John Perry (Sligo-North Leitrim, Fine Gael)

As Minister of State with responsibility for small business, I wish to emphasise the commitment of the Government to small and medium-sized enterprises, as evidenced by the budget, the programme for Government, the jobs initiative and the governmental jobs strategy which we will announce early in the new year.

The Government is acutely aware of the importance of the small business sector and its potential for generating employment. Our challenge has been, and continues to be, where to best target our efforts and financial supports and interventions to best effect in the coming months. In these constrained economic circumstances, this requires difficult choices to be made in the face of enormous challenges - choices to ensure we achieve change and make a difference not only to the business community, but also in balancing the human, social, and economic costs to protect and enrich the living and working conditions of all the people we represent. My aim, as Minister of State appointed by the Government with specific responsibility for small business, is to continue to ensure that small businesses play a central role in our economic recovery.

Small businesses are a central part of the economy and their ability to succeed and grow underpins our future potential for jobs, growth and prosperity. There are approximately 200,000 small businesses in Ireland, involving 655,000 people throughout the country. They are currently operating in a particularly difficult environment, and I believe it is vital that we continue to focus on actions to achieve positive improvements in the operating environment for small businesses.

Over the next two years, the Government will commit approximately €1 billion in enterprise capital supports. It recently committed to a multi-annual action plan on jobs, with quarterly targets and a strict implementation process. This will be key to delivering a rolling set of reforms across the economy and Government to support the Government's number one priority of job retention and job creation.

Access to finance is a key issue for the small business sector. We need a financial system that is better suited to the needs of smaller companies. Financing the productive capacity of the economy is critical to long-term economic success. While large businesses have various options open to them, including the capital markets, small businesses are heavily dependent on the banking system, which is why it is so critical. The initiatives taken by the Minister for Finance to restructure and recapitalise the banking system were the principal response to making credit available. The recent restructuring of the domestic banking sector creates capacity for the pillar banks to lend in excess of €30 billion in the next three years to the SME and other important sectors. The Government has imposed lending targets on the two domestic pillar banks for the three calendar years, 2011 to 2013. Both banks will be required to sanction lending of at least €3 billion this year, which will be benchmarked, €3.5 billion next year and €4 billion in 2013 for new or increased credit facilities to SMEs.

A number of targeted initiatives are being developed by my colleague, the Minister for Jobs, Enterprise and Innovation, Deputy Bruton, within the Department, in order to build on the recapitalisation platform and ensure a flow of credit to businesses in order to sustain jobs and generate new employment opportunities. The introduction of a targeted temporary partial credit guarantee scheme was one of the commitments announced in the jobs initiative. On 22 November the Government approved the design of a scheme. The invitation to tender was published on Monday 5 December. We intend to roll out the scheme in 2012. The microfinance scheme, which is equally important, will provide loans to small companies and it will be rolled out in the first quarter of 2012. The temporary partial credit guarantee scheme and the microfinance loan fund will not solve all the issues around access to credit but they will form key components in the solution.

As the Minister of State with responsibility for small business I want to be the voice of small business to Government. I established the small business advisory group in June. Over the summer months we produced a worthwhile publication which every Member should have received this week. Hard copies will be delivered in the coming days. The Government has agreed that five of the recommendations will be progressed immediately. They are pragmatic ideas which are capable of early implementation to help troubled small businesses obtain supports, address some of the challenges of the hidden economy, assist their cashflow by promoting prompt payments, and seek ways to reduce administrative burdens.

I have established an interdepartmental SME liaison group to pursue those recommendations of the group which require cross-Government implementation, as joined-up thinking is very important. The report also identifies measures which call for action by the industry itself and by business representative bodies. I also deal with the high level group on business regulation which has the remit of reducing the regulatory and administrative burdens on business. It operates on the basis of the "think small first" principle.

Small businesses are not just a vital part of our economy. They play a vital role in society and local communities as well. That is why I intend to continue to ensure that the business environment is supportive of them. Our future economic prospects depend on sustaining our strong entrepreneurial spirit, even in the face of unprecedented economic challenges. The Government is focused on ensuring that small businesses are supported in every way to develop their business, increase exports, create jobs and rebuild the economy.

Deputies McGuinness and Ó Cuív, as former Ministers, will be familiar with high potential start-up companies and the development of the potential of small companies. We have a major plan of action that will be demonstrated clearly on the ground in every region in order to ensure that credit and confidence is restored in banks and the banking sector. Given that 650,000 people are working in 200,000 small companies, we must encourage the confidence of employers and, equally, the confidence of employees, because in an economy of €90 billion it is very important that employees spend in the economy.

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