600 rural pubs have shut since 2004, say vintners

Almost 600 rural pubs have closed over the past two years, the Vintners' Federation of Ireland (VFI) said yesterday. Federation president Séamus O'Donoghue pointed out that this was the equivalent of almost one pub every day. He said that spiralling overheads, including "exorbitant local authority charges", were a key factor.

"We have seen post offices and shops closing down in many rural areas and now we are afraid the same thing is happening pubs," said Mr O'Donoghue.

Speaking at the opening of the federation's agm in Sligo yesterday, he said rural pubs and the business community at large were struggling to cope with local authority charges which were "spiralling out of control".

Membership of the VFI dropped from 6,031 in December 2003 to 5,434 in December 2005, which Mr O'Donoghue pointed out was a drop of 10 per cent.

He conceded there were varying reasons for the unprecedented number of closures - such as retirement or publicans opting to realise the value of their licences or property.

Research by the VFI has established that 500 pubs have been sold, while about 100 have simply stopped trading.

"Many small rural pubs simply could not survive against these spiralling overheads," the VFI chief insisted.

Mr O'Donoghue said in a substantial number of cases the site was regarded as more valuable than the business, and former pubs were being developed as apartments or office buildings.

The smoking ban and changes in lifestyle have been factors with more people opting to drink at home, said the VFI.

Research by the Drinks Industry Group of Ireland (DIGI) has established that 27 per cent of VFI members have a turnover of less than €1,200 a week, which Mr O'Donoghue said was the equivalent of €600 profit. Just over 50 per cent have a turnover of less than €4,000 a week, leaving a profit of €2,000, but Mr O'Donoghue said mortgage repayments, wages and other overheads were paid out of this.

It was true that some publicans chose to realise the value of their assets, he said, but "the point is that there was time when the next generation would try to carry on the business but, increasingly, this is not happening," he said.

Local authority charges are now running at four times the rate of inflation and have had a huge impact in the past two years, said Mr O'Donoghue.

A study undertaken by Ibec for the period 2004 to 2005 showed that waste collection charges had increased by 23.2 per cent, local authority charges by 20.5 per cent and water charges by 21 per cent.

The VFI said the cumulative average inflation over the same period was 4.8 per cent.

"The figures don't stack up and it is becoming increasingly difficult to maintain a viable business in such a difficult economic environment," said Mr O'Donoghue.

"Annual water rates have continued to soar and are now unsustainable," said the Portlaoise- based publican. He maintained that the latest move by Cork and other county councils to charge for waste water leaving a premises as well as water going into a premises was "grossly unfair and anti-business".

"The business community is being held to ransom and the Government must look at introducing a more equitable regime that will enable rural Ireland to compete and stay in business," said Mr O'Donoghue.

The VFI's research showed that Co Cork lost 74 of its 920 pubs from December 2003 to December 2005.

The number of pubs in Co Clare dropped from 304 to 261, while Galway lost 57 of its 490 pubs in the same period.

At the lower end of the scale, Longford lost 14 of its 91 pubs, while the pubs in Co Leitrim dropped from 88 to 79.