IT’S pretty obvious that we are now in a state of economic peril. There is no light yet, just the ordering of more tunnel.
It was laid out in stark terms last week by research and insights agency CGA who crunched the numbers to show that since 2019 the total loss in trade value to pubs in Northern Ireland is in the region of £233 million. That is a frightening number for a sector which has previously generated so much for the economy.
Closure is upon the hospitality sector in Northern Ireland. The rises in energy costs, food prices, staff shortages, supply chain issues and consumer inflation have struck us like a lightning bolt.
I hear stories every day about the end-game situation we are in. The reality was laid bare recently by North West hospitality leader and vice-president of the Derry Chamber of Commerce, Selina Horshi who spoke on the radio vividly about the tripling of energy costs within her business. The clarity she brought to such an issue should sound the loudest alarm bell within government locally and nationally.
The hospitality sector is run by some of the best people. Yes, through the pandemic there were various levels of support, but now we find ourselves cast adrift. Government support for the hospitality industry here needs to large and fast.
The cost-of-living pressures which have been highly impacted by the massive hike in residential energy costs also means that any disposable income people once had to go out for a pint, a meal or a local weekend break has now sadly been obliterated as household income is immediately redirected.
Businesses cannot simply pass on cost pressures to the consumer. They don’t have it to spend, despite it needing to be as much as a quarter more on top of what people pay now.
We are getting it from both ends. A one-off payment or grant isn’t going to stimulate or pump prime the sector’s recovery, this is now about actually pulling some economic levers on rates, VAT and energy. A comprehensive package needs to be put in place until the end of the financial year to give those with any chance some hope. Without a range of measures there will be thousands of job losses not seen for some time.
The focus now must be on the new Prime Minister and what decisions come out of Number 10. It’s clear that there needs to be rapid intervention and that Northern Ireland needs to be a priority as we find ourselves in a terrible situation with no Executive.
Colin Neill is chief executive of Hospitality Ulster
