Thursday, 8 October 2020
Nithe i dtosach suíonna - Commencement Matters
I welcome the Minister of State to the House, although I am disappointed it is not the Minister for Tourism. If I had a planning matter, I would be delighted to see the Minister of State here, but that is not the case today.
This Commencement matter relates to the equality of treatment for the hospitality sector. I call on the Minister of State to set out the evidence that clearly shows that the hospitality sector is causing an increase in the rate of transmission over and above that of any other economic sector. As the Minister of State will be aware, 36 hours ago the country went into level 3 lockdown, but the hospitality sector went into level 5. Some 900 hotels, 2,500 restaurants, 7,000 pubs, some of which have never reopened, and another 2,000 accommodation providers closed their doors on Tuesday night.We were the last sector to reopen on the 29 August and we were the first to be shut down again. We were asked at that time to hold firm and not to push reopening, which we did. The emphasis was on stopping the shutdown-open, shutdown-open pattern. Clearly, that policy has pay failed. Three counties, Laois, Offaly and Kildare, are now in a third lockdown. Dublin and Donegal are in an extended second lockdown. The remainder of the country has now gone into a second lockdown. I can only express to the House the strain this is placing on the hundreds of thousands of employees in the sector and on the tens of thousands of business owners and their families, including mine. It is also placing a strain on people's mental health.
The industry is calling for clarity as to why we were shut down. It is justified in seeking that information. We did what was asked of us, provided a safe environment for our customers and our staff, who went through rigorous training in order to allow us to reopen on 29 June. We opened on that date and after the first six weeks, which is three full double-week cycles of the 14 days to which we keep referring. The transmission rate had dropped significantly. Before we reopened, we were looking at 1,418 cases a day, there were 155 patients in ICU and 850 patients overall in hospitals. After our six weeks of trading, there were 28 cases daily, six people in ICU and only 12 patients overall in hospitals. Where is the evidence that the hotel sector is the exponential factor that is causing the increased rate of transmission? Dublin went into further lockdown on 21 August. At that time, the 14-day transmission rate was 118. Three weeks later, when the hotels, pubs and restaurants had not even opened so they cannot be blamed, it has gone up to 163. Where is the evidence? At the same time, our industry is looking at social media all of the time and seeing house parties, with marquees and pubs being hired in. We are told that the key factor the health services are worried about is how human behaviour is affected by alcohol. What the Government is promoting is social interaction in a home environment that the Garda Commissioner said yesterday his force cannot control. All its officers can do is stand outside people's houses.
The Government has closed down sectors which were providing a safe environment for people to socialise in, where the gardaí could come in, inspect and even had powers to consider the licence of the pub owners in their applications. Where is the transparency? Where is the evidence? Publish the evidence. If this does not happen and I am wrong, I will accept that. If, however, the Government is asking the sector to take a hit over and above any other, it should admit that and recognise it in the budget next week.
I thank the Minister of State for attending. As Senator Casey has outlined, the strain placed on the hospitality sector has been enormous in recent weeks and months. I will outline a number of specifics for the attention of the Minister of State. The hospitality sector contributes €4.5 billion in wages, salaries and employment taxes every year. More than 330,000 people are employed or are supported directly by demand from the sector. Tens of thousands of their jobs are located outside cities in places where jobs will be especially difficult to replace. The Government has acted and, it must be acknowledged, has put in place considerable supports. Following the latest blow of being essentially shut down, as Senator Casey just outlined, however, we are at level 3 but the hospitality sector is at level 5. We have now been informed that we will be closed for another three weeks. It is clear that these supports must be enhanced in next week’s budget. Some 8% of the entire population is employed in what the Central Statistics Office defines as the accommodation and food service sector, which includes local pubs, restaurants and hotels. This is one of the most important sectors in the economy.
This is the time to act and to place confidence in the ability of this sector to rebound quickly when we begin to emerge from Covid-19. Our sector can and will, with sufficient supports, come back and create a huge improvement, similar to the effect it had on the economy in recent years. We need to consider a range of measures, including a reduction in VAT and an exemption from 2021 commercial rates - this is essential - which will be a considerable portion of the commercial rates for the entirety of next year. Of course, as the Minister of State is aware, this will result in additional expense in the short-term but I firmly believe that it will be a case of short-term pain for long-term gain whereby we can ensure the future viability of businesses in the hospitality sector.
