The Executive has been told it needs to invest in hospitality or its Tourism Action Plan will take twice as long to deliver due to pressures faced by the sector.
The Chief Executive of Hospitality Ulster, Colin Neill, has warned that the 10 year plan could take 20 years if the hospitality sector is expected to invest its own money to deliver it and that it can't be done without additional funding from the Executive. He said the industry is already struggling and will be under further pressure later this year when the new National Insurance Contribution legislation is put in place for employers.
Last week, Economy Minister Conor Murphy, launched a Tourism Vision and Action Plan to grow the sector over the next 10 years with the hopes that overenight visitors will spend £2 billion a year by 2035. However, the hospitality sector has warned it needs support from the Executive if it is going to be a success as many businesses are struggling fiancially.
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Colin Neill has said the plan "won't be worth the paper it is written on" without urgent action to address problems for the hospitality industry and called for reform of business rates, a reduction in the VAT rate and an exemption from the ETA scheme for NI from Westminster.
He said: "Having met today with the Minister of Finance Dr Caoimhe Archibald MLA and officials from the Department for the Economy, who stood in for Minister Conor Murphy MLA, Hospitality Ulster is compelled to warn that if the hospitality sector is expected to invest its own money to deliver upon the Executive's 10-year tourism action plan, then the Executive must also put funding on the table. Without much-needed support, the action plan could take as long as 20 years to deliver as hospitality businesses are forced to reduce staff or close, depriving Northern Ireland of the tourism infrastructure upon which the action plan is built.
"While we know that finances are tight in all areas, the hospitality industry stands to be especially affected by the forthcoming changes to Employer National Insurance contributions and wage rates due to the fact that we were uniquely affected by the coronavirus >Covid and cost of doing business crises, through which we received no support, unlike our counterparts in Britain and the Republic of Ireland. In this context, the upcoming cost increases will simply be the straws that break the camel's back. The Executive itself is facing a £100 million increase in the National Insurance contributions it pays, but the difference is that this increased cost can be taken down budget; the region's hospitality businesses do not have that luxury.
"Without the delivery of an interim support package for hospitality from the Executive in the short term, and the total overhaul of the business rates system in the long term, and a reduction in the VAT rate for hospitality and exemption from the ETA scheme for NI from Westminster, the Executive's tourism plan will not be worth the paper it is written on. The hospitality sector is fully supportive of the action plan and committed to delivering upon economic growth, a fact that both Minister Archibald and Murphy have acknowledged, but this growth cannot be delivered when conditions are forcing our businesses to contract. Hospitality accounts for four in every five tourism jobs in Northern Ireland; without the delivery of these supports, there will be no tourism growth to speak of."
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