The IHF President believes that the measures taken to date fall “well short” of addressing the significant challenges being faced now by businesses.
“Safeguarding public health is our absolute priority but this must go hand-in-hand with ensuring we have a viable economy after this crisis has passed,” she stated, “Decisive action is needed now to save large parts of the economy and the future livelihoods of hundreds of thousands of people, including 260,000 jobs in tourism and hospitality.
“One of the lessons learnt from the financial crisis was the requirement to act extremely quickly so that large parts of the economy are not obliterated, with long-term consequences,” she continued, “Cashflow is the killer of businesses in crises like this. The IHF is calling on An Taoiseach Leo Varadkar and Minister for Finance Paschal to implement measures that will assist with cash flow now as well as reducing the rates of VAT and PRSI and arrangements for the deferral of these payments. We also call on the Government to waive local authority rates until this crisis is over together with the introduction of direct business supports including finance and marketing assistance.
“The Department of Transport, Tourism and Sport with Ministers Shane Ross and Brendan Griffin have recognised the deep crisis facing the tourism, hospitality and leisure sectors and sought Government agreement for urgent assistance that would have eased cash flow pressures. The Government must safeguard this essential indigenous industry,” she concluded.
Her statement follows the publication of a joint plan to support business and personal customers by the banks yesterday after a meeting between the Minister for Finance Paschal Donohoe TD and the chief executives of Ireland’s five retail banks (AIB, Bank of Ireland, KBC, Permanent tsb and Ulster Bank) along with their representative body the Banking & Payments Federation Ireland in order to set out a joint-plan to support the thousands of businesses and employees across Ireland impacted by the Covid-19 pandemic.
The five retail banks will introduce measures to help businesses and personal customers and they’re also working collaboratively to ensure that continuity of service plans are in place, that critical functions can continue and that staff remain available to continue to service customers at this time.
“The banking and payments sector is fully committed to working together and collaboratively to ensure provision of branch and payment services during this challenging period,” stated the Banking & Payments Federation Ireland.
“These are exceptional circumstances in which people now find themselves and we believe they require exceptional measures,” said the BPFI’s Chief Executive’s Brian Hayes, “The banks are moving urgently to introduce measures that will best support businesses and personal customers impacted by the Covid-19 crisis. They will also require the full support of key stakeholders in order to make it happen,” he added.
The measures are as follows:
- implement a payment break of up to three months for business and personal customers affected by Covid-19, to be followed by ongoing reviews depending on the scale and extent of the situation. Customers wishing to avail of a payment break should contact their respective bank
- the banks agree there is a need for a simplified application process to make it as easy as possible for businesses and personal customers impacted by Covid-19 to receive support from their banks and they’re working with all member banks to achieve this
- the banks want to ensure that any Covid-19 application for a payment break and further reviews will not adversely impact the customer’s credit record and the banks’ reporting of these facilities. Banks want to avoid this and are meeting with the Central Bank of Ireland to urgently achieve a solution in this regard
- banks will also defer court proceedings for three months
- the banking system stands ready to provide working capital support
- the BPFI has had initial discussions with credit servicing firms and with those non-bank lenders who provide mortgages. Both have issues which need to be addressed with the Central Bank of Ireland but both are committed to working with the Government and industry to provide the flexibility that people need right now”.
“Priority must be given to ways in which our collective action can support individual customers, families, businesses and communities across the economy during this time,” said Brian Hayes following the meeting, “As the situation evolves, there will be a requirement to further address changing needs across the economy and the banking industry is ready to respond promptly and with agility.”
He said banks are also extremely conscious of the particular challenges which vulnerable customers may face at this time and are committed to ensuring that the well-established policies and measures in place continue to serve their needs.
“We will play our part at this critical time,” he concluded, “The banking sector will support our customers and the economy and work to protect the safeguards built up within the banking system in Ireland over the last 10 years including capital, liquidity and operational resilience. We will also work to ensure our economic sustainability beyond Covid-19.”