Thursday, 13 July 2023
Ceisteanna ar Sonraíodh Uain Dóibh - Priority Questions
51. To ask the Minister for Culture, Heritage and the Gaeltacht if she has met with, or whether she intends to meet, a representative body (details supplied) and Fáilte Ireland to raise concerns around hotels price gouging and cancelling bookings without reason, and re-advertising the same rooms at much higher rates when major events, such as a specific concert, are announced; and if she will make a statement on the matter. [34582/23]
This question is to ask the Minister whether she has met, or intends to meet, the Irish Hotels Federation and Fáilte Ireland to raise concerns around the issue of hotels price gouging, cancelling bookings without reason and readvertising those very same rooms at a much higher rate when major events, such as concerts are announced, and to make a statement on it.
My position on the general issue of hotel pricing and, indeed, the wider value for money proposition within Irish tourism remains unchanged. While Ireland is not a low-cost destination, it is vital the sector keeps the value-for-money proposition to the fore across all its segments to ensure that our high quality reputation is maintained and that new and repeat visitors continue to come here. The long-term impacts of short-term thinking need to be carefully considered by all tourism businesses in setting their prices.
While there is fair value to be had in tourism accommodation, including hotels, around the country for much of the year, there are specific price spikes at specific times and locations, often coinciding with concerts and sporting events. These spikes, or compression events that occur when demand is highest, have the potential to cause reputational damage for the sector. I am advised by Fáilte Ireland that this is not necessarily representative of the wider hotel sector in general but, to bring some definitive facts to bear on the situation, I have asked Fáilte Ireland to commission independent research to better understand the potential scale and frequency of any pricing issues based on the best available empirical evidence with recommendations for actions arising, as appropriate.
While I have not specifically met the Irish Hotels Federation on this matter, I have raised the issue at a whole-of-sector level as recently as 28 June at the hospitality and tourism forum which I co-chair with the Minister for Enterprise, Trade and Employment. My officials continue to engage on an ongoing basis with Fáilte Ireland on a range of issues relating to the tourism sector, including potential concerns around pricing. The issue has also been discussed in detail by the Joint Oireachtas Committee on Tourism, Culture, Arts, Sport and Media at a number of hearings with the Irish Hotels Federation, the Irish Tourism Industry Confederation, Fáilte Ireland, and my own officials.
It is recognised that businesses, including hotels and others within tourism, continue to face significant cost pressures due to inflation and other economic factors. Rising costs however are not unique to the tourism industry and are a challenge for the wider economy. Businesses need to be able to make a sustainable trading margin but they must also pay attention to their pricing and how they can continue to deliver added value to ensure their long-term viability.
I welcome the fact Fáilte Ireland is or will be looking at this issue and I look forward to that report. Cost pressures are not an excuse for the multiple increases in the usual prices we have seen around specific concerts, St. Patrick's Day or, most recently, the Taylor Swift concert. Multiple increases in the usual prices were sought for rooms. In some cases, bookings which had already been made for those dates were cancelled and readvertised at inflated costs. This is something my colleague, Deputy Munster, has raised continuously over the years. This cannot continue because it is doing reputational damage. Hopefully, the Irish Hotels Federation will heed the warnings about the damage such actions by some of its members is causing to the tourism industry.
I am in agreement with the Deputy on the potential reputational damage to an industry which is of great importance to Ireland from an employment and economic point of view. That is why I have asked Fáilte Ireland to initiate this research. I will see what recommendations might arise from that.
We are definitely seeing price spiking in certain locations and these seem to occur, as the Deputy said, when concerts or major sporting events are scheduled, and he named one such even. As I said, this is not affecting the entire sector, or every hotel in the country. It seems to be specific locations at specific times but I want the hard data and to see what the recommendations from Fáilte Ireland are.
The Minister is correct that it is not all the members - in fact, the vast majority of hotels are trying to get by. There may be increases every now and again due to costs and so forth, but the multiple increases in the usual prices in certain areas of the country, Dublin included, cannot be justified. If this is a threat to the industry in our State, then the Minister and the Government need to act. This is the very same body which lobbied for special VAT rates, which were justifiable in many cases. This body has thus far been quite silent on this issue. It needs to remind all of its members, and those who are not members, that they are damaging the tourism industry and the tourism product we have and that this practice has to stop. If that does not happen, the Government, including the Minister, must have the powers to intervene to stop that damage to our tourism industry.
Apart from the research I have asked Fáilte Ireland to do, I know it would have written last winter to registered accommodation providers and would have asked every business to consider Ireland's long-term value-for-money reputation when setting prices. That was repeated again at the industry information events, attended by more than 2,000 industry members, and at the Irish Hotels Federation, IHF, conference earlier this year. As I said, I have asked that the research report be delivered in the autumn and in addition I have asked that the research make recommendations. That will inform both the Department and Fáilte Ireland in considering how to proceed.
It is too early to commit to what the actions will be. I have to await that research because I need to understand the research and see the nature and scale of the potential problem.