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Cash injection into hospitality sector ‘not enough’ to ensure survival

Hotels in Dublin have seen bookings plummet, with many operating on an 11% occupancy rate.

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Fergal O’Connell, general manager at The Fitzwilliam Hotel (Niall Carson/PA)

Fergal O’Connell, general manager at The Fitzwilliam Hotel (Niall Carson/PA)

Fergal O’Connell, general manager at The Fitzwilliam Hotel (Niall Carson/PA)

Hoteliers have said the financial injection into the hospitality sector has not gone far enough.

Hotels in Dublin have seen bookings plummet, with many operating on an 11% occupancy rate.

The financial leg-up for the hospitality sector saw the VAT rate reduced from 13% to 9%, which will be introduced from November and last until December 2021.

Other measures include a new scheme aimed at businesses hit by lockdown restrictions, which will see a maximum weekly payment of 5,000 euro paid to businesses.

Despite the cut in VAT on food and extra support for businesses, some hoteliers say they need long-term supports.

Fergal O’Connell, general manager at the Fitzwilliam Hotel in Dublin, said: “It is all about survival in the business and while we talk about being agile and resilient, days like today are very important to give us some glimmer of hope.

“It’s vitally important that you know we have a business at the end of this.

“We need proper government supports to recognise the challenges that we’re facing to get through this.

“I do believe that whilst some of the measures in today’s budget are very positive for our sector, I don’t think they go far enough and I don’t think they’re wide enough to ensure the survival of businesses in tourism.

“I don’t think they’ve been ambitious enough for our sector in order to get it through the next 12 and 18 months.

“9% is better than 13%, but I must also put that in context – 9% of nothing is the same as 13% of nothing.

“While 9% will help us be more competitive and will stimulate business when it returns, it’s only when business returns that that will have a benefit for us.

I don't think they've been ambitious enough for our sector in order to get it through the next 12 and 18 months Fergal O'Connell

“Business won’t return in our sector in this city until international tourism resumes in any meaningful way and that’s a fact.”

Paul Gallagher, general manager of Buswells Hotel in the city centre, said that while the reduction in the VAT rate is welcome, it will only work if the country reopens to international travellers.

He said that Ireland needs to align itself with the European traffic light system for travel.

Some 70% of the hotel’s business is overseas travellers.

He also called for the government to extend the cut in the VAT rate beyond December 2021.

The hotel went from 60 full-time staff to just six.

“The sooner we can get this country open, the more staff can return and come off the PUP payment,” Mr Gallagher added.

The hotel has around 11% occupancy rate, while turnover is down 88% on last year.

Mr Gallagher has also called for the 5,000 euro business support to be implemented retrospectively.

He added: “There’s no doubt the hospitality, tourism, entertainment and art sectors have borne the economic front of Covid-19.

“There is  no other industry in Ireland who has had to do what we have had to do.

“We’re either on layoff, short time work, reduced hours and pay cuts, and hanging over all our heads is whether or not we will have a job in the long term.

“Will our businesses actually survive?”

Online Editors