The Minister is very welcome. I understand the need for this Bill but I wonder how much difference this funding will make when it comes to solving the problems facing tourism in Ireland. It seems the biggest barrier facing the future of tourism in this country is hotels. The Irish Hotels Federation warned that a return to the 9% VAT rate may be needed as the hospitality industry faces very turbulent times, with forward bookings from Britain and continental Europe running below 2019 levels.
The contracting of hotels for use as emergency accommodation by Ukrainians has created unprecedented levels of hotel scarcity in the country's top tourist destinations, as attested to by the chief executive of Fáilte Ireland, Mr. Paul Kelly. A breakdown of the contracts awarded by the State reveals deals worth €337 million with 270 hotels and bed and breakfast accommodations between April and September this year. A spokesperson for the Department of Children, Equality, Disability, Integration and Youth said the actual figure is far higher because of the deals awarded in the last quarter of 2022, details of which would not be released until January 2023. Tourism hot spots such as counties Kerry, Donegal, Clare, Cork and Galway have a significant number of hotels and bed and breakfast accommodation in use by the State, with contracts ranging from €20,000 to €12.5 million. From late November to the end of the year, the Government plans to take in 11,000 more Ukrainians, bringing the total to 72,000 alongside more than 17,000 persons who have arrived here this year seeking international protection.
Contracts for 360 of the 500 hotels in contracts with the State are up for renewal this month, and the Department is expecting the majority to extend their deals. The Irish Tourism Industry Confederation said "nearly one in every four tourist accommodation bedrooms is currently being used to fulfil Government contracts and the number seems to ... [be growing week by week]". Hoteliers and hostel owners accommodating more than 1,000 Ukrainian refugees are owed millions by the State. Many have not been paid in three months and are threatening to kick their guests out onto the streets unless this issue is resolved soon.
Last month, the Department of Children, Equality, Disability, Integration and Youth, which is responsible for housing the Ukrainians, nearly all of whom are women and children, admitted to difficulties in paying people and expressed regret. One hotel owner expressed how he was owed more than €1 million. He is housing between 100 to 200 refugees and is feeding them every day. He had to borrow money from the bank so he could keep the Ukrainians on his premises. A Department spokesperson said more than 650 contractors are providing accommodation for Ukrainian beneficiaries of temporary protection for the Department of Children, Equality, Disability, Integration and Youth. The Government admitted that some providers are still waiting for payments due to a backlog but said the additional staff had been allocated to process payments to hotels as soon as possible. Really, this is the elephant in the room when it comes to tourism. How is it going to be dealt with? How does one resolve this? I sense modular homes might be involved in the solution. Where will we put these? What supporting infrastructure will be put in place around them? How will this Government manage to make it sustainable? These are the questions that need to be answered. Will the Minister provide any updates on this?
There are also energy costs for hotels, restaurants and businesses, and the tax warehousing will be up by the end of this year. Many of those businesses may just close their doors next year. There are many issues affecting our tourism trade before the end of this year that the Minister might need to address very quickly in 2023.