Kevin Humphreys (Labour) | Oireachtas source

I was in government when the 9% VAT rate was introduced and it was the correct thing to do. We needed to stimulate the market and it worked well. We created employment. We have moved on, and the Minister's figures have shown how well we have done. It is time to review it. This is why the Fine Gael motion makes no sense as it states to give it to the sector forever with no conditions. It is total utter madness. It reminds me of the days of the tent in Galway, where the developers were asking for more and more incentives to build more and more at higher and higher prices because everything would be rosy. Then we went into the financial crash. We have legislation on lobbying, which might have got it a little wrong because now people will not be able to get access to Ministers for €100 for breakfast. I wonder how many people in the hospitality sector have paid €100 for breakfast to lobby Ministers to keep the 9% VAT rate in place.

I will speak against Dublin, because it does not make sense to use the 9% rate to subsidise hotels in the Dublin area which have 82% and 92% occupancy rates. Senators cannot get hotel rooms. According to PricewaterhouseCoopers, in 2015 there was a 15% increase in costs in the hospitality sector in Dublin, and in 2016 it is expected to have increased by another 15%. We are not protecting the consumers.

To reply to Senator Conway, I fully support calls to identify ways to spread visitor numbers to towns and villages throughout Ireland. This may not have the traditional benefits of the tourism industry but it makes sense. Should we spend the €620 million every year in a way that targets areas in the country which do not benefit from the tourism industry because it is so highly concentrated in the Dublin area? Show me evidence. When the Minister was on the Opposition benches he spoke constantly about moving to evidence-based decisions. All the evidence shows workers in the hospitality sector are being exploited. Everybody in the House knows it and everybody has some experience. Every study has shown it. This is evidence based. The evidence-based approach states we do not give a 9% rate to somebody who is coining money and has jumped hotel rates through the roof. The midlands, the west and parts of Cork are not getting a share. They need investment. We need to consider this on an evidence basis and ask whether we should shift investment. Do we need to ensure that places from Dingle to Athlone to Letterkenny share in the increase in tourist numbers? Would it be better, using an evidence-based study, to spend the money in a different way to ensure we spread the benefits of the increase in numbers in the tourism industry?

Yes, we must be careful with regard to Brexit, and we need to compete in very difficult circumstances for the British market of which we have a large section. I am not overly convinced that giving €620 million in subsidies to the hospitality sector in the Dublin area is money well spent. The money may be well spent by building a convention centre in Cork and creating a counterbalance to Dublin.

The Fine Gael Senators proposing the motion stated on the one hand we should be doing this and on the other hand the measure should be up for review. The motion does not mention a review, it mentions multiannual which means it would be given on multiannual basis. This is a little bit daft, but I am not surprised that Fine Gael has gone a little bit daft. The motion states it must be ensured the consumer benefits, but it includes no criteria by which the consumer would benefit. As a matter of fact, Senator Catherine Noone did a very good price check when the measure was first introduced. She highlighted a number of operators in the hospitality sector which did not pass on the benefits to the consumer but nothing happened to them.

If we are to help the hospitality sector we must ensure workers are treated right. This is not happening at present. They do not know how many hours they will get from week to week. They have no expectations to save for a mortgage, educate their children or have a little ambition for their families.

Would providing the 9% rate on a multiannual basis help? It would probably be mostly those in the greater Dublin area. A better way to spend the money would probably be to invest the €620 million outside the Dublin area to boost the tourism industry in Cork, Laois, Mullingar and all the areas which have not benefitted really well from the growth.Somebody has got somebody's ear. They've decided to give them the 9% - €620 million - with no conditions. We are back to the good times. No evidence base and no studies. Let us shovel €620 million into a black hole without any measured returns.

Many speakers spoke about the Wild Atlantic Way. This was done for very little money. It was worked out, thought through and marketed well. I would like to see a strong marketing campaign for Ireland's Ancient East so that growth can extend outside greater Dublin. I would like to see investment in a convention centre in Cork to counterbalance Dublin.

The vast majority of that €620 million is going to end up in the pockets of multinational hotel groups in the Dublin area.