The Bulgarian Hotel and Restaurant Association (BHRA) has issued an angry and lengthy statement in response to the government’s proposed measures to support businesses closed under stricter measures against Covid-19, describing the measures as “inefficient, ineffective and insufficient”.
The stricter measures approved by Bulgaria’s Cabinet, that take effect at 11.30pm on November 27, include closing restaurants and bars for three weeks.
“The death of tourism has already been announced. We are waiting to see if we die of Covid-19 or from starvation,” the association said in a media statement.
The shutdown of restaurants and bars as of November 27 is similar to measures that were imposed for several weeks after Bulgaria declared on March 13 a State of Emergency because of Covid-19.
“In recent months, no real anti-crisis policy has been pursued and the necessary measures have not been taken to support tourism, which is a structural factor for the Bulgarian economy, while the taxes and insurances we pay in better times directly contribute to 10.3 per cent of GDP.”
It dismissed the measures proposed by the government as relief as “a show that something is being done without any real benefit from the actions”.
“The proposed 24 leva (about 12 euro) per day as assistance for workers in closed businesses is absolutely insufficient and demotivating. To see for yourselves, we suggest that politicians, (Cabinet) ministers and officials try to live on 24 leva a day.”
The BHRA said that according to the measure, employees left without a livelihood against their will or their employers’ will receive three leva per hour for each working day.
“This is extremely insufficient because salaries in the sector are different. Some people receive, are insured on and pay taxes at eight hours a day at 800 leva, and others at 2800 leva. That is, it is more profitable for these people to lose their jobs and receive compensation on the labour exchange according to the funds they have contributed to the treasury for many years together with their employers.”
It said that the proposed amount of 24 leva day is smaller than the current 80:20 payroll support measure. That is, in the difficult situation into which the business is forced, the aid for it was in reality reduced, BHRA said.
“This ‘support’ is valid only as long as the establishments are forcibly closed for the next at least three weeks. However, not enough help is provided for self-employed people and nightclub staff who have lost their livelihoods much earlier,” BHRA said.
It said that there was talk of help of 15 to 20 per cent of the turnover of closed businesses to support them.
“However, this is extremely insufficient for businesses that have not been able to operate at full speed for nine months, and some actually have been closed most of the time.”
All the proposed measures lead only to one logical step, to reduce staff.
“In this way, thousands of people will remain on the streets, businesses will go bankrupt,” BHRA said.
“Twenty-four leva per day for the professionals in the restaurants in the resorts is an absolute mockery. A chef usually has a salary and insured income of more than 2000 leva. This person pays for accommodation in the resort for the season and eats at his workplace (which is now closed), has a family to support himself, loans and achieves at least some middle class standard because he is a serious professional,” it said.
“Those people who have conscientiously paid taxes and social security contributions cannot survive on 24 leva a day.”
The same goes for food and beverage managers, general managers, salon managers and more qualified and trained staff who will be irretrievably lost to the business.
“And again we will talk about measures to import staff from abroad, while unemployment in our country is growing,” the association said.
“With all the proposed ‘measures’, the government is actually quietly reducing aid to businesses, hiding behind high-sounding speeches and secret negotiations with certain circles convenient for them.”
It said that while Health Minister Kostadin Angelov’s order did not actually close hotels, in effect their work was halted because they were not allowed to open their restaurants.
“Hotels have reservations for upcoming holidays such as St. Nicholas Day and December 8, which fall within the banned period for restaurant operation, as well as for the remaining days of these three weeks. And of course now they have to reimburse their customers. Because no one takes a holiday without food and eating in his room,” BHRA said.
It said that because seasonal hotels operate only for three months, they cannot meet the requirements for medium-sized enterprises, although they have the corresponding turnover and employees, but only for a short period in which they are open.
“Companies that have invested millions of leva in this way do not have access to EU programmes and state aid. Hundreds of thousands of people in resorts and cities are threatened by misery, but they are not negotiated about, the authorities are not interested in their problems and do not seek to solve them.
“And while on the capital’s Vitosha Boulevard home delivery may help some of the restaurants, such a measure cannot be implemented for restaurants in resorts, hotels and other cities. Because there are simply no people willing to deliver this food.
“Entire municipalities depend on tourism, and the state’s abandonment of the problems of the people living in them is genocide and could be even more deadly than Covid-19,” it said.
Closed seaside hotels did not receive any real support, and nor did the prospects for winter hotels, BHRA said.
“This form of zero support and even 100 per cent neglect of the issues raised by BHRA leads to the total collapse of an entire sector in the economy. And this is not a problem caused by Covid-19, but a systemic and long-standing one for the tourism industry,” it said.
“No one supports or wants to understand and manage the problems of real tourism – holiday hotels, restaurants, attractions, tour operators, tour guides, ski lifts and other tourist resort infrastructure. In this way, the Cabinet neither helps hundreds of thousands of people, nor preserves at least what has been achieved in the sector, nor will it gain any political support and approval.
“The goal of leaving the industry to natural selection in the crisis and its complete dependence on social benefits and heavy loans from banks is clear,” BHRA said.
“The members of BHRA received no support for their request for assistance for rescheduling loans, for a moratorium on amounts due to banks, for granting liquidity quickly and on favourable terms, for survival of its partners – tour operators, tour guides, music performers, etc etc, about the continuing lack of e-visas, about the insufficient infrastructure in the resorts and places next to them, about the zero advertising of Bulgaria, about the lack of visa-free or facilitated and cheaper regimes with Russia, Turkey, etc, about the legal problems with the status of resorts, the lack of support for vocational training in the sector by the state, the problems and legal irregularities for investment in new lifts, while allowing construction in restricted areas and national parks, the lack of any national planning of the bed base, the failure to resolve the problems of intergovernmental restrictive issues, of the aviation industry and solving the problem with Plovdiv airport, about the zero advertising of city tourism.”
In the nine months since the beginning of the crisis, nothing had been done to provide timely medical care and quarantine hotels for tourists in the resorts, BHRA said.
Hospitals, not only in the resorts, but across the country were unprepared, despite experts’ predictions of a return of the virus in October.
“As a result, we are not only closed to the world as an insecure destination, but our loved ones are dying,” the association said.
“BHRA is adamant that our patience with the measures proposed by the Minister of Economy and of Social Affairs has run out. And if we do not see a clear desire from the Cabinet for change and real help for business, the only choice that BHRA members and their employees will have is to take to the streets and demand the resignation of all those who do not take vital measures for the sector to survive.”