Mr. Gerard Brady:

I agree with everything Mr. O'Brien said. At European level, a lot of things could be done around a capital markets union in particular which would help Ireland as a small market with a banking system that experienced a lot more trauma in the past ten years than did the systems of other countries which have large mature markets and better general access to capital.

In particular, we have a very small equity market and, when it comes to seeking funding, our companies are among the most reliant on bank lending in Europe. In particular, they are more reliant on overdraft and short-term lending than companies in any other country. They rely on very short-term and, therefore, very expensive lending, which is a massive issue.

Part of it is improving the tax treatment of some of the equity pieces. At the moment, there is a hearts-and-minds piece in that a lot of Irish companies are unwilling to move this way as they have not traditionally had to give up equity. As any business owner will say, equity is blood and it is at the core of their business. We should make the tax treatment of giving up equity and buying into the equity of companies much more attractive. Currently, half of businesses that start up in Ireland fail within five years. As such, it is very risky to invest in a business. Unlike other countries, we do not have a large pool of mature investors who are willing to do it, which is why we probably need to make EIIS, in particular, more attractive. One of the biggest issues we are coming up against at the moment is that the administration of the scheme is taking so long. There have been changes in the administration of the scheme which have made it uncertain, on top of the uncertainty of buying into small businesses in particular. There are risks there which need to be recognised and there is a mindset change that needs to come from business. It is not just on the political side but on our side too to try to improve the attitude towards equity. It is about improving the tax treatment of that funding mix to get people away from it. Even if that is simply short-term improvements which give a shock to the system to get people to change their attitudes, it would be very welcome.