OMM

Hoteliers complain of a catastrophic financial shock

Kerry IHF chair Bernadette Randles remarked: “We have experienced nothing short of a catastrophic financial shock”

HOTELS and guesthouses in Kerry are facing massive challenges as a new survey conducted by the Irish Hotels Federation reveals a €2.6 billion drop in revenues during 2020 compared to the previous year.

It brings an unprecedented financial hit to the sector which is down 60per cent year on year and the collapse in revenues, due to Covid restrictions, has affected all areas of hotel operations, including accommodation, food and beverage, corporate events and social gatherings.

Results show a dramatic decline in room occupancy levels for the sector, plummeting to a record low of just 30 per cent nationally last year compared to 73 per cent in 2019.

With significant restrictions set to remain in place for the first of half of 2021 and beyond, the sector continues to face enormous financial challenges and uncertainty and hoteliers are calling for urgent additional government supports to enable them to survive.

They are seeking an emergency tourism budget with additional targeted measures to ensure the viability of tourism businesses and the livelihoods they support throughout the country.

Kerry IHF chair Bernadette Randles remarked: “We have experienced nothing short of a catastrophic financial shock, with risks of a prolonged and devastating impact on our industry and the ability of tourism businesses to survive and recover”.

She added: “Government supports so far have been piecemeal and fallen far short of what is required, given the extended restrictions and economic damage facing our sector.”

The hoteliers want a special budget to include substantial increases in payments to tourism businesses, enhanced employment subsidies, an extension of the local authority rates waiver until the end this year and a further six-month moratorium on bank term loans to support cashflow.

“It is critical that we get certainty around supports for business recovery. We cannot afford any delay if businesses are to have a fighting chance of getting back on their feet this year,” Ms Randles said.

 WHAT THE HOTELIERS WANT

  1. Covid Restrictions Supports Scheme: Targeting businesses with 75% drop in revenue, doubling of payment amounts irrespective of level of Covid restrictions as well as removal of the current €5,000 weekly cap
  2. Employment Wage Subsidy Scheme: Extension of the scheme up until the end of 2021 to enable tourism businesses retain staff.
  3. Local Authority Rates: Extension of waiver for tourism businesses until end of 2021. After that, payment of local authority rates should be based on reduced levels of activity due to the crisis and until the industry has recovered.
  4. Liquidity Measures: Further six-month moratorium on bank term loans to support cash flow. Additional mortgage deferment for employees impacted by the crisis.
  5. 9% VAT: Clear commitment re retain 9% tourism VAT at least up until 2025 to assist recovery and provide certainty for tourism businesses.

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