Mary Coughlan (Donegal South West, Fianna Fail)

Last week, I confirmed that work is under way in my Department on examination of a possible scheme of loan guarantees for the SME sector. This is in line with one of the recommendations in the Mazars report on credit availability. As I also made clear last week, there are significant issues to consider before any final decision can be made. For example, we need to be certain of the extent to which any scheme would assist SMEs, if a scheme would actually result in an increase in total lending and if the cost of borrowing by SMEs under such a scheme would not prove prohibitive. A properly tailored and targeted scheme could prove successful in assisting viable companies secure credit that they might not otherwise obtain.

Enterprise Ireland and Forfás have examined loan guarantee schemes in the UK and in some other countries. Forfás, together with the Department, is carrying out a further examination and on completion of this work, I will bring the results before the Government. We will need to ensure that any scheme developed assists businesses directly, while safeguarding the taxpayer.

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