Ceisteanna ó Cheannairí - Leaders' Questions

The tourism and hospitality sector supports around 270,000 jobs across the State. Some 68% of those jobs are outside of Dublin and in many parts of the country it is the principal source of economic activity. The sector supports hundreds of thousands of workers, families and communities. It has been one of the hardest hit sectors as a result of Covid-19 and the facts bear that out. In recent months, approximately 92% of all workers in the accommodation and food sector have received the pandemic unemployment payment or have been on the temporary wage subsidy scheme. I appreciate that some of these workers have been able to return to work in recent weeks, and that is to be welcomed, but many more have not.

Many publicans and workers in the pub trade are very disappointed with last night's announcement that the planned reopening on Monday will not now be able to proceed. I appreciate that the decision has not been taken lightly. I know that public health officials are concerned about increased transmission and possible transmission of Covid-19 at this time. We must all be guided by the public health advice in the decisions that we take. However, I think we need to acknowledge that this virus is going to be with us for some time. It is here for the medium term if not the long term and we need to plan accordingly. Has any consideration been given by NPHET to varying the approach to reopening in particular regions? This is an important question. Is consideration being given to allowing pubs to reopen, like restaurants are open now, with all of the restrictions that are in place in terms of table service, social distancing and time limits but without the serving of food? The Minister for Health says there is no concern about restaurants, so could pubs do the same but without food? It strikes me that this could be a way forward in the weeks ahead.

In addition, we need to look seriously at a specific stimulus plan for the tourism and hospitality sector. Such a plan is needed. The Tánaiste may be aware that Sinn Féin recently published a proposal amounting to a stimulus of €860 million to provide every adult in the State with a voucher worth €200 and every child with a voucher worth €100 to be spent in businesses in the tourism and hospitality sector. It would provide a big boost to counties and regions heavily dependent on tourism and hospitality as well as supporting hundreds of thousands of jobs. This plan would also give workers and families a welcome option for a break away or days out after what has been an extraordinarily difficult period. Similar stimulus plans have been introduced around the world. Italy has a similar plan to encourage people to holiday at home. Vienna has given vouchers to residents for restaurants in the city. The US is distributing billions of dollars in stimulus cheques directly to residents. This is a worthy investment in terms of jobs in businesses and in communities. Without that intervention now thousands of jobs could be lost permanently, costing the State considerably more in the long run. The Government is due to publish its July stimulus plan in the coming days. Will this scheme or a similar one be considered as part of the package of measures that will be announced?

I very much agree with Deputy Doherty that the tourism, hospitality and travel sector is a significant part of the economy. A quarter of a million more people are working in that sector, which is very dependent on travel, both international and domestic. It is a sector that was hit hardest first and will probably be affected the longest as a result of this pandemic. While people running pubs and hotels will be very disappointed at the decision the Government took last night they will acknowledge that the decision was taken for good reasons of public health, as Deputy Doherty acknowledged in his contribution.

In terms of how we support these sectors and how we save jobs, different countries will adopt different approaches and when one compares packages one needs to compare them in the round. For example, in the UK, including Northern Ireland where Deputy Doherty's party is in power, the wage subsidy scheme will come to an end in October and instead something is being done with VAT for one month. Our approach may be a different one. We may decide that the best way to protect jobs is to continue the wage subsidy scheme beyond October. When one talks about what different countries do, one has to look at it in the round. The focus that we have taken to date is the wage subsidy scheme, because that is the most effective way to keep people in work and it targets those businesses most affected. We have warehoused tax liabilities and brought in the pandemic unemployment payment for reasons of social solidarity. In the initial phase of this pandemic we made much greater payments than have been the case in other countries, including north of the Border. As well as that, we have waived commercial rates for three months.

In terms of what is planned in the July stimulus, that is not decided yet. It will be decided on Monday, with a view to being published on Tuesday or Wednesday. We are looking at all sorts of different potential actions and I do not want to speculate on them too much here because that may then raise expectations that cannot be met. One of the things we are examining is whether the commercial rates waiver should be continued for a longer period. That saves money for businesses in terms of reducing their costs. We are also considering whether the wage subsidy scheme should be continued and opened to groups of workers that are not currently covered, such as seasonal workers who were not on the payroll back in February. In addition, we are considering whether we should do something about the restart grant. The restart grant has been very beneficial for many businesses, but some did not qualify and, to give the other side of the coin, some correctly pointed out that the restart grant north of the Border is more generous than it is here. These are the kinds of things we are examining.

