Mr. John A. Moran:

I thank the committee for inviting us to address this really important topic. SME Recovery Ireland is an umbrella platform. It has sprung up to give small businesses and the 1.5 million people relying on them a strong voice during the Covid emergency.

Many of the principles that we use are of general application. I am here as chair and I am joined by Mr. Derek Foley Butler, founder of this initiative, and Ms Jean McCabe, who is a small business owner because we think it is really important that all of these conversations include the voices of actual business owners.

The committee already has our submission and has seen the plan so I can move fairly quickly. As I said, we are endorsed by some 26 industry bodies that have come to support the plan since it was first published in April. Five local authorities have also come behind the messaging in the plan and its measures. The most important message that I would pull out of the whole thing is as follows. Everybody is aware that SMEs across Ireland are dying at the moment. They need an urgent bailout of, we reckon, approximately €15 billion that involves an immediate cash injection of €6 billion, which is a much larger number than has been talked about in the past. This is required so that businesses would be restructured. The money needs to be given to them as grant aid and not as debt. We learned some lessons from the last crisis and we can talk about the importance of not having too much debt.

At a macro level I would mention that we cannot be afraid to spend this money. Unlike the last crisis we are now in a position where we can borrow and we need to use that borrowing on the most valuable choices for us. Dr. Stephen Kinsella has already addressed the committee. He went into this matter in some detail and explained how important investment is as opposed to things like structuring, wage support and the rest, and that investment is more useful. We would say that saving and investing in SMEs is now an investment to save the jobs in that sector. It can also be used, and should be used, to modernise the SMEs and create new jobs for the 21st century. That is the way to pull us out of the recession. There is no point in waiting. Perfection is the enemy of survival for many of these firms and we cannot wait. The July stimulus package presents an opportunity to introduce a scheme like ours to recapitalise firms, depending on the severity of their losses. The most important thing is that it needs to be fair, fast and done easily, for which we have recommended the Revenue Commissioners. The most important thing is that cash gets out quickly and in large amounts.

As I mentioned at the beginning, it is not a question of asking the academics like Dr. Kinsella and others or, indeed, us, one must ask the SMEs. By that we mean also small firms, not just big industry and their representatives because only they really understand on the ground what will save us. They have told us for the last couple of months that they need cash and not more mountains of debt.

The support package of the Government was announced as €6.5 billion only two months ago, built up in iterative pieces. The figure was based, because of the legislative vacuum of having no Government and an Oireachtas, on another crisis - the Brexit measures - where there was time to plan and gauge viability. We are saying that has not worked. In fact, the numbers show that only €100 million of cash has been disbursed in Ireland while across Europe there have been percentages ranging between 12% and 15% of GDP being disbursed to save industry. We need to move quickly to reallocate and change those schemes but base them on a pandemic, which has recognised that 34% of firms have closed completely and 85% have had their activities significantly restricted.

What worries me most, having been around for the last crisis, is that I do not think that the State is getting ahead of the problem and it is patching up. I do think we have a handle on the cost of the problem and the extent of the crisis, and I do not want to see us make the same mistakes again.

Our principles are very simple and are as follows. SMEs are critically important to the fabric of Ireland right across our rural communities and in our cities. We need to recapitalise them with a large amount of money. We think that is €15 billion, which we can debate later, with €6 billion released immediately as equity. We also need to give SMEs a boost to demand. What has been different is that for the last couple of months we have argued that we want this done as grants and not as debt. That is following what our European counterparts have done. Even up in Northern Ireland there are grants of £25,000 readily available to firms while our firms are looking at numerous pages of an application form. We are saying we need to move quickly and recognise the importance of the sector like what was done in the programme for Government but time is rapidly running out and we need to see urgent action. The members, as elected representatives, probably understand this as much as us, and realise that these businesses breathe oxygen into local communities. These businesses are the ones that support the local GAA teams and buy tables at charities. We need now, in a similar spirit of solidarity that they showed by closing their businesses to protect us, to act to protect them.