President's Overview

William Power

When I look back over 1998 the events which took place in Belfast, early in the morning of Good Friday, 10th April 1998, and the signing of the multi-party agreement, stands "head and shoulders" over everything else. The hope, that at last, a sustainable solution had been found to the Northern Ireland issue supersedes all other achievements of the year. From a tourism perspective, the ensuing peace is a foundation on which to further grow this industry, which now exceeds 8% of our gross domestic product.

1998 was another record year for Irish tourism. Preliminary estimates show that revenue from out of state markets reached £2.3bn. up 9% on the previous year. When you add to that, the Domestic Tourism contribution of almost £800m. the total industry, in which we operate, has a turnover of £3.1bn. The benefits of such a major industry are enormous. Employment now exceeds 124,000 people and the exchequer benefits to almost £1.5bn. A major drive in this growth has been the investment in the hotel and guesthouse industry. There are now, in the Republic of Ireland, over 820 hotels with 35,900 bedrooms and 443 guesthouses with 4,700 rooms. This is an increase of almost 30% in capacity over the last three years.

Employment in hotels and guesthouses has also increased and is now in excess of 50,000 people, three quarters of whom are employed on a permanent basis. Most of the new jobs now created in tourism are being created by the hotel and guesthouse sector. Tourism growth at 10% still is 1.5% greater than the growth in our gross national product. The growth in hotel and guesthouse employment keeps pace with the national employment growth of just less than 5%. With Ireland's unemployment rate at 7.8% half of what it was five years ago, recruiting new staff is becoming more difficult for all sectors.

The success in creating 8,000 new jobs in our sector in the last two years is confirmation that our Federation was correct in launching the Quality Employer Programme at the end of 1996. This is a strategy which sets us apart from most industries in setting a code, based on best practices in the whole area of employment. It is only by building on these practices and by increasing the participation of our members, can we have any reasonable hope of attracting new recruits to our business in the most competitive labour market which Ireland now has. It is most gratifying to note that well over half of the members of the Irish Hotels Federation have now applied to become accredited as Quality Employers and over 20% have already achieved accreditation.

Even with the Quality Employer Programme, it will become more difficult to recruit staff in the future. The supply lines are drying up. More and more employers are seeking new employees and the Irish hotel industry must adopt changed tactics to ensure that it has the staff to provide the quality service to its customers. With this objective in mind, we participated in conjunction with the Restaurant Association of Ireland and CERT in a nation-wide "National Tourism Career Roadshow" during November 1998. Over 8,000 second-level students attended presentations throughout the country. A database has been created of these students and they will be kept informed of developments and opportunities available in the hotel, guesthouse and catering sectors. We are also looking at other supply sources for our workforces of the future. Ireland has one of the lowest levels of females participating in the workforce, in the, EU With this in mind, in our pre-budget submission, we asked the Minister for Finance to introduce a Homemakers Revenue Job Assist Scheme to incentify homemakers return to the paid workforce. While this proposal was not included in the budget speech, we understand that the Department of Finance is now seriously examining the proposal.

Pictured at the launch of career opportunities guide "Get A Life in Tourism" were cert students (l to r) Edwina cunningham, Gail Broe and Eoin Sweeney.

I also welcome the recent release of the Report of the Expert Working Group on Childcare under the auspices of Partnership 2000. The implementation of the recommendations in this report would increase substantially the availability of childcare facilities and allow more parents to return to the paid workforce.

We participated in a recruitment drive in London and Glasgow in the early part of 1998, targeted at attracting people working in the industry in the U.K. to seek employment in Ireland. We are actively pursuing opportunities to recruit, in other EU countries, suitable staff to work in the Irish hotels and guesthouses. IHF Quality Employer accredited members are supporting these initiatives and anybody recruited under them will be directed towards these properties. Our industry is committed to providing a quality product to customers. The provision of this quality product needs quality staff. The Irish Hotels Federation will do whatever possible to help its members to acquire quality staff.

We maintain throughout the year, close liaison with CERT and we welcomed its new Chief Executive, Shaun Quinn, who commenced at the beginning of October. We are confident that CERT will continue to provide the industry with training which is necessary both for the people entering the industry and on an ongoing basis to ensure that our Quality Product is protected.

