THE DRINKS INDUSTRY Group of Ireland has criticised the Government’s stimulus package for the hospitality sector claiming it “fails to grasp the magnitude of the situation that publicans are facing”.
The Government last week announced a €16 million support package for pubs around the country following the confirmation the they would not be reopening.
Since 29 June, pubs that serve food have been permitted to re-open under strict guidelines, but other pubs have had to remain shut.
Exact details of the package are yet to be revealed but the Tánaiste Leo Varadkar said they would top-up the restart grant for affected pubs by 40%, waive licence fees and court fees for pubs that remain closed as part of the package.
Minister for Public Expenditure and Reform Michael McGrath said the package would be worth up to €4,000 for licence holders, and confirmed it would also apply to restaurants, hotels and bars that are already open.
The Drinks Industry Group of Ireland today said that the funding has provided “little comfort” to the industry.
“Since the lockdown, almost half of publicans have taken on debt of €16,000, one in five as much as €30,000, much of it to invest in protective equipment and refurbishments in preparation for reopening. The package therefore barely scratches the surface of what is required.”
The group said that pubs in Ireland have been closed for almost six months which is “significantly longer than any other EU country,” it said.
“There has still been no explanation from the Government as to why Ireland is a special case,” the group added.
“Furthermore, the Government have not provided any certainty or even a rough timeline for pub re-openings. This is little comfort for the thousands of business owners who face the real prospect of permanent closure, and soon.
“Lockdown until 2021 will cause irretrievable losses in jobs, reduce prospects in rural communities, weaken our tourism product, and permanently damage the character and culture of the country,” it said.
The group said that if the Government wants to make “impactful decisions that will enable the industry to not only reopen but to recover, then longer-term strategies need to be put in place that reassess some of the wider constraints that exist across the sector, such as excise tax”.
“Despite being one of the most severely impacted industries in the state as a result of the Covid-19 pandemic, the drinks and hospitality sector remains subject to the second highest excise tax in Europe. A reduction in excise tax should be among the core considerations for Government as we look towards Budget 2021.
“Without a reduction, businesses will reopen in debt at reduced capacity with the second highest rate of excise in the EU. This will put them on an immediate backfoot and threaten more permanent closures.”
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