Arthur Morgan (Louth, Sinn Fein)

I thank Deputies Penrose and McManus and the Labour Party for sharing time and welcome the opportunity to discuss the Bill.

While I have many policy differences with the Fine Gael Party and Deputy Varadkar, I am pleased to note we do not differ on the legislation before us. My father used to say business was a great vehicle for binding people together and so it has transpired this evening, for the purpose of this Bill in any event.

I also welcome what appears to be a change of heart on the part of the Government insofar as it appears to have accepted the general intent of the Bill. While I do not wish to pour water on that or continue with the debate of the past two days, I wonder if the Government will be in office in six months and, therefore, in a position to take the Bill. I hope whichever Government is in place at that time will allow the House an opportunity to debate the legislation and address the issues it raises.

I also hope it will not adopt the attitude the current Government takes to amendments tabled by Opposition Deputies. On many occasions, Fine Gael, the Labour Party and Sinn Féin have offered commendable amendments which the Government has refused to accept, perhaps because it believes a Deputy from this side will suddenly appear at a Cabinet meeting. Although I do not believe that is the case, I cannot explain the reason Opposition amendments are automatically rejected. This is bad practice and a fundamental flaw in Government policy. I do not have sufficient experience to know whether this mistaken policy was adopted by previous Governments. Notwithstanding these reservations, the Government position on this Bill marks a welcome change to practice.

Bad debts cause a significant chain reaction. If business A is not being paid by business B, other companies supplying the former will have their systems clogged up by the failure of the latter to pay its debt. As noted earlier, if business A is a large company, recovering the debt is a relatively task because the matter will be placed in the hands of the company's legal department or team of solicitors which will sort out the matter in the time the courts require to do so. Small businesses and entrepreneurs, however, do not have the luxury of engaging large legal teams at significant cost to deal with these matters. The Bill is, therefore, particularly welcome in that regard.

A further consequence of not having the goods or services one provides paid for on time is that one incurs expensive overdraft charges. In the current climate, many businesses would welcome access to overdraft facilities, even with high charges, because they are being strangled. I have no doubt the telephones in every Deputy's constituency office are hopping as people facing this problem seek to contact them. I hope the legislation, when finally enacted, will help to resolve this problem. The Bill offers the prospect that a cost-effective measure will be introduced providing companies with a speedy process of accessing the courts and having debts dealt with quickly and efficiently.

Many contributors acknowledged that small and medium size businesses have always been at the heart of the economy. That is not to say that foreign direct investors are not welcome. While I acknowledge the significant role played by that sector in building the economy over decades, most of these companies have either moved or are in the process of moving to the Far East or Middle East where labour and other costs are significantly lower. Ireland will never be able to match costs in those regions and for this reason must concentrate on assisting small and medium size enterprises. This legislation marks a significant step in that direction.

I am disappointed the Government did not use more of the revenue from the boom years to further assist small and medium size enterprises, specifically in helping them upskill management and enhance export capacity. Our small and medium size sector does not have a culture of research and development. This must change and we must find mechanisms of bringing entrepreneurs and managers on board to ensure they engage in research and development practices and recognise the necessity of patenting and working closely with third level institutions.

Credit terms are a key area for small and medium size enterprises. A business supplying one of the major retail chains may experience problems because the retailer resorts to any excuse not to pay the supplier. In such circumstances, the period in which moneys are owed increases from 30 days to 60 days to 120 days and so forth. Deputies will be aware of many such cases. If the supplier complains or brings the matter to a point the retailer regards as unacceptable, the latter will simply stop taking the supplier's goods or services. The businesses of such suppliers invariably becomes dependent on large customers within a short period.

An independent office needs to be established to address this issue. The legislation addresses a slightly different problem. We should establish an independent office with a small staff of perhaps a couple of accountants and solicitors with some clerical back-up. A business facing the circumstances I have described could bring the case to the office and have it stood up in a short period of perhaps one hour. At that point, the independent office could examine the books of the large supermarket chain or other purchaser. By examining the files pertaining to the complainant and other suppliers, it could ensure the complainant is not readily identifiable and a level of anonymity is maintained. This is necessary because the more dominant the large supermarkets become, the more small businesses depend on them and the greater their vulnerability is to being abused by them. We need to be mindful of this problem. I do not advocate establishing another large agency with all sorts of bells and whistles. A small, tight and imaginative structure could be built to provide genuine protection to businesses which are being ripped off - that is not too strong a term - by large companies.

While I acknowledge the inefficiencies of the job creation agencies, I do not wish to be hard on them because circumstances have changed and they, too, will have to change. Deputy Penrose referred to the county enterprise boards, the agencies charged with dealing with businesses with fewer than ten employees. The maximum grants these bodies can provide are irrelevant in business terms and the criteria for approving such grants need to be overhauled, as the Minister will be acutely aware from debate and discussions she has had in the Joint Committee on Enterprise, Trade and Employment. Politics have never entered into the deliberation of the joint committee. While it has good and lively debates and frank and open discussions, they have always been focused on trying to achieve what is best for enterprise and business and long may that practice continue.

Reform measures are also required in FÁS, which I do not propose to attack for the failings highlighted all too often recently. The agency requires a significant overhaul. As with nurses in the health service, the recruitment ban has caught frontline FÁS staff who may not be recruited without the approval of the Department of Finance. FÁS is unable to quickly replace some of its trainers, including those who take maternity leave or retire, and this has created a backlog in some FÁS offices. That is not a criticism of the Minister of State, Deputy Calleary, because I appreciate that he is not long in the job but I raise the issue with him in the hope that it can be resolved because the knock-on effect, the bottleneck which that creates in the FÁS offices when we are trying to get people in to be trained and upskilled, is very significant. I hope that a mechanism can be found to alleviate that bottleneck and to resolve that issue as quickly as possible.

Credit is an integral part of businesses. There is a practice developing that I have noticed in some sectors. Perhaps I will explain it to the Minister of State best by using the example of the food service sector, wherein a struggling business moves from its vegetable supplier to a new vegetable supplier and leaves the old one carrying the can of €3,000 to €10,000 or whatever the sum might be. The business runs up a new debt with its new supplier and after a relatively short period of time, moves to yet another supplier. This legislation, were it in place, would eliminate such carry on because there would be a chain reaction of businesses folding, of significant bad debt, and of some businesses not being able to simply write it off and being in mortal trouble.

I accept that there are some issues with the Bill. There are certainly some amendments I would like to see appended to it. That is by the by and we can deal with them on Committee Stage as they are not significant. I hope that the court rules can be amended, as was stated earlier, to save a major piece of legislation having to be brought in to facilitate the implementation of this legislation. I welcome the opportunity to discuss the Bill here this evening and I look forward to it being discussed in six months, whether by this or another Government.

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