Tourism businesses are still staring into the abyss despite the announcements on the replacement for the furlough scheme – the Job Support Scheme and its further expansion in the case of local restrictions.
This additional support announced by the Chancellor has done nothing to address the very real challenges faced by tourism and travel businesses who have seen demand decimated due to the impact of the UK Quarantine system, the impact of implementing social distancing and hygiene protocols and increasing restrictions which are chipping away at consumer confidence to plan trips.
The vast swathe of businesses who make up the tourism economy have been at the forefront of the economic impact from Covid-19. For the majority of businesses reserves have now gone and reduced revenues are not covering outgoings and overheads. The requirement for businesses to bring staff off furlough to work a minimum of 33% of their hours and to pay a minimum of 55% towards employee wages isn’t viable and will result in large scale redundancies and business closures.
These businesses were only able to operate three months out of a normal six month peak season, and have not been able to make up the loss of income caused by the lockdown, additional Health and & Safety Covid costs, travel restrictions and the impact on operational capacity.
We continue to see this impact through the announcement of more redundancies, most recently from National Trust and Hillsborough Castle. In addition, we face the potential closure of some of our privately operated key tourism assets which are the main attractors for visitors and demand generators for the wider tourism economy.
Tourism businesses are an important part of our regional economy creating compelling reasons for people to go to different regional destinations, providing experiences that are good for mental health and wellbeing as well as generating local income streams and supporting much needed local jobs. Over 70% of visitor spend is from outside of Northern Ireland and in 2019 this is estimated to have been around £700m which is new money into our local rural, coastal and urban communities supporting local businesses and jobs.
In addition, tourism supports the thousands of self-employed and micro businesses who provide quality and authentic experiences for visitors. The Self Employed Income Support scheme has left people on the breadline and the announcement that this support is being reduced to 20%, just as we head into the Winter season, has left them with nowhere to turn.
The industry has worked hard with consumers and partners to reschedule travel and holiday plans to 2021, has financially invested to implement measures to be Covid-19 secure and provide packages and experiences tailored to the home markets in order to maximise the significantly shortened peak season. But with the growing number of local restrictions on businesses and the ever increasing travel restrictions (domestic and international) tourism businesses have seen demand continue to decrease and without visitors the tourism economy is on hold. Yet, as tourism businesses are not legally required to close, they cannot avail of the extension to the Job Support Scheme.
The NI Executive have allocated funds to support the marketing efforts of Tourism NI and Tourism Ireland, but as tougher restrictions on travel and movement across our home markets and the potential introduction of more severe restrictions locally and the impact this is having on consumer confidence, tourism businesses have seen demand decimated.
The NI Executive and the UK Government must recognise the fragile state of tourism businesses in Northern Ireland and across the UK and act now so we will be in a position to rebuild and play our part in the regional economic recovery.