A Dundalk pub and restaurant owner laid out the “huge challenges ahead” this winter, as gas and electricity bills soar.
Donal McGeough, owner of the Windsor bar and restaurant revealed that he was quoted an increase in monthly gas bills from €1,900 to €8000.
“The monthly electricity bill was on average €6000, but the new rate they are giving me would see it go up to €12,000. That’s just unbelievable really, I don’t know how businesses are meant to cope with these hikes,”
“We have a big premises here, there are a lot of fridges and chilled areas that need to be kept going constantly, so we are heavily reliant on energy to keep the place running.”
He added that warnings around government plans to increase the VAT rate for hospitality back up was “a real worry.”
In 2020 the rate was slashed from 13.5% to 9% to help pubs, restaurants and hotels cope with the drop in business associated with the pandemic. Now, the soundings are that the rate may go up in the budget.
"It feels as if we are being hammered on one end by the massive energy bills, and then VAT. It’s a double whammy.”
He said the hospitality sector “included very different businesses, pubs and restaurants, which can’t keep changing the price of food and drink, and hotels which can increase the cost of rooms.”
He admitted that passing the costs on to customers "isn't something we can realistically do either.”
"We just can't keep putting the price of a pint or a steak up, our customers wouldn't, or couldn’t pay it. If Garth Brooks is playing this weekend, hotels can increase their room rate, responding to the demand there, but other parts of the hospitality sector just don’t have that option.”
Any suggestion, he adds, of closing the pub for a few hours every day to reduce costs “just don't stack up.”
"Because we are in the food industry, so many of our storage facilities can’t be turned off, so closing the place for a while during the day doesn't change that.”
"It is actually cheaper, we have been advised, to keep our heating on at a lower rate even overnight and throughout the day, than to turn it off entirely and then have to heat a large building like ours back up again when we reopen.”
He called on the government to step in “with some meaningful assistance” for businesses.
"I am hoping that they do what they did during Covid, through the payroll system which was very successful, and maybe bring my wage bill down. so that I can pay these huge energy bills.”
With a difficult few months ahead, he says “We might be changing our Covid signs from ‘Please wash your hands’ to new stickers inside reading ‘Keep your coat on!’