Refugee over-reliance on hotels is a slow-moving train set to crash in 2023 – The Irish Times

The government has inflicted immeasurable pain on itself and the tourism industry over the state’s reliance on the accommodation sector – hotels and B&Bs – to house refugees from Ukraine and elsewhere. More than 40,000 tourist beds are now used to house impeccable people who had come to Ireland seeking refuge from war, persecution and other misery. Yet it is difficult to see how this can be sustained without causing significant economic damage in 2023.

The figures suggest that more than one in five of all tourism berths are currently off the commercial market because they are used by the state for refugees. Outside of Dublin, it is closer to one in four. Removing such a large portion of the industry’s accommodation capacity will seriously disrupt the market during the winter, leading to high rates and frequent bottlenecks in availability.

Related businesses that rely on tourists, such as local attractions and restaurants, could come under serious pressure in some regional locations as they have no state refugee benefits to fall back on

However, that is little more than an inconvenience. The real pressure will come in March next year, when the international travel season kicks off again and many hoteliers and B&B owners will try to end their agreements with the state and return their bedroom stock to the commercial market. If they don’t, they will throw away their own income for the year because of lost tourism.

Meanwhile, ancillary businesses that rely on tourists, such as local attractions and restaurants, could come under serious pressure in some regional locations as they have no state refugee benefits to fall back on. This will be especially the case in the numerous tourist towns along the Atlantic coast, where many refugees spend the winter. It will certainly test local sympathy for refugees from Ukraine and elsewhere.

Government and business must face the inevitability that some hoteliers will soon choose to ask refugees to leave their accommodation. But where to?

This week we got a taste of what’s to come. According to local Sinn Féin TD Eoin Ó Broin, about 200 refugees, including 83 children, staying at the Ibis hotel in Clondalkin have been told to move within two weeks. The uncertainty must be terrible for them. With about 250 hotel companies currently signing temporary contracts to rent rooms to the state for refugees, there could be plenty of stories like the Ibis Clondalkin’s every week in the spring.

There is no evidence of any state plan for what lies ahead. It seems to epitomize the cliché image of a slow-moving train accident. The government may not have a clear plan in place because it does not have the resources or the ability to do so. The unavoidable fact of the acute shortage of all types of accommodation in the state makes this a tough nut to crack.

The tourism industry lobbyists have put down a marker. The Irish Tourism Industry Confederation (ITIC) released a report this week calling on the state to cut the current reliance on hotel and B&B rooms for refugees by around a third. This suggests that even in the unlikely event that no more refugees arrive to be accommodated in tourist accommodation, the state will still have to find alternative beds for more than 10,000 people over the next four months.

Impossible

Very simple, that’s impossible. The government has nowhere else to accommodate people coming from Ukraine and other countries. Modular homes cannot be built fast enough to handle the potential outflow of hotels, and the idea that factories and office buildings could be quickly ‘repurposed’ into suitable accommodation for refugees may sound good on local radio, but it is imaginative.

Winters in Ukraine are cold. Many houses have been destroyed. Any escalation of the conflict, which seems possible at any moment, could trigger a renewed flow of refugees to the West

Not only is the number of tourist beds allocated to refugees unlikely to fall below 30,000, as the industry wants, but it seems more likely that demand will actually increase in the winter. Winters in Ukraine are cold. Many houses have been destroyed. Any escalation of the conflict, which seems possible at any moment, could trigger a renewed flow of refugees to the West.

Next spring, all hell will break loose as the reality of this dilemma fully hits both industry and government. ITIC claims that if the number of refugees rises by 30 percent, which is not beyond the realm of possibility, up to €1 billion could be lost to the tourism industry in displaced income. That is a very round number, and useful for lobbying. But even if it’s not entirely accurate, it’s true that significant damage will be done.

West and South West tourist towns such as Killarney, Westport, Bantry, Doolin, Ballyvaughan and Clifden are among those most exposed to what lies ahead. These cities are among the most visited by American tourists, who spend more on supporting businesses than visitors to any other market. If American tourists can’t make hotel reservations in these cities, they won’t come to Ireland at all.

Tender documents from the Department of Children and Integration, which is responsible for housing refugees, suggest the state pays mid-range hotels €135 per room per night for full board in Dublin, on a single occupancy basis. In limited circumstances it pays up to €145. Fares outside Dublin are lower. There is an additional charge of €25 for each additional adult or child in the room.

It can be a good thing for some hoteliers in winter. But the most recent industry data from research firm STR shows that turnover per available room in Dublin in September was €203, for example. It’s only a matter of time before more hoteliers cancel their temporary refugee contracts.

The tourism industry has been disrupted by the needs of the state for three years now. It had to be sacrificed to fight the public health emergency of the 2020 and 2021 pandemic. This year has been quite a year, but now the reality of the refugee crisis and how it is eating up tourism capacity bodes ill for 2023. Throw in the endless and damaging wrangling over tourism’s 9 percent VAT rate and the prosperity of the industry has been a gift from politicians for far too long. It must be released.

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