I propose to take Questions Nos. 74 and 75 together.
No official estimates are as yet available in relation to the loss of tourism business arising from the tragic events of 11 September 2001. However, while it may still be too early to assess the overall impact on international travel patterns, it is clear that the terrorist attacks will impact on visitor numbers to Ireland, in particular from America, for the balance of this year and into 2002, probably leading to the first annual decline in visitor numbers for a decade.
Bord Fáilte has been working on revised estimates for tourism performance in 2001 although it has been difficult to come up with accurate revised forecasts given the varying experiences from the carriers and uncertainty over the nature and duration of the international response to the terrorist attacks. The situation has been further complicated due to the American Airlines crash on 12 November. In the latest edition of its Link magazine, circulated to members of both Houses of the Oireachtas, Bord Fáilte forecasts an overall reduction in visitor numbers in 2001 of between 6.5% and 10%. This is equivalent to a reduction of between 420,000 and 598,000 visitors, representing foreign revenue earnings of £168 million, €213 million; and £233 million, €296 million, respectively. However, on the positive side, according to industry sources the past two months have witnessed a particularly robust performance in the domestic market and hopefully this will continue into next year.
During the launch by Tourism Ireland Limited – the new all island tourism marketing company established under the Good Friday Agreement – of its 2002 marketing plans on 7 November, the company forecast a best case scenario for 2002 which envisaged a return to close to 2000 visitor levels. This assumes a speedy conclusion to military retaliation, non-recurrence of foot and mouth disease and no further reduction in access routes and capacities.
Since the tragic events of 11 September, officials of my Department have met with senior management of both Bord Fáilte and Tourism Ireland Limited on a very regular basis. I have been in regular contact with the chairman, the acting chief executive and senior executives of Bord Fáilte and with the chairman and chief executive of Tourism Ireland Limited to review developments. I also met a high level delegation from the Irish Tourist Industry Confederation on three separate occasions since 11 September, to take stock of the situation and to discuss appropriate responses. Critical factors in dealing with the crisis include not only the nature and duration of the response to the terrorist attacks but also the speed with which public confidence in air travel can be restored. Unlike the foot and mouth disease crisis, which to some extent was within our own control, there is very little that Ireland can do to influence current international events.
At my request, Bord Fáilte and Tourism Ireland Limited have urgently re-examined, in consultation with the tourism industry and through the tourism marketing partnership structure, their respective marketing programmes and plans for the remainder of 2001 and 2002. Bord Fáilte subsequently announced details of a £750,000, €952,500, programme of additional immediate measures for the British, Irish, French and German markets and have recently circulated to the trade and other interested parties, and to members of both Houses of the Oireachtas, comprehensive details of their full £3.5 million, €4.4 million, autumn programme. Following recent contacts with ITIC, and again at my request, Bord Fáilte has introduced further marketing actions in Britain, Northern Ireland, the US and domestically for the balance of the year at a further cost of £400,000, €507,900.
Meanwhile, the new chief executive of Tourism Ireland Limited, Mr. Paul O'Toole, spearheaded the review of marketing plans for 2002 which culminated in the launch on 7 November in Dublin and Belfast of marketing plans for 2002 and details of a new and exciting television and print international advertising campaign for the island of Ireland, developed at a cost of approximately £4 million, €5million.
Additional informationNew fulfilment literature and market books have been prepared and will be available for the first time ever on an all island basis. The plans for 2002 will be flexible in nature to take account of the changing circumstances arising from the events of 11 September. Particular importance is attached to the partnership approach with industry and there has been extensive consultation, including two meetings of the tourism marketing partnership, in the drawing up of these plans.
When I met with the ITIC delegation, one of their key priorities was that Tourism Ireland Limited would be fully operational in time for the 2002 marketing season. I am glad to report that Tourism Ireland Limited is fully on track to take over full responsibility for international tourism marketing activity on an all island basis next year. The new company will have a programme budget of £21 million, €27 million, for 2002 which will be supplemented by niche and product marketing funding from Bord Fáilte and the Northern Ireland Tourist Board.
The Government is very conscious of the important link between competitive air and sea access and tourism flows. We are particularly well served by the levels of investment in recent years in sea access which has seen the emergence of a high quality and competitive route network, in particular across the Irish Sea. We are acutely aware of the important contribution which Aer Lingus has made to developing tourism traffic over the years, most recently through the extension of their transatlantic network. The priority from a tourism perspective therefore, is the maintenance, as part of the survival plan for the airline, of as much of the pre-11 September service network as possible going into the 2002 season. My Department has been working closely with the Department of Public Enterprise to safeguard as much of the route infrastructure as possible so that, when the recovery comes, we are best placed to avail of it.
The Government is also anxious to promote new air route development, in particular from the large continental European market which has not performed up to expectations in recent years. The recent announcement that Aer Rianta has expanded its incentive scheme for new routes to Dublin, Cork and Shannon Airports is to be welcomed. An interdepartmental group, under the chairmanship of the Department of the Taoiseach and involving representatives of my Department, has been established to look at the interaction between access transport, particularly by air, and tourism with a view to identifying further possibilities for increasing the flow of visitors to Ireland. That work is advancing and I am hopeful that there will be a positive outcome soon.
The Government has allocated significant funding towards tourism development since coming into office. Under the national development plan, a total of £350 million, €444 million, has been earmarked for product, marketing and human resource development. The first ever multi-annual tourism marketing fund has been established with a commitment of £150 million, €190 million, over seven years.
This year, the total Exchequer tourism budget is of the order of £90 million, €114 million. We must ensure that this funding is used in the most effective manner to help address the real development needs of the industry in order to sustain foreign revenue earnings and employment levels. The destination tourism marketing budget of £21 million, €26.6 million, at the disposal of Tourism Ireland Limited in 2002 represents the largest ever budget available for the attraction of international visitors to the island of Ireland.
Given the more challenging environment which we are now facing, I believe that it is vitally important to quickly bed down the process of institutional change now under way in the tourism State agencies which have remained unchanged in structure since the early 1960s. It is important to complete the start-up of Tourism Ireland Limited so that it is fully operational for the year 2002 marketing season. I also welcome the support of the council of CERT and the board of Bord Fáilte for the proposed creation of a new national integrated tourism development authority. This initiative also has the support of industry. I will be asking Government very shortly for approval to proceed with the creation of the new body which will require new legislation. The objective is that we have strong structures in place to implement our medium-term plans for international marketing, product and human resource development as contained in the national development plan in order to help the tourism industry to meet the undoubted challenges that lie ahead.