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JOINT COMMITTEE ON ARTS, SPORT, TOURISM, COMMUNITY, RURAL AND GAELTACHT AFFAIRS díospóireacht -
Wednesday, 28 Sep 2005

Tourism Ireland: Presentation.

Tourism Ireland is appearing before the committee on the basis that we have met Fáilte Ireland, the regional bodies and some of the sub-regional bodies. At the end of the meeting today I would like to think we could collate from the minutes the different points that have been raised and come back to the joint committee with a rapporteur study that could be presented to the Minister as the points that have been put to us by the regions and the national organisations.

It is with great delight that I welcome Mr. Paul O'Toole, the chief executive of Tourism Ireland, Mr. Joe Byrne, director of markets and customer relations, Mr. Niall Gibbons, director of corporate services and Ms Margaret O'Reilly, head of corporate and industry communications. That title is nearly as long as that of our committee. They represent Tourism Ireland and are here today as part of the final module of our hearings on tourism and related matters. I remind the witnesses that while the members of the joint committee have privilege those attending the committee do not, although that should not be an issue.

The usual procedure is that a presentation is made by the representatives following which we have questions from members of the committee. Representatives may respond to those questions and if they do not have any relevant information, perhaps they will forward it to the committee in written form.

Mr. Paul O’Toole

Good afternoon. I thank the chairman and the members of the joint committee for the opportunity to meet them and outline the work of Tourism Ireland and to discuss some of the issues facing the tourism industry.

To give some background details about Tourism Ireland, we are responsible for marketing the island of Ireland overseas as a tourism destination of choice and we are established as one of six areas of co-operation under the framework of the Belfast Agreement in 1998. The company was incorporated in December 2000 and came into operation in 2002.

Tourism Ireland's vision is to play a leading role in growing tourism business to the island by providing strategic leadership in overseas marketing and delivering world class marketing programmes. Tourism Ireland also influences product quality and service delivery through the expression of its understanding of the customer and overseas marketplace. Our over-arching objectives are to increase visitor numbers and revenue to the island of Ireland and to support Northern Ireland in realising its tourism potential.

It might be helpful to reflect on last year as 2004 was the year in which many of the issues that had been quietly developing over recent years came to light. Many of the underlying trends had been masked by the major shocks of 11 September, SARS, the war in Iraq and general global and economic instability.

The year 2004 was one of mixed fortunes for tourism on the island of Ireland. While there was overall growth, not all sectors or regions benefited equally. There was growth of just more than 3% in all-island visitor numbers to more than 7.6 million visitors. Revenue from overseas tourist receipts reached €3.65 billion and represented 73% of total tourism revenue.

The British market, which has driven growth for many years, disappointingly delivered a flat performance to the island of Ireland in 2004. On a positive note, we saw a strong recovery in the important North American market. Visitor numbers grew by 8%, which exceeded our target. Targets were also exceeded in mainland Europe, with visitor numbers growing by a healthy 6.8%. However, the distribution of this growth was quite uneven and the shift in consumer preference to shorter stays in urban areas hit a number of sectors and regions in the industry quite hard.

To place our performance in a more global context, we should be encouraged that despite challenging marketing conditions and shifting consumer patterns worldwide, we continue to punch above our weight. As I have said, we turned in a reasonably good performance in 2004 with an increase of 3.3% — an additional quarter of a million visitors. While global tourism grew by 10% overall last year, Europe grew by 4% and western Europe by just 2% due to increased access and intense competition from emerging eastern European destinations. The island of Ireland, therefore, grew faster than Western Europe and we continue to maintain market share in a volatile marketplace.

Looking at our strategy for 2005, we began 2005 with an ambitious target of 5% growth. In addition to focusing on the overall targets, we also deliver on a number of key challenges set by the tourism policy review group in the South and its equivalent in Northern Ireland. In taking cognisance of the strategic focus of both groups, coupled with the realities of an ever-changing marketplace, we have an ambitious three year programme aimed at increasing overseas visitor numbers to the island of Ireland to 9 million by 2008.

I will now summarise some of our key priority areas for 2005. Beginning with the British market, a major strategic review was undertaken in the Great Britain market in 2004 following evidence that the market was softening. Notwithstanding that, Britain accounted for 44% of Revenue and 62% of visitors to the island of Ireland, 49% of whom were on a repeat visit. They spent approximately €1.6 billion here last year, which is nearly half of all our overseas tourism revenue.

Project Britain had to be and was the most fundamental review of the British market ever undertaken in Irish tourism. The objective was to identify the challenges facing Ireland in this most important market and how to face them. An industry steering group was established to guide strategy development. The group met throughout 2004 and by year end had finalised a co-operative strategy to restore growth to the British market.

Arising out of the Project Britain review, we now have an agreed path forward with tourism industry partners and sister agencies focusing on three central themes of promotion, product and welcome. We have also identified potential for growth in the short breaks and additional holiday markets as well as in business tourism and among older skilled workers. To realise this potential, we will have to explain and expand our offering across the board. Prospective visitors need to be able to more easily imagine what they will do when they get here. For example, Tourism Ireland is taking a new approach in its advertising by emphasising holiday experiences. In tandem, the wider industry needs to move away from selling product components such as bed-nights or seatsand blend these and other elements into an attractive holiday experience.

