Mr. Adrian Cummins:

I thank the committee for the opportunity to speak here today as part of this important meeting on competitiveness and the cost of doing business in Ireland. With me is the president of the RAI, Mr. Sean Collender, who is the co-owner of three restaurants in Dublin.

I represent an industry that has shown remarkable resilience over the years. It is made up of hard-working people who have weathered recessions, survived a global pandemic and continued to serve communities across Ireland, day in and day out. I have to be honest with the committee and say that what we are facing now is unlike anything we have seen before. Every day I hear from restaurant and café owners who are at breaking point as a result of a combination of skyrocketing input costs, unsustainable energy bills, rising labour cost pressures and Government induced charges that are pushing food-led businesses across Ireland to the edge.

I will give some concrete examples of how out of control things have become in the context of input costs in the period since 2021. Fruit and vegetables are up by 50%, chocolate by 157%, chicken by 35%, gas prices by 58%, electricity by 94%, beef by 97% and insurance by 35%. These are all costs that our industry has to face on a day-to-day basis. These increases are not reflected on our menus. Restaurants, cafés and food-led businesses have done everything they can to absorb the impact, protecting their staff and shielding customers, but they have reached their limits. Last week, I spoke to a restaurant owner from Waterford who has been in the business for 25 years. She has decided that she just cannot keep her business open and needs to call it a day. Another café owner from Dublin who contacted our association said she is now depending on the return of the 9% VAT rate or she will have no choice but to sell her business. These stories are the same across the island of Ireland, whether it is Cork, Wexford, Galway, Offaly, or Mayo. Yes, consumer prices have risen, but not at nearly the same rate as the costs that hospitality businesses are facing. Since 1 January last, restaurant and coffee shop prices rose by 3.3%, as per data from the Central Statistics Office, CSO. Meanwhile, input costs for ingredients, energy, labour and insurance have, as already stated, surged far beyond that figure.

The data is clear that businesses have taken a massive hit to protect their staff and customers, but the resilience I spoke of earlier has its limits. No business can absorb endless blows and survive. Businesses are cutting hours, with many closing on Mondays, Tuesdays and, in some cases, Wednesdays in order to keep costs down. Others are closing altogether because they are not able to keep up with spiralling costs. Workers are losing hours of work each week, which is a serious blow. Business owners are also taking personal income cuts just to keep their doors open and protect jobs.

This is not just about hospitality any more; it is about the knock-on effect for communities, families and Ireland's reputation as a world-class tourism destination. A 2024 report by the economist Tony Foley warns that the reduced trading hours and closures could cut tourist numbers by up to 10%, which could mean a €1 billion reduction in tourism spending. This prediction may now be starting to become a reality. CSO data from May 2025 shows a 10% decline in in-bound tourism and a staggering 21% drop in tourism spend. Alarm bells should be ringing and if we do not act now things will only get worse. The most effective way to help is by re-instating the 9% VAT rate, as promised in the programme for Government. Leading economist Jim Power also estimates that the closure of a single restaurant can cost the economy up to €1.36 million, when account is take of job losses, reduced wages, lost taxes and increased welfare supports.

If 500 restaurants were to close, which happened in 2024, the total economic impact would be €680 million. That is more than the projected cost of returning to the 9% VAT rate for food-led businesses. Along with the reinstatement of the 9% VAT rate, we are calling for a reduction in employer's PRSI, linking the minimum wage to inflation and dedicated support for food tourism, including a food tourism strategy. Together, these measures would give businesses a fighting chance.

I thank the committee again for the opportunity to speak. We appreciate the chance to share our perspective, and we are ready to work with the committee. If we want to protect jobs, support tourism and ensure that our food businesses can be viable once again, we need to act now. I welcome questions and the discussion.