Independent TD Carol Nolan has described a proposed €10 million tourism mitigation fund for downstream businesses negatively impacted by the high rate of hotel and guesthouse beds being occupied by Ukrainian refugees and international asylum seekers, as ‘grossly insufficient and poorly targeted.’
Deputy Nolan had raised the matter in the Dáil with Minister for Tourism, Culture, Arts, Gaeltacht, Sport and Media, Catherine Martin, where she also highlighted the significant erosion in competitiveness within the tourism and hospitality sector following the decision by Government not to retain the 9% VAT rate for the food services sector:
Data released by the Irish Tourism Industry Confederation revealed that 1 in 5 hotels and guesthouses are now occupied by Ukrainian refugees and international asylum seekers, while figures from Fáilte Ireland, show that 13% of these rooms are in registered tourism accommodation with 7% in non-registered tourism accommodation:
“The Irish Hotels Federation (IHF) have pointed out that Ireland now has the third-highest tourism VAT rate in all of Europe. At the same time The Irish Tourism Industry Confederation have raised serious concerns for the 40,000+ enterprises within the sector who faced the VAT hike last month just as they head into the quieter winter period,” said Deputy Nolan.
Earlier this year, a “secret government memo” revealed that the Irish economy was “expected to take a €1.1bn hit because of a lack of hotel accommodation this summer, amid the ongoing pressure of housing refugees.”
The document presented to ministers in recent days warns that the level of refugee and asylum-seeker occupancy of hotels will have a serious impact on tourism spending in the coming months. It predicts the economy will lose out on an estimated €1.1bn, with reduced spending from tourists and other factors.
The document also says that attractions and activities here, that depend on tourist spending, will need financial supports as a result.
Full details of the cost were spelled out in the ‘Discussion Paper on Displaced Tourism Accommodation’.
The document, approved by Fáilte Ireland, states that for every €1 spent on accommodation, every tourist visitor to Ireland spends another €2.50 in the local economy.
“Given the nature of the social contract involved following urgent requests from Government for such accommodation, a fund of €10million is almost an insult. It goes nowhere near recognising the scale of the challenges that thousands of pubs, restaurants, café, tourism attractions are facing,” Deputy Nolan said.
“I know first-hand from talking to tourism and hospitality operators here in Offaly and Laois that visitors to the counties are simply moving on and are not staying in any significant numbers because of the lack of hotel or guesthouse beds.”
“This is a problem that is becoming systemically embedded and is having a hugely detrimental impact within Offaly and indeed all midland counties.”
“We have strategy after strategy to promote tourism and we have excellent and dedicated providers, but they are not being a fair chance to showcase their talents, or their attractions and they are losing vital income on top of that.”
“The Government must wake up to the scale of this challenge in order to protect the 284,800 directly employed people in almost 46,000 tourism-related enterprises. It is already the case, according to Fáilte Ireland, that for every euro spent by tourists 23c is generated in tax. Imposing further VAT hikes in addition to that was almost incomprehensible,” said Deputy Nolan.