On the issue of regionality, ensuring a more equitable spread of the benefits of overseas tourism is top of the Tourism Ireland agenda for action but the tourism industry continues to face major challenges in its efforts to achieve a better spread of business to all regions in an intensely competitive and changing marketplace. The difficulties experienced by the regions in getting a greater slice of the tourism pie have been highlighted of late, with falling holidaymaker bed-night numbers being of particular concern to the industry. The reality of changing trends in the marketplace is hitting hard. The growth in popularity of shorter, urban based breaks among time poor, cash rich consumers combined with shifts in behaviour such as last minute booking and purchase decisions and the fall-off in car touring are impacting particularly strongly on tourism businesses to more rural parts of Ireland.

Tourism Ireland's action plan to support a better distribution of the benefits of tourism to all the regions of Ireland is already well under way. We have made significant resource changes to help tackle the regionality issue in terms of overseas marketing by appointing a senior manager to head up the effort and earmarking considerable funds specifically for this purpose, including a €1.4 million package of investment to support the car brought market in Great Britain and €0.5 million support for Ireland's western regions campaign.

Tourism Ireland's region to region print advertising campaign of double page spreads, currently running in the British media, maximises the promotion of Ireland by focusing on six Great Britain regions with direct air and sea access to the island of Ireland. A twinning programme linking regions in Ireland to regions in Great Britain, Europe and the United States, based on direct access, potential interest and product fit is under way as well.

On access development, the number of air routes per week to the island of Ireland currently stands at approximately 1,700. In addition, there are currently 281 sea crossings per week. A key focus of Tourism Ireland's work is to act as strategic partner to and engage in co-operative marketing programmes with air and sea carriers. We have intensified this work in 2005 and are actively working with sea and air carriers to maximise awareness of existing routes and to secure additional route developments. We are also working closely with regional airports to ensure we get the best possible regional spread when carriers are considering introducing new routes and services. There have been several positive developments in air access this year, with increases in peak seat capacity of 40% from Europe, 16% from Great Britain and 17% from North America.

Tourism Ireland will continue to vigorously pursue additional air route development in conjunction with airlines and airport authorities. In this regard, progress in the current discussions between the European Union and the United States on the bilateral arrangements and air access is considered essential to develop this highly lucrative market in future years. I should add that proposals regarding the short-term improvements and extension of check in and boarding facilities for customers at Dublin Airport, together with the longer term developments planned for the airport, are welcome and our hope is that this work will proceed without undue delay.

Tourism Ireland has established an all-island, industry-wide e-marketing partnership group which has just finalised an e-marketing strategy which will serve Irish tourism in the international marketplace for at least the next three years and will oversee the development of the next generation website for launch in early 2006. Tourism Ireland already has an extensive on-line presence with 24 websites in 14 languages. This year to date we have had a 39% increase on traffic to our site and of particular note there has been a 40% increase in click-throughs to industry and partner sites, representing over one million sales leads for tourism providers.

The new site will include a "My visit" function which allows users to store web pages and build up a holiday itinerary which they can save or send to friends. Digital media will be integrated from the start with video clips and digital radio serving to provide a local flavour and engage the customer. Other innovations will include building on the success of our recent web-based "taxi" promotion.

Regarding new marketing communications, Tourism Ireland has just finished shooting its TV advertising campaign as part of its complete new suite of marketing communications. The three-year, €50 million global advertising and media campaign is being produced by J. Walter Thompson. The campaign, which was in development over the past year and firmly rooted in consumer research in key markets across the globe, will be launched during the first week in December and rolled out in the markets in February 2006. The campaign will target the segment known as "sightseers and culturalists". In 2004, visiting places of cultural and historical interest was the most widespread pastime among overseas visitors making up 56% — that is 1.9 million visits — of all holidaymakers to the island of Ireland. Our key message underpinning the campaign will be "great places and activities — brought to life by great people".

The year to date performance of overseas visitors to Ireland has been quite good and we are encouraged in particular by the stellar performance of mainland Europe which has achieved holidaymaker growth of almost 18%. Our intensive work in Great Britain appears to have yielded results with an overall increase of 2%, evidence that the decline in the market seems to have been halted. While we are still concerned about the dip of 1% in visitors from North America, especially in the early part of the year, this must be benchmarked against an extremely strong performance from this market in 2004. We also need to consider that North America's outbound market to Europe grew by only 2% in the first six months. We are, however, encouraged by the two consecutive months of good growth in June and July from North America.

The Central Statistics Office, together with other sources, has indicated a growth of 4.3% in visitor numbers to 3.78 million for the period January to July 2005. This is welcome, but as with all top-line statistics, it needs to be put in context. The real measure of performance is the success or otherwise of the individual tourism enterprises that make up our industry. Undoubtedly, some enterprises are performing well, some very well, while others are finding the going much tougher.

I referred to the current business environment in which we operate as being both dynamic and challenging. Undoubtedly, in this constantly changing scenario, we can never be sure of how outside shocks will affect our future as an industry. I am convinced, however, of the quality of our product and the tenacity and professionalism of our industry, which has bounced back time and again. As an organisation, Tourism Ireland will seek to match that professionalism and flexibility. The industry's proven capacity constantly to adapt to a changing environment, together with the support and commitment of Government and its agencies, represents the best way forward for our industry. All global forecasts indicate that the tourism sector will continue to grow worldwide. We are confident that Ireland cannot only win but that it can improve its share of the business in the years to come.

I wish to ask Mr. O'Toole a number of questions. I do not know whether he was being politically correct or meant something different when he said that the organisation's overarching objectives are to increase visitor numbers and revenue to the island of Ireland and to support Northern Ireland in realising its tourism potential. He mentioned that not all sectors or regions benefit equally. Unless he was being politically correct in what he said, it seems as though the organisation will give Northern Ireland a leg up, so to speak, and then deal with regional disparity and the poor regions. I say that by way of comment.

