This Bill is concerned with what is probably correctly described as the most important aspect of the tourist industry, namely, accommodation for tourists. It provides for the renewal of the powers of the Miniister for Industry and Commerce to guarantee loans for the expansion and improvement of hotels and other forms of holiday accommodation and for the development of tourist resorts. That power, which was given by the Tourist Traffic Act, 1952, expired early this year. It is necessary to renew it if it is to be exercisable in the future.
Our investigations of the possibilities of expanding the country's tourist trade indicate that hotel accommodation continues to be the main limiting factor and that it is necessary to induce substantial private investment in the hotel business if this country is to be put in a position to cater for the growing volume of tourist traffic which is anticipated over the next few years. The tourist traffic of the world has undergone a very big increase since the end of the war and it is still growing very rapidly.
The estimates which have been made by the international bodies that study these matters and publish the results of their studies are that the tourist trade of Europe will grow at the rate of 10 per cent. per year and, in the case of tourist traffic from across the Atlantic, these experts predict that the technical improvements in the means of travel, particularly the advent of faster and larger airliners, will provoke a substantial increase in the number of American visitors within the next few years. It is anticipated that that increase will be noticeable next year, particularly because of the coming into operation, as from early in the year, of new lower tourist fares on all the airlines operating on the Atlantic route. It is most important, in relation to the economic problems of the country, that we should get our share of these expected increases in the total tourist traffic, but we cannot hope to do that unless we organise our facilities to cope with the anticipated expansion.
There has been a steady increase in hotel accommodation in this country within the past few years. I am afraid I have to say, however, that the rate of increase was not nearly sufficient to meet our requirements. The problem is one which calls for energetic action, as well as for courage and enterprise, on the part of private interests concerned with hotel developments. So far as the Government are concerned, there is full appreciation of the urgency of the need for energetic action. We are aiming to do all that can reasonably be expected of a Government to facilitate hotel proprietors and other interests in their efforts to expand and improve hotels and other forms of holiday accommodation.
The guaranteeing of loans raised for the purpose of improvements and extensions is the most effective and the most practical method open to the Government to facilitate private investment. Accordingly, under this Bill, it is proposed to extend that power of guaranteeing loans for a further period of five years. That alone is, I think, not sufficient. The Hotel Loans (Guarantee) Scheme introduced in 1952 has not resulted in the expansion which I then anticipated and indicated to the Houses of the Oireachtas as likely. The scheme, for many reasons, has been less productive of results than I had hoped for. Nevertheless, loans totalling £250,000 have been guaranteed. We contemplated a much higher target in 1952, but even that expenditure on hotel expansion and improvement represents some progress.
I do not think progress at that rate will help to solve the problem of inadequate hotel facilities within reasonable time. We must now try to get a considerable acceleration of the rate of hotel construction, if we are not to miss the opportunities which are likely to present themselves during the next four or five years. We have given consideration to that problem and, in so far as it is one that calls for legislation, this Bill achieves that result, but I think that as much more can be done by administrative action without any change in the law.
It is proposed in this Bill to increase from three years to five years the period during which An Bord Fáilte can make grants to hotel proprietors to cover the interest payable on guaranteed loans. That, I think, will induce greater resort to them. The feeling that the loans raised in that way for the extension of hotel accommodation will not involve any burden of interest for the first five years of the loan must have some effect.
The second step—which is, I think, equally important—is to enable An Bord Fáilte to guarantee loans raised for that purpose—the extension or improvement of hotel accommodation otherwise than under ministerial guarantee. Again, the period for which such grants can be given in respect of interest is five years. It is known, I think, that the procedure necessarily involved in the consideration of applications for State guarantees for loans, and in deciding and implementing decisions on such applications, is fairly lengthy. That protraction of procedure has operated, I think, to discourage resort to the scheme. When An Bord Fáilte has the power to guartee loans raised otherwise, that delay can be avoided, if the loans can be raised otherwise—and in many cases hoteliers can get that accommodation from their bankers or otherwise.
In the past, if they sought to get accommodation outside the guaranteed loans scheme, they could not get the benefit of the interest grants. Now they can get that benefit, no matter how they raise the money, provided the money is raised for a purpose which is approved by An Bord Fáilte. I am arranging to have a review made of the administrative procedure, to see whether it is possible—I believe it should be possible—to speed up the consideration of applications and reduce the formalities which have to be complied with, even where the decision is favourable.
