THE ORGANISATION FOR pubs outside the greater Dublin area has said rural pubs are facing an “existential threat to their survival” unless targeted government supports are introduced.

The chief executive of the Vintners’ Federation of Ireland (VFI), Pat Crotty, said closures are “accelerating and cost pressures continuing to mount”.

VFI has said over 2,220 pubs have closed since 2005, with the closure rate hitting an average of 128 per annum in recent years.

Crotty remarked that a pub is “more than just a business” and that when a rural pub closes, the community “loses a social anchor”.

Speaking on Newstalk Breakfast, Crotty said rural pubs have changed with the times to survive, but that in recent years, the government has “broken the model” and “made it impossible to continue to work successfully”.

He added that this has been “exacerbated” this year by a rise in energy costs.

The VFI has called for a new “On-Trade Sustainability Scheme” – a tax credit linked to the supply cost of draught products.

The organisation said the proposed scheme would be capped at €20,000 and “is designed to support smaller pubs in particular”.

“Under current arrangements, the TV and film industry can avail of tax relief when filming in an Irish pub, while publicans themselves receive no equivalent support,” said Crotty.

“A tax credit per keg purchased would pass muster with Europe, as well as current Irish financial law, and would give the necessary relief to small publicans so they can actually plan to stay in business.”

The government reduced VAT for the food-led hospitality sector to 9% in the most recent budget – a move that will come into place in July – and while Crotty welcomed this, he said close to two-thirds of rural pubs do not serve food and therefore do not benefit from this.

“The change in VAT for people who sell food was an indication at last that government accepts they’re a part of the problem,” Crotty told Newstalk.

“Well, they need to accept that they’re a part of the problem here too, it’s the same problems for traditional Irish pubs but there’s no relief for them.”

The VFI noted that pubs support local employment and tourism but added that many are “now at breaking point, driven by significant cost increases and an absence of targeted relief”.

Crotty said there is “no capacity left to absorb further cost increases” and added that smaller, rural pubs that don’t serve food are particularly vulnerable.

Elsewhere, a recent VFI member survey showed that over 40% of publicans are reporting that trading conditions are now worse than 12 months ago.

Meanwhile, two-thirds say rising costs are having an “unsustainable impact on operations”.

“Government policy should recognise that pubs are essential social and cultural hubs, particularly in rural communities,” said Crotty.

“Irish pubs are recognised around the world as a defining part of our cultural identity. We must act now to protect them, and the people behind them”.