Issue link: https://maltatoday.uberflip.com/i/706995
maltatoday, SUNDAY, 24 JULY 2016 10 News lowcostholidays.com collapse Maltese hotels licking their wounds maltatoday, SUNDAY, 24 JULY 2016 MHRA calls closed-door meeting to discuss ramifications with hoteliers affected, biggest concern on how to fill beds in slow season PAUL COCKS A number of Maltese hotels were left reeling from the collapse last week of Low Cost Travel Group (LCTG) – one of Europe's larg- est early bed-banks and a mid- level online travel agency – with the possible local financial fall- out in the millions of euros. Over 450,000 British tour- ists visit Malta every year, and a good percentage of those are booked through agencies like Low Cost Travel. In a statement uploaded on its website on 15 July, the com- pany said that it had ended its activities following "exhaustive attempts by the group's direc- tors to rescue the group, which has been hampered by the recent and ongoing turbulent financial environment". All the beds and room reserva- tions that Lowcostholidays and Lowcostbeds had pre-booked in Malta were invalidated follow- ing the collapse of the company, leaving the hotels scrambling to find fresh bookings to fill their rooms and beds. Andrew Agius Muscat, CEO of the Malta Hotels and Restau- rants Association (MHRA) told MaltaToday that a number of Maltese hotels had been hit by the collapse of LCTG. He said that the association had invited hoteliers affected by the group's collapse to a closed-door meeting on Friday to discuss the possible ramifications for Mal- tese hotels and the island's tour- ism industry. During the meeting, which saw a considerable turnout, it was agreed to gather all relevant data to be able to determine exactly how – and how much – Maltese hotels would be affected. "While this data is still being collected, we are going to work with the members involved to decide on how to start address- ing the issue and the local fall- out," Agius Muscat said. Sources in the industry told MaltaToday that the biggest problem was not getting the beds and rooms filled in the peak season, as the bookings would probably still come in from other avenues. The major concern for Mal- tese hotels would be selling the beds and rooms during the slow seasons, especially winter, since many of the hotels affected used to depend on LCTG pre-buying the beds in bulk, albeit at re- duced rates, to sell on to its cli- ents later. There are quite a few Mal- tese hotels that were affiliated with Lowcostholidays, includ- ing: Sunny Coast Resort Club, Il-Palazzin Hotel, Qawra Point Holiday Complex and Clover Holiday Complex in Qawra; Gil- lieru Harbour Hotel and Am- bassador Hotel in St Paul's Bay; Pergola Club Hotel & Spa and Solana Hotel & Spa in Mellieha; Hotel Argento and St Julian's Bay Hotel in St Julian's; Bay- view Hotel & Apartments and The Diplomat Hotel in Sliema; Sunseeker Holiday Complex and The Blue Sea Bugibba Hotel in Bugibba; and the Comino Hotel. Administrators Smith & Wil- liamson revealed that at the time of the company's collapse, there were 27,000 Lowcostholidays customers currently on holiday and 110,000 who had booked trips but were yet to depart. About 55% of the group's cus- tomers were British. The administrators said that a bond in place for €1.3 million was enough to pay out only a few pounds to each customer in compensation. Expecting "very substantial" claims from about 140,000 ag- grieved holidaymakers, the ad- ministrators warned that pooled compensation was unlikely to be more than 1%-2% per claimant – potentially less than £10. Among those stranded were scores of tourists who were al- ready on holiday in Malta and who were left in the dark as to the state of their holidays. The group's collapse was be- ing partly attributed to a lack of reserve funds and currency fluc- tuation, which causes huge diffi- culty for the travel industry. Hotels are usually not paid un- til pretty close to the arrival date of the party. So Low Cost Travel Group found itself in the night- mare scenario of having British clients who paid in full for their holidays in pound sterling back in January or February, but itself having to pay the hotels when the sterling had dropped 10% since the UK's EU referendum on 23 June. Many travel agencies hedge their bets a little in regard to guessing what the currency will be at when it is time to pay the hotel. That is one reason why one can get several different prices for the same hotel room when searching online; the different sites would each be guessing a different currency rate. Agencies with enough reserves would be able to cover a loss such as that registered by ster- ling in the past month. Low Cost Travel Group obviously did not have enough reserves. The UK's Civil Aviation Au- thority (CAA) had already issued a warning back in 2013 advising holidaymakers to avoid booking with LCTG following its reloca- tion to Spain. The move meant that bookings with the group were no longer protected by the Air Travel Organisers' Licensing (ATOL) scheme, which protected cus- tomers who purchased package holidays and flights from partici- pating tour operators. This protection ensures that customers are able to return home and receive a refund if a company does collapse. Delimara plant still needs environmental permit Final permit to be awarded after public meeting and 30- day public consultation, but Environment and Resources Authority has set no date for approval of project JAMES DEBONO THE Environment and Resources Authority is processing the Integrated Prevention and Pollution Control (IPPC) permit for the operation of the new ElectroGas power station at Delimara, but is not yet in a position to set a timeframe for its approval. The power station consists of a massive Floating Storage Unit anchored off Delimara, linked to an onshore regasi- fication plant which will operate on liquefied natural gas, considered as a cleaner alternative to heavy fuel oil. The IPPC will require the presentation of technical doc- uments addressing safety issues. A spokesperson for ERA confirmed that "the IPPC per- mit shall be in place prior to commencement of opera- tions" and the authority shall be taking a final decision at a meeting held in public, following the conclusion of the public consultation and a period of discussion with the operators on the permit conditions. The ERA spokesperson also confirmed that all the rel- evant documentation shall be made available for review and comments by the public and following which, ERA shall be taking account of submissions received, "thereby ensuring the accountability and transparency of this de- cision-making process and contributing to public aware- ness of environmental issues". But a spokesperson for the ERA did not reply to ques- tions on when ERA will commence the 30-day public consultation period and when a final decision is expected to be taken. In December 2014, when conceding that the new power plant would not be completed, as promised, by March 2015, then Energy Minister Konrad Mizzi had promised Parliament that it would be up and running by June 2016 at the latest. In May the government said that the power plant should be working "in the summer months". Installations like power stations and large chemical plants have to obtain an IPPC permit from the Planning Authority to be allowed to operate. The permitting pro- cess ensures that these plants make use of the "best avail- able technology in their operations". The IPPC assesses the whole environmental perfor- mance of the plant, including matters like emissions into the air, water and land, generation of waste, use of raw materials, energy efficiency, noise, prevention of acci- dents and risk management. The processing of an IPPC permit requires the submis- sion of a number of documents according to legislation in this field, primarily the European Union's Industrial Emissions Directive. Qawra's 'highest hotel' seeks permit JAMES DEBONO A 12-storey hotel with 204 beds is being proposed instead of the existing 3-storey Seaview Hotel along the Bugibba coast oppo- site the waterpark. If approved the hotel will be- come the highest in the area, surpassing the 10 storey high San Antonio Hotel. Qawra is one of five locations where over-10 storey buildings can be constructed. A recently approved policy also exempts hotels from heights set in local plans, allowing two extra storeys over the number allowed by the local plan on any existing hotel and an unlimited number of floors for standalone hotels. Isaac Vella, who owns the ex- isting hotel is also seeking to widen a tunnel underneath the public road to provide vehicular access to the hotel's basement from the seaside. Plans also envision the lay- ing of 50 sunbeds on the public beach opposite the hotel. The application also foresees changing the use of two existing boathouses to store beach furni- ture. The new hotel will have two basement floors of car parking, two levels of hotel facilities and services at ground floor and 12 floors of bedrooms.