Thousands of pub owners could end up defaulting on their mortgages in the coming months, according to the organisation representing Dublin publicans.
The Licensed Vintners Association (LVA) claims that once the six-month moratorium on mortgage repayments put in place by the banks in March expires later this month, many publicans will still be unable to afford to repay their loans.
As a result they will technically be deemed to be in default, the LVA says, a designation that could damage their credit rating.
Publicans are annoyed at the decision by the Government to delay further the reopening of pubs that do not serve food due to the level of Covid-19 still circulating in the community.
They are also disappointed with the package of supports announced last week by the Government to assist the pub sector, where these so-called "wet pubs" have been closed for six months.
The LVA has criticised the measures as "paltry" and a "token gesture".
It points out that pubs closed for six months are receiving the same level of assistance from the State as businesses in Kildare that were forced to close for a month due to the reimposition of restrictions following a spike of virus cases.
The vintners association said it has discussed the mortgage default issue with the banks, who have confirmed the breaks cannot be extended further.
"We are massively concerned that the decisions made by the Government and NPHET last week are going to drive thousands of pubs across the country into mortgage default," said Donall O'Keeffe, Chief Executive of the LVA.
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"Firstly the Government and NPHET has once again stopped these pubs from opening their doors, so they have no income coming into the business. On top of that they announced a paltry, token gesture of a package which offers next to no support to these businesses."
The LVA claims that only a tiny amount of the €16m package of assistance announced by the Government will actually be made up of grant aid for closed pubs, which is what they need.
"Most of these are small pubs who are in the lowest licencing band and they will be due a total of an extra €1,600 in grants," said Mr O'Keeffe.
"By next Sunday, when they will have been closed for 25 weeks, that will be an average of €64 extra per week of closure. It does not come near to covering the costs facing these businesses, who are closed by order of the Government."