Behind every business, whether it is a hotel, a bar or a restaurant, there is a family. In Galway's inner city where I come from, the situation is particularly frightening and this is having huge implications on the mental health and well-being of people. As alluded to by Senator Casey, hundreds of thousands of jobs are at stake here. The uncertainty of that is taking its toll. I have already told the Taoiseach that I fail to understand how 12 hours’ notice or, as was the case last week, 36 hours’ notice are acceptable in the context of shutting down the entire industry. I can inform the House about my first-hand knowledge of the wastage in restaurants, bars and hotels. Three days’ or five days’ notice could have been given. It was the same in Dublin, where 12 hours’ notice was given. I do not think the Government realises the impact this is having. I ask, as Senator Casey did, that if the evidence is there, can it be published in order that we might have some certainty? We do not know whether we will be able to reopen in three weeks' time or whether we will remain closed. This is having an enormous effect in the cities but also, I am sure, in rural areas. I await the Minister of State’s response.
I thank Senator Crowe. It is a particular pleasure for me to call the Minister of State to speak, to welcome him to the Seanad and to congratulate him on his appointment. He is doing an immense job and there is a great sense of anticipation among my electorate that he will even do more.
I thank the Leas-Chathaoirleach and I thank both Senators Casey and Crowe for this Commencement debate.
I know that both Senators have considerable experience in the hospitality sector. I can leave them in no doubt that I am very acutely aware of the pressures that are faced by the hospitality sector. In my town of Mullingar, I have seen what staff and businesses have endured over the past six months due to the very uncertain path of this virus. It is very sad to see businesses which have made such an effort to make their premises safe for the public, and what they have had to go through as a result of a very quick decision which has impacted greatly upon them.
On 5 October, the Government decided that from midnight on Tuesday, 6 October, all counties would be placed on level 3 under the plan for living with Covid-19. The Government is acutely aware of the impact that the move to level 3 has for society generally and, in particular, for the tourism and hospitality businesses around the country. The current restrictions effectively require many tourism and hospitality businesses to close their doors for a second time this year. The nationwide move to level 3 is based on a review of the current public health advice and is in response to the deteriorating situation with the virus across the country.All counties will be at level 3 for a period of three weeks until midnight on 27 October, at which point the situation will be reviewed by the Government based on the status of the virus and the public health advice. In recognition of the impact of the level 3 restrictions, a 30% top-up to the restart plus grant will be provided to help support those affected through the three-week period. The restart plus grant is a contribution towards the cost of reopening or keeping a business operational and reconnecting with employees and customers. The grant can be used to defray ongoing fixed costs during closure, for example, utilities, insurance and refurbishment, or for measures to ensure employee and customer safety. In addition, in recognising that level 3 is being extended in Dublin and Donegal beyond their initial three-week period, businesses in these counties will be eligible for a further 20% and 10% top-up, respectively.
Prior to these most recent developments, the Government took a number of steps to help the tourism and hospitality sector. The July stimulus package introduced significant measures to help support businesses to recover following the devastating impacts of the Covid-19 crisis. Some of the key measures for tourism and hospitality include the stay and spend initiative, the €26 million adaptation grant, the €10 million grant for coach tourism and the revised restart grant, which now includes bed and breakfast accommodation. Tourism enterprises also benefit from wider horizontal supports, such as the employment wage support scheme, liquidity and enterprise investment measures, warehousing of tax liabilities and the extension for a further three months of the waiver of commercial rates. This is a key area for which the Department has responsibility and we sanctioned €600 million up to September. The case is being reviewed in the context of budgetary negotiations.
As part of its response to Covid-19, and to drive bookings for short breaks and holidays in Ireland in 2020, Fáilte Ireland has invested in a number of domestic holiday campaigns since June. The Minister, Deputy Catherine Martin, has seen first hand that these campaigns have been successful in getting Irish people to holiday at home.
