| 16.4°C Dublin

Hospitality sector requests extra help in stimulus package of virus aid

Close

Minister Michael McGrath

Minister Michael McGrath

Minister Michael McGrath

The hospitality industry is demanding a major extension of State-backed wage subsidies and a slashing of the VAT rate as the Cabinet meets to start work on a major "July stimulus" to help pandemic-hit businesses.

Taoiseach Micheal Martin's coalition team will hold its first substantive meeting today, with ministers set to be updated on the Covid-19 crisis and the state of the economy.

The Cabinet will also work on the stimulus package referred to as the "July jobs initiative" in the Programme for Government (PfG).

It is to include planning for the future of the temporary wage subsidy scheme (TWSS) and €350-a-week Covid-19 Pandemic Unemployment Payment (PUP), as well as setting up task forces led by line ministers to develop recovery plans for different parts of the economy.

Mr Martin's department will be heavily involved, as will Tanaiste Leo Varadkar's Department of Enterprise, Trade and Employment.

The July jobs initiative will be aimed at helping businesses to boost job creation, particularly in the sectors worst hit by the Covid-19 crisis - tourism, hospitality, retail, entertainment and the arts.

There are plans to enact legislation for a new €2bn credit guarantee scheme and for other financial support like business restart grants.

Concern

Newly appointed Public Expenditure Minister Michael McGrath last night said the July stimulus package will be the "most immediate issue" facing the Government

He told the Herald that the Cabinet would have to give businesses clarity on the future of the TWSS and work on commitments set out in the PfG on commercials rates and State-funded loans.

"All of these issues will have to be teased out and decisions will have to be made in a very short period of time," he said.

Representatives of the hospitality sector have raised serious concerns that the tourism sector is not part of a senior economic ministry.

They also made significant requests for inclusion in the July package.

Tourism is included in Green Party deputy leader Catherine Martin's vast media, tourism, arts, culture, sport and the Gaeltacht brief.

Restaurants Association of Ireland (RAI) chief executive Adrian Cummins said his organisation was "extremely disappointed" at the lack of economic focus for tourism in the realignment of Government departments.

On the July stimulus he said that the RAI wanted to see the TWSS continued until next summer and extended to include seasonal workers.

He also called for the VAT rate to be slashed to 0pc, something Mr Varadkar previously said could not be done due to EU rules.

The Irish Hotels Federation (IHF) also expressed "deep disappointment" at the status of tourism in the Cabinet, with president Elaina Fitzgerald Kane saying there was shock that it had been placed in a "six-faceted portfolio".

She said the industry was in the midst of a "devastating economic crisis" and also called for the continuation of the TWSS, including for seasonal workers until the crisis has abated.

The IHF wants the cap on the number of people indoors linked to the size of venues.