Willie O'Dea (Limerick City, Fianna Fail)

I move amendment No. 3:

In page 9, line 14, after "time," to insert the following:

"not later than 12 months from the commencement of the scheme,".

Section 10 provides that the Minister may at any time conduct a review of the operation of the credit guarantee scheme. What I propose is that the review should take place within 12 months. That is not unreasonable and the timeframe is not too short. As has been outlined, we are putting taxpayers' money at risk in order to generate more credit. We are reaching out, as it were, to small businesses, some of which would not be able to borrow in the normal way, either because the banks do not understand the nature of the business or for whatever other reason.

To return to the Committee Stage amendments that were deemed out of order, I tabled an amendment to the effect that overdrafts and various other types of loan should be included, not simply new borrowing. That was ruled out of order as being a charge on the Exchequer. I do not know how it could have been ruled out of order for that reason because there is a cap anyway and given that is the case how could the charge on the Exchequer increase if one varies the type of loans that can be granted? However, we will leave that to one side. I have a suspicion that the real reason this is not being allowed is because if one allows necessary financing such as overdrafts and invoice financing, which is allowed under other comparable schemes in the United Kingdom and Canada, within the level of the cap, there would be a surge of demand and we would literally be at our limit within a short time in the early part of the year in the first 12 month period of the operation of the scheme. I suspect that is the reason the proposal was turned down.

Regardless of the fact that the Government does not want to vary the type of loans that can be guaranteed, there could be a rush and we could find ourselves out of money or up to the limit in a short period. It may become apparent at an early stage that the scheme in its present format is not working because there is and will be a considerable demand which is not being satisfied by the banks for other types of loans such as overdrafts and invoice guarantees – the various types of loans that are allowed under the United Kingdom scheme which is the nearest comparable scheme. Because such loans are not included the scheme is not working in the way in which the Government and everyone would like it to work in the interests of the country. I accept the Government will probably review the scheme after 12 months but that should be specified in the legislation. The initial review at least would need to take place after the scheme has been in operation for 12 months.

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