amenities and facilities, and it would be tragic if because of a lapse in any area those investments were put in danger in any way, leading to a lack of morale and confidence among those involved in the industry. At present some hotels are putting their staff on short time. It is regrettable that this should be happening during the peak tourist season. The June unemployment statistics show that there has been no major take-up in tourism employment this year. Every June huge numbers of students and others are recruited by hotels, guesthouses and restaurants to cater for the peak tourist season.
I want to refer to the allocation of money from the EC Structural Funds, which I think has amounted to £400 million over three to four years. Because of its structure this money is mainly directed towards larger projects. Private enterprises have to put up 70 per cent of the money and they receive the other 30 per cent by way of grants. I wish to criticise two aspects of this system in the hope that there will be some changes. This funding is orientated towards amenities and facilities rather than accommodation. As we all accept, many hotels and guesthouses are in urgent need of upgrading and refurbishment. In the absence of a provision in the budget for such work, grants from the Structural Funds should be used to upgrade larger and smaller projects which are in dire need of some incentive and aid.
The second point I would like to make — this refers to the lack of tourism promotion and marketing — is that some portion of these moneys should be allocated to the regional tourism organisations, who have an expertise in maketing and promoting their areas. At present regional tourism boards are in dire need of such funding. I want to press on the Minister the need to set up a new structure for the utilisation of these considerable funds which are devoted to the development of Irish tourism. These funds should be channelled towards the improvement of accommodation, both in small and large concerns. Those are the only concerns which can avail of these funds.
As I said, we have an excellent product but the extent to which we can market and promote it throughout the world is determined by the amount of money provided. In the early spring I put down a question to find out how much money has been provided by the Government during recent years for the promotion of tourism. I was informed that in 1986, £25.696 million was provided, £23 million in 1987 and £27 million in 1988 which included a special allocation of £4 million. The figure showed a reduction in both 1989 and 1990 when it dropped to £23 million and I understand it has been further reduced this year. Taking inflation into account it is clear that this amount is totally inadequate to market and promote tourism in a variety of markets.
I should also say it was inadvisable for the Minister for Finance to increase the rate of VAT on food in hotels and restaurants. Some years back the rate of VAT on food and accommodation stood at the incredible level of 23 per cent. However, in 1985 it was reduced to 10 per cent. In the light of the developments which have taken place in tourism throughout the European Community it was inadvisable to take this step and I ask the Minister to review his decision.
I have already mentioned the urgent need to review air services into Ireland and press for a major initiative to be taken. I suggest that an extended ticket be offered as an incentive by those airlines servicing Ireland in an effort to attract some of the substantial number of American tourists who visit Britain annually. Some of them, if offered an incentive, may be attracted to Ireland. That should be our goal.
I would like to refer to some of the other Estimates and seek clarification on a number of points. I shall refer to the Estimates for the Department of Tourism, Transport and Communications first. An Post have brought forward a viability plan which recommends the provision of road side post boxes, the closure of sub-post offices, the downgrading of existing post offices and 1,500 redundancies. I attended a series of public meetings called by public and community groups to give full expression to their concerns about the viability plan. The public representatives who attended offered their full support and rejected the viability plan. I am aware the Minister has appointed consultants to consider all the options but he, his backbenchers and other public representatives who have been put under pressure by community groups should resist any steps to provide post boxes at the end of boreens or on roads up to two or three miles away from the homes of old age pensioners. They should resist attempts to close sub-post offices which have provided a valuable service, including the paying of pensions and social welfare benefits, and to make 1,500 people redundant. In addition to providing the services offered by An Post they have been social communicators down the years. The Minister should allay the concerns expressed in our communities by groups who have received the full support of public representatives. He should make it clear that the plan, no matter how desirable from the point of view of An Post, introduced to balance their books, is not acceptable to either him as Minister or the Government. This message has been accepted by the Minister's representatives at the public meetings I attended.
