Catherine Murphy (Kildare North, Social Democrats) | Oireachtas source

The Social Democrats recognise that some indigenous businesses are struggling and we support a targeted approach for providing support to them. In addition to the hospitality sector, some smaller retail outlets are under pressure. We are losing vibrancy in our cities, towns and villages, seeing buildings becoming redundant and that leads to dereliction. In turn, that puts other businesses that are trying to exist in that kind of environment under pressure.

The motion is not targeted and that is of concern to us. It states that food-related businesses have seen insolvencies more than double in the first three months of the year and we must be concerned about that, but those insolvencies do not differentiate between those in Dublin and those in the rest of the country, as the motion seeks to do. It acknowledges that 135,000 workers are employed in that sector in Dublin and we must be seriously concerned about those jobs, as we should be about jobs in the rest of the country. The cost-of-living crisis is probably most acute in Dublin, especially with the cost of accommodation. Business rents are also likely to be a lot higher. With an increasing number of people opting to work from home, there is less footfall in the city centre, especially if we look at lunchtime activity, and we are seeing a loss of businesses and vibrancy in the city centre as a consequence.

I am also thinking of the contradictions that would happen if this differential in VAT were to be applied. There are locations such as Leixlip where part of the town is in County Dublin and most of it is in County Kildare. It has two hotels, one of which on the Dublin side unfortunately closed, as did a pub on the Dublin side. Should a 5 % VAT rate be applied in one area and just across the bridge a 9% VAT rate? The same is the case with part of Bray being in County Dublin and part in County Wicklow. The motion has not been well thought out. The urban versus rural or the rest of the country versus Dublin should not be what we are talking about in a national policy on tourism. It should not differentiate. It should look at the totality of what is needed. The Covid-19 pandemic was particularly difficult for Dublin, which did not benefit from staycation business. Some businesses are still recovering with some debt warehoused. Let us therefore get away from that when we are thinking about the sector. It should be seen in its totality.

In respect of the hotel sector, I looked online yesterday in preparation for this debate and saw that there are hotels that charge €700 and €800 per night, but they are few and far between, except when a big event is on. I certainly am not supportive of price-gouging when events are happening as it damages our reputation. However, for the vast majority, there was not a huge differential across the country and they are fairly expensive at this time of year.

The motion correctly acknowledges that 246,000 people work in the hospitality sector. A sizeable number of them are foreign nationals without whom the sector would not survive. A document was published by the Joint Committee on Tourism, Culture, Arts, Sport and Media in 2022 - Deputy Mattie McGrath was member of that committee - which referred to the clear evidence presented to the committee of widespread poor pay and working conditions in many parts of the hospitality sector and went on to talk about people who are particularly vulnerable and identified migrant workers in that group. We have to look at the working conditions in the tourism sector as well and the shortage of skills in the sector needs to be properly addressed by any tourism plan.

Criticism of the Government's reliance on the accommodation sector to provide temporary accommodation for Ukrainian refugees and those seeking international protection is valid. I have no doubt but that in some locations, it reduces the tourism spend and puts secondary tourism providers in difficulty. That needs to be rectified with alternative, not tourism-related, accommodation. There is a plan for that but it is painfully slow in being seen. We do not even have the locations of where the six centres that will be publicly run will be located. That urgently needs to happen in its own right.

The element of the restaurant sector that is growing the fastest is fast-food, such as McDonald's and Burger King and other outlets. If this motion were to pass, the reduction in the VAT rate would benefit such companies. Public policy is working towards healthy food and it would seem strange to give an advantage on one side and then try to rectify it on the other. We have to think about the consequences of a blanket approach rather than a targeted one.

There is no doubt that there are high input costs for insurance and despite the changes made in this House relating to the insurance industry, it does not appear the benefits are being passed on. Insurance is a big issue for businesses, small, medium and large, as is the cost of energy. People can get away with things in this country if they make them complicated. How the cost of energy is arrived at is so complicated that it makes it difficult to untangle, but it needs to be untangled as it is making this country uncompetitive.

I agree with the point Deputy Nash made about commercial rates, which are structured in such a way that businesses almost benefit from being an out-of-town, large entity. We are undermining our main streets by not reforming the commercial rates sector and how rates are levied. The focus should not be on the rate charged by local authorities each year because they do not have any choice if they are to survive. The structure of the commercial rates is the issue that needs to be addressed and we should be looking at a system that gives an advantage to keeping the vibrancy of our indigenous industries in our towns and cities. It works to their disadvantage.

However, my main point is that we need a targeted approach. The one-size-fits-all approach brings all kinds of problems with it.

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