Hoteliers Respond To Programme For Government
Hotel and guesthouse owners have welcomed the incoming Government’s recognition of the challenges facing tourism in the programme for Government together with its commitment to place tourism at the centre of its National Economic Plan. However, Tim Fenn, Chief Executive of the Irish Hotels Federation has called on the Government to recognise equally the urgent requirement for immediate measures to help businesses survive. Mr Fenn added that a failure to act now could be particularly devastating for the regions given 70% of tourism employment is located outside of Dublin.
“Tourism businesses, including hotels, are facing a fall of 70% in revenue this year due to the collapse in the overseas visitors. The establishment of the Tourism Recovery Taskforce is a very welcome first step. But, in addition to its work, immediate interventions in relation to liquidity and competitiveness are also required to support tourism businesses throughout the length and breadth of Ireland. “For the peak summer month of August, our members project* an average occupancy of 38% this year compared with an average occupancy of 90% for the same month last year. This represents an enormous drop in projected business levels. Hotels and guesthouses not only provide local employment opportunities, they buy local services, source locally produced food and provide a vital infrastructure in support of local business and communities so the ramifications will be felt far and wide.”
“One of the lessons learnt from the financial crisis was the requirement to act extremely quickly to avoid long-term consequences,” he said.
Four Urgent Measures Immediately Required - the IHF is calling on the incoming Government to implement four key measures as a matter of urgency:
1. Liquidity Measures tailored to the specific challenges facing tourism businesses to help them survive and restart: i) a significant widening of the direct business grant scheme; ii) 0% interest on Government guaranteed finance; iii) a Government supported scheme for deferral of capital and interest payments for a period of one year; iv) re-assessment of the SBCI loan system to ensure appropriate products are available for tourism and hospitality.
2. Continuation of the job subsidy scheme for tourism and hospitality during the crisis. Seasonal employees not currently eligible for TWSS should also be included. Businesses will be operating at severely constrained levels of activity when they re-open. The Covid–19 Wage Subsidy Scheme should be continued until the impact of physical distancing and mass gathering restrictions has abated.
3. Reduction in tourism VAT on a permanent basis to assist recovery and secure a viable and sustainable future for tourism. International competitiveness is an urgent issue for Irish tourism with hotel VAT now higher than 28 European countries we compete with.
4. Local Authority rates and charges – the three-month waiver period should be extended for tourism businesses to coincide with business interruption due to Covid-19 and for a minimum of 12 months. After that, payment of local authority rates should be based on reduced levels of activity due to the Covid-19 crisis.