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Varadkar says hospitality sector is 'taking a hit for the team' as he pledges continued supports

Varadkar said a decision on financial supports will be made in the coming days.

Tánaiste Leo Varadkar.
Tánaiste Leo Varadkar.
Image: Oireachtas.ie

TÁNAISTE LEO VARADKAR has said the hospitality sector was “taking a hit for the team”, as he told the Dáil that the government may consider more targeted supports for businesses.

Varadkar, who is also Minister for Enterprise, told the Dáil today that the Employment Wage Subsidy Scheme (EWSS) costs the state about €400 million a month and that most companies availing of it were not in the hospitality industry.  

Varadkar said a decision on financial support for the hospitality sector and other businesses will be made in the coming days, with Finance Minister Paschal Donohoe also saying that the EWSS could not continue indefinitely. 

In recent days, several politicians and business groups have called for cuts to the EWSS to be reversed and for increased supports for hospitality businesses. 

With a curfew of 12pm remaining in place on the night-time sector and the public encouraged to ration their social contacts, many hospitality businesses are reporting widespread cancellations ahead of Christmas. 

Speaking in the Dáil today, Varadkar said that bars and restaurants have been the “hardest hit” during the Covid-19 pandemic. 

“In many ways that sector that’s been the worst hit, the hardest hit and longest hit is now once again taking a hit for the team and that’s why we need to support them and that is why we will,” he said. 

Varadkar added, however, that most businesses availing of the EWSS were not in the hospitality business:

I would point out to the house though that the Employment Wage Subsidy Scheme costs €400 million a month. It’s the biggest intervention in the Irish economy since the banking guarantee, and a much better one by the way, but a huge one nonetheless. And most companies in receipt of the Employment Wage Subsidy Scheme are not in the hospitality, entertainment, arts, events or aviation sectors. So if we’re going to do something it does need to be targeted and that’s what we’re working on.  

Speaking earlier in the Dáil, Varadkar said the government was waiting on the advice of the National Public Health Emergency Team (NPHET) before making any decisions on reviving financial support for struggling sectors.

NPHET is meeting today and is expected to discuss whether any fresh measures are required to stop the spread of Covid-19 ahead of the Christmas period.

Responding to a question from the Social Democrats’ co-leader Catherine Murphy TD, Varadkar said: “Once the government has received advice from NPHET, the government will consider that advice and make a decision on its implementation.”

The government will have to make decisions on the Pandemic Unemployment Payment and EWSS.

“It is prudent to see what the advice is and how that will impact people and businesses,” he said. 

If it’s the case that people end up being laid off, or being made redundant over the course of the next few weeks, and I’m not saying that’s going to happen, of course we’ll need to respond to that.

“It wouldn’t be fair to say to them, some of them being laid off potentially for the second or third time, that all we have for you is the traditional job seekers’ payment.”

Murphy told the Fine Gael leader that businesses had already seen the effect of public health advice calling on people to reduce their level of socialising.

“People heeded that and heeded it in their droves. They have been cancelling Christmas parties and going to events,” she said.

This was going to be the month that was going to help them through the lean months of the new year. There needs to be targeted supports for these particular sectors.

“We can’t afford to lose them, but they can’t afford to keep the doors open either.”

Business group IBEC today called on the government to “urgently step up financial supports for organisations within the experience economy”.

Ibec CEO Danny McCoy said: “While business recognises its role in supporting the suppression of the Covid virus, such compliance has meant that the experience economy has borne the brunt of the devastating economic impact of Covid.

It is clear that the latest concerns around Covid have seen consumers grow more cautious and many businesses have seen a collapse in their bookings for the crucial revenue-generating festive period.

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Finance Minister

Speaking separately to reporters in Dublin’s north inner city today, Finance Minister Paschal Donohoe said  that €414 million was spent on the EWSS in November alone and that it must end at some point.  

“When it is safe to do so, we will continue with our efforts to adjust and then at the right point to end the Employment Wage Subsidy Scheme,” he said. 

“It is a programme of huge impact but it was launched at a time of a risk of mass unemployment and what we will do is review where we are from a public health guidance point of view and then the government I’m sure very shortly will make a decision about what is appropriate in the coming months.”

- With reporting by PA

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Rónán Duffy

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