Later on, Deputy Louise O'Reilly will be launching our proposals that contain all of the measures outlined such as the wage subsidy scheme, the restart grant and rates waivers to support SMEs.

The Tánaiste rightly acknowledged that the tourism sector is the worst hit and it will suffer for the longest as a result of Covid-19. No matter what type of supports we put in we must stimulate demand because 10 million overseas tourists are not coming to the country this year and many of them will not be coming next year. It will not be possible to replace that demand with domestic consumption but we need to try, and a voucher scheme is a way to do that. In my view it is a cost-efficient way to do it as 23% of every euro that is spent in the economy in tourism comes back to the State. The key is to get as many people as possible off the pandemic unemployment payment and back into the tourism, hospitality and accommodation sector.

I thank Deputy Doherty.

Could the Tánaiste answer the question on whether pubs could operate like restaurants but without food? We know that a meal in itself, whether it is €9 or €12, is no defence against Covid-19. Is that a potential solution for the future?

The Deputy has made his point. I thank him and call the Tánaiste.

I think there is a strong case for putting in place actions that would help to stimulate demand, but we need to be honest with people too. Stimulating demand will be no good to a pub or nightclub that is closed or to a wedding venue that cannot hold weddings for more than 50 people. That approach has its benefits but it also has its limitations. I have no doubt Deputy O'Reilly will produce a very long shopping list of everything that we could do. Up until yesterday she would have said she would pay for it with the money from Apple, but of course we know that kind of stuff is not realistic.

We never said that.

There is a limit to how much one can have in any stimulus package.

I will send the Tánaiste a copy.

We want to keep borrowing to no more than €30 billion this year. We will take in about €50 billion in tax and we will spend €80 billion. A €30 billion deficit is pretty huge. It may be the biggest we have ever had. We are spending a lot of money. We are borrowing a lot of money. That is the right thing to do but it is wrong to suggest the money is unlimited and one can just do everything on the list. One has to prioritise. It is not credible to produce a very long list every day and to add to it.

I thank the Tánaiste.

In terms of Deputy Doherty's question on pubs, NPHET has not been asked to advise on that. I understand the point the Deputy makes and I think it is a valid one. If we could open pubs with very strict social distancing, that could potentially work. The problem we have seen on a number of occasions is that when people are consuming alcohol, for example in house parties, on the streets or even in restaurants, it is very hard to maintain social distancing. That is a real difficulty. One thing that is fundamental to pubs is that they are ultimately about serving alcohol.

Although there is a major focus on travel, a sector of the industry is facing extinction unless they receive urgent funding. Ireland's 190 licensed travel agents are currently watching their businesses fail and, unlike other SMEs, they have received little or no assistance. I have been in correspondence with the Tánaiste about this issue. Industry projections estimate that as a result of the advice not to travel abroad, travel agents will lose €120 billion in projected earned income, which comes largely from commissions and service fees. Without the benefit of the temporary wage subsidy scheme, TWSS, many travel agents would already have closed their doors as turnover is down by 90%. All income earned to date from advanced bookings is handed back in refunds, resulting in negative trading. Advanced bookings are practically at zero so businesses are looking down a black hole toward the rest of 2020 and the first quarter of 2021. Travel agents earn income when consumers pay the balances. Unlike the domestic tourism industry, they cannot benefit from staycations to any great extent. Outbound travel agents have no fallback. However, outbound and inbound tourism rely on each other to generate passengers for airlines to justify operations. Multinationals and SMEs depend on travel agents to properly manage their costs. Outbound travel agents also sell European holidays in the UK market and bring meetings, conferences, sports groups and a host of other visitors into Ireland.

Travel agents are not arguing against Government advices but they are concerned about the unintended consequences that are putting them in jeopardy. Greater assistance is urgently required. Travel agents were excluded from applying for the online retail scheme in the first round of grants as they were considered to be providing a leisure service. Travel agents should not be excluded from the upcoming round of financial supports for SMEs or from applying for certain grants that may evolve due to a misconception about the volume and type of business they provide.

In summary, the Government advice is not to travel. Thousands of people have followed that advice by cancelling holidays. Most of these cancellations are package holidays that include flights, transfers and accommodation. We have a ludicrous situation where under a EU directive the travel agent is legally responsible for the refund of the entire package. This is simply not sustainable financially. It is a travesty and incredibly unfair to expect travel agents to shoulder the burden of this financial outlay. It will force them into liquidation. Ironically, the travel agent bonding system to protect consumers when agencies collapse only becomes active and effective after a travel agency goes into liquidation. Travel agents, and thousands of consumers across Ireland are stranded between a EU directive and Government travel advice. This matter requires urgent attention and correction.

