Budget brings tourism back from the precipice

LIFELINE The State’s Budget 2021 supports for businesses, across a plethora of sectors, must be welcomed during these difficult times

UNVEILING last week’s Budget 2021 Minister for Finance Paschal Donohoe said the coronavirus pandemic has been the greatest challenge to face the country since we gained independence. The €17.75 billion package to keep our economy afloat was ‘unprecedented in both size and scale in the history of the Irish State’, he said.
The State’s supports for businesses, across a plethora of sectors, must be welcomed during these difficult times.
Significantly, for a county like Mayo, which is so dependent on tourism, the rate of VAT for the hospitality and tourism sector is to be cut from 13.5 percent to 9 percent. This has been broadly welcomed by many in the hospitality industry.
Westport and its environs benefited this summer by the huge influx of staycationers and, indeed, may well continue to harness revenue from families that normally chose to go abroad for their summer holidays. It is possible a whole new constituency of annual visitors has been tapped into because of travel restrictions abroad due to the pandemic. Families who normally headed for campsites in France and apartments in Spain may into the future choose the pristine beaches and walkways of the Wild Atlantic Way even after this virus has waned and a vaccine has been found.
FΡilte Ireland has to be acknowledged for its inspired marketing campaigns that continue to showcase the western seaboard. Whilst the huge trend towards outdoor pursuits – from hillwalking to cycling, paddle-boarding to surfing – was already on a steep upward curve, the impact of the virus on our social lives and gatherings now means that this county provides a panacea for our city and urban dwellers.
Whether it was the very first meeting of the Hospitality and Tourism Forum in the days before the Budget chaired by Minister for Tourism, Catherine Martin and attended by TΡnaiste and Minister for Business Leo Varadkar that finally drove the point home to Government about the importance of tourism to our economy, the funding for the sector has brought it back from a precipice, by all accounts.
Not only are possible profit margins increased now by 4.5 percent because of the VAT reduction, due to start on November 1, but businesses whose revenue falls by more than 80 percent whenever restrictions go to Level 3 or higher, can claim €5,000 per week in compensation.
Wage subsidies have also been extended to the end of 2021 and, significantly local authority rates have been waived until the end of this year. Moreover, FΡilte Ireland has been allocated €55 million in cash grants for the businesses that have really floundered and €5 million to support new tourism capital investment projects.   

Healthcare injection
OF course, whilst there is no comparison between the impact of this devastating global pandemic and that of the Celtic Tiger crash of the late 2000s, the impact on people’s mental health is a common thread. The difference this time around is obviously that this insidious virus threatens our physical wellbeing too.
Never before has there been more focus on healthcare in a budget. Speaking last Tuesday, Minister for Health Stephen Donnelly said the ‘biggest health budget in history’ would build ‘permanent capacity’ across the system.
We all know someone who has been left on a hospital trolley overnight. But will the extra €4 billion allocated for the health service to meet the costs of Covid-19 and for permanent expansions in capacity be enough?
Indeed, was this not the perfect time to address pay inequalities in the health system and show a serious appreciation of our many underpaid frontline workers who risk their lives to make the rest of us safe? Former Taoiseach Brian Cowen’s dubbing the Department of Health as ‘Angola’ over 20 years ago still resonates, unfortunately.
Let us hope that Paschal Donohoe was correct when he said: “From the ashes of the pandemic, together we will build a stronger and more resilient Ireland.” The elderly, the disabled, the unemployed, families struggling with mortgage debt and those in Direct Provision must be a big part of that picture.