The past four weeks has seen multiple closures of local businesses across Ireland in quick succession. As we move into the Spring of 2024
it’s clear this year will bring further change, not just visually in terms of a multicultural population, but experientially, in where we
shop, eat out and socialise.
The covid hangover is descending in the form of warehoused tax, VAT rate hikes, minimum wage hikes and sustained inexplicable energy costs – all of which are further exacerbated by the loss of tourist beds across the country.
Independent and family run shops, pubs and restaurants are a lifeline to a local community, but many face closure following the Christmas break, according to Killarney based restaurateur Paul Treyvaud, who is due to reopen next week. The outspoken chef has sounded alarm bells since 2021, criticising the €9 meal as ‘hair-brained’ and refusing to enforce what he saw as a discriminatory vaccine pass, pointing out at the time ‘we are not law enforcers, nor will we ever be.’
Treyvaud tracks the current issues back to the covid closures of 2020 and said the legacy of policies imposed are now causing ‘carnage’ across the country.
The primary issues affecting business are the budget increase in hospitality VAT from 9% to 13.5%, and from January 1st, the 12% minimum wage increase to €12,70 per hour. A temporary business energy support scheme for businesses ended last September and from May this year, businesses that warehoused tax during the covid period will need to have 20% ready to pay back and a payment plan for the remaining 80%.
But the real issue causing a raft of closures in recent weeks, according to Treyvaud, is cashflow.
“The revenue and the tax that people owe day-to-day plus what’s warehoused, in order to have money and cashflow to pay that, you must have turnover, you must create profit. Your tax and your VAT is not a cost on the business which means, that after I pay all my costs, I still must have money – cashflow – to pay my VAT and tax. That’s the problem now,” he said.
Killarney has a population of 10,000 with two main industries, Liebherr, the crane making company and tourism.
“If you mess around with either of them, the town greatly suffers. We have 4,000 refugees and asylum seekers, so we have taken the best part of 40% of our tourist accommodation out of the equation. Those hotels that accommodate these people are flying, because they are getting an insane rate from the government. The hotels that didn’t take in asylum seekers and refugees want me to shut up, because they were full last year on at least a 50% increase on their average rate compared to previous years, so they’re flying, but there’s 40% less people in the town and that means the high street suffers,” he said.
Is it possible that the owners of hotels under government contract might begin to rethink their actions? Treyvaud believes that’s the next phase of this process.
“Now what the hotels are seeing, is people saying oh my God, we won’t go to Killarney sure there’s a load of immigrants down there, and sure half the shops are going bust. We’ll go to Dingle or we’ll go to Kinsale, because they didn’t take anyone in. Now the hotels are seriously under pressure, the ones that were telling me to shut up last year are now going, eh maybe we took too many immigrants into Killarney. That’s exactly what we are seeing right now.”
“And I think that’s going to start to change. Now you are going to see locals turn around to these business people and say, listen I think
you have made enough money. Now you are starting to kill my town. I think that will be the next stage of pressure,” he said.
Media outlets are only beginning to report on the biggest issue facing Ireland today – immigration.
“The Irish people that are being labelled as racist and far right – it’s not true because previously we welcomed so many people from eastern Europe, and
nobody had any issue because they came here to work. Nobody has an issue with someone who wants to come here and work and contribute to
society. But I have an issue, with me working paying for bums that don’t work and that’s whether their from Botswana or Crumlin. I couldn’t care less where they’re from but I’m not working my ass off all day everyday with nothing at the end of it because of this ridiculous social welfare payment,” he said.
The Restaurant Association of Ireland (RAI) has called for a five point plan to alleviate pressure on small business, reducing the VAT rate to 9% for food lead business and addressing the issue of reduced availability of tourist beds. But business owners facing a cashflow
crisis require help immediately, according to Treyvaud.
“They are touting this (VAT rate cut) around, but that will do absolutely nothing short term. If a business is on its knees right now, where cashflow is screwed, something has to drop. So whether the VAT rate drops, whether it’s heat or energy bills that drop, the cost of doing business, whether they give a rebate for employers for hiring staff, they have to do something.
