Mick Wallace (Wexford, Independent) | Oireachtas source

While the Minister has done well in meeting his responsibilities for exports, jobs and enterprise, the economy has suffered a great deal on the Government's watch. Besides the lack of action to address upward only rent reviews, which I do not propose to discuss now, lending to businesses remains a serious problem. I am aware from experience that banks are ending financial arrangements with companies in order that they can recommence them. A company will receive a letter stating the term of a loan has been cancelled and a week later the bank will indicate it is willing to re-open the loan. The reason for this approach by the banks is that it allows them to define such loans as new lending.

Many companies are borrowing from banks to repay loans to other financial institutions. Another significant problem is the lack of loans to companies in the domestic economy that are seeking to reinvest.

Rates are also a serious problem. I have five premises in Dublin which are being re-rated. We have been informed that the rates on these premises will increase by 47%. While we have appealed the decision, we are not sure what will be the outcome. I do not understand the logic of increasing rates which were already set at a high level.

There is no doubt the reduction in VAT to 9% in the hospitality sector has been of great benefit to the restaurant and hotel industry. For example, my companies have benefited from the measure. I am not sure what the Government plans to do in the budget but I hope the new rate will be retained. The level at which rates are set is creating a serious problem. If they increase further, as seems likely, it will be very challenging for the sector.

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