Budget 2020: Harbour town crests the wave of tourism buoyancy

The picturesque town of Cobh has suffered many blows over the years, with the booming cruise liner business now serving as its main industry and employer, writes

Budget 2020: Harbour town crests the wave of tourism buoyancy

The picturesque town of Cobh has suffered many blows over the years, with the booming cruise liner business now serving as its main industry and employer, writes Conall Ó Fátharta

On a crisp Autumn day in October, there are few towns as picturesque as Cobh anywhere in the country — let alone in Cork.

Given its rather hilly terrain, if you put the effort in to make it up to the iconic St Colman’s Cathedral, you get a view that’s worth the lung-busting effort.

The colourful ‘Deck of Cards’ houses remind you that, even if you’ve never been to Cobh, you’ve seen it on countless adverts and postcards.

It’s one of those towns. You’ve seen it a thousand times even if you’ve never visited.

History and the sea dominate the town no matter where you go. Cobh was, after all, the last port of call for the doomed Titanic.

That history is vividly captured in the offerings like the Cobh Heritage Centre and the Titanic Experience.

Throw in plenty food and drink and Spike Island — named Europe’s leading Tourist Attraction at the World Travel Awards in 2017.

That year, it was the only Irish town recognised in the list, which recommends small towns and villagers from all over Europe to holidaymakers.

Tourism is now the key driver of a local economy that has had to adapt over the decades.

Cobh was hit with its fair share of punches to the gut over the years.

The closure of the Verolme Dockyard in the 1980s and Irish Steel in the early part of this century meant it has suffered its fair share of job losses.

It has rebounded through tourism — the major employer in the town both directly and indirectly.

This year will be a record year for cruise liners in Cobh, with 102 vessels set to have docked before the end of the year.

They will have brought with them 200,000 passengers and 80,000 crew by the end of the year.

For local businesses, it’s crucial that this trend remains on an upward curve.

But an impending Brexit and its impact here is on the minds of most small business owners in the town.

Chairman of the local Tidy Towns, Hendrick Verwey, said tourism was now Cobh’s “only indigenous industry”.

If you take the Irish Navy out of it, our biggest employer is the Commodore Hotel. After that, it would be a supermarket.

As a result, Mr Verwey said the increase in the tourism Vat rate from 9% to 13.5% in last year’s budget was a decision all local businesses were looking to see changed.

The importance of British tourists also raised the threat of Brexit to the town’s economy.

“The cruise ships that come in, the ones with the British passengers, are the days that Cobh really loves. They are the smaller ships but the British passengers spend money, they go to the pubs and they take less excursions out of the town.

“The British market is our biggest market. There’s no two ways about it so that has to be taken into account,” he said.

As it turned out, the tax rate stayed static in yesterday’s budget, though there was a bit of a concession to the tourism sector with Paschal Donohoe giving €40m for tourism specific initiatives and saying the Government “will further support the industry should a no deal happen”.

Gillen Joyce - Titanic Experience

One of Cobh’s principal tourist draws is the Titanic Experience. Opened in 2012, it charts the story of the iconic and ill-fated Olympic class liner which left from the town on her maiden voyage on April 11, 1912.

The centre was the brainchild of Gillen Joyce and his wife Sonia and is housed in the original White Star Line building in Casement Square in the centre of the town, from where the Titanic passengers boarded the tenders that brought them out to RMS Titanic.

For Mr Joyce, the key hope for this year’s Budget was that the Government would revisit the Vat rate for the tourism sector and consider dropping it back to 9%. His wish was not granted, though he might take a crumb of comfort from the Government’s financial commitment to the sector around Brexit.

“When introduced, the reduction in the amount of Vat tax raised in tourism, was offset by the increased exchequer returns as a result of increased activity and employment. Instead of trying to reduce the rates for a period of time we should endeavour to bring other Vat rates down to 9% to positively impact other sectors of the economy as well,” he said.

The potential impact of Brexit was also to the forefront of Mr Joyce’s mind given the importance of British visitors not just to Cobh’s tourism sector, but to the tourism industry as a whole.

“In relation to Brexit I would feel that a positive outcome to ongoing negotiations would be very important for the tourism sector as a whole. In the event of a no deal there will be uncertainty, but also the potential for negative tourism sentiment towards Ireland, from both the UK and other nationalities.

In addition a no deal Brexit would further exacerbate the recent fall in the value of sterling. This has made Ireland a more expensive option for UK visitors while at the same time reducing the cost of visiting the UK for both ourselves and other nationalities.

“This will result in pressure in relation to tourism numbers not only from the UK but also other nationalities as well. Put simply, international tourists may choose to visit the UK instead of Ireland. A positive outcome to the Brexit negotiations would help alleviate these potential impacts.”

Henry Crowley - Seasalt

Right across from the Titanic Museum is one of Cobh’s newest gastronomic offerings — Seasalt.

With its funky interior and food receiving rave reviews, it’s the latest sign of Cobh’s renaissance.

