There was a video clip circulating on social media of Charles Walker MP speaking in the House of Commons last week. He was speaking about the extension of the lockdown in the UK. I do not know much about Sir Charles Walker, Conservative MP, or his political ideologies. But I do know, that for that short video I admired the compassion and empathy he spoke with on behalf of his constituents. If only we could witness the same compassion and empathy from our Political Leaders (watch the video below).
There was little compassion and empathy shown towards the 100,000+ hospitality employees that were temporarily laid off for the 3rd time in 9 months 3 days before Christmas. They have put supports in place for businesses and employees, but have they shown compassion or empathy? The official announcement was made on 22ndDecember, but each of those employees impacted endured 5 days of incessant speculation following the leaked NPHET advice on 17th December, from all the Talking Heads that have popped up during the Covid-19 pandemic. Their speculation mimicked on every TV channel, every radio station, every newspaper, and all social media platforms. Yet our Government let it roll on, and not for the first time. Did this display their compassion & empathy?
Impact on Hospitality workers:
In Hospitality, for the most part, employees do not receive the same wage every week. Their earnings can increase significantly during busier times, particularly when gratuities are considered. It is fair to say that most employees were banking on the higher earnings they would have received from their work during post-Christmas & New Year’s week. This may not resonate with those whose employment has not been affected, but to those employees in Hospitality, non-essential retail and other Industries affected, I am sure the impact of lost earnings is very worrying.
In most cases, the rug was pulled from under them and their income has diminished greatly for the foreseeable future. Income that may have been earmarked to cover their rent or mortgage in January. They may have spent a bit more on presents for their children or spent a little more buying a gift for a friend that was feeling down. They had planned for a happier Christmas & New Year. The much revered PUP payment they received came with a sting in the tail for those that received tax bills last week. A tax bill for employees that have been forced into a continuous lay off cycle due to Government’s approach to this crisis since last March. Hospitality employees all over the country face an uncertain future, they deserve better from their Government.
On 2nd January, the heating broke in my house during the cold spell, within an hour my daughter asked was the heating broke because we had no money as the hotels/pubs were closed. I reassured her and the heating was fixed the next afternoon (thankfully we have a plumber in the family). To me, this showed how the worry and concern of lockdowns permeates through families of Hospitality workers. I wonder how many other children are worried or concerned about their parents working in Hospitality.
I know in our 5 businesses, our employees were fantastic last year, in the face of adversity they showed up consistently. Even the days when it would have been easier for them to leave, they stayed. The customer is always right, but not all customers were accepting of the guidelines or believing of the restrictions. I have learned that there is more of a fondness for the pint of Guinness than there is for the €9 substantial meal. But that should not give a minority of people the right to abuse the people that were doing their jobs and applying the guidelines. I am very grateful for the hard work and effort from all our teams in the most difficult of circumstances.
With all the keep well advice being posted by our Ministers & TD’s on their social media channels in recent weeks, it is amusing that they do not appear to see the irony. When their kite flying and flippant remarks during interviews & press conferences are playing havoc with the mental health of hundreds of thousands of workers.
Last week, Leo Varadkar posted 2 updates on Twitter regarding new job announcements. This was fantastic news for the businesses involved and for the regions that would benefit. But are 130 new jobs over 3 years more important than the tens of thousands of jobs that are currently at stake in Hospitality.
Time for Action:
If our Government can find compassion & empathy for the Industries most impacted, then there is hope. They must engage in a meaningful way with Industry Representative Groups and thrash out the support package that will be required for 2021 to protect businesses and livelihoods. To date, from my viewpoint, it has been an exercise in politeness and paying lip service to lobbying from Industry Groups.
Most of the current supports are due to expire on 31st March having recently being extended from 31stJanuary. Is it not time for Government to accept that the piecemeal approach is not the correct approach and a new longer term strategy needs to be implemented for Industries most affected by lockdowns and restrictions?