All of these measures have helped the sector. The Minister appreciates, however, that severe challenges remain and we must continue to examine ways to ensure that businesses survive and recover. Earlier this week, she welcomed the publication of the tourism recovery plan by the tourism recovery task force. The task force makes a number of recommendations to help ensure the survival of tourism businesses and jobs and to help the sector to stabilise and recover in the years to come. Within this, it has identified a number of priority recommendations aimed at ensuring the survival of tourism businesses and jobs. The recovery plan will be hugely beneficial to the Minister and her colleagues in Government as we work towards the budget and the national economic plan.
I thank the Senators for their contributions. The Minister and I are under no illusions about the scale of the challenge and the many competing priorities facing the Government. However, she will be pushing hard for further support for the sector following on from the measures introduced as part of the July stimulus.
I thank the Minister of State for his response. My comments are not directed at him. The response refers to level 3 so it does not even admit that the sector is at level 5. That is where we are. It would be something for the Government to acknowledge that in reality the hospitality sector is at level 5. Being asked to survive with 15 customers outside and for people to stay in a hotel in their own county is absolutely ridiculous. It raises questions about the stay and spend initiative, to which I was looking forward. It is being deferred. I appreciate that the Minister of State has said that €600 million has already been given to the commercial rates waiver scheme. I do not want to be told by the local authority when I go to look for a waiver that technically I am not closed down because I can open for 15 customers outside and for people living in Wicklow having a staycation. That will not run with me. If I am told this by my local authority it will be treating the industry with a disrespect that it does not deserve because it has done its best. Where is the information that clearly outlines we are an exponential factor in the spread of Covid-19? Nobody is prepared to publish that information because I do not believe it exists. We are not being treated in the same way as other economic activities in this country.
I absolutely accept the points being made but I am very clear about the rates waiver. If a business was closed it was eligible for the waiver. Those businesses that were partially closed were also allowed to apply for it and did so successfully. The Senators are aware that very few businesses were precluded from the scheme. It is very important as we go forward. I see in my town of Mullingar that the Greville Arms Hotel has closed its doors. It is an institution in Mullingar. As I walk the streets I see the businesses under significant pressure and the hospitality sector is chief among them. I have no doubt we have to approach the budget on a sector-by-sector basis because one thing I learned during the last recession was that when the construction sector suffered so much and we had a huge demand for capital expenditure in the country, it was not adequately resourced to pick up the demand. Equally, we have a huge amount of viable but vulnerable businesses in our tourism sector and when we get rid of Covid-19 we need to have capacity to absorb the demand that will come into the country. We will need a strong hospitality sector to do this. The Government will respond to this through the budget and it is at the forefront of the negotiations.
Will the Minister of State give a commitment in the House this morning that at the very latest he will inform the hospitality sector by Thursday, 22 October, which gives only four or five days notice, whether they will be allowed to reopen? I ask the Minister of State to bring this to the attention of the Minister. It is absolutely vital that we get notice for rosters, orders and chefs across the board. The stay and spend initiative, with the greatest respect, is too complicated and now that it is meant to come into place the whole industry has been shut down. It needs to be rejigged at the very least.
Senator Casey alluded to this, and it is not personal with regard to the Minister of State, but we must get the message across that the Government is treating the hospitality sector with contempt. Coming up with the initiative that places can open for 15 people means they are damned if they do and damned if they do not. If a business opens it will lose all of the supports but if it does not open it will get boxed in. Someone running an operation for a maximum of 15 people at the very minimum will need a chef and front of house staff. The operation will need seven or eight staff. It is sending out the wrong message. Will the Minister of State give a commitment that on Thursday, 22 October, the hospitality sector will be informed?
Just to clarify, I am very clear that I am not treating the hospitality sector or the tourism sector with contempt. I am not aware of the grants that businesses are precluded from getting if they are closed. The temporary wage subsidy scheme can be received as can the restart plus grant. They can also get the rates waiver if they were open or partially open. They are not excluded from getting the rates waiver. I want to be very clear that the Government is supporting the hospitality sector and it will not be found wanting in the budget.