DELICATE BALANCE BETWEEN PROTECTING HEALTH AND JOBS

THE human cost of the state-wide move to Level 3 restrictions is already clear. Many employers in hospitality, tourism, the arts, entertainment and other services had to contact their distressed staff yesterday to tell them their jobs are on the line. Some will never return.

Those workers are among the real victims of the Covid-19 pandemic, not the wounded pride of experts from the National Public Health Emergency Team (Nphet), whose advice to the Government was rejected this week.

Their recommendation of an immediate Statewide move to Level 5 prompted a stinging response from Tánaiste Leo Varadkar, who claimed the team had failed to think things through. Predictably, opposition parties rounded on him, but were not clear on what they would have done.

A resetting of the relationship between the Government and Nphet was overdue.

With no end to the pandemic in sight, there is a delicate balance to be struck between protecting our health and reopening society. Chief medical officer Dr Tony Holohan may yet be proven right in his assertion that a graduated approach will not work. The Government’s decision, on the other hand, will be vindicated only if greater adherence to the rules and more effective policing bring down the R number without having to resort to Level 5. Going to the highest level of restrictions would have been very costly, even with cheap money available to borrow. Loans have to be paid back.

Some sectors of the economy were already badly affected when Ireland suffered one of the largest falls in household spending in Europe during the lockdown earlier this year.

The Economic and Social Research Institute reports today that the domestic economy has been severely hit, with areas such as construction, hospitality, arts and recreation experiencing some of the largest declines in Europe. (There were lockdown-resistant sectors as well: exports from multinationals in computer services and pharmaceuticals increased relative to 2019.)

Tourism is the most obvious casualty. The sector supported 260,000 jobs last year and was worth €9bn to the economy. Most of that came from overseas tourists, a rarity this year. The domestic market contributed about €2bn of last year’s total, but much less this year.

It was hardly surprising that 13pc of tourism businesses reported at the end of August that they had ceased trading, and that last month just over half said they were operating at less than 50pc capacity.

The sector is not helped by Level 3 restrictions, which already applied to Dublin and Donegal and oblige people to stay in their own county.

The extension of Level 3 came on the same day that the Tourism Recovery Taskforce issued a report on how to revive the sector. It has a long list of recommendations that would cost many millions of euro to implement. Tourism is not the only sector looking for urgent assistance in next week’s Budget. But there will have to be a financial reckoning some day.

Distressed workers are among the real victims of the Covid-19 pandemic