The impending sale of the Great Southern Hotel group has provoked a predictable response from the usual quarters. Local politicians are concerned about the damage to regional economies, workers are understandably worried about their jobs and a wider constituency prepares to mourn the passing into history of another great national institution.
While these are important issues, they do not negate the fact that the sale of the hotel group is necessary. The business as currently structured is not sustainable and risks becoming a drag on its parent, the Dublin Airport Authority, which has more than enough on its plate at present.
The decision to put the company up for sale does not, however, guarantee its future. Early indications are that the most likely buyers are interested only in parts of the group - and for some the underlying development value of the hotel properties is the main attraction.
The sale is also unlikely to offer much comfort to the group's 660 full time employees, who enjoy some of the best terms and conditions in the industry. Anybody buying one or all of the hotels with a view to continuing in business will have to bring costs and facilities into line with the rest of the sector. Competition is intense, both within the four star sector and from the budget chains.
The number of hotels in the four star sector has more than doubled since 1998. Not only are many of them of a higher standard than the Great Southern estate, they have fewer and less well paid workers. The Great Southern hotels need fresh investment totalling €80 million and significant restructuring to have even a chance of remaining competitive. This is not going to happen under state ownership.
While the commercial case for a sale is overwhelming, it is clear that there is a reluctant acceptance of this in Government circles. Some Ministers are clearly against the initiative and the Taoiseach is as ambivalent as ever. The worst possible outcome for the company is that it would now enter the limbo occupied by Aer Lingus. There, the argument for selling has prevailed, but with little appetite for action. Aer Lingus's strong financial position offers it some protection while the Government dawdles, but the Great Southern group enjoys no such luxury. Indeed it runs a real risk of insolvency.
Having indicated tactical support for the sale, the Government should now put constituency considerations aside and follow through with action. Specifically it should not attach any conditions aimed at ensuring the group continues in its present form, but under different owners. To do so would only postpone the inevitable.