(Limerick East) asked the Minister for Labour if Great Southern Hotels will remain in his ownership in the coming year.
31.
Ceisteanna—Questions. Oral Answers. - Great Southern Hotels Group.
1.
asked the Minister for Labour the Government's plans for the future development of the Great Southern Hotel group in light of the decision to reject the various bids for the hotels; and if he will make a statement on the matter.
32.
asked the Minister for Labour if he will confirm that there will be no change in the ownership of Great Southern Hotels.
37.
asked the Minister for Labour if he has considered the sale of Great Southern Hotels; and if he will make a statement on the matter.
I will take Questions Nos. 1, 31, 32 and 37 together.
In September 1987 the Government, having considered a decision of the previous administration to dispose of the Great Southern Hotel group decided not to proceed with the disposal of the group but instructed me to keep the position of the group under review and to report back in a year's time. During the course of that review a number of offers were received for the purchase of the group. The Government have not accepted any of these offers.
I am not at present considering any specific proposals in relation to the future of the group. I shall, of course, keep the performance of the group under constant review.
Deputy De Rossa rose.
Deputy Jim Mitchell tabled a question and he takes precedence. However, he is not offering. I call on Deputy De Rossa.
In regard to Question No. 31, do I take it from the Minister's reply that there are no plans for the development of the group?
The board will now — without conditions imposed by me — look at the options for the expansion of the group. Expansion is not ruled out but I will leave that matter to the board. Of course I do not know what they will decide but there may be further development.
Has the transfer of the Great Southern Hotels to any other area of the State sector been considered?
In my review, I considered all kinds of options but nothing came of them. The group in their present form are doing well and my concern for them relates to the long term. They are making modest profits but it would be very difficult, from their own resources, to undertake an expansion or refurbishment programme. I do not know if the group's present form is the best solution for them and particularly for their staff with whom I have had a great deal of discussions.
Do the proposals for the hotel group not include adequate depreciation allowances to cover refurbishment in future?
The Deputy is aware that a sum of £16 million was put into the group in recent years so the question of major refurbishment will not arise in the near future. However, the buildings are old, it will arise in future and we must keep this in mind.
The Minister is an accountant and he should know if adequate provision has been made for this sort of contingency before profits. Will he, therefore, agree that the results as published exaggerate the strength of the group?
There is now an element of repetition.
As an accountant, I know that you do not exaggerate writeoffs. The group built in figures to a moderate extent but they ran into difficulties with these very old buildings in the past and this must be watched in future. However, there is no immediate difficulty with the group.