Stars in agony

Worldwide, budget hotels continue to outperform four- and five-star properties. Combined with low-cost airlines, budget hotels are driving tourism growth around the world as they are more in line with the requirements of today's travellers who are taking shorter and more frequent holidays so they want to spread their budget for travelling and cover at least three or four trips whereas before they travelled once.

While budget hotels around the world, including top European cities, are doing well and their prospects look even better, three-star hotels in Malta and Gozo are suffering badly and struggling to fill their beds. More of them will be going out of business, as they are not viable any more.

Our three-star hotels so far make up a third of our tourism industry. The Deloitte survey for 2005 shows that occupancy levels in three-star hotels fell by more than two per cent. Their operating profits fell by 20 per cent. Their energy costs with the new water and electricity surcharge are pushing them to the limit. Business for them has been particularly bad these last five months. Their room rates are lower than they were in 2002. While in 2001 three-star hotels obtained Lm866 profits per room, they obtained Lm675 in 2005.

Our three-star category feel not only ignored by Government and the Malta Tourism Authority (MTA). They also feel that they have been treated with contempt as if they were inferior and an embarrassment to our country and tourism industry. Rather than being encouraged and helped financially to upgrade their standards, they were told to move up to the four- and five-star category as if that alone would ensure their viability and guarantee Malta becoming an upmarket destination when the country remains so shabby and its environment so degraded! All tourism destinations that are doing well in the world today have a good mix of budget, four- and five-star properties so that they can cater for a range of travellers.

The PN government's contemptuous attitude towards the three-star category has been more the result of snobbery than of good tourism policy! Over the years those running three-star hotels tried to organise themselves and engage Government but they feel they made little headway. An action plan drawn up a three-star action committee three years ago was aborted as the action committee failed. The new initiatives being taken now by the Malta Hotels and Restaurants Association (MHRA) to revive this sector should be nurtured and supported tangibly, not just with words.

Reviving this sector

These hoteliers have grown tired of voicing their concerns over the same issues time and time again. They want action before it is too late. They want Government and MTA to help them market this sector. They need help to train and improve their employees' skills. They need assistance to improve their product and services.

They need MTA to create the demand for more people to want to visit Malta and Gozo. They need Government to take the necessary steps to introduce low-cost airlines to Malta in a well-managed way. It does not make sense to persuade people to visit Malta and then they decide to go elsewhere as it is too expensive to fly to Malta. Three-star hotels and guesthouses cannot afford to bring tourists by paying for their flights and giving them free accommodation.

They would like Enemalta to be more understanding and relax the pressure it is exerting on them to pay their utility bills within 45 days, especially as they have had such a bad winter. They cannot understand why Government and Enemalta have not used the hedging and other instruments to buy fuel at more favourable prices so that the surcharge would not be so unaffordable. Some of them also expect Government to help them install alternative energy equipment like solar energy panels to lower their dependence on Enemalta.

Three-star hotels based in the Bugibba/Qawra zone also complain of the shabbiness and lack of cleanliness of the area. There is only one warden to catch people dumping in the area! In Sliema they point to the parking problem, the timeshare touts and the overflowing sewage in The Strand. Hoteliers want proper enforcement of safety and health regulations in the construction industry and would like not to have tourism zones remain building sites all the year round with a lot of dust and noise pollution disturbing their clients.

In its policy to rejuvenate our tourism industry, the Labour Party is paying particular attention to the plight of three-star hotels. The Labour proposals include a strong marketing and promotion campaign for this sector, incentives to improve their facilities, funds to innovate their product and services, the creation of schemes to help upgrade their management and train their staff.

Three-star hotels would also benefit greatly from Labour's decision to draw up a national strategic plan in tourism where three-star hotels play a prominent role along with four- and five-star properties. Another important MLP proposal which should help three-star hotels is the reduction of taxes and the creation of a more business-friendly economic environment.

Labour believes that three-star hotels are indispensable for the country, as we need the necessary volumes of tourists to have more people in jobs and to ensure that our islands regain their viability as a tourist destination and enough traditional and low-cost airlines and tour operators want to bring people to Malta and Gozo.

evaristbartolo@hotmail.com