James Bannon (Longford-Westmeath, Fine Gael)

I thank my colleague, Deputy Leo Varadkar, for proposing this important Bill. I have seen too many small businesses go to the wall due to cashflow difficulties not only in the midlands but throughout the country. That is a shame and an indictment of the Government. I fully support the Bill's intention of putting in place mechanisms to assist local small businesses to survive in the interest of regional and national economic recovery.

According to a recent survey by ISME, 96% of small and medium enterprises have introduced pay cuts or pay freezes since the start of the year. Firms planning lay-offs have increased to 35% from 25% two months ago. Smaller businesses are continuing to struggle and the situation will deteriorate. The survey found that 35% of firms plan to make 20% of their workforce redundant within the next three months. As the sector employs approximately one million people, this equates to approximately 70,000 jobs.

ISME has called on the government to address the failure of the banks to lend money to small and medium enterprises and the costs imposed by government on businesses, and to introduce business incentives aimed at stimulating the economy. It has also stated that late payments are having a disastrous effect on small and medium businesses, which are now waiting an average of 69 days from invoice date. That is the highest waiting period in Europe. A massive 42% of companies are waiting in excess of three months for payment. It is imperative that the Government introduces a mandatory payment period whereby all companies regardless of size will be guaranteed payment within 30 days from the end of the month of invoice or delivery. It must also put in place a mechanism similar to the existing small claims court structure to settle payment disputes as they arise in order to protect the small businesses sector. This would be a step towards ending the dominance of large businesses at the expense of small and medium enterprises and creating a level playing pitch for all credit transactions. However, if the Government continues to sit on the fence, the ensuing closure of many small businesses will push more workers onto the dole.

ISME has claimed that State agencies are blackmailing Irish businesses over their contracts with the Government. The association states that agencies are writing to smaller suppliers demanding reductions of 8% and more on their existing contracts. These communications imply that any firm which refuses to comply will be blacklisted and not permitted to supply State agencies. The current procurement process for public work contracts favours larger firms at the expense of the survival of smaller companies. I am particularly concerned that some local authorities employ consultants who in some cases are putting contractors out of business and this is happening in the midlands. This must change because it is unfair to small and medium sized contractors and businesses.

My colleague from Meath dealt with the issue of how farmers are being penalised by the Government. I want to see fair play across the board for all sectors of the community. I will support my colleague on the issue of longer sittings of Parliament. We should sit during the entire month of July, go on holidays in August and return on 1 September and deal with the crucial issues that face the economy and the people of the country.

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