Billy Kelleher (Cork North Central, Fianna Fail)

An increased involvement of SMEs in public purchasing will allow SMEs to make the most of their potential for job creation and expansion and we have taken action to facilitate this.

Last July, the Tánaiste and Minister of State, Deputy Mansergh, launched a public procurement initiative to ensure a level playing field for all innovative companies wishing to participate in public tendering and to promote greater access for SMEs to public sector contracts. To progress this initiative, the Tánaiste has asked her officials to examine any further issues which may constitute an obstacle for SMEs accessing public contracts. These issues will be examined and addressed through the work of the procurement innovation group, chaired by the Department of Enterprise, Trade and Employment.

Furthermore, the Government is committed to addressing administrative burdens with regard to public procurement procedures. The national public procurement operations unit, established in March 2009 in the Office of Public Works, has been tasked with streamlining tender and contract documentation across the public sector to reduce the administrative burden on companies and to introduce a more standardised approach to tendering for public sector contracts. The unit has also embarked on a programme of meetings with bodies representing suppliers and potential suppliers to hear their concerns and proposals for public procurement policy.

The Government is committed to helping the approximately 250,000 small businesses in this country that employ some 770,000 people. SMEs need no reminding of the scale of the unprecedented challenges facing our business community. During the past year, exporting businesses have also been particularly badly hit by the fall of up to one third in the value of sterling against the euro, which on its own would be more than enough to create enormous competitive problems for exports to our closest and largest trading partner.

To address the immediate threats to Irish businesses from the current crisis, the enterprise stabilisation fund was established in 2009 to support viable but vulnerable enterprises. Already, more than 100 enterprises have been approved for approximately €45 million of funding. The availability of credit to the SME sector however, remains a key concern. That is why, as part of the bank recapitalisation package, the Government provided a number of supports for SMEs, including a commitment that recapitalised banks should increase their lending capacity to SMEs by 10% over 2008, a code of conduct on business lending to SMEs, published by the Financial Regulator and in force since March 2009, and funding for SMEs of €300 million provided by the European Investment Bank for lending through three Irish banks.

In addition, the Tánaiste and Minister for Enterprise, Trade and Employment, along with the Minister for Finance, established the credit supply clearing group to identify appropriate solutions where flows of credit to viable businesses appear to be blocked. To assist and complement the work of the credit supply clearing group over the summer, I completed a series of eight regional meetings discussing access to credit with groups that included representatives from the banks, SMEs, relevant State agencies and other business interests. The outcome of these meetings facilitated a greater understanding of the issue at both regional and national levels and will help inform policy and future engagement with the banking and business sectors.

Last month, the Tánaiste announced further measures to aid the SME sector. Over the next few weeks, the small business forum will reconvene to assess and review the impact of the current economic situation on the needs of SMEs. The Tánaiste also announced a significant broadening of the financial supports that the county and city enterprise boards can offer their client businesses. Finally, this Government intends over the coming months to bring forward a national entrepreneurship strategy aimed at stimulating entrepreneurship and coordinating existing measures.

Ireland's outward-looking policies as a small state, our membership of the European Union, and our constant focus on education, enterprise and innovation have shaped our development, enabling us to transform ourselves from an underdeveloped society into a high technology and knowledge economy, with a keen emphasis on innovation and enterprise. Last week I was in China, with representatives of 13 Irish companies, all leaders in their fields and poised to enter strategic partnerships with Chinese companies and bodies. This week, the Tánaiste is in North America with 35 Irish companies delivering this strong message to potential business partners - Ireland is still an excellent place to do business with and to invest in.

Ireland is re-emphasising the export-led growth model, and has historically stressed the vital role that education and learning plays in building a skilled workforce for future economic growth. Young people in Ireland now have one of the highest educational attainments in the OECD; some 40% of our 25 to 34 year-olds have a third level education. Earlier this month, the United Nations confirmed Ireland's continuing economic and social improvements when its human development index ranked us the fifth best country in the world to live in for a third consecutive year. There are many reports that highlight the positives of doing business and living in Ireland.

Ireland's attractiveness as a location for business continues to be recognised internationally. The World Bank's study, "Doing Business 2010", ranks Ireland seventh in the world for ease of doing business. Entrepreneurs in Ireland pay the second lowest rate of tax as a percentage of their profits. Ireland is the third cheapest country in the EU to start a business and the third cheapest for start-up business regulation.

In a key sector such as information technology, Ireland is ranked first for government support for IT industry development by The Economist and fifth for overall IT environment. This continuing attractiveness was highlighted just this week by the announcement of the significant expansion of an Internet services company, Newsweaver, in County Cork.

It is also encouraging that, in this difficult economic climate, Irish technology firms remain able to raise funds. More than €110 million in venture capital funds for indigenous technology businesses were raised in the first half of 2009, up 7% on the previous year, while the number of companies raising these funds increased by almost 35% on 2008.

Beyond controlling costs for enterprises in Ireland, this Government has been preparing for recovery by reorienting our economy to ensure a resumption of sustainable growth as soon as possible. For that reason, the Government published a blueprint last December to build Ireland's smart economy. This blueprint involves key areas for action such as establishing Ireland as an innovation hub, building the green technology sector and investing in critical public infrastructure.

The lesson from severe global recessions in the past is that weathering the economic storm is not sufficient; countries need to restructure their economies to target the next wave of economic growth. A key part of this vision for a smart economy is the need to effectively utilise the knowledge, skills and creativity of people and translates them into innovative processes, products and sustainable jobs.

In Ireland we currently have one of the highest performing clusters of high-tech multinationals. We will continue to incentivise these enterprises to invest further in high-value research and development areas to increase exports and create employment. We are also targeting the growth of our own Irish-based multinationals. Creating the smart economy will nourish a high-value, research-intensive, multinational community alongside a thriving set of Irish innovative companies. Ireland is one of the most entrepreneurial economies in Europe:as many as 2,800 people are setting up new businesses every month, a per capita rate significantly higher than that of the EU and the OECD.

We are investing billions in research and we must ensure we get maximum return for this investment. We will intensify our efforts towards creating the best research, innovation and commercialisation ecosystem in Europe, marketed internationally as the innovation island.

Just last week, Enterprise Ireland's "Big Ideas Showcase and Commercialisation Awards" highlighted Irish innovation and entrepreneurship at its best. This ability to successfully commercialise publicly funded research is key to our long-term economic prosperity. In this context, I welcome the renewed commitment by the programme for Government earlier this month to retain favourable treatment of smart capital for innovative start-ups and upscaling indigenous enterprises.

This Government believes that a smart economy must also be a green economy. Ireland's strategy for this green economy is focused on creating economic opportunities in high value, innovative, green technology sectors. The high level action group on green enterprise will shortly report on means of identifying and pursuing opportunities for jobs and economic growth and its recommendations will be pursued as part of the Government's recovery and growth strategy.

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