MHRA boss says utility bills ‘crucifying’ hoteliers

The Malta Hotels and Restaurants Association (MHRA) survey for this year's second quarter showed that compared to last year, tourist arrivals went up by 3.6%, bed nights went up by 11.4% and tourist spending increased by 7.7%.

The association's president Tony Zahra said this demonstrates a reversal of the negative results registered in the first quarter of the year and added that the third quarter "seems to be very good."

However he called on government to lower utility bills and decrease VAT in order to help the industry reverse the negative trend registered in the last four years.

Explaining that the positive results achieved so far are the result of the good work by the Malta Tourism Authority (MTA), the tourism ministry, hoteliers and all other stake holders involved, Zahra warned that more must be done for the forthcoming winter months.

"The big question is quarter four. We are in talks with MTA and Air Malta about increasing the seat load factor and increasing accessibility to Malta in the winter and shoulder months," Zahra said.

He explained that the number of seats will not be increasing this summer however if the seat load factor is pushed up it will benefit the hotel industry and the airlines.

Zahra also said that despite the increase in arrivals, bed nights and expenditure, costs have also increased. At this point, he passionately urged hoteliers not to panic and resist calls to lower their rates.

"Do not give in to the demands by agencies asking for lower rates. Keep steady, tourists will arrive and all stakeholders are working hard to increase the number of arrivals," Zahra said.

The MHRA boss added that his previous pleas not to lower rates were vindicated by the results achieved so far this year.

Zahra pointed out three areas which will help the tourism industry reverse the negative trend which afflicted the industry since 2009. Apart from increasing the seat load factor in winter and the shoulder months, Zahra called for a decrease in VAT and utility bills.

"Hoteliers are crucified by the utility bills. The matter should be solved at a national level and should not be treated as a political issue. I have warned that if we do not get it right, Enemalta can drag Malta to Greece's levels," Zahra said.

He said if utility bills are decreased by 4c/Kw the industry will be spared up to €6 million.

On VAT, Zahra said this should be revised to 5% from the current 7% rate on hotels and restaurants. Such a measure would save the industry up to € 20 million and such funds could be used to refurbish hotels, Zahra said.

"We are not making ourselves very popular but this is our job," Zahra added.

In a parting shot to the government, Zahra lambasted the state of the roads in Malta and said: "The situation is hurting the industry. Some parts of government are shouldering their responsibilities, however some other parts of the government are not."

Bureaucracy was another target of Zahra, saying "bureaucrats have hoteliers by the neck," claiming that it takes ages for hoteliers to obtain permits and approvals.  

While urging Air Malta to increase its non-EU destinations, since the company is restricted by the European Commission's restructuring plan, Zahra announced that during the MHRA general meeting in November, Air Malta and a mystery airline will participate. The meeting will discuss accessibility and sustainability.