Oireachtas Joint and Select Committees

Wednesday, 5 May 2021

Joint Oireachtas Committee on Transport, Tourism and Sport

Challenges Facing Travel Agents and the Aviation Sector: Discussion

Mr. Paul Hackett:

I start with some good news. The airline refund process, specifically with regard to Ryanair, has improved. It is not complete and is not working for everybody but compared with where we were when we first addressed this committee in October 2020, the position is much improved. We attribute that in no small part to the coverage the matter received when raised at this committee. For this reason, we thank the Chairman and members for the committee's assistance in helping to resolve this issue.

The travel industry, airports and airlines need clarity as to when we can restart trading with the safe reopening of international travel for our corporate and leisure markets. Hotels in Ireland need to know if they can accept international visitors in 2021. It is important to remember that 75% of income in the hospitality sector comes from the international market. Until such time as full restart plans are announced, we are very keen to support the regional airports of Cork, Shannon and Knock. We call on the Government to be generous in its support for all Irish airports and to support the pillar airlines on which we in Ireland rely. We have heard that Cork airport will be closed for ten weeks from September. To close a key regional airport just when international travel is restarting is not good.

The European Commission launched the digital green certificate on 17 March, almost two months ago. The European Parliament last week voted to approve the certificates and recommended that they be renamed "EU Covid19 certificates". This will be law in June and must be implemented by all member states within six to eight weeks. This is a regulation. It is not a pick-and-mix option, as mentioned by the Minister for Health on RTÉ news last week. It is mass harmonisation legislation, the objective of which is to have travel within the EU reopened safely with all EU member states adopting the certificates. The Government must do this and, in so doing, it must revoke the advice against nonessential international travel.

As referenced earlier this week, on Monday, 3 May, we also need to open up to travel within and outside of the EU. The UK and United States are core markets for Ireland's corporate and leisure travel. The European Commission has announced a plan for Schengen member states to allow travel by fully vaccinated people and we urge the Government to adopt this proposal.

As matters stand, it is illegal to travel to a port or airport for nonessential travel. Those who do so face a fine of €2,000 per person. There are 35 different statutory instruments, implemented since January this year, that control and limit international travel. We need a plan and commitment to unwind these statutory instruments once the vaccination roll-out hits the level of 82% by the end of June, as is the current target. On "The Week in Politics" programme last week, the Taoiseach stated we are an interconnected global island and we cannot seal off the island forever. Taking all of this into account, as well as the improving position in our hospitals, the overall levels of Covid and the positivity around the vaccine roll-out, Ireland needs to implement the EU Covid19 certificates in full and without delay, open up to international visitors and allow Irish citizens the right to travel, at least within the EU to begin with.

We note our concern about the cost of PCR testing. At approximately €100 per person, PCR test costs are too high, antifamily and a cost deterrent for international travel. We are surprised the Government has not adopted the recommendations of Professor Mark Ferguson's report on antigen testing and we note the irony that the HSE is using antigen testing in some facilities.

One important consideration around continued travel restrictions in the Republic is that international travel will recommence from Northern Ireland’s airports some time between midMay and midJune. We have already seen Ryanair open a new base in Belfast City Airport adding ten new routes. Moving assets from the Republic of Ireland is very easy to do for both Aer Lingus and Ryanair. Both airlines have been forced to do so given there is no plan to open Ireland for international travel.

Bookings for international travel are still around 85% down and there will be no recovery until consumer confidence returns. No other sector has had little or no income since March 2020. Irish hotels had some income last summer but travel agents had none. A reduction in income of between 85% and 95% effectively amounts to minus income as our cost base, even with massive reductions, is still substantial. We have met Ministers in the Department of Transport, members of all political parties and countless Deputies and Senators, all of whom have been understanding and sympathetic to our plight, but what pocket do we put that into? Sympathy and understanding are not something we can pass on to our landlords, IT providers, insurance companies and the staff we must retain.

There is a delay of between six and nine months between booking and travel, which means our sector must work for between six and nine months before we count the income generated from advance bookings. So long as there is no income, the travel industry needs to see ongoing support from the Government. We are getting the wage subsidy and the Covid restrictions support scheme, CRSS. The CRSS needs to be repurposed and linked to guidance on international travel. We hope to see extensions of support beyond 30 June. The travel industry needs to see supports continue until we no longer meet the qualifying criteria. The support is needed now ahead of the restart to financially rebuild in order to reduce our dependency on the State. Without ongoing and targeted sector-specific supports, there will be more failures in our industry. There is no need for that to happen. Customers have full protection because all travel agents are licensed and bonded, so additional support will prevent company failures.

Before I finish, we need to bring a matter to the committee's attention. As a result of Covid19 and the impact on the travel industry, some merchant service providers are taking a very hard line and demanding substantial cash deposits from travel agents. This is a direct challenge to the bonding and licensing arrangements the Government has in place for travel agents. Some of the companies involved are associated with our partially Stateowned banks. This is a very serious issue for the sector and the Government must address it given that it has poured millions into supporting the sector during the pandemic, only to have the very future of the sector put at risk by these staggering demands for cash security. I thank the Chairman.

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