I had a chance to speak briefly to the president of the Irish Travel Agents Association, ITAA, on a Zoom call the other day. The Minister of State, Deputy Hildegarde Naughten, whose responsibilities cover aviation and international travel will meet ITAA representatives in the next couple of days to explore what specific supports we may be able to put in place for them.

Approximately 3,000 people work in travel agents and tour operators throughout the country. We all know these businesses and they are largely locally-owned, often family-owned. They tend to be an important feature on our high streets. While many people now book online, lots of people still use travel agents and tour operators, and that includes inbound as well as outbound travellers. We want to make sure that they survive and that they are able to do well again when we get past this pandemic. They benefit from the actions already put in place by Government including, for example, the wage subsidy scheme. Almost all of them would benefit from that because their turnover has gone down by so much. We also brought in the refund credit note scheme so that people would get vouchers or credit notes rather than cash refunds in an effort to assist the sector so that it did not collapse, although people are ultimately entitled to the cash if that is what they want. Their commercial rates have been waived and some are eligible for the restart grant once they get started again. We will see what else can be done with both through the July stimulus fund that is happening next week and also if there is anything in particular we can do for the sector. That is what the Minister of State, Deputy Hildegarde Naughten, will explore with them.

The Deputy wrote to me about the online retail scheme, which falls under my responsibility as it is an Enterprise Ireland scheme. That funding has all been drawn down, but if we able to reopen the scheme, I take the Deputy's valid point that they should be included under that as well.

I wish to raise a separate but connected issue. Thousands of people booked flights with airlines. On Government advice, they have taken the decision not to travel. We now have a situation where airlines have had the use of people's money for a considerable period. However, because the flights have not been cancelled, they are unable to recoup their money. The only option they have is to change the date and when they move to do this, the airlines are charging them as much they paid for the original ticket. This is total exploitation by the airlines of their dominant position. Will the Tánaiste intervene with them to allow a situation to develop where they only charge a nominal fee for moving the booking forward?

I will certainly take that up in my engagement with the major airlines. The Government advice since the middle of March has been to avoid non-essential travel off the island but I appreciate that there are some people who made bookings long before March and now find themselves in a very difficult position. On the international travel advice, I restate that nobody should engage in non-essential travel off the island and anyone coming in for reasons essential or otherwise should, not quarantine as such, but restrict their movements for 14 days. That means staying at home and only going out for essential supplies and exercise. I regularly see the terms "quarantine" and "self-isolate" used incorrectly. The advice is for a person to restrict their movements for 14 days. That applies to anyone coming to the island with a very small number of exceptions such as pilots, transport workers, cabin crew and diplomats. On Monday, however, we will have a green list of countries that have an incidence of coronavirus that is similar to ours. We will then be able to update our advice on those countries and it will be different from the general advice for countries not on that list.

Is the Government decision, based on medical advice, to keep our pubs closed until 10 August? This is a retrograde step. Our hard-working publicans and, very importantly, their customers as well, are being treated very unfairly.

In the interest of keeping things proper and correct, I declare at the beginning that I am connected to a person who owns a pub. Our public houses have served us very well over the years. The Vintners' Federation of Ireland, VFI, is a very responsible organisation representing very responsible, small businesspeople who were very much looking forward to opening next Monday on the Government's word. The Tánaiste should remember what the Government has done to them. Their pubs are now stocked, work rosters have been organised, and people have organised babysitters. They are ready to open their doors and turn on their lights but last night the Government pulled the rug out from underneath them. I want to look at the reasons.

NPHET are saying they have looked internationally at what has happened in public houses throughout the rest of the world and that when they opened, there was a spike or increase in cases of the virus. However, we are missing one very important point here. We have always said that Irish pubs are unique, that our country pubs are unique. They cater to smaller groups of people and they know their customers. All they wanted to do was open up in a small way so that local people could come in from the countryside to have a drink. It must be remembered that there is an awful lot of difference between Dame Lane and Ballinskelligs, or between Dame Lane and Portmagee, or indeed any other part of the constituency that I represent.

The Government has really missed the bigger picture, in that opening these pubs absolutely would not have increased the occurrence of the virus. I would like the Tánaiste to explain on the record the difference between a person inside in a public house with a pint of Guinness in one hand and a toasted cheese sandwich in the other and a person in another pub with a pint of Guinness and no toasted cheese sandwich?

They could be very hungry.

