Half of all restaurants in Ireland will close unless the government intervenes with an emergency grant aid package worth £1.8b, the Restaurants Association of Ireland has warned.
The announcement follows the release of a report investigating the impact of not supporting the restaurant sector. The report, prepared by Jim Power Economics, found that the accommodation and foodservices sector has been seriously damaged by the pandemic. It sets out an eight-point recovery plan that includes turnover-based rent, extending the 85% wage support beyond August and eliminating VAT for the restaurant sector.
Economist Jim Power said: "The restaurant sector has been impacted in a devastating fashion by Covid-19. Once it reopens, the trading environment will be extremely challenging as a result of social-distancing requirements, various health protocols, the absence of overseas visitors and consumer nervousness.
"It is essential that the restaurant sector gets the maximum possible support from government to get the sector through the difficult times ahead. The cost of such support would be far outweighed by the cost of doing nothing, in terms of job losses all over Ireland, closed businesses on the streets of towns, villages and cities all over the country, and the damage to Ireland's tourism offering."
He added that the restaurant sector is a major employer in Ireland and is an "essential element of economic and social life and arguably the most important component of Ireland's tourism offering".
Restaurants Association of Ireland chief executive Adrian Cummins said the report was "damning evidence that our sector needs support measures put in place immediately by the government."
He said that their members were saying that a 50% staff layoff is "inevitable" without financial support and that they estimated almost 50% of restaurant businesses will shut their doors if the government does not intervene.
The report has calculated that the cost of not supporting the restaurant sector would cost the exchequer around €2b (£1.7b) in increased social protection expenditure and up to €500m (£445m) in lost payroll taxes if 100,000 workers were to remain unemployed for a year.
Last week The National Tourism Development Authority of Ireland, Fáilte Ireland, revised its guidelines for the reopening of pubs with changes to seating times, social distancing and contact tracing ahead of reopening on 29 June.