When I became President, last February, I set at 400 a target for the number of applicants for the Quality Employer Programme to be achieved by the end of 1998 and the appointment of Quality Employers Facilitators to assist Anne O'Carroll, in achieving this objective were appointed. I am pleased to report by year-end that we had 450 applicants and had accredited 160 properties. Over 55% of all members of the Federation have now applied for membership of the Quality Employers Programme and 20% have been accredited. I have used every opportunity during my first year of office to promote the Quality Employer Programme and it is gratifying to see its recognition at Government level and at commercial level as a major initiative to address the challenges of obtaining more people to work in our sector. Demanding targets have now been set for 1999 and additional resources have been allocated to the Quality Employer Programme. This underlines my strongly held belief that only with a clear establishment of our industry as a Quality Employer in which priority attention is given to the development of our human resources can our industry continue to grow and contribute more to the Irish economy and to the profitability of our members.

Throughout the year, I had meetings with four Ministers, the Minister for Tourism, Sport & Recreation, the Minister for Justice and Law Reform, the Minster for Finance and the Minister for the Environment and Local Government. In the numerous meetings which I have had with the Minister for Tourism, Sport & Recreation, the importance of the creation of a £20m. Per annum, designated fund for tourism marketing of Ireland overseas was highlighted. The Minister accepts our argument and while it would be our desire to have this fund created by the Exchequer which benefits to the tune of £1.5bn. from tourism, the suggestion by the Minister of a visitor tax being introduced to fund this amount received a guarded welcome from the Federation. The acceptance of such a fund will be conditional on it being a designated £20m. fund, under the joint control of the tourism industry and Department/Bord Failte, the existing level of funding of Bord Failte should be at least being maintained and that there being total transparency on the use of the tourism marketing fund. There have been numerous meetings between the Minister, his Department Officials and the Irish Tourist Industry Confederation delegation, to progress and develop this suggestion.

Your Chief Executive, has been part of this delegation and I can assure that the interests of the Federation members are protected in any system which might be developed. Dr McDaid also accepted the Federation's argument that the room tax proposed by Dublin Corporation should be rejected and following extensive lobbying, the Joint Oireachtas Committee on Tourism, Sport & Recreation unanimously rejected the proposal to introduce such a tax. We sought and obtained agreement with the Minister to continue with the Regional Tourism Marketing Initiative (formerly Domestic Tourism Marketing Initiative) and the allocation to this fund of £500,000.for the 1999 season. With the expiry of the current Operational Programme for Tourism at the end of 1999. I believe that tourism should fare prominently in any National Plan and Operational Programme for Tourism to follow. While it would be desirable to have a separate Operational Programme for Tourism, it may be more practical in the context of the method of funding available from the EU post 1999, and in the event in there being no industry specific operational programmes that tourism should receive high ranking in whatever new format these programmes take.

The scourge of unapproved accommodation still stays with us and despite numerous representations to the Minister and his Department has not addressed this issue. While there were grounds to hope that the levying of Local Authority Rates on all commercial providers of tourist accommodation would be introduced in a new Valuation Bill, the views of the Minister opposing such a suggestion is a major cause for concern of the Federation and its Council. At the time of going to press, a meeting has been arranged with the Minister to explain, again, to him the inequity of the present system under which, hotels and guesthouses are the only commercial providers of tourism accommodation which are liable to Local Authority Rates. The extensions of the rates net to these other commercial providers of tourist accommodation would net a substantial fund of not less than £20m. to Local Authorities coffers. It would then level the playing-pitch on which all tourism accommodation providers including our members operate. We emphasised to the Minister the need to introduce a licensing system for all commercial providers of tourist accommodation. We reiterated that it is only through the existence of a licensing system based on quality, fire and hygiene safety and adequate insurance arrangements being in place, can the risk which this unregulated sector providing over half of the rooms available to tourists be removed. This is not an exercise in making it more difficult for our competitors, but it is a genuine concern that the tourist industry on which so much of the future of the Irish economy depends, is organised in a professional quality based system whose primary objective is to ensure the enjoyment and safety of every person who uses tourist accommodation in this country.