It is not my intention to cause offence by writing this blog, but I cannot be mindful of the sensitivities of our elected officials when they do not appear too concerned about the sensitivities of the Hospitality workers across the country that are impacted by these lockdowns. For our politicians, they entered 2020 and Brexit was the highest priority and the biggest concern from an Economic & Political viewpoint, then Covid-19 came hot on the heels of a General Election. I believe their initial response was admirable and they have been reacting since, as we all have been. To date, our business is very grateful for the supports received and for the PUP that employees receive.
There is now speculation that restrictions could be in place for 6 months and reports of a potential delay in supply of the Astra Zeneca vaccine. This is extremely worrying, as we can be assured that we will be the last to open, and a delayed roll out of the vaccine could lead to another rollercoaster stop start year. It is time for action from Government and Industry Representative Groups need to step up their negotiations with Ministers to ensure the industry receives the necessary supports. It is not about political sensitivities it is about protecting the interest of their members & Industry employees.
The appointment of a Senior Minister for Tourism must be prioritised. By all accounts, Catherine Martin is an astute and hardworking politician, but her current portfolio is far too broad for one Minister to cover.
An efficient and effective vaccine roll out strategy is critical and will provide the quickest route to some semblance of normality. This should allow for the implementation of a sustainable living with Covid-19 plan.
In my opinion, the following will be required for employees impacted by Covid-19 restrictions:
The income for hospitality employees since March 2020 has diminished significantly even with the €350 per week PUP payment. Their outgoings or commitments will be, in most cases, commensurate with their pre-COVID-19 average annual income. This is placing considerable financial strain on top of anxieties due to the uncertainty of their work situation.
- PUP: To be maintained at current levels. For permanent hospitality employees that have been on PUP for an extended period, either consecutively or cumulatively, there should be additional supports provided until back in full time employment. These additional supports could include free GP care, access to rent subsidies or support with schoolbooks or uniforms.
- Banking: Reintroduction of 6 month moratorium for mortgage payments or bank term loans
- Training: Continuation of funded training schemes available to hospitality employees until 2022
- Tax Bills: An amnesty introduced for tax accruing due to TWSS / PUP scheme for employees that have been heavily impacted.
In my opinion, the following will be required to protect businesses and support employment:
- EWSS: The wage subsidy needs to be increased to same level as TWSS when level 5 restrictions apply or when businesses are closed through restriction. This would support businesses to protect more employment. When businesses reopen EWSS must be maintained at current subsidy level until March 2022.
- CRSS: Immediate payment of double week announced in December. The support to be extended to businesses currently excluded. The €5,000 cap to be increased, in line with scale of business or employment numbers supported by each business.
- Commercial Rates: To be waived for all of 2021. A phased reintroduction of rates once businesses are in recovery based on economic outputs.
- Banking / Funding: Further 6 month moratorium on bank loans. Access to funding for Working Capital to prepare for recovery. Department of Finance should conduct a review of current Government supported funding schemes. The minimal take up reported to date may indicate an underlying issue in applications.
- Tax Warehousing Scheme: A new timeline for exiting the scheme needs to be introduced based on current outlook for the Industry in 2021.
- Stay & Spend Scheme: A simpler end user scheme needs to be introduced for H2 2021, if restrictions allow. If not, the money allocated must be redistributed to a different support.
- Lease Agreements: More protections need to be included in the code of conduct introduced by Government between Landlords and Business Tenants on rents.
- Tourism VAT: To be maintained at 9% to ensure Ireland remains competitive with other EU countries when International travel resumes.
Austerity for a large section of the population is not the answer. The best road to recovery will be through investment, a form of “Paying it Forward” if you will. When Covid-19 has passed our Industry will support and stimulate economic recovery in many communities across regional Ireland. Hospitality businesses and people contribute so much to Ireland’s appeal as a destination. When we come to better days, it will be hospitality businesses and events that will boost the morale & economy of the nation.
Hospitality businesses are facing into the abyss, if Government fail to put the necessary support package in place then many businesses will not survive. As it is, the cash burn in most businesses will decimate any cushion that hospitality businesses may have made in the last 5 years following the previous economic crisis.
Thank you for reading, if you agree, please share.
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Group General Manager,
Connacht Hospitality Group