Hotels and guesthouses in Galway are facing enormous uncertainty without additional supports and much-needed clarity from the government.
That’s according to the Irish Hotels Federation, whose recent survey revealed a collapse in new hotel bookings – with the sector effectively at a standstill since the update on COVID restrictions on February 23.
As cancellations wipe out any new business, the IHF is urging the government to provide a significant increase in sector specific supports for tourism businesses as a matter of urgency.
Hotels and guesthouses across Ireland are reporting booking levels of just 22% for July and 20% August.
Speaking following the latest meeting of the Government’s Hospitality and Tourism Forum, John Ryan, Chair of the Galway branch of the Irish Hotels Federation, said that the domestic market was very important to the Irish hotel sector last year and they expect that booking levels will improve.
“However, in the meantime, businesses have to plan. The Government may not be able to provide assurances as to when society will reopen, but they can give much needed certainty and reassurance around business and employee supports,” said John Ryan.
“With Galway hotels facing a prolonged period of closure and related cash burn, this piecemeal approach is hugely frustrating and detrimental for hotels and their teams who, along with the rest of the tourism and hospitality sector, have been disproportionately impacted by Covid restrictions.
“Specifically, we are seeking increases in payments under the Covid Restrictions Supports Scheme (CRSS) with a doubling of payment amounts irrespective of the level of Covid restrictions as well as removal of the current €5,000 weekly cap.”
Mr Ryan said that they estimate that 44% of hotel bedroom stock nationally is excluded from CRSS entirely, which he said must must be resolved as a matter of urgency.
“Enhanced employment subsidies are also necessary,” he added. “We also ask the Government to intervene with the banks to ensure they have appropriate supports and engagement processes in place for hotels and their team members until the pandemic has passed.
“Hotels also require a clear commitment from the Government to retain the 9% tourism VAT rate. Many hotels are already contracting for international business up to two years out.
“Tourism is highly competitive, yet they have no pricing certainty in relation to the retention of this critically important VAT measure and this could hamper their recovery.”
Mr Ryan said that hotels are focussed on restoring employment levels as quickly as possible and the best way to ensure that is to support the businesses.
“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 survival.
“Prior to the pandemic, some 20,900 livelihoods were supported by tourism and hospitality here in Galway with the sector contributing €910 million to the local economy.
“A severely devastated hotels sector would be a major loss to Galway’s economy and society for many years to come. This can and must be avoided.”
The IHF survey was carried out between March 8 and 10, and the results are based on the response of 303 properties with 31,150 guest rooms spread across the country.