Representatives in all the regions have informed us that people now make bookings by way of the Internet. Mr. O'Toole identified the problem that people make bookings at the last minute and, as a result, his organisation loses out. If one does a search for "Ireland" on the Internet, one does not get an automatic link to the websites, "Vacation Ireland" or "Tourism Ireland". Will the new website to be launched in 2006 overcome the access problem such that people will be able to access immediately the website on which they want to make a booking? Will it be competitive? I have been advised it will not give one a link to a website such as last minute.com. One will get a link to the Fáilte Ireland or Tourism Ireland website and will not get the same value as if one makes a booking on lastminute.com. I do not know like to advertise any website but the one I mentioned is one of the obvious ones. I would like Mr. O’Toole to comment on that.

Research from Jordanstown university today reveals that with the GAA being a family friendly sport, drug free and amateur, it could be the greatest catalyst to attract tourists to Ireland, equivalent to the phenomenon of bullfighting in Spain or that of sumo wrestling in Japan in that it is unique. Does the organisation specifically promote the attraction of sport abroad? Has it information on research to support the research to which I referred? What is the view of the organisation on the promotion of such sport abroad?

I wish to raise an issue on which Deputy Deenihan might pick up. The organisation is advertising Ireland internationally. I met its representatives in Japan when they were launching a Japan-Ireland brochure. The issue I am raising is similar to the Dingle-An Daingean question. I question whether references to towns, such as Derry or Londonderry, in promotional literature should include the two names of the town as opposed to one or the other, given that some traditions favour one title and others favour the alternative. Some people hear about the location from different perspectives and it is confusing if the literature refers to only one of the two names by which the town is known. That is the argument currently on this matter.

I welcome the delegation, Paul O'Toole, Margaret O'Reilly, Niall Gibbons and Joe Byrne. Their remit is to examine how our tourism industry is being served in terms of its various structures. How is their relationship progressing with Fáilte Ireland and is the cohesion between both bodies working well? Some concern was expressed that it is difficult for one body to be responsible for domestic marketing and another responsible for marketing the country abroad. Do the representatives have a view on that?

Is the organisation restricted in marketing Ireland abroad because we do not have a convention centre here? Business tourism is worth about €250 million per annum but it could be increased by an additional €50 million to €60 million per annum if we had a convention centre. Such a centre could sustain 3,000 jobs.

The Chairman referred to promotion of Gaelic games abroad and there is also the potential to promote horseracing and greyhound racing abroad. For example, only 50,000 people attend horserace meetings here compared to an attendance of 5 million people at horserace meetings in the UK. Do the representatives not consider that some of the supporters of this sport in the UK, which is so close to us, could be attracted here and result in at least a doubling of the attendances at race meetings in Galway, the Curragh and the other 300 meetings held throughout the country during the year? The representatives might comment on that.

When promoting the Republic of Ireland abroad, does the organisation encounter any problem in terms of our competitiveness, given that there is greater transparency with the advent of a common currency throughout Europe? Given the large number of Irish people who travel abroad on holiday, more money is spent abroad by Irish tourists than by tourists who come to this country. This could reflect on our prices. Is it more difficult for the organisation to promote Ireland abroad when Ireland is competing with other destinations for tourists? The representatives might comment on that, although it may be difficult for them to respond. Ireland has one of the highest VAT rates and one of the highest levels of excise duty in Europe. The other question relates to infrastructure. Mr. O'Toole mentioned the reduction in car hire or the use of the car. Typically, people who brought cars to this country visited more parts of it. Could the reduction be due to the cost of car hire, which has become more competitive, or the roads in other parts of the country?

The US market is down 11,400 in the first six months of the year. Does this give rise to concern, given that the west, where the numbers are declining, generally attracted American tourists? In the context of regional decline, the fact that there are fewer Americans visitors will certainly be reflected in the regions.

I welcome the delegation. On numerous occasions I have raised the issue of the development of the inland waterways. While we have some wonderful waterways, we have never benefited from or developed them to their full potential. Is this something we should examine?

Mr. O'Toole spoke about the development of regional airports. Are competitive car hire rates available at regional airports to facilitate people who arrive there on cheap flights and need transport? One of the issues that continually arises is the fact that we seem to be doing well from short breaks but are losing out in the case of the two to three week holiday period. In developing the regional airports we must also examine what alternative transport is available when the visitors arrive.

Mr. O'Toole spoke about the new campaign aimed at attracting sightseers and culturalists. What aspects of culture will be promoted and how will this ensure rural areas get their due number of visitors? A number of theatres and other venues have been provided but we do not seem to be able to develop them. I had the pleasure on a number of occasions of visiting the facility in Senator Ó Murchú's constituency in Tipperary and seeing its value. What aspect of the new proposal will affect it? Will Temple Bar be put forward as the main attraction or will other parts of the country be put forward to attract people to travel further than the Pale? The current trend appears to be to attract people there and just hope somebody travels beyond it. What we are seeking from the sightseeing and culturalist aspect is that rural areas, that is, large towns that have theatres, arts events, museums and so forth, will get the same benefit.

The obvious issue is what we should do about the English market. Mr. O'Toole said it was flat in 2004. What is his opinion of that market at present? Have we reached the maximum point? Are we dependent on Irish people returning home to visit family or friends or are we attracting UK visitors? What can we do about that market? Deputy Deenihan and the Chairman spoke about sports facilities. There are also major racing facilities and musical events. However, they are short-term in nature. The issue is how to attract UK visitors for long-term stays and, of course, to rural areas.