The Tánaiste is a doctor. Will he explain to me why eating a sandwich or not poses a public health danger to a person drinking a pint? It is a crazy decision by the Government. I really feel very bad. Today, on behalf of every publican, be it a man or a woman or a younger person in charge of a pub looking forward to opening next Monday, I want to tell the Tánaiste they are extremely angry about the way they have been treated by the Government. They are responsible people. They are more interested in public health than anyone else. Remember they have been minding people's health for many years because they are in charge of what I would call well run public houses-----

Thank you, Deputy Healy-Rae.

-----where they know their customers and they want to mind them. They were going to mind them next Monday but now the Government has pulled the rug out from underneath them.

I thank the Deputy. I can understand what a hammer blow this news is for publicans and for people who run pubs, nightclubs and other venues, who had expected and hoped they would be able to open next Monday. I do not think I am the only person in the House who was looking forward to freedom pints next week but, unfortunately, this is not possible. It is not possible for a good reason, which is that the incidence of the virus in Ireland has increased. It is still very low, at roughly 20 cases at day at four per 100,000, which is the eighth or ninth lowest out of 31 countries in Europe, but the trajectory was a matter of concern. It was going in the wrong direction.

This has not been largely due to international travel despite all the focus on it. It has been 90% due to our own behaviours, with people in close contact with one another in confined indoor spaces breathing on one another, coughing on one another and touching one another, and as a result of this we have seen a number of clusters, often linked to house parties and social engagements. This is a matter of concern and this is why NPHET gave the Government the advice it did and the Government acted on it, which was to defer the opening of pubs and nightclubs at least until 10 August and bring in new rules on house parties, which is to say that people should not invite more than ten people to their house and from no more than four households. This is the advice.

We know from all over the world, and from China and Asia, that it is not outdoor gatherings, for example like what happened in Dame Lane, which should not have happened, where the virus spreads but it is in indoor small confined spaces with ten or 15 people passing it to each other through close contact and being together for a prolonged period of time. This is house parties and small pubs, unfortunately. That is the truth of it. It is also potentially restaurants, if restaurants act as if they are pubs and concentrate more on selling alcohol rather than people having a meal with a bit of alcohol and getting out within an hour and a half.

I thank the Tánaiste. What the Government has done is create another problem. These small businesses that were looking forward to standing on their own legs next Monday and opening their doors will now be faced with the financial burden of another 25 days with the doors closed. What proposals does the Government have, and I am not talking about loans but grants and substantial assistance to be made available to these businesses, to allow them to carry on their businesses when the Government eventually decides to let them open? Now the Tánaiste is saying it will be 10 August. I received many calls late last night and very early this morning from people asking how sure we are the Government will actually allow that because it has broken its word already. The Government raised their hopes which was a horrible thing to do. The message that has gone out now throughout the world is that people can come from a hot spot but they cannot have a hot drop because the Government has left the doors closed. It is a poor decision. If I thought that it was a good idea medically of course I would be behind it but I do not.

Particularly in rural Ireland, we feel as though we are being blamed and getting the brunt of the anger the Government had when it saw what happened on Dame Lane-----

Thank you, Deputy.

-----and any decision made with regard to house parties-----

The time is up.

We welcome anything that would control that sort of nonsense but please, for God's sake, recognise the fact that our publicans are responsible people who run good houses.

Please, Deputy, the time is up. The Tánaiste to conclude on this matter.

I thank the Deputy. I have no doubt the vast majority of publicans in our country are responsible people who want to open their businesses and I also want their businesses to open. However, I do need to be clear that what we are saying is that pubs and nightclubs will not open any sooner than 10 August. We are not saying they will open on 10 August, we are saying they will open no sooner than 10 August and it will depend on the numbers and how the virus behaves, to use Tony Holohan's term, between now and then. When we published the plan, and I was the one who published it as Taoiseach at the time, to reopen business and society, we made it very clear on day one that it was a plan that could be accelerated if things were going in the right direction, paused if things were going off-line and reversed if needed to be. We were always upfront about that from day one.

In terms of the help we can offer the pubs to open when they do reopen, the wage subsidy scheme is in place and we intend to extend it. They do not have to pay commercial rates and we are looking at whether we can extend this also. They will benefit from the restart grant. I am looking at whether we can make the restart grant better and more attractive, particularly for those who need it the most, which is the hospitality sector including our pubs.

