Ireland’s night-time economy is in genuine peril - why were licensing reforms so long coming?

Irish politicians have for years looked to Europe and admired the sophistication of our continental neighbours’ culture around drinking and socialising. Why must we always swill pints instead?

Michael McDowell, the former minister for justice and now an Irish Times columnist, made an early attempt at fostering a “cafe bar culture” when he proposed in 2005 to deregulate the market for selling alcohol for consumption on a premises. Perhaps inspired by weekend breaks to European capitals, McDowell appeared to envisage a genteel culture of denizens sniffing Sauvignon blanc on balmy terraces in the evenings, instead of piling three deep at the nearest bar counter to accrue a feed of pints before closing time. The powerful publicans’ lobby quickly mobilised and the proposal was killed off.

Helen McEntee, the Minister for Justice, also appears to have been inspired by Europe with the Sale of Alcohol Bill, the scheme of which was approved by the Cabinet this week. Its most eye-catching, although not its most significant, proposal is to allow nightclubs to serve alcohol until 5am, before closing at 6am after a final hour of dancing.

At a speech launching the proposed new laws, McEntee recalled visiting nightclubs in European cities, where many routinely operate until sunrise, and wondering “why we couldn’t do the same at home”. Anyone who has ever visited a city such as Berlin knows what she is talking about. McEntee says that she included the 6am closing provision for nightclubs to ensure that the Republic’s “night-time culture is equal to that in modern European cities”.

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[ The Irish Times view on the change in licensing laws: last orders for an outdated regime ]

The new regime proposed by McEntee, in partnership with Minister for Culture Catherine Martin, envisages the most far-reaching overhaul of Ireland’s licensing laws in generations. As well the nightclubs provision and lengthening opening hours for all pubs until 12.30am seven nights a week, it would also simplify the system for licensing late bars that open until 2.30am and remove the “one-for-one” rule requiring new licensees to kill off an old licence before being allowed to open.

The 6am proposal to reinvigorate the nightclub industry is long overdue. It is hard not to look at McEntee’s age — she is 36 — and conclude that it must have played a role in her ability to grasp the fact that the night-time economy, which in cities is based around nightclubs, is in genuine peril. More than 80 per cent of nightclubs have shut in the past 20 years.

There are fewer than 7,000 pubs in the State, after more than a fifth closed in the last 15 or so years, a consistent trend driven by a structural changes in consumer drinking behaviour

McEntee was just 34 when she took over the Department of Justice, and her clubbing days were presumably not long behind her, if at all. McDowell, who had a greater understanding of the hospitality industry’s future than he ever got credit for, was 51. His successor, Brian Lenihan, was a relatively youthful 48. He was followed by 53-year-old Dermot Ahern; Alan Shatter, aged 60; 63-year-old Frances Fitzgerald; and McEntee’s predecessor, Charlie Flanagan, who was 59 when he took over.

But there is another fundamental difference in the “cafe culture” overhaul put forward by McDowell in 2005 and the more realistic one proposed by McEntee this week: the publicans have yet to come out and strongly criticise the plans. Some of that may come later, but the absence of an immediate industry mobilisation against it is a sign that the guts of the Sale of Alcohol Bill may eventually be passed into legislation. McEntee wants it as law by next summer.

[ ‘European tourists laugh at us for closing so early’: Nightclub owners welcome 6am law change ]

McEntee and, especially, Martin have had greater contact with the pub and nightclub industry over the past few years than any of their predecessors, in part because the Government sacrificed the industry for public health reasons during the pandemic. That gave industry leaders a direct line to Ministers, who felt compelled to give them a sympathetic ear.

As the pandemic still raged, Martin established the Night-Time Economy Taskforce, whose proposals for an overhaul fed neatly into McEntee’s plans to consolidate all licensing legislation. A detailed process of consultation with the industry was held earlier this year, resulting in a Bill that, so far, has yet to stir the sector’s anger.

On the face of it, many publicans seem to have got a lot of what they wanted. The Licensed Vinters Association (LVA), which represents more than 700 Dublin pubs, specifically asked for the 12.30am closing time seven nights per week, the overhaul of the system for 2.30am late bars, and the 6am closing for nightclubs, which were all delivered.

There is also rough with the smooth for city publicans. McEntee said this week that the deregulation of the system for issuing licences — the end of the one-for-one — was designed to help reopen shuttered pubs in rural towns and villages. But in reality it is in major urban areas where this proposal will have the greatest impact.

Taken as a complete package, McEntee’s proposals have a fairly good chance of getting through relatively intact before next summer

Rural pubs aren’t closing because of the one-for-one rule, but because there are simply too many of them and fewer drinkers. There are fewer than 7,000 pubs in the State, after more than a fifth closed in the past 15 or so years, a consistent trend driven by a structural changes in consumer drinking behaviour. The end of the one-for-one will not affect this.

An existing pub licence, which must be bought and then extinguished by a new outlet, costs about €40,000-€45,000 on the open market. The removal of such a significant capital cost will see more pubs open in cities, because that is where the profits are, and not in rural areas. LVA chief executive Donall O’Keeffe told me this week that he has concerns over the possible impact on his members of the end of one-for-one.

[ Miriam Lord: Taoiseach’s all-night clubbing plan leaves Mattie McGrath in a spin ]

The rule will remain in place for new off-licences, which generally are expanding supermarket chains such as Aldi and Lidl. It is this demand from supermarkets that has kept the market value for existing licences so high. Rural publicans, who supply most of the licences extinguished by new operators, may fret over the potential for the value of those permits to drop. But in all likelihood, they have little need to worry because the demand from supermarkets will remain.

For city publicans, a potentially more serious provision is buried in the legislation. Late bar licences have always been easily available to pubs and hotels. Now, it appears they will also be more easily available to premises with wine licences. That opens up the possibility that many restaurants and food/wine bars will, once food service is finished, push back the chairs and tables and morph into late bars until 2.30am.

That prospect will have many city publicans in a lather. O’Keeffe, for example, says he was “shocked” when he discovered it in the Bill, which is more than 400 pages long. The LVA seems certain to oppose that aspect of the Bill as it makes its way through the Oireachtas.

But, taken as a complete package, McEntee’s proposals have a fairly good chance of getting through relatively intact before next summer. The public health lobby will oppose the proposals, of course. But it always opposes any attempt to ease the sale of alcohol, even though consumption per head has been declining steadily for more than 20 years.

An overhaul by the Government of the muddled system for pub licensing had to happen. What took them so long?