I welcome the delegation. My question is about the possible duplication mentioned by Deputy Deenihan. I am worried that there is an element of duplication between Fáilte Ireland and Tourism Ireland. To what extent have the two organisations bedded down? The Ryder Cup will probably provide Ireland with an immense showcase opportunity in terms of tourism next year. However, I understand there might be difficulties in how to make people aware of it. This could be used as an illustration of the difficulties between Tourism Ireland and Fáilte Ireland. If there is confusion outside this country, that comes within the remit of Tourism Ireland which deals with developing the market outside Ireland.

I am also interested in how Tourism Ireland is dealing with Northern Ireland tourism. There is an inherent contradiction in Tourism Ireland's function and Northern Ireland tourism's function. Tourism Ireland is marketing the island of Ireland. It is also marketing Ireland in a foreign market in the United Kingdom. Northern Ireland, however, would regard the United Kingdom as a domestic market. Has this caused any difficulties? Are there tensions? I would be delighted to hear there is none but what has the experience been?

What does Mr. O'Toole believe is the biggest challenge in marketing Ireland abroad? Is it the issue of pricing? Another issue that concerns me greatly is that of salmon and drift net fishing. I believe it is doing ferocious damage to our reputation abroad. Does Mr. O'Toole wish to comment on this? I researched this issue over the summer and have found that it has decimated the angling industry. This was probably a specific and lucrative sporting sector to promote. Does Mr. O'Toole see it as Tourism Ireland's role to lobby for what needs to happen in terms of a responsible fisheries policy? I have obviously declared my feelings on the matter.

Mr. O'Toole mentioned research. Has he learned anything surprising from it? Is research an important matter for Tourism Ireland or what portion of the budget would be spent on it? Mr. O'Toole has also said Ireland continues to maintain market share in a volatile marketplace. Is that the strategy? Is Tourism Ireland content with just doing this or are there plans for growth?

I have a straight question that requires a simple yes or no answer. Is Tourism Ireland in favour of the abolition of the bilateral status of Shannon Airport? It appears from the submission that it is. Can I get the answer to my question now?

There are others——

The answer to that question will determine my participation in this meeting. I want the question answered, be it yes or no.

I assume it will be an expanded answer rather than a yes or no.

Mr. O’Toole

We can explain the position and the context.

That cannot be just yes or no. I call Senator Daly who will be followed by Deputy O'Shea.

My question is related. It is in connection with the acknowledgement by Tourism Ireland of declining numbers of tourists to the regions. It claims it has an action plan to deal with this. Will Mr. O'Toole expand on this?

I come from the west and mid-west region. I note the comments in the submission about speeding up decision-making on the bilateral agreement. The general perception is that if the bilateral status is changed, it will badly affect Shannon Airport. Falling numbers through the airport will have a more severe impact on the regions than the present situation, bad as it is. Those involved in the tourism industry in the west are deeply concerned about what will happen if there is a major change in the status of Shannon Airport. The bulk of those concerned will be hoping that the bilateral negotiations are concluded quickly, although that seems to contradict what was said in the statement.

We have heard that the bed and breakfast business has gone down by 20%. Is there any indication that providers are pulling out of the business? I take the point that Tourism Ireland wishes to spread the business more thinly but my concern is that B&B providers bring tourists into areas where there is no other accommodation. I am concerned by indications that B&B providers could be pulling out.

Is Tourism Ireland concerned about parts of the short-stay package business as it operates to urban areas and Dublin in particular? For instance, stag parties do not have the greatest reputation in this respect. What agencies can help to put packages together more effectively?

The fall off in motoring holidays obviously affects the south-east region which I represent. People travelling to France by ferry can bring back a lot of low-cost wine, but there is no reciprocation in this direction since we lost the duty free status. Does Tourism Ireland have any bright ideas as to how car ferry journeys to Ireland could be made more attractive? I am talking about attracting more motoring tourists, particularly the British ones.

Is there solid information that salmon anglers are in decline and, if so, is it directly related to the fact that our salmon stocks are diminishing?

I join with members in welcoming Mr. O'Toole and his colleagues. I have some brief questions to pose. In previous years there was a discussion in the media as to how visitor numbers were arrived at. What is the definition of a "visitor" for the purpose of Tourism Ireland's submission? Can Mr. O'Toole clarify that point for us and bring us up to date on it?

For Deputy O'Shea's benefit I would add that hen parties sometimes have as bad a reputation as stag parties. The benefit of the U2 concerts at Croke Park to the economy of north Dublin was particularly striking. Taximen, those great barometers of the economy, tell us that they never had it so good as during that weekend due to the influx of foreign visitors to see U2 playing at home.

I saw nothing in the submission concerning the trend towards short-stay breaks being event-based. Such breaks are being actively exploited in other parts of the world where significant programmes of events are developed in major cities. I am thinking of Melbourne in particular where this has been done extremely successfully. Will such major events form part of Tourism Ireland's future strategy? Horseracing was mentioned earlier in connection with Galway and the Curragh, but it strikes me that those two venues do not need to be developed. Events could be organised around other race meetings, which could develop the season both for that sport and for tourism generally. I would be interested to hear Mr. O'Toole's comments on that point.

Is transport infrastructure a negative aspect in Tourism Ireland's research? There has been a decrease in the number of car-based visits here and our transport system has been the subject of much negative comment. I would be interested to hear the tourists' attitudes to our transport infrastructure.

