Willie Penrose (Longford-Westmeath, Labour)

The Minister of State is aware that up to 250,000 small and medium-sized enterprises provide 800,000 jobs. While foreign direct investment is important for Ireland, small and medium-sized enterprises are the lifeblood of most areas, particularly rural areas. Is the Minister of State aware of people's concerns of a significant drain on the retail sector that will take place after Christmas? I am talking about the real businesspeople who I meet in towns and villages.

In the past, banks lent irresponsibly to builders who now cannot pay. The banks are squeezing other borrowers relentlessly to increase their reserves. Viable small and medium-sized enterprises are threatened by the unwillingness of the banks to lend. It is not because these businesses are at a risk of failure, but because the banks are desperately trying to attract deposits rather than give loans. These are profitable small and medium-sized enterprises which do not have the money to pay creditors.

Is the Minister of State aware that some businesses are afraid to take on too many creditors in case they are charged with reckless trading. The Minister of State, Deputy McGuinness, would know of this. If a trader takes on credit and cannot pay for it down the line, he or she will have to answer questions somewhere else under company law. There is a great fear among small and medium-sized enterprises that they could be charged with reckless trading in such cases. That is why credit is important to them. They are profitable businesses but they will be squeezed out of existence.

Access to the €15 billion in funds from the European Investment Bank came into operation in September. It is now nearly Christmas, three months later, and the banks still have not tapped into this fund. Why? Has any Minister asked the banks why? Is it because the banks will not get enough in management and banking charges? Will the banks deprive small businesses of the opportunity of survival? The financial institutions guarantee was given by the Dáil. What was asked in return? That the banks would save our 250,000 small and medium-sized enterprise by ensuring enough liquidity and cash to go around for them to meet their day-to-day commitments. It is time for the Minister for Finance and the Tánaiste and Minister for Enterprise, Trade and Employment to call in the banks to tell them they have a role to play as active participants in getting us all over this economic hump.

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