What is the Government's attitude to the proposed sale of the Great Southern Hotels? What is Government policy on the matter? The Taoiseach is very familiar with the contribution made down the years by the Great Southern Hotels and is aware of the very high quality service provided there. He appreciates that they have been a key piece of the tourism infrastructure of the country for very many years and will agree with me that they have tended to be passed from Billy to Jack in recent years. For example, the contribution the hotels made to the training of high skilled staff was, at one stage, more than the contribution made by the rest of the entire hotel sector.

I was contacted this morning by people in Killarney, not all of whom were of my particular persuasion, as they put it to me, to remind me of the Minister for Arts, Sport and Tourism's pledge before the election that the hotels would not be sold. I was horrified to hear that, on local radio this morning, he seemed to resile from that position.

What is new?

He now seems to be saying the hotels are loss makers and, therefore, it is a decision for the Minister for Transport, Deputy Cullen.

The Lord save us.

We know what will happen there. We will be very lucky if he does not erect tolls at the entrances to all the Great Southern Hotels.

I will take up the two points advanced for this decision. One relates to — shock, horror — approximately €6 million in accumulated losses. In yesterday's debate I pointed out to the Taoiseach that the previous day's report stated that €125 million was foregone in tax to new hotels.

The Deputy's time has concluded.

The accumulated losses in this case are €6 million. Let it be remembered that, contrary to the impression being put about, these hotels never got State subvention except at one stage in the 1980s when the State debt needed to be cleared, largely taxes due to the State at the time. That is the full extent —€6 million in accumulated losses compared to our willingness to give €125 million for the construction of new hotels. That is the financial record. Dublin Airport Authority has never made any secret of the fact that it did not want these hotels. It never permitted reinvestment to the extent needed as this would take up its borrowing capacity. They always made plain that they did not want it. The same situation obtained in CERT, where there was never a clear commitment to develop and invest in these hotels and establish necessary international linkages.

I appreciate Deputy Rabbitte's acknowledgement of my support for and knowledge of this group. Debts were cleared in the 1980s and the group was given a clean bill of health.

It was starved of investment.

In the late 1980s and early 1990s it was given the go ahead to redevelop a number of their hotels. Subsequently it set up new hotels, including the Great Southern Hotel at the airport, which is now the flagship hotel. They were given permission to invest in the Derry and Cork hotels and to refurbish the Corrib, Eyre Square, Parknasilla and Killarney hotels. Despite these efforts the group has continued to have trading difficulties. Accumulated debt is €40 million and rising. The Corrib, Galway and Rosslare hotels represent a serious strain on the group and only the airport hotel is operating with reasonable success. Even in this hotel wage costs are uncompetitive and the classic hotels of Parknasilla, Killarney and Eyre Square need major capital investment and retrenchment. A number of difficulties have continued for several years and I have continued to speak with staff, management and unions over the past few years.

The board of the Great Southern Hotel Group has decided to sell the hotels as a going concern. The Dublin Airport Authority fully endorses the decision and the Government as shareholder has been kept fully informed of these issues. I have made the point to the chairman of the Dublin Airport Authority and to the Minister that it is important to engage with staff and staff interests to deal with these as a going concern and keep them as hotels in so far as is possible, keeping as many staff employed as possible, if not extending employment.

The reality is that the hotels are not going where they need to go. The Government assessment is that the orderly disposal of the hotels as a going concern offers the best opportunity for them to reach full potential in a niche market to which they are best suited. This will enable hotels to contribute to tourism in the community. The Great Southern Hotel Group has engaged advisers to assist in the orderly disposal. The Minister will meet staff interests in the next few days to discuss how we can assist in this process.

Shame on the Taoiseach.

I am not sure how the Taoiseach can reconcile his opening remarks supporting the contribution of 800 staff in the Great Southern Hotel Group with his conclusion that he purports to sell the hotels in the manner described, keeping them as far as possible as hotels. That clearly means the inevitable will happen and some will be developed for property speculation, for which they are ideal sites, as opposed to being an element of the tourism infrastructure that disperses tourism around the country to areas that would otherwise suffer.

I am amazed the Minister for Arts, Sport and Tourism can facilitate this and that the Fianna Fáil Party can be dictated to by the Progressive Democrats. An obscure, unelected Senator ranted and raved this morning on the merits of selling the hotels. The Taoiseach referred to losses of €6 million in a hotel chain that has been starved of the capacity to make the necessary investment. The second element seems to be the high proportion of staff costs as compared to turnover. The staff are the leading, most professional, highest skilled staff in the tourism sector. That is a fact and if the argument is that they should be replaced by cheaper staff and the hotels sold for property speculation, it is a disgrace.

That is what will happen at a time when we need, more than ever, to disperse the tourism figures across the west of Ireland. Some major facilities that have played a major role in the past are to be sold for property development. Eyre Square sits on the edge of a 13 acre site, while the Killarney Great Southern Hotel and others are ideal for property speculation. I am amazed at the Minister for Arts, Sport and Tourism, who made a pledge to the people of Killarney and staff a few years ago. The Minister for Community, Rural and Gaeltacht Affairs, Deputy Ó Cuív, Tadhg an dá thaobh, has been running around speaking from both sides of his mouth about the two hotels in Galway.

This is a bad day for tourism and a bad day for Fianna Fáil when it is being dictated to by the Progressive Democrats' wish to put everything in the State sector under the hammer rather than creating a stand alone vehicle for these hotels where investment can be made, linked to an international brand to bring tourism to Ireland, using marketing skills to disperse tourism from the east coast and Dublin to the west of Ireland.

The Great Southern Hotels Group has had every opportunity over the past 20 years and support from various Governments to assist it. At a time when we have the highest number of tourists in the country, 6.5 million last year, the hotel group unfortunately lost between €7 million and €8 million. Accumulated losses amount to €40 million. The hotel at Dublin airport, which is coming under increasing opposition because of three new hotels that have opened in the area, needs capital to expand and develop. If we have a genuine interest, as I, Deputy Rabbitte and other Members of the House have, in trying to protect jobs in this group, it is by making——

Cynic.

The Labour Party will realise that at the peak of tourism business, when there are more tourists than ever in the country, and a business is losing €8 million per year, with accumulated debts of €40 million, it cannot go on.

There have been roadworks outside one of the hotels for two years.

The decision was taken by the board of the Great Southern Hotel Group.

Fianna Fáil hacks appointed by the Taoiseach.

The Dublin Airport Authority, which is doing a very good job, believes this is the correct decision.

Speculators will buy it.

I hope most of these hotels will continue to be hotels as I have always thought they have much potential.

Will tax breaks be provided for them?

Hopefully they will generate the same interest as the huge number of hotels we have seen built in Killarney, Dublin, Cork and Wexford, so they will be able to continue.

One of €25 million——

They are being built with taxpayers' money.

In the meantime, the Government will work with the trade union interests and the workers to try to make the best decisions for their interests and protection in the future.