I welcome the delegation and compliment them on doing such a magnificent job in such a short time. One of Tourism Ireland's great successes is to have been able to present the whole island as a holiday destination, which will pay dividends for us in the long term. Tourism Ireland's predecessor, Bord Fáilte, never got full credit for the work it did in developing tourism here. It was always taken for granted as if it came out of the sky, yet we were way ahead of some of our competitors. Bord Fáilte did a fantastic job through its hands-on involvement and accessibility to the industry. I accept that new challenges are currently facing us and I am sure that part of Tourism Ireland's remit is to identify those challenges and respond to them.

There is no doubt that many B&Bs, including those in my own part of the country, have been affected whether through lack of business, high overheads or too much bureaucracy. Does Mr. O'Toole have any ideas as to how B&B owners can be empowered to meet these challenges? In some parts of the country smaller hotels are in head-to-head competition with B&Bs, having lowered their prices. B&Bs will not be able to continue in business unless they are helped. Every B&B should have some licensing prospect so they can provide alcoholic beverages within certain constraints. It is hard to compete with hotels if they can provide meals and drinks, whereas in a B&B one would be lucky to get a Marietta biscuit and a cup of tea. That situation should be examined. If Tourism Ireland or Fáilte Ireland do not provide a lead it will not happen.

Planning permission for extensions to B&Bs constitutes another aspect of the problem. Most B&Bs are not viable economically so those in good locations certainly need a greater bed capacity. Such extensions should be encouraged without incurring planning expenses.

The tax code should also be examined in this regard, although I realise it is not within Tourism Ireland's direct remit. In recent weeks I met a distraught lady who had become involved in a tax wrangle and received no credit for the voluntary work she had put into building up her business. Such voluntary work should be recognised when B&B owners are assessed for tax purposes. It is different with a big establishment but one cannot place a full assessment on B&B owners claiming their surplus is their profit, because it is not. That must be re-examined.

I raise a note of caution in another area. As Tourism Ireland competes in a bigger world market, we might compete head to head on some issues but lose out in some of the very areas which are still attractive. Such areas have been touched on by Deputies Wall and Glennon. Tourism Ireland needs to be careful of small communities which have their own attraction for people. They may not necessarily be the coach operators' ideal destination but at the same time it is good for Ireland and for those areas, which, unlike the bigger areas of population do not benefit from mainstream tourism. I would like to think this issue would not be too far down the list of priorities.

I refer to the major survey on tourism years ago in which tourists were asked what they did while in Ireland. At that time 67% of tourists put visiting national monuments at the top of their list. While some of these monuments are not necessarily located in the cities, people put that activity on their lists. High class evening entertainment came in among the top three. I am glad to say traditional entertainment was also a separate area. My point is that I would not rule all of those attractions out of the equation. As there is a base for those activities we should continue to nourish and cultivate them. Mr. O'Toole might ask how that might be done. One way in which it can be done is in the advertising campaign.

It is we who are asking questions, not the other away around.

In the advertising campaign it is still worthwhile highlighting those areas and that personal service as part of our attraction.

The type of market that exists in North America, from where in the past a large percentage of tourists came from the first or second generation Irish-American community partly due to loyalty to Ireland as well as sentimentality, has changed. We are now engaged in tourism from the third and fourth generations. My experience is that the wheel has begun to turn in our favour. The third and fourth generation Irish-Americans are beginning to focus on Ireland but they must be addressed in a different way than previously.

Like all my committee colleagues, I welcome Tourism Ireland to the meeting. Having spent most of the summer travelling in Ireland, I cannot help but say that we have a great quality tourism product and it should not be too difficult to sell.

Is J. Walter Thompson an Irish company? Is Tourism Ireland's website the best in the world? There is no reason it should not be. We have the best of everything else. How often is the website updated? Would Tourism Ireland consider establishing a major nationwide twinning programme allocating financial assistance to involve all sporting, cultural, social and business groups with similar groups?

There has been a savage number of questions, most of which do not involve duplication which will mean it will be difficult to respond to all. In the context of the issue of the arts and sports, some members referred to the fact that Tourism Ireland is a lobby group in terms of getting funding. I wonder whether, in passing, Mr. O'Toole would clarify whether this is the case. If Tourism Ireland is presenting sightseers and culturalists, has it any power to lobby that some of those cultural monuments get money for refurbishment? If Tourism Ireland has identified a problem of access in transport infrastructure, has it got a role in and input to the soon to be unveiled ten-year transport plan? If Tourism Ireland is looking at events, is it already looking at the opportunities presented by the 2012 London Olympics?

Mr. O’Toole

I will attempt to answer as comprehensively as possible the questions posed. On the Chairman's final question, Tourism Ireland is not a grant-giving or funding body but is part of the policy formulation group in the Department of Arts, Sport and Tourism. Tourism Ireland is also a member of the recently established product development strategy group of Fáilte Ireland. Tourism Ireland's role in that group is to bring back research based information on what consumers in markets perceive and would like to see in Ireland. We have a means of passing that information to our colleagues in the Department and in Fáilte Ireland. We do so rigorously and vigorously.

We thought it important to state accurately what the twin remit is. It is not meant to convey that we favour Northern Ireland over any part of Ireland but under the British-Irish Agreement special regard was to be had for the position of Northern Ireland. The tourism industry forms approximately 2% of GNP in Northern Ireland, compared to approximately 5% of GNP in the South and in England, Scotland and Wales. The South receives in the region of 3.5 million holidaymaker visitors, whereas Northern Ireland receives 300,000. What the Agreement stated was that, without causing disruption or ignoring the need to grow the business in the South, regard had to be had for business in Northern Ireland. At present, the share of that holidaymaker business in Northern Ireland is approximately 8% to 9% but Northern Ireland contributes approximately one third of Tourism Ireland's core marketing budget, and that is the context in which we operate.