It was reported in The Irish Times last Saturday that the Irish members of the Economic and Social Committee of the European Community in Brussels condemned these proposals on the grounds that they would lead to the withdrawal of services in rural Ireland which formed part of its fabric. These proposals will have a devastating effect of the lives of rural communities. I appeal to the Minister for Tourism, Transport and Communications, Deputy Brennan, to bring an end to this debacle and to say to An Post, either before or after he receives the consultant's report, that this is an exercise which the Government cannot and will not entertain because of the hardship and inconvenience it will cause in communities where such a service has been provided heretofore. The post office and the postman should continue to provide a service in rural areas.
I should now like to comment on the Estimate for the Department of the Marine. We received some welcome news this morning; European Community funds are to be provided for coast protection works. My county, like many other, has been bedevilled by the problem of coastal erosion due to the Atlantic eating into the hinterland and in the process threatening dwellings and villages. The Estimate is totally inadequate to deal with this massive problem. It is my hope that those villages where the livelihoods of individuals are threatened or where there is a continuous threat of flooding of good agricultural land will have first call on any European Community funds which may be made available.
Another matter to which I must draw the attention of the House is the development of fish farming within enclosed waterways. The development by Salmara Limited of a number of fish cages in Kenmare River, County Kerry has been strongly opposed on the grounds that the Minister does not seem to be sure if this development will give rise eventually to pollution and harm the wild salmon stocks. The residents of Kenmare, a premier tourist centre with tremendous potential, are seriously perturbed about this development. I strongly urge the Minister to be extremely cautious in granting further fish farming licences in this area. In their opinion, to which I subscribe, there is an absence of adequate investigation to satisfy people that the chemicals and pollution emanating from fish cages will not eventually cause grave damage to the environment and the natural habitat of the area. That would be a tragedy for an area which is a magnet for tourists. We should satisfy ourselves that the tremendous potential of the tourism industry is not put at risk by a development the outcome of which is not certain. A recent seminar on fish farming held in Ireland was told by a representative from Norway, where they have great experience of such enterprises, that the development of fish farming within enclosed sheltered waters is a high risk undertaking. I would ask the Minister to be reluctant to expand further until scientific evidence proves that there is no danger. Such evidence is not yet available.
There are many harbours and ports which are in urgent need of improvement and development works. The continuing closure of Renard Point in Cahirciveen due to storm damage two years ago and the delay in giving final approval of the harbour development at Portmagee, which is so urgently required, are two matters I would bring to the notice of the Minister.
There is considerable concern regarding the overrun of the budget and possible cutbacks in education involving a renegotiation of agreements in relation to the pupil-teacher ratio. I refer in particular to the appointment of remedial teachers. I have here a document from a group of parents representing ten schools in the Cahirciveen rural area, attended by a total of 857 pupils. These schools have never had a remedial teacher but assessments carried out by the INTO reveal that about 14 per cent of the pupils are in need of the expertise of a remedial teacher. I implore the Minister in considering this matter to take into account the disadvantaged nature of the area and the scattered location of the schools and to accede to the demand for a remedial teacher. This would indicate that she is really concerned about those who have this difficulty. It would be a gesture in the right direction, regardless of the monetary cutbacks, to give these children the facility to which they have a moral entitlement.
I listened attentively to the Minister for the Environment last night in his lengthy and elaborate submission. Two aspects were omitted. Adequate provision is not being made for local authority housing needs. The Minister's estimate of 1,500 houses for the year will make little or no impact on the waiting list of 22,000 people. The second point is that members of urban district councils and corporations to which there were no elections this year are in a limbo and seek clarification of the Minister's proposals. Are urban councillors and town commissioners to continue in office without elections or will those bodies be dissolved?
The most serious problem confronting the country is unemployment. The total dependence of the Government on private enterprise to deal with this massive problem is not the answer. The right climate has been cultivated and the right incentives have been given, but the number of jobless continues to grow. We would urge the Government to reconsider their attitude to State and semiState developments. RTE are seeking a large number of redundancies due to the legislation last year which capped their advertising revenue. At the same time Channel 4 and other channels are carrying advertisements which should be broadcast by RTE. While there are job losses in RTE we are creating jobs outside the country.
I hope the points I directed to the Minister for Tourism will be reflected upon.