“Like it or not they are going to have to write off the warehouse tax. They are going to have to give a once off €15,000 to €20,000 injection to lift businesses out of their cashflow issues, because giving me something that’ll help me in the next six or nine months is not going to help me now,” he said.
“We still haven’t seen anywhere like the number of closures that we are going to see because alot of rural Ireland is closed for annual holidays but a lot of places aren’t coming back. We were supposed to be getting a grant, an increased cost of business grant, that was supposed to be paid into your bank account in January. We were supposed to be getting 50% of our paid up rates to the maximum value of €5,000 and we still haven’t seen a single cent. They haven’t even mentioned it. Can you imagine if the shoe was on the other foot? That leads me to believe the government doesn’t care if small business go bust.”
Clare based Green Party Senator Roisin Garvey believes small businesses should be investing in solar panels to offset energy prices. Treyvaud’s reaction to this is scathing.
“We have the weakest government in the history of the state who are afraid to tackle the useless energy regulator because the energy companies are saying, we are making way too much money out of this. For a Green Party representative to say the solution for small businesses is to erect solar panels sums up how useless the Green Party are,” he said.
Garvey’s constituency of north Clare is hosting 3,000 new arrivals, 1,400 of whom are housed in hotels and hostleries in Lisdoonvarna. Peter Jackson, of the award winning Roadside Tavern in the world famous spa town, took over the business in 2022.
“A month after we opened our doors the war in Ukraine happened and all of our hotels here in Lisdoonvarna went to Ukrainians, direct provision or whatever. So that’s a huge chunk of tourism that would have been here so that first year we ran at a loss,” he said.
Solar panels present a long term gain, but businesses facing a cashflow crisis can’t afford that initial investment, according to Jackson.
“We run a kitchen, the energy costs are huge. Solar panelling, yes there’s a long term gain but again the issue is the initial investment,” he said.
First opened in 1865, the Roadside is one of the oldest pubs in the Burren area. Jackson’s approach is centred on a high quality menu with produce supplied by the farmers of county Clare, coupled with exceptional music provided by a cohort of dedicated local musicians. He is developing a new Roadside Whiskey alongside craft beers brewed on site and offers live music every night.
“We put on the Cead Mile Failte every night. We book the musicians for the year. On a Friday night we have music from Christy Barry. There are people from all over the world come to see him.”
Jackson is realistic about the influx of new arrivals into Lisdoonvarna.
“Sure look before we knew it the horse had bolted. We had no other choice than to get on with it. We are seeing a lot of new faces coming in, alot of the old faces have moved on, whether they’ve gone back home I don’t know. Some of them got social housing so they are going to be here and set their lives down here, you know, great, a lot of people add to the community and get involved in Tidy Towns and then you can see there’s the other sort that are here purely financially,” he said.
Accommodation is a massive issue in north Clare, as locals compete with Ukrainians who are entitled to free accommodation paid for by the state at a rate of €800 tax free to landlords. Last year, Jackson rented rooms in town to help his own staff settle in.
“Last year on top of my own expenses I had to rent rooms for staff to stay in until they got on their feet. A lot of places are buying houses for their staff to stay in,” he said.
Despite the challenges, Jackson believes firmly in the particular magic this region has to offer.
“Everything we do is local. We serve Wagyu beef from cattle raised here in Clare. Kilshanny Lamb from Kevin Howley, he popped in last night we had a chat, he was lambing all weekend. That man knows his sheep.”
“There are challenges. We stay positive. It’s a great community here. And we will always point people in the direction of other business
around here, up to O’Donohue’s Pub in Fanore or over to the Burren Perfumery and like that, others will say to the tourists, stop in the Roadside Tavern for your lunch and sample a few of the locally brewed beers. Lisdoonvarna is always worth a visit. It always has been,” he said.
Treyvaud’s in Killarney reopens February 7th: https://treyvaudsrestaurant.com/
Roadside Tavern is open seven days a week: https://www.burrenexperiences.ie/the-roadside-tavern/