The Internet and Tourism Ireland's presence on the worldwide web arose in a number of questions from the committee. We believe that "Ireland Inc.", and Tourism Ireland as its overseas marketing arm, must operate the best website in the world to enable tourism enterprises in Ireland to access consumers and potential customers through this medium. Most businesses, in some shape or form, look at the worldwide web and at their presence on it. Tourism Ireland's role, and where we believe we can add value to the industry, is to ensure that consumers with Ireland in mind can find our website, where they can get quality information about all aspects of our product presented in an easy to use fashion which persuades them to go further. We will not claim yet to have the best website in the world but we believe the investment we are currently undertaking will ensure that the island of Ireland has the best presence possible and we will be up there with, if not ahead of, the best in the world. We are making a major investment in that. We are working with our colleagues in Fáilte Ireland, the regional tourism authorities and the industry to that end. We think it is a powerful way to deal with some of the real issues the industry is facing. Allied to our major campaigns which say "Think Ireland", we hope to use the web to communicate what about Ireland is of appeal and how one may access it. Our intention is to improve what is already a good service to the industry and make it a great service.

As a GAA fan, I enjoyed the All-Ireland Football Final on Sunday. Tourism Ireland wishes to be able to promote it more. We have had some contact with our colleagues in the Gaelic Athletic Association on how we can improve such promotion. Currently, I suppose access to the major feature games is an issue. At present, people want to go to the headline games such as the all-Ireland finals, the provincial finals, etc. There is, however, much capacity in other major games and in outlining discussions with the GAA we are exploring how best we can develop those. In doing so, we look to the Great Britain market and perhaps, initially, the Irish ethnic market. We have worked overseas with the GAA in some of its promotional visits. The GAA has been to Australia, to the States, to Japan and to other countries, and we will try to maximise that. We think it represents an opportunity that is probably not being fully exploited.

The use of city and town names in Tourism Ireland's promotions was mentioned and the Chairman mentioned Londonderry. We approach that by taking official guidance on names from both administrations but we try also to ensure, not only on maps but in our literature, that we make people aware of the different colloquial uses. For example, our map would state Londonderry and then Doire underneath it, and people would be able to see that.

Is that so?

Mr. O’Toole

In our main maps we are certainly doing that and if we have not done it in them all, we will correct that. We seek to do that. In our text we refer to City of Derry, Derry and Londonderry because there are different views on the correct name. In that regard, we take official guidance on the official placename.

Tourism Ireland has a good relationship with Fáilte Ireland. It is important to note that Tourism Ireland only came into being in 2002 in the operational sense. At that time, both Bord Fáilte and CERT were amalgamated into Fáilte Ireland. Therefore, we are a relatively new body with a different team of people in place. We have committed at executive and board level to ensure that we give a seamless service to industry and that whatever bedding-in and learning needs to take place does not interfere with the successful promotion and development of the industry. By and large we achieve that goal. Our job is to promote the island of Ireland as a destination and to create demand for coming here. Our colleagues in Fáilte Ireland ensure that people have a great time when they are here. We interface in a number of areas with regard to how we bring the product to the marketplace. Industry has sometimes wondered and asked questions about how it works and who does what. We try to communicate to ensure that our industry partners know what is going on and seek to improve what we do if and when issues arise.

The convention centre is essential infrastructure required to put Dublin and Ireland in a different league in terms of the business the centre would generate for business tourism. Our understanding is that the competition is coming to a close and there will be a convention centre in the near future which will enable us to compete in markets in which we are not currently involved. The centre is a significant feature of the programme of the Department of Arts, Sports and Tourism. Once it is announced and the timeframe for completion is set, we will ensure it is promoted and that this segment of the industry is promoted vigorously in overseas markets.

The tourism potential of horseracing and other sporting events was raised. We believe there is an opportunity to further the promotion of horseracing in overseas markets, with Great Britain being an obvious target. We met our colleagues in Horseracing Ireland some weeks ago to see what we could advance. We intend to use the Punchestown festival next year as a pilot. We will have a vigorous and focused promotion of that festival to see how it plays out in the British market and how we can expand the business. Both Fáilte Ireland and colleagues in Horseracing Ireland will be involved in that promotion programme in 2006.

The extent of the competitiveness issue for Ireland was raised. It is probably the single most important issue facing the future of our industry. We must ensure that the Irish product, its promotion and presentation and the experience we give our visitors equal and exceed visitors' expectations and what is available elsewhere. Price is a factor, but it is not the only issue. Ireland does not do cheap holidays. We do not try to win the price battle with a race to the bottom as we do not believe that is an appropriate strategy. We must, however, be affordable and we must ensure this affordable experience is fantastic for our visitors. Currently, more than 90% of people who come here on holidays say they have a great time. We need to nurture and cherish this and ensure that it is not only a great time but an affordable experience.

When we analyse the components of competitiveness and examine our costs, the tourism industry is, by and large, facing up to the competitiveness challenges. We benchmark our prices in terms of flights, ferries, packages and accommodation that people buy before they come here. The core tourism industry is responding to the challenge and ensuring visitors get good value. The industry must, obviously, deal with its own businesses, input costs, profitability and margins, etc. However, it understands the realities of the marketplace and we believe it is responding to them.