Other incentives, numerous and varied, have been offered to hotel proprietors to exert themselves to derive the maximum advantage from the present situation. In addition to these provisions for State guaranteed loans and grants in respect of interest on loans, improvements to hotel premises qualify for a remission of two-thirds of the local rates attributable to the improvement, and there is also now the concession that 10 per cent. of the capital expended in any year on the extension and improvement of hotel accommodation is allowable as a deduction in computing profits for income-tax and corporation profits tax. Hoteliers, of course, derive benefit from the sums given by way of Grant-in-Aid to An Bord Fáilte, which can amount to £500,000 a year. These moneys are available for the publicising of holiday resorts and other tourist development activities.
I should say again that all the concessions and advantages which are at present available should be regarded as temporary in character. It is necessary to say that there can be no guarantee that they can be continued indefinitely. Therefore, it is in their own interest that hotel proprietors and others concerned with aspects of the tourist trade should take advantage of the opportunities while they are there and put in hand as quickly as possible their plans for the construction, improvement and extension of their premises.
The other provisions of this Bill, though perhaps less important than those to which I have referred, are nevertheless of interest. Section 5 provides for the registration of motor hotels by An Bord Fáilte. These institutions, which are now developing in most countries, are called by a variety of names—motels, motor courts, and so forth. It is a form of accommodation which was developed first in the United States but has become increasingly popular on this side of the Atlantic. There are many indications that a growing part of our tourist traffic will take the form of motorists travelling around the country by car or availing of car hire or bus services, for whom that type of accommodation is particularly suitable. It is possible, therefore, that that type of accommodation will tend to develop here; and that being so, it is desirable that An Bord Fáilte should have the same rights of registration, the same control over the use of those names and the same powers of inspection in regard to it, as they have at present in regard to hotels. By bringing this type of premises within the scope of this Bill, they also qualify for the State guaranteed loans scheme and for the interest grants.
The experience of An Bord Fáilte has been that quite a number of visitors come to this country and stay with private families or in boardinghouses, in premises of a kind which is not required under the existing law to be registered with An Bord Fáilte. They have been frequently asked by visitors for information concerning accommodation of that kind that may be available. The board desire to publish a list of persons willing to take visitors on that basis, giving particulars of the accommodation available, whether that accommodation is accompanied by full or partial board. It is proposed to empower the board to collect that information and publish it. There will be, of course, some preliminary examination by the board of the suitability of the premises for listing by them. Of course, no premises will be included in their list except on the application of or with the consent of the proprietor of the premises. It is thought that that facility, available for the type of visitor requiring that kind of accommodation, will help to give satisfaction to them and perhaps increase their numbers.
There are some minor amendments being made in the law relating to registration of hotels and guest-houses. They are dealt with in Sections 6, 7 and 8 of the Bill. None of them is by itself important. All of them arise out of the board's experience of the operation of the original Act. Perhaps I should make it clear that the enactment of this measure does not involve any increased expenditure by the Government. An Bord Fáilte is financed by way of Grant-in-Aid and it is within the limits of the Grant-in-Aid that they will carry out any additional responsibility or functions they are given in this measure.
I have frequently expressed my view that a very substantial increase in the present level of tourist income can be secured by exploiting the potentialities of this country as a holiday centre. Senators are no doubt aware of the fact that we have been advised by external experts who investigated the position, that we can quite confidently hope to double our present tourist income, provided we tackle the enterprise with the necessary skill and enthusiasm. An increase in tourist income would, of course, react very favourably upon our whole economic position and would benefit many sections of the community other than those who are directly engaged in any branch of the tourist industry, or even those who are interested in the supply of goods and services to tourists. The enactment of this Bill will facilitate progress in that direction.
Perhaps I should explain that I have a number of proposals and suggestions relating to the development of the tourist industry under consideration. I would have preferred to have come here with a more comprehensive measure giving effect to such of those proposals and suggestions as I think would be worth while. I was, however, anxious to proceed with this Bill without delay, by reason of the fact that the power to guarantee loans has expired.
While I do not think that up to the present An Bord Fáilte has been impeded in its consideration of applications because of the public assurance I gave that a Bill to continue that power would be presented to the Oireachtas, nevertheless the Bill should not be delayed further. Problems would arise if the completion of the enactment of the Bill were to extend into the next financial year. That, I think, would almost be certain if I were to attempt to delay it in order to incorporate some of the proposals to which I referred.
It is therefore to be considered as very likely that other proposals embodied in, and taking the form of, legislation will come before the Oireachtas probably before the next financial year. I should perhaps make it clear that they will not alter in any way the provisions contained in this Bill relating to guaranteed loans and similar matters so that nobody need hesitate to avail of these provisions now in anticipation that more generous proposals will come later. The proposals we have under consideration deal with other matters and, while they are important, they will not necessarily have the same impact on problems of extending hotel accommodation and so on.
Business suspended at 6.5 p.m. and resumed at 7 p.m.