Owned by husband and wife Henry Crowley and Jacquie O’Dea, it opened in February and has gone from strength to strength.

The couple also owns a long-established jewellery shop in Cobh.

In a town so dependent on tourism, every business owner has the Vat rate on their minds and Henry had hoped the Government would take another look at lowering it, but realised it was a long shot. It didn’t.

“You’d like to see them reduce the Vat rate to what it was before we started up which was 9% but was pushed up to 13.5%. I don’t think it’s going to happen, obviously. That would be the hope for anyone working in this sector,” he said in advance of yesterday’s budget announcement.

Mr Crowley said although the numbers visiting Cobh seem to be up this year, there has been a noticeable drop off in British visitors.

I can see it in the shop myself. I am sceptical with regard to all these polls but I would say British tourists are just staying away completely. With the currency situation with sterling, there’s just no value there anymore.”

Mr Crowley pointed out that British tourists were the key driver of the tourism trade in Cobh as they spend more money than other nationalities and described tourism as “the heartbeat of the town”.

It’s the only thing that’s left to be honest with you. You can see the difference in the last few years with the amount of buses visiting places like Spike Island which has become a huge draw. Also, tours that have been organised coming to Cobh are now staying a lot longer than they used to. There’s a lot more to see and to do.

"The town is tidier, thanks be to God, it’s cleaner. There’s been huge progress as regards the tourism offering. There’s always ways to improve but I would say this year has been up in terms of overall numbers compared to previous years.”

Killian Tighe - The Roaring Donkey

One of the most famous watering holes in Cobh, The Roaring Donkey is located in a spot that the locals call “top of the hill”.

It stands apart — quite literally — from the hustle and bustle of downtown Cobh and judging from the reams of five-star TripAdvisor reviews from tourists the world over, is more than worth the hike up the hill to imbibe.

Killian Tighe bought the pub four years ago after a previous life as an oyster farmer. For him, any budget which would bring Ireland closer to the EU in terms of excise duty paid on alcohol would be a welcome move.

“I would hope to see that there isn’t an increase on the excise duty on alcohol (there wasn’t). In fact, it would be great to see a discount (there wasn’t) considering that the tax take is so far ahead of forecasts so far this year. But I doubt that will happen," he said.

We [publicans] pay so much more than our counterparts in Europe. The excise duty on alcohol here is like something like one thousand times higher than in some other countries in the EU..

Mr Tighe also said that, despite his pub being known for its strong local trade, it has been noticeable that the number of British tourists stopping by has dropped off.

“I’d also be hoping for some provisions to be made with regard to the impact of Brexit (there was) because British tourist numbers seem to be down this year. There seems to be an industry-wide realisation that tourism figures from the UK are down.

“We have seen it a bit but, luckily, we have a very strong local trade. During the summer, we’d have more tourists than during the winter but we have seen slightly less this year. Definitely, Brexit is something that would be on your mind as to how much of an impact it’s going to have,” he said.

The publican said that tourism is now the key driver of the local economy and that it was vital that its key offerings were protected so that the town continues to prosper.

“Tourism is much bigger in Cobh now than it was in times past. You’ve got the Heritage Centre, Spike Island, the Titanic Museum and the cruise liners, of course.”

Frank Moynihan - The Coffee Cove

Frank Moynihan is one of Cobh’s newest business owners. Having previously worked outside the town, he recently returned to run his own café — The Coffee Cove.

Located on West Beach, it overlooks the harbour and is one of the pitstops many people heading over to Spike Island make for a coffee.

Like many people working in the tourism sector, when you mention hopes for the Budget, the first thought that comes to his mind is the tourism Vat rate which he had hoped would be reduced back down to 9% or lower.

“They put a 50% increase on it from last year. It was at 9% and they put it up to 13.5%. A big thing with my business and any small business is say, for example, I buy in a sausage there’s no Vat on it. I sell it, there’s 13.5% on it because it’s cooked.

“So they are not cancelling each other out. Technically, it’s coming off my back end. When you try to explain that to customers, they don’t see that. So, if I am to up my prices, it becomes a Catch 22 there,” he said.

Mr Moynihan also took issue with the costs facing small business owners in terms of employing people.

I am new to business ownership but one thing I can’t understand is how it’s costing me so much in tax to employ people. I have got three part-time staff, none of them do a full week and it could be costing me €20 to €25 per person each week in tax. And that’s not including other taxes that they pay, you know?

“Their taxes would be on top of that and, at times, they are being taxed next to nothing as they are not earning enough. But I am still getting taxed €25 per person and, in a small business like mine, that’s huge. The alternative is that these people are unemployed and it’s costing the Government €200 a week. It would be fine for the likes of McDonalds or these big companies or whatever as they can absorb it but for me, it all adds up. It can be, in peak season €600 or €700 per month,” he said.

He is taking a wait-and-see approach to the possible impact of Brexit on tourism locally but said the sector is vital to Cobh’s future.

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