Other issues of concern are infrastructure, transport, car hire, and the car-brought market. Ferry or sea business has declined in recent years. Those companies are losing out, particularly to low cost air travel. The ferry companies must face up to those challenges. Despite the decline, we believe it is important to maintain faith and invest in the sector. People who bring their car here are likely to stay longer, travel further and spend more. We are currently working on strategies with the ferry companies to persuade visitors, particularly British visitors, that bringing a car is a worthwhile experience and that it is easy, accessible, affordable and competitive with other options. We realise it is an uphill battle, but we will continue to promote it. In the peak months of June to September probably 500,000 visitors come by sea. We must ensure we protect this market, notwithstanding the challenges we face in doing so.

Reference was made to the US market. This market was down 10%, cumulatively, in the first quarter and 5%, cumulatively, for the second quarter or the first half of the year. The market started to turn in June when we had a 9% increase in visitors and there was a further 8% increase in July, leaving a cumulative 1% down for the first seven months of the year. We believe this will be redressed over the balance of the year and that we will have a net growth. However, it is unlikely we will hit the target for the market and for that reason we are establishing a review group to undertake consumer research in the North American market to see whether we are losing touch or whether there is uncertainty about where we are going in that market. This is a highly valuable market that we need to grow. We believe we can promote growth in the market, which suffered terribly post 2001. We have been trying to build it up ever since, believe it will turn into net growth this year and that we will be poised next year to get back on the growth curve.

On inland waterways and the challenges and opportunities they present, as an island water-based leisure is very important to tourism. Our colleagues in the Marine Institute are advancing a strategy blueprint to maximise marine or leisure tourism. We are participating in that process and hope it will translate into a new policy that will help develop marine tourism such as angling, cruising, water sports etc. There is further potential in this area and we will support the work of our colleagues in the Marine Institute to develop that potential.

One of the ways of addressing regional tourism issues such as airports, car hire etc. is, undoubtedly, to nurture the development of airports, including Dublin Airport. The network of regional airports has different levels of business, experience and success. When visitors come for short periods and time is of the essence, it is an advantage if they can access their destination quickly, conveniently and competitively. We support airlines that open new regional routes, but it is important "to join the dots" so that people who arrive in a regional airport have the means of going further through bus, rail or taxi services. There is more to be done in that regard.

The issue of length of stay was raised. Growth over recent years has been in the short break market, one to three nights. Dublin has benefited extensively from this market. The number of longer stay visitors, two weeks plus, has not declined in absolute terms, but has declined in terms of share of the overall market. This issue is a challenge. Length of stay is important in terms of the total take from the business. We believe consumers are voting with their feet and that they are more inclined to take shorter breaks. There is considerable value in changing a one to three night break into a four to seven night break and developing that should be the focus of our strategy.

I was asked what our new campaign will do and whether it will focus on urban centres. Our new campaign seeks to help the person who has never been here to imagine something other than a green island. Our research shows that in our main markets overseas visitors have a strong, consistent, warm and positive image of Ireland and its people. The challenge is that people find it difficult to imagine what there is to do on holidays here. The change in our marketing direction will show what they could incorporate in their holidays, including festivals, events, scenic landscapes, monuments, culture, traditional music, etc., all strong images that resonate well in the marketplace. They are strong images for Ireland and we want to ensure that in future campaigns they will remain strong and well presented by Tourism Ireland.

With reference to British visitors and the importance of sporting or artistic events, events-based tourism is a key plank of our work. Our colleagues in Fáilte Ireland have an extensive programme of support for arts festivals and events and we promote their programme in the marketplace. An improved web presence will help in this regard. Events are a key component of short break visits because they add an incentive for people to come here. On the question of possible duplication of the work of Fáilte Ireland, we both work on aspects of the same market and it is more a case of where we share functions that issues of understanding arise rather than from duplication. It is incumbent on both agencies to continue to work at ensuring clarity in the information given to our tourism enterprises.

On the question of the Ryder Cup, Tourism Ireland is responsible for the overseas promotion of the event on behalf of Fáilte Ireland which is the main investor in the project. This event will be a stunning success and it will also serve as a launch pad to present an exciting, full, vibrant and special image of Ireland when it is held next year. We are working with colleagues in Fáilte Ireland to ensure it is properly promoted.

Tourism Ireland has a good working relationship with the tourism industry in Northern Ireland which is becoming aware of the benefits of the all-island promotion. People in Northern Ireland come from different traditions and have differing views as to the way the British market should be described. Tourism Ireland is presenting an image of the island of Ireland to all overseas markets, including Great Britain.

The biggest challenge facing the industry is to remain competitive, not just in terms of prices but also in the overall quality of the experience and its affordability. This is the key challenge facing policy-makers, Tourism Ireland and the tourism industry.

Reference was made to salmon angling as a tourism product. The angling tourism market has shown a decline in recent years and there are a number of differing views as to the reason. Part of the reason is that the number of people, particularly in Britain and also in other overseas markets, who engage in specialist activities, such as angling, is in decline, but product issues also need to be addressed. Our colleagues in Fáilte Ireland and in the Marine Institute of Ireland, are undertaking market research to ensure Ireland wins its share of the angling business and the business is coming under close scrutiny to help bring this product back on track.

Tourism Ireland will this year invest approximately €900,000 in researching overseas markets which we regard as a very worthwhile investment. The industry is worth almost €4 billion. We study the markets and the consumers and relay that information to policymakers and to the industry so that it develops to meet overseas consumer needs, based on information from the customer.