Pictured at the Holiday world Experience in Dublin's RDS recently were Noel O'Mahoney, General Manager, Bay View Hotel and Leisure Centre, Killybegs; An Taoiseach Bertie Ahern TD; Maureen Ledwith, Holiday World Experience and Lorna McNamara, IHF.

We sought an assurance from the Minister for Tourism that adequate funding remains in place to fund the activities of CERT and I believe that major progress is being made when this organisation, under the chairmanship of our former IHF President, Mr Eamonn McKeon, in addressing the recruiting and training needs of our industry. There is now much greater co-operation and dialogue between CERT and the Federation and the Federation and in conjunction with other sectors of the industry we actively in joint initiatives. particularly in the area of recruitment.

I wish to thank the support given by our branches to the National Tourism Career Roadshows. The making available, free of charge, the facilities of hotels to stage these events is a clear indication of the priority which the Federations members place on the recruitment challenge facing us.

I also wish to acknowledge the generous manner in which members have offered prizes which are used in conjunction with publicity campaigns to heighten the profile of our industry as offering attractive career options.

During the year I led a delegation of the Licensing Committee of the Federation which met the Minister for Justice and which outlined to him the Federation's position regarding any forthcoming changes in the Licensing Laws. I believe that the Minister was impressed by the case which we made and acknowledged the major contribution which our members participating in the NightClub and Disco business make to the economy and society of this country. We strongly outlined the need to include in any review of Licensing Laws, provisions that the economic viability of these operations be protected. We highlighted the fear that the extension past midnight of normal bar closing times would be the death-knell for many rural hotels with nightclubs. We are hopeful that the proposed legislation in this issue will take into account, issues that we raised with the Minister.

Through our membership of the Irish Business Against Litter) organisation (IBAL, the federation hosted a meeting of its council at Northbrook Road. The Minister for the Environment and Local Government, Mr Noel Dempsey attended that meeting and, in addition to my ongoing concern about the inadequacy of road-signage, I raised with him the absolute need to heighten the anti-litter campaigns and committed to recommending to the Federation the initiating of an anti-litter initiative in 1999.

IHF President William Power, chairman of Irish Business Against Litter Tom Cavanagh and Minister for the Environment, Noel Dempsey T.D. before their meeting in IHF headquarters in December 1998.

The Federation was among less than 20 delegations which the Minister for Finance, Mr Charlie McCreevy met to present their pre-budget submissions. This submission concentrated on the following issues:

• The creation of a ring-fenced tourism marketing fund of £20m. per annum;
• The introduction of a Homemakers Revenue Job Assist under which mature persons returning to the workplace would get a special tax free allowance of £2000 per annum for the first three years;
• Access to the regions should be improved by a major road improvement programme funded from a public/private partnership and concentrate on the provision of a Western tourist corridor linking Derry, Donegal, Galway, Limerick, and Cork with radial links from Dublin. The purpose of this proposal is to ensure that most tourists areas of the country should be within two to two and a half hours from an international airport or car-ferry port and that the improvement in the roads in the West is essential to achieve this objective;
• The commitment to the continued funding of CERT;
• We sought a commitment from the Government to continue its efforts to retain hotels and restaurants within the reduced rate of VAT in any EU common system of VAT.
• We called on the Minister to continue his efforts for the retention of the availability of duty-free sales for intra-European travellers and highlighted the effect that such a removal would have on access costs.

As with the Minister for Tourism, we reminded the Minister of the inequity of the Local Authority rating system in which over half of the bedrooms available for commercial tourist accommodation fall outside the rates net. We reiterated the need to have this rectified in the forthcoming Valuation Bill.

