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23.03.2020

 

Media Statement

 

HOTELIERS CALL FOR URGENT SUPPORT MEASURES TO SAVE TOURISM JOBS

Up until last week, Irish Tourism supported 260,000 jobs and generated €9.2 billion in annual tourism revenues – now we are fighting to save these jobs and our beloved Irish Tourism

 

23rd March 2020: Irish hotels and guesthouses are seeking urgent measures to help save Irish tourism and secure the livelihoods of 260,000 people employed across the country by our industry. Elaina Fitzgerald-Kane, President of the Irish Hotels Federation (IHF) states: “Safeguarding public health is an absolute priority for us, and this must go hand-in-hand with ensuring we have a viable economy to return to after the crisis. The health and wellbeing of our people is intertwined with the economy.

“People will need livelihoods when this is all over – including the 260,000 people across the country who, up until recently, were employed in tourism and hospitality. This represents 11% of total employment nationally. Some 70% of these jobs are outside of Dublin and often support whole communities and households. Over 100,000 have already been laid off and it is deeply regrettable that many more will follow in the coming days, unless immediate action is taken by government."
 

  1. Employees: Government should commit to paying 80% of the salary of workers if businesses keep them on their payroll. Similar to mortgage deferments, provide grants for employees who are renting.
  1. Cashflow / Finance: measures to assist with cashflow for businesses facing short term problems, including:
    1. Interest free loans with deferred capital payment structures
    2. Government supported and targeted bank support initiatives
    3. 12-month payment deferment on Senior debt (Capital and Interest)
  1. Government grants: business interruption grants to help businesses reopen and interest-free Capex grants that are repayable over time
  1. Local Authority rates and water charges: to be waived for the duration of business interruption and initial recovery period due to Covid-19.
  1. Taxation: tourism VAT rates and employer’s PRSI to be reduced to zero until the industry has recovered.
  1. Insurance: grants to cover business’s public liability and property insurance for the duration of the crisis and for Government to require the insurance industry to be more flexible with charges in relation to businesses that are closed.

“Tourism makes a vital contribution to our national economy, generating some €9.2 billion in revenues last year. Within a short number of weeks, we have seen revenues plummet by up to 100% across the sector. Tourism businesses have now closed with thousands of people being laid off on a daily basis across the country. We must do everything within our power to ensure that these closures are temporary.

“The challenges we now face are existential and far greater than anything we went through during the financial crisis. We require extraordinary measures and political leadership right now to ensure these closures and layoffs are temporary. That is why we have called on the Government to act extremely quickly to ensure that large parts of our economy, including tourism, are not obliterated by the current crisis.

“When we look across the water to the UK, we see a range of seriously impressive measures to save jobs and the economy, such as the UK Government’s decisive commitment to pay up to 80% of the salary of employees if businesses keep them on their payroll as the economy crashes. Here in Ireland, we need our own ‘great national effort to protect jobs’ along similar lines.

“It is extremely regrettable that the response so far by Government has been inadequate and this is causing alarm across our sector given the lessons learnt from the financial crisis and urgency required to minimise long-term damage to vulnerable sectors of the economy.

“Last week, for example, the Government moved to defer commercial rates for businesses impacted by the crisis. Such a deferment is futile for tourism businesses that have no revenue as it just means they are being asked to accumulate the liability. It fails to tackle the underlying problem and will do little to get our people in Irish tourism back to work as part of rebuilding Ireland. For those businesses most affected, including those that have closed, these Local Authority rates must be waived until the crisis is over.

“Cash flow in particular is the killer of businesses in crises like this, and we have called on the Government to implement measures that will assist with cash flow now as well as reducing the rates of tourism VAT and employer’s PRSI to zero for the duration of the crisis. In addition to our call for local authority rates to be waived, we are seeking direct business supports, including finance and marketing assistance.”

Urgent measures required now: “We now expect societal and business interruption to last far longer than originally anticipated, and this significantly changes the context and scale of Government intervention required. Nothing short of a drastic intervention will secure the future of Irish tourism.

“We are all in this together and tourism businesses, including hotels and guesthouses, are determined to get through this crisis and get the 260,000 people back to work in tourism. There is only so much we, as individual businesses, can do in the face of such an overwhelming crisis that threatens to obliterate Irish tourism. That is why on all TDs to support our call for decisive and exceptional measures at this time of national crisis.”

The Irish Hotels Federation (IHF) has expressed deep alarm at the Government’s response to Covid-19 in relation to local authority rates. Elaina Fitzgerald Kane, IHF President described proposals to defer rates payments as wholly inadequate and a futile exercise that will do little to get the 260,000 people in Irish Tourism back to work as part of rebuilding Ireland.

“Securing jobs is our priority now and it is disappointing that the Government does not realise the reality of what is needed.”

The IHF is calling for rates to be waived until this crisis is over saying that decisive, meaningful action is required that recognises and properly addresses the enormous financial challenges facing the tourism and hospitality sector.

“Deferring payment fails to tackle the underlying problem. It needs to be waived. Let’s be very clear, our quest is to get 260,000 people back to work and if this meaningless intervention is to the only initiative brought to the table, businesses throughout Ireland will suffer. Every day without a waiver leads to further job losses.”

“Hundreds of tourism and hospitality businesses across the country have closed their doors in recent days due to this crisis, with no idea as to when they will be able to reopen. Accruing their liabilities makes no sense. Their financial difficulties are not going to simply evaporate at the end of May. We want to get people back working and play our part in rebuilding Ireland. These businesses are facing weeks if not months of lost income, during which time their liability for Local Authority Rates will accumulate.”

Tourism supports over 260,000 jobs in every town and county and is a major contributor to the rural economy. Ms Fitzgerald Kane says that meaningful action is required now so that hotels and other tourism businesses can start to plan their recovery for when this crisis is over.

“One of the lessons learnt from the financial crisis was the requirement to act fast so that large parts of the economy are not obliterated, with long-term consequences which will directly impact the local authorities. It is in everyone’s interests to start preparing to put our economy back on a firm footing as quickly as possible.”

Tourism sector at a glance:

  • 10.9 million out of state visitors
  • Tourism accounts for almost 4% of GNP
  • Total tourism revenue of €9.2 billion in 2019
  • Tourism industry has created over 90,000 new jobs since 2011. It supports over 260,000 jobs, equivalent to 11% of total employment in Ireland with over 60,000 of these jobs in the hotel sector alone.
  • €7.25 billion in foreign exchange earnings
  • €1.96 billion in domestic tourism revenue in 2019
  • Total of 62,897 hotel and guesthouse bedrooms in Ireland (2019)

 

- ENDS -

Media Queries:

Seán Lawless / Ger McCarthy                                     Tel: 01 6798600

Weber Shandwick                                                         Mobile:  085 11 676 40 / 086 2333590

 

 

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