The latest survey from the Irish Hotels Federation (IHF) has revealed a €2.6bn drop in hotel and guesthouse revenues during 2020 compared to the previous year, representing an unprecedented financial hit to the sector.
Down 60% year on year, the collapse in revenues due to Covid restrictions has affected all areas of hotel operations – from accommodation, food and beverage to corporate events and social gatherings.
Results show a dramatic decline in room occupancy levels for the sector, dipping to a record low of 30% last year compared to 73% in 2019 as a result of restrictions and the total halt of overseas tourism into the country.
With Government restrictions set to remain in place for the first of half of 2021 and beyond, the sector continues to face financial challenges and uncertainty.
The IHF is calling on the Government to put in place an emergency tourism budget with additional targeted measures to ensure the viability of tourism businesses and the livelihoods they support throughout the country.
Tim Fenn, Chief Executive of the IHF, said: “The Government must come forward with a more coherent, sector-specific programme of supports and measures to secure the long-term financial sustainability of hotels and guesthouses. We are calling for decisive Government action in the form of an emergency tourism budget to include substantial increases in payments to tourism businesses under the Covid Restrictions Supports Scheme (CRSS), enhanced employment subsidies, extension of the local authority rates waiver until the end this year and a further six-month moratorium on bank term loans to support cashflow.
“We also calling for a clear commitment from the Government to retain the 9% tourism VAT rate to assist recovery and secure a viable and sustainable future for our industry. Tourism businesses such as hotels are now contracting for international business up to two years out in an exceptionally competitive market with one hand tied behind their back. As yet, they have no pricing certainty in relation retention of this critically important VAT measure and this must urgently be addressed.”