Budget 2027
Dail Éireann — 2026-05-20
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Peter 'Chap' Cleere (FF), Carlow-Kilkenny

The Vintners’ Federation of Ireland, VFI, AGM took place last week at Mount Wolseley in my constituency. The message coming directly from publicans is that rural pubs are under enormous pressure. Closures are accelerating year after year. Since 2005, more than 2,200 pubs have closed across the country. More worrying again is that the rate of closure is increasing, with approximately 128 pubs closing every year.
We have to be honest about what that means for rural Ireland. When a pub closes in a village or small town, we are not simply losing a business premises or a commercial enterprise; we are losing a meeting place and a venue for traditional music, fundraisers, sports clubs and community gatherings. In many communities, we are losing the last remaining social space where people can come together. For older people in particular, the local pub often acts as an important defence against loneliness and isolation. In many areas, it is one of the last functioning community hubs left standing. Rural pubs are not just businesses. They are part of the social infrastructure of rural Ireland.
Despite that role, many publicans face what the VFI describes as an existential threat to their survival. The cost pressures they are dealing with are extraordinary. Electricity costs have risen by 70% in the past five years, alongside insurance and every other operational cost facing small businesses. It is important to note that the restoration of the 9% VAT rate for food service is very welcome and will undoubtedly provide essential support for many hospitality businesses. However, the reality is that many smaller rural pubs do not serve food and, therefore, cannot meaningfully benefit from that measure. In fact, the VFI estimates that two thirds of smaller rural pubs are excluded from the benefit of the reduced VAT because they are traditional drinks-only establishments.
That is why the VFI proposal for the on-trade sustainability scheme deserves serious consideration ahead of budget 2027. It is a targeted, capped and structured tax credit proposal that is aimed specifically at supporting smaller pubs that are struggling with rising costs and declining viability. The proposal will provide support linked to verified draught product supply costs, with a cap of €20,000 per premises, ensuring the support is proportionate and targeted towards smaller operators. Importantly, there is a precedent for this type of support within Government policy. We already provide tax credits to support film and television production, digital gaming and unscripted television production.
This is about rural sustainability, protecting local employment, supporting tourism and maintaining social cohesion in communities that are already feeling under pressure from depopulation and loss of services. The OECD recently highlighted the importance of community infrastructure and social spaces in sustaining rural communities and local economies. The GAA has warned about the erosion of rural social infrastructure and specifically identified the loss of pubs as contributing to declining community vibrancy. This issue goes well beyond one sector. It is fundamentally about whether we are serious about protecting rural Ireland and the communities that sustain it. Will the Government seriously examine the VFI’s proposed on-trade sustainability scheme ahead of budget 2027 and recognise that protecting rural pubs is ultimately about protecting rural communities?

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Record URI: https://data.oireachtas.ie/akn/ie/debateRecord/dail/2026-05-20/debate/main
Retrieved: 2026-09-28T05:50:47+00:00
Sitting date: 2026-05-20