The bilateral arrangements between the EU and the United States and between Ireland and the United States need to be reviewed and there is an inevitability about changes to the current arrangements. Ireland must ensure it is in the best possible position to develop business from the North American market. Shannon Airport is a significant component in the delivery of leisure tourism business from North America to the west, north west and south west. The removal of the bilateral arrangements without recognition of this fact and without constructive action in respect of Shannon Airport, Shannon Development and the tourism industry, would be an error. I have had discussions on this issue with tourism interests and with Shannon Development and I will have further discussions with Shannon Airport Authority in the next two weeks.

Tourism Ireland has this year put considerable investment into the support of Ryanair services to Shannon and the new American Airlines service to Shannon and over time it has assisted four routes from the United States to Shannon. We are confident of putting in place a constructive investment so that the promotion of Shannon Airport goes hand in hand with any changes that may occur. It is essential that a joined-up approach is adopted rather than dealing with issues separately.

With reference to Tourism Ireland's action plan for the regions, our marketing campaigns are designed to give the customer a complete picture of all parts of Ireland, including its urban and rural centres and the product they offer. We have invested specifically in initiatives highlighting the western regions which include an initiative in the Great Britain market which is beginning to bear fruit and we hope to adopt similar initiatives with our colleagues in North West Tourism, Cork Kerry Tourism, East Coast and Midlands Tourism and South East Tourism. This will be a challenge but we are confident Tourism Ireland can play its part by means of focused promotional efforts for the regions.

The bed and breakfast business is declining and a major review of the business is under way. This business is losing out to hotels on a competitive level and approximately 10% are leaving the business each year for various reasons. It is vital that what was once the bedrock of Irish tourism continues to thrive and flourish, albeit in a different environment. In my view, bed and breakfasts should not compete with hotels for heads on beds but rather compete on the basis that they offer the tourist a uniquely Irish experience. It will be a more challenging future for them but Tourism Ireland wishes to see them flourish.

Stag and hen parties in Temple Bar are inclined to go awry and they do not create a desirable image of Ireland. Many of these parties are now going to Riga so this issue may have moved on. The various interests in Temple Bar have worked to ensure the negative image caused by those parties does not conflict with the overall positive image Tourism Ireland tries to foster.

Regional tourism authorities, local industry groups and tour operators can help present a tourism package for local areas. Consumers must be convinced it is worthwhile travelling to Ireland by ferry. Tourism Ireland has undertaken this promotion this year but there is a lot more to do, such as a new programme in conjunction with the ferry companies planned for 2006.

Total visitor numbers are broken down under headings such as main purpose holidaymakers, those visiting friends and relatives, business visits and visits for other purposes. Tourism Ireland targets the category of main purpose holidaymakers and discretionary visitors. Those visiting on business or home visits are not its core target.

Our heritage of traditional music and the traditional arts but also the new more cosmopolitan culture all play a part in what consumers seek. I agree with the comments made about the changes in the ethnic market in North America, but these present an opportunity. Tourism Ireland has penetrated the ethnic market very well but it must develop its business by reaching out to new opportunities in a non-ethnic market.

JWT, J. Walter Thompson, also has an Irish operation and Tourism Ireland works with its Irish and London operation to develop the campaign. It is our intention to make our website the best in the world. Tourism Ireland is not a funding agency for major twinning programmes. Where there are significant twinnings, such as Cork and Shanghai, we would use that as a lever into and a means of accessing a new market such as China. We do not fund it but we support it through overseas promotion.

I wish to establish whether Tourism Ireland is in favour of the status quo in respect of the bilateral agreement on Shannon Airport. It can talk with whom it likes but it is vital that this be clarified. What is wrong with the agreement? We wish to promote Shannon Airport. Is it saying that the bilateral agreement should be changed and that all flights should come directly into Dublin?

Mr. O’Toole

We believe the current bilateral arrangements must be changed.

So it is promoting Dublin against the west. I must leave the meeting in protest.

Mr. O’Toole

That is definitively not the case.

Tourism Ireland is promoting Dublin against the west by saying that the bilateral agreement should be changed to the detriment of Shannon Airport.

The Deputy should either remain and speak or leave. The answer to that question was put into context. It does not affect my region as much as that of Senator Daly and Deputy James Breen.

I sincerely thank our contributors and the committee members for their interest and interaction. The efficiency with which they dealt with so many issues amounted to a tour de force. If they are as efficient in committee in the future we will be in safe hands.

We wish Tourism Ireland well, particularly with its website as that is the way forward. Whatever money is spent on marketing most people can now click on a mouse as the quickest way to get information.

The new website will have a 'My Visit' section. Does this mean that if somebody clicks on the website, they can obtain somebody's itinerary and might this, particularly if a person was critical of the destination they had visited, be controversial?

It suggests that if a person wants to go horseracing one day and golfing another they can click on the different sections and build up a personal itinerary.

I read it wrongly then.

I compliment Mr. O'Toole on the comprehensive response he has given. In all the meetings I have attended, his responses, to questions tabled at very short notice, have been among the most forthright and straightforward we have received. I ask him to elaborate at a later stage as to what the construction investment programme for Shannon will involve.

Tourism Ireland is developing those issues and consulting with people in the regions. I ask Mr. O'Toole, when it is possible, to send us a copy of each regional strategy. We will circulate it among the members because they will have their own particular regions at heart.

Mr. O’Toole

I would be happy to do that.

The joint committee adjourned at 5.54 p.m. sine die.

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