I also want to ask about the July stimulus package, which we all know is needed to assist businesses in the reopening of the economy and the months ahead. We all agree on this. I want to ask what businesses will be expected to do for the State in return for all of the support the State is giving to them. It is a two-way street and it is not simply enough that they come out of the crisis in reasonable shape. The State must also be in reasonable shape. In return for the support we, as the State, are giving to them they need to support the workers who make their businesses a success. I do not believe a business can survive without the support of its workforce. Indeed, it is the workforce that makes many businesses viable. It is not simply through supporting entrepreneurs or business people that we will recover; it is also by supporting workers and linking the survival of workers and their families to the success of the State.

Too often in recent weeks, as people have returned to work, I have heard stories of businesses using the crisis to reduce wages without consultation. In one business, management has made many people redundant and is availing of the wage subsidy scheme for the remainder of employees. It is also using the crisis to reduce the remaining wages by 10% for everybody across the board, for which workers are already getting the wage subsidy. In another employment, management has taken on a new policy whereby all the workers return to work on the wage subsidy alone. While this may be okay, as the Tánaiste has said to me previously, it is a betrayal of workers and the State.

We need to get to a new way of thinking in this country, whereby we can acknowledge that business is important for the success of the economy but an engaged workforce is important for the success of business. This is key. The Tánaiste and the Government can make this happen. After all, I know the Tánaiste has the well-being of our people at heart. My question is simple. Will the Tánaiste make the jobs stimulus package work for workers also and ensure they, as well as their employment, will be able to survive?

I thank the Deputy. The answer to the question is "Yes". If he looks at what we have done so far, I announced a package of approximately €12 billion to respond to the coronavirus. This is leaving aside the health costs. This approximately €12 billion is for supports for business and employees. Not all of this has been drawn down yet but the bulk of it that has been drawn down is the wage subsidy scheme, which subsidises the wages of workers, and the pandemic unemployment payment, which provides a welfare payment to people who have been laid off. The vast majority of the money we have spent so far has been targeted at people who have lost their jobs or people whose jobs only exist now because they are being subsidised.

The amount we have given to business in grants and loans is much less than that. In fact, I believe we need to do better in terms of the grants and loans we give to business, and we intend to do that next week. The focus has been on people who have lost their jobs and ensuring that more people do not lose their jobs.

Businesses do a great deal for us already. They create much employment and they pay a large amount of tax. We are able to fund our education, health and justice systems, as well as public infrastructure and everything else, from all the taxes businesses pay. I might be wrong about this and there may be exceptions but I do not believe there are many employers in this country who are taking advantage of this crisis to reduce people's wages or terms and conditions. There might be examples and we must expose and tackle those people, but in the vast majority of cases where employers are seeking pay reductions it is because they have no choice. Their business is down 50%, 60% or 70% and they will be in a loss making position this year. Part of what they must do to survive is reduce their costs, and it is very regrettable when that has to happen. However, it has to be better than the business failing and all those people being laid off.

I thank the Tánaiste, but people staying at work for wages on which they and their families cannot survive is not good for them either. What we must do is change the dynamic whereby businesses in partnership with their workers will survive. That is the reality.

The Tánaiste has consulted and met IBEC, the Small Firms Association, ISME, Chambers Ireland, SME Recovery Ireland and a range of State bodies, including Enterprise Ireland, local enterprise offices, Fáilte Ireland, the Strategic Banking Corporation of Ireland, the Ireland Strategic Investment Fund, the Central Bank, Microfinance Ireland and the Credit Review Office, but he should have meetings with workers and workers' representatives as well. Then he will hear about the businesses that are capitalising on the crisis and using it as an excuse to make workers pay by cutting wages. There is no doubt that a workplace might have to reduce wages, but it should do that in consultation with the workers and recognise that its workers are vital to the survival of that workplace. That is what the State should be doing as well. We should be creating that dynamic. I ask the Tánaiste and the Government to start that ball rolling and to use the July stimulus to make that happen.

I will be doing that next week. My meetings next week include meetings with unions, including the Irish Congress of Trade Unions. I will certainly listen to what they say in that regard. In my previous occupation I did that regularly and will do so in this role as well. I am the Minister with responsibility for enterprise, trade and employment, not just enterprise. I mean that.

We can change the dynamic and the philosophy all we like, and I understand what the Deputy means when he speaks about that, but there is one dynamic that we cannot change. For a business to survive, it must take in more money than goes out of the business. That is the bottom line. A business might get away with running at a loss for a few months and perhaps even for a year or two but, fundamentally, for any business to survive and have any employees at all its income must match or exceed its outgoings. If it does not, the business will fail. The business will close and people will lose their jobs. We do not want that to happen.