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ITAA Fights for Industry Survival in Joint Oireachtas Committee Hearing, Asking for a ‘Bespoke Response’

ITAA Fights for Industry Survival in Joint Oireachtas Committee Hearing, Asking for a ‘Bespoke Response’

The ITAA met with the Joint Oireachtas Committee on Transport and Communications Networks today and its opening statement laid out in stark terms the unprecedented difficulties currently being faced by the travel industry. Led by ITAA CEO Pat Dawson and Paul Hackett of Click & Go, the delegation’s opening statement outlined all of the issues that have left the industry effectively unable to trade and how current financial supports don’t go far enough to alleviate a crisis that shows little sign of getting better in the immediate future.

Paul Hackett & Pat Dawson going into the Dail

Addressing the committee, Paul Hackett said, “if  NPHET  and  the  Government  want  to  close  down  international  travel  for  a  year  they  need  to  put  in  place  the  appropriate  level  of  supports  if  they  want to have an Irish travel industry when international travel can safely resume.”

“We are a unique  sector; we have had to remain open to clients to facilitate refunds with practically zero income for  almost two years. The travel sector needs a bespoke response, a specific support as a consequence  of being closed on public health grounds linked to international travel.” – Paul Hackett

The statement also outlined the issues with the current levels of support, including the Employment Wage Subsidy Scheme (EWSS).  The scheme is available to all businesses whose turnover is down at least 30 per cent, the statement read, but for the travel sector, the fall off in trade is closer to 90 per cent for 2021 and potentially up to 100 per cent. “The  maximum  EWSS  payment  in  a  full  year  is  €18,200,” Mr Hackett said. “Whilst  not  for  one  minute  being  ungrateful  about  the  wage  subsidy,  how  many  people  do  you  know  earn  €18,200  in  a  full  year?  There is no visibility on wage supports after 31st March.”

The statement also took issue with the limitations of the COVID Restriction Support Scheme (CRSS), which only applies at Levels 4 and 5 of lockdown, and is not a grant but an advanced tax credit. Arguing that while on the surface a maximum threshold of €5,000 per week might seem reasonable for a business whose annual turnover is less than €4 million, the CRSS doesn’t cover non-payroll costs “to any material extent” for companies who trade above that level. ” This is a retail-focussed assistance and does not cover all Irish licensed travel companies,” it read.

“CRSS doesn’t support a downturn in business and is directly linked to the levels in  the COVID framework but clearly travel agents are prevented from trading, irrespective of the levels  and have been since March 2020.”

The statement also called for a reform of the Refund Credit Note (RCN) scheme more in line with that adopted in countries like Denmark, the Netherlands, Portugal and Bulgaria. They made the argument that it was “introduced with a  9‐month  delay  on  the  assumption  that  the  industry  would  be  back  trading.  Clearly  this  is  not  the  case.”

In their statement, the delegation explained that “a significant number of refunds to customers for cancelled flights are outstanding” and asked for greater government assistance in tackling the problem of “one particular airline” and its refusal to engage with the travel trade over refunds. It also asked for greater clarity in dealing with the problem of so-called ‘ghost flights,’ when airlines operate flights contrary to government advice. Finally, the statement questioned the dithering over the introduction of pre-departure airport testing and the efficacy of the vaccine rollout, saying it “does  appear  that  we  are  lagging  well  behind [other countries]  in  getting  the  vaccine  into  the  arms of our citizens.”

In the follow-up Q&A session, Paul Hackett replied to a question by committee member Duncan Smith (LAB) saying, “We made submissions last year to every committee…but we were ignored. If we don’t support this industry there won’t be an industry. It’ll be managed out of the UK.”

After the session, ITTN’s managing director Sharon Jordan spoke to Paul Hackett in an exclusive interview.

 

 

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