Conference told of jobs potential in hotel sector

AN ADDITIONAL 20,000 jobs could be created in four years in the tourism industry despite the current difficulties, delegates at the Irish Hotels Federation annual conference in Co Cavan will be told today.

Some 400 delegates will hear federation president Paul Gallagher claim that prospects could be improved by a government prepared to invigorate the industry.

In advance of the conference Mr Gallagher said “a pro-business ‘can do’ approach” could deliver the jobs by 2015. But he said specific action must be taken to address the lack of credit facilities and cost of energy.

He called on the incoming government to establish a “reconstruction and development bank” or a special banking division within one of the State-controlled banks to address the sector’s problems.

He also urged the new government to undertake a review of the Commission for Energy Regulation to result in lower energy prices.

Hoteliers see a guarantee scheme similar to that in operation in the UK, where at least 50 per cent of qualifying loans to viable businesses are guaranteed, as being a potential solution to the credit squeeze. Borrowers would pay a premium of about 2 per cent to support the scheme.

In relation to high energy costs the conference will hear last year’s energy levy has resulted in additional average costs of €7,000 per annum being imposed on individual hotels.

The federation maintains competition in the energy market should have resulted in lower prices, but up to now this has not been the case.

Details of an industry survey undertaken by the federation, which are to be distributed at the conference, will show local authority rates and wage-and-utility costs are the most pressing issues affecting their businesses.

The views of 180 hotel owners and general managers were canvassed and revealed 84 per cent of respondents were concerned about the viability of their business in 2011. Some 46 per cent reported a reduction in overall business, compared to last year, while 33 per cent reported an increase and 21 per cent indicated no change.

Federation chief executive Tim Fenn said half of all respondents indicated they had experienced difficulties accessing standard credit facilities from their banks during the last 12 months while 28 per cent indicated their banks had reduced their normal overdraft facility amount.

However, while trading circumstances continue to be difficult, hotels and guesthouses expressed a more positive outlook for their businesses in 2011 compared with a similar survey in March 2010.

Mr Fenn welcomed the announcement of Queen Elizabeth’s visit to the Republic later this year. He said the visit alongside a possible visit by US president Barack Obama would create “massive awareness worldwide” for the tourism industry.

Mr Fenn said that with Britain being the key source of tourists for Ireland the visit of the queen was a “positive development”.