At European level we continue our active involvement with HOTREC and I attended General Assemblies in Vienna and Cologne. HOTREC continues to lobby for the retention, within the proposed EU common system of VAT, of the reduced rate of VAT on hotel and restaurant services. It also seeks that expenditure, on hotels and restaurants, be allowed as inputs by VAT registered customers. The European Finance Commissioner suggested that 50% of these costs be allowed as VAT inputs, and, it was gratifying to note that following lobbying from HOTREC and its national associations, including the Federation which lobbied all Irish Members of the European Parliament, the Parliament adopted amendments, which if applied, would allow full deduction of these costs. HOTREC will continue to pressure, at EU level on all these issues and will co-ordinate the activities of member associations in their national lobbying.

During the year, the Review Committee reported on the structures and functions of the Federation. The work programme for 1999 will include the implementation of many of these recommendations, the principal of which, will be more focused lobbying campaign structure and a streamlining of the activities of the sub-committees which focus on specific activities. A more active participation at branch level in marketing activities is also recommended.

I warmly welcomed the appointment of John Dully as Chief Executive of Bord Failte and the appointment of Niamh Fitzpatrick as the International Marketing Manager. The future of Irish tourism, to a major extent, depends on marketing. We in the Federation through the production of the 1999 "Be Our Guest Guide", having a record 1,014 entries and a print-run of 400,000 copies play our part in the marketing of Irish tourism. IHF members and the executive active participate on the board and marketing committees of the Overseas Tourism Marketing Initiative and on the management committee of the Regional Tourism Marketing Initiative. This participation helps to ensure that that their activities are kept focused and that the resources available are directed to the consumer marketing activities for which they were designed, which we believe are to the greatest benefits of the overall tourist industry and our members.

It is now over a year since 74% of the Gulliver reservation system was acquired by FEXCO. The Federation has maintained close contact with the development and promotion of the Gulliver reservation system. It is gratifying to note that, in 1998, Gulliver's first year under the control of FEXCO, the value of business, which is provided to hotels and guesthouses, increased by 55% over 1997. The technology being developed for the Gulliver system and its accessibility to hotels and guesthouses using an internet based extranet facility will further improve its value to our members. Technology is going to be a major driver in our future development. This is put in context when you see that the Irish Government has asked the Information Society Commission to conclude, by the end of March 1999, its assessment on the possibility and merit to provide an Email address with Internet access to every citizen. The Gulliver information system and the linkage which it has to the Be Our Guest Guide, the Be Our Guest Guide website, its hyper links to individual property websites is our contribution, to date, to this information technology development.

Pictured with out-going Dublin branch chairman Jim Murphy are some of the recently accredited Quality Employer Dublin Hotels and Guesthouses.

Early 1998 saw the publication of the ITIC "Strategy for Growth beyond 2000 - A Strategic Framework for Irish Tourism". Your federation had a major input into the development of this strategic framework document for Irish tourism. It outlined both the benefit of the industry, its potential in the future, the key market trends, the changes in customer preferences, the activities of its competitors, challenges facing the industry in the future and the potential growth scenarios. The objectives of the suggestions contained in this report would mirror the ongoing activities of the Federation.

During 1998 we built further on our close relationships with our hotel industry colleagues in Northern Ireland. Following the Good Friday agreement we put in place a north-south Committee to build on the opportunities which will, no doubt, come from the implementation of the structures envisaged in this agreement. The hotel representative body in Northern Ireland has relaunched itself as the Northern Ireland Hotels Federation. The Irish Hotels Federation has been supportive in the activities of this federation and will continue to do so in their setting up of structures and activities which we believe to be to the overall benefit of tourism in the whole island of Ireland.

The Benevolent Fund Committee under the committed chairmanship of Patsy Ryan embarked on a most praiseworthy venture to substantially boost this fund by organising a fantastic draw with a first prize of a BMW car and splendid holiday prizes. I strongly commended this major effort and asked as many members as possible to purchase a ticket and help put in place fund which, some day, may be called on to help some of our less fortunate colleagues.

In conclusion, I must say that I thoroughly enjoyed my first year as President and support the enthusiasm conveyed to me by members, the branch network and national council, encouraged and gave me enormous energy throughout the year. Without this support the actions of me, as President, would be ineffective. The information and guidance given both at council meetings and through my branch visits was invaluable.

Finally, I wish to thank the Chief Executive and staff at Northbrook for their support, guidance and achievements throughout the year.