Hoteliers' Boss Warns Of Jobs In Danger

Around 60,000 jobs in the hospitality and associated sectors could be at risk unless banks increase the flow of credit to businesses.

The Irish Hotels Federation (IHF), which is holding its annual conference in Killarney says the industry is facing one of the most difficult periods in decades and it also urged a temporary VAT reduction of five percent to help tackle the economic crisis.

The IHF annual report for 2008, launched last night, revealed that room occupancy had declined to 58%, the lowest since 1994.

IHF President Matthew Ryan has said that hotels were experiencing real difficulties in securing funds from banks.

He also insisted that the Government's recapitalisation plan has so far failed to bring about increased credit facilities.

He said banks treat hotels and guesthouses as a high risk sector and that this may be contributing to the reluctance to provide adequate working capital facilities.

"Our concern is that the difficult short term credit situation will cause the unnecessary demise or contraction of otherwise viable hotel operations and constrain the eventual economic recovery," he said.

Without firm action, he said, "a financial nightmare lies ahead" for the sector, which employs 60,000 people.

The Irish hotel industry boss has also warned that the practice of paying staff double is no longer sustainable.

Mr Ryan argued that hotels could no longer afford to pay the "exorbitant hourly rates" imposed under the Joint Labour Committee (JLC) system.

He said current wage costs of over €20 an hour for Sunday working are "unjustified and completely out of step with other countries".

He said hoteliers have been forced to curtail services on Sundays due to the statutory requirement under the JLC system, which was established in 1946 and requires hotels operating outside of the urban centres of Dublin, Cork and Dún Laoghaire to pay staff double time for working on Sundays.

(BMcC/JM)