A pandemic in retreat, a Government at standstill

29 May 2020

A June bank holiday like no other

As we enter the June bank holiday weekend the Irish tourism and hospitality industry would normally be buzzing with activity. This year though is very different with businesses closed, doors shut, and employers and employees extraordinarily worried about the future.

As well as being a public health crisis, Covid-19 has proven to have had a devastating economic impact and the Irish tourism and hospitality industry – the country’s largest indigenous industry and biggest regional employer – has been hit quickest and hardest.

The announcement earlier this week of no deaths in Ireland as a result of Covid-19 was very welcome news. Infection numbers continue to decline both here and across Europe giving hope that the pandemic is finally in retreat.

But despite clear and welcome signs of the pandemic weakening, the Irish Government has remained in cautious and conservative mode on reopening the Irish economy. This is hurting tourism and hospitality businesses in particular who are by and large restricted to phase 4 (July 20th) and phase 5 (August 10th) of the Government’s reopening roadmap. With little international tourism expected this year, tourism and hospitality businesses will be heavily dependent on the domestic market and the late reopening dates make for a very short summer season before the schools reopen.

The key R number: Reopening date

The Irish Tourism Industry Confederation (ITIC), representing the leading tourism stakeholders across the public and private sectors, has argued for a €1.5 billion suite of financial support packages for tourism businesses to help them survive this crisis. With a new incoming Government expected to be formed in the coming weeks, ITIC has called for a dedicated Department of Tourism headed by a Minister with significant economic clout, a reduced Vat rate, a doubling of overseas marketing funds, and a domestic market stimulus. >>> See ITIC’s Programme for Government ask here.

Closed by Government decree, and for public health reasons, since early March it is now time to make every effort to restart the Irish tourism economy. Tourism and hospitality businesses are ready to meet the highest hygiene and cleanliness standards and are anxious to commence trading and recover some lost ground.

However official restrictions on trading continue to be imposed. A 14-day quarantine period has been brought into legal effect for any arrivals into Ireland torpedoing international tourism hopes whilst the 2-metre social distancing rule poses massive viability concerns for businesses whenever they are allowed reopen. Ironically Europe is moving in the other direction, relaxing any quarantine rules with many countries applying the World Health Organisation’s 1 metre social distancing guideline.

It must be hoped that the 14-day quarantine period which is up for review on June 18th is not extended beyond that date. With airlines keen to commence routes, and the majority of Ireland’s tourism economy based on international visitation, it is vital that this business is somewhat restored. Equally the social distancing rules should be relaxed as the Covid-19 infection rate remains low.

Efforts should be redoubled to bring forward the reopening dates for the tourism sector whilst assuaging public health concerns.

Time to kickstart the economy

Like every nation in the world the Irish economy has been put in deep freeze for the last three months. But now is the time to get the economy moving again. IBEC, in their recent “Reboot & Reimagine” campaign, have called for a €15 billion recapitalisation of the Irish economy and the SME Recovery Plan, chaired by former Secretary General of the Department of Finance John Moran, has called for a similar level of investment.

The new incoming Government must be interventionist and assertive particularly for the tourism and hospitality industry. 75% of the tourism economy is based on international visitation and this is regrettably expected to be minimal in 2020. Thus a sector-specific support package for Irish tourism must be put in place including an extension of the wage subsidy scheme and a waiving of local authority rates for the rest of the calendar year at least.

Industry at the heart of a tourism recovery

It is clear society will have to live with Covid-19 for some time before effective treatment or a vaccine is found. ITIC has committed to publishing an Industry Revival Plan by the end of June which will aim to shape the agenda and set priorities for a new Minister and Government.

ITIC lobbied hard for industry to be at the heart of the recently announced Tourism Recovery Taskforce. The taskforce, under the stewardship of Ruth Andrews, met for the first time this week and is committed to establishing measures and policies to help Irish tourism recover from the ravages of Covid-19.

Irish tourism has rebounded from previous crises and will recover from this devastation, but support now – when the industry is at Ground Zero – is fundamental. Too many jobs and livelihoods are at stake.