Hotel industry being hit by local authority rates and NAMA

As Chairman of the Irish Hotels Federation in Mayo and General Manager of the McWilliam Park Hotel in Claremorris, Fergal Ryan represents the county and its 40-plus hotels at a national level, attending monthly meetings with other representatives from around Ireland.

Top issues of concern at the moment, according to Fergal, include local authority rates, which amount to €100,000 for a standard hotel, and unwanted competition from the so-called NAMA and bank-owned hotels, offering cheap rates to achieve volumes.

“Even in the boom times the local authority levy was exorbitant but now it is just prohibitive”, said Fergal. “We already pay separate charges for sewage, electricity and water so there isn't even any benefit to us from these rates, they just fund the councils. This charge has remained the same even though every hotel has had to review its cost base by at least 30 per cent to 40 per cent. If they don't do that, they just won't be in business.

“As for the hotels now owned and managed by the banks, these need to be looked at as the very low rates are causing unfair competition. Examiners should be there to ensure there is no below-cost selling conducted as this will decimate the industry”, he said.

Such pressures additionally contribute to the problem of building the tourism industry, Fergal asserted.

“We are trying to promote tourism but it's these costs outside our control that are making the industry stagnate in the county. Since 2008 there's been a drop of 30% in business and it will get worse if these costs persist. The thing is, when it comes to the recession, the one thing we can re-energise immediately is the tourism business because it is an export business. But we have to get local authorities and the Government to look at it from this perspective - that when hotels can thrive so too can pubs, shops and entire towns once we get foreign travel into the county. At the moment most inward travel coming into this area through Knock Airport from UK destinations such as Leeds, Manchester and Bristol, have onward destinations identified and booked. There is also a huge UK visitor drop-off in Ireland whereas it is only a slight drop to continental Europe. That just shows the emphasis is wrong here. Bringing people to the west of Ireland, promoting our towns, this is what matters.

“It is also vital that the departure tax of €10 is removed because even if people fly in just for lunch they will easily cover that €10 on VAT costs alone. Anything that prohibits people coming in must be removed. Knock is working very hard to be a regional airport so that people will come to stay in Mayo but if we don't get people onto those planes, Knock won't be there in the future.”

The Hotel Federation group in Mayo meets once a month at a different hotel each time.

“This month's meeting is at our hotel, The McWilliam Park, which gives us a nice opportunity to showcase our facility. We have a fairly strong agenda and forum, made up of experienced people in business from the county. We thrash out ideas and try to solve problems and then I bring that agenda once a month to Dublin for the national meeting.”

Is Fergal hopeful about the future of the hotel industry in Mayo?

“We are anxious for the future but still remain upbeat about our prospects. If good decisions are made at a national and a local level then we can re-energise and re-invigorate the tourism business in the Mayo and the west of Ireland as a whole.”

 

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