Timmy Dooley (Clare, Fianna Fail)

I welcome the opportunity to contribute to this debate, although I am not necessarily in agreement with the Opposition in terms of the approach it takes. It is important that we take every available opportunity to discuss the area of job creation and retention in the House. There is no point in getting into the difficult economic situation in which we find ourselves but at the heart of our current difficulties was our inability to retain the level of employment we had. We must consider every measure, and that is why it is worth considering the idea put forward by the Opposition. However, as the previous speaker mentioned, we must be careful not to put the taxpayer further in hock than is absolutely necessary.

We are right to focus on small- to medium-sized enterprises. We often pat ourselves on the back when IDA Ireland succeeds in bringing foreign direct investment to the country, which is important and beneficial even in the current climate because it contributes towards exports. However, SMEs must be seen as the bedrock of employment in this State, as is the case throughout Europe. The type of support they need is not overly burdensome credit support but assistance in running their businesses in a careful and efficient way. What they need is an effective banking system and an effective flow of credit, which has not been the case up to now. Although the Government has had to introduce policy initiatives - in particular, the requirement for Bank of Ireland and AIB to generate new borrowing by providing €3 billion in new loans this year and next year - my view is that this is not filtering through. I have heard reports, as Deputy Conlon mentioned, of institutions converting overdrafts into term loans, which is ultimately not new money. It is not providing any additional comfort to companies that are vulnerable in the current environment but will have a viable existence and be able to create and retain jobs as we come out of this difficult international climate.

Much has been achieved in resolving the problems in our banking system, whether it be through the nationalisation of certain elements of our financial institutions, the recapitalisation or the existence of NAMA and the work it has done. However, continuous monitoring is required and further pressure should perhaps be put on financial institutions to improve their policies, either through their boards or by implementing additional measures if necessary. We need to continue to monitor this.

The community enterprise boards are a vital and valuable component of support for the emergence of SMEs, providing assistance from the very start. We need to focus more on that. I was disappointed during the week to see that some of these community enterprise boards have not sought extra money or have not been in a position to draw down the additional money. In the current climate they should be pushing it out to the boundary. For that reason we need to have a greater focus on this area.

I will conclude with a view I hold, which is that we need to change our bankruptcy laws. If we force the owners of SMEs into the wilderness for 12 years - or even for six years, as mentioned in the report of the Law Reform Commission - we are robbing ourselves of some outstanding entrepreneurs. They are the people who will ultimately get us out of the mess we are in through the creation of employment. There is much work to be done in dealing with the political fallout of this, but we do need to reduce the length of time for which people find themselves locked in bankruptcy.

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