Dara Calleary (Mayo, Fianna Fail) | Oireachtas source

I thank the Minister of State and his officials for providing us with a copy of the service level agreement, SLA. It is an incredibly detailed document, but it has addressed some of my concerns about the Bill. However, while I do not propose to oppose the Bill on Second Stage, I will be tabling a number of amendments on Committee Stage to address my remaining concerns about the role played by Enterprise Ireland. I have discussed these concerns previously with the Minister of State. Enterprise Ireland does a fantastic job, but its expertise and supports are focused on companies that want to export, high potential start-ups, HPSUs, and high technology companies and I fear that the types of company that have previously been supported by county enterprise boards will fall between the cracks. The SLA, section 5 in particular, goes some way towards addressing these concerns, but we should continue to monitor the issue. Not all companies want to be HPSUs. They may just want support in setting up their operations. In many cases, these supports are not even financial in nature. The county enterprise boards provided training, networking and, most important, mentoring support. Quietly and behind the scenes, they facilitated experienced business people in offering a helping hand along the way for new businesses. The SLA provides that such work can continue, but we must ensure it does continue.

The enterprise boards have done a phenomenal job since 1993. They created and supported 33,000 jobs through an average of 900 projects and almost 25,000 participants per annum. They have supported a wide range of business activities, from the traditional candlestick maker to leading edge technology companies. This support has helped to build companies such as EduBills which was established by Sandra Maguire with the assistance of her local enterprise board. As a parent and secretary in her local school, Ms Maguire was familiar with both sides of the issue of school books. She established EduBills to offer an online mechanism for schools to upload book lists and other charges and a secure facility for parents to pay school costs online. This project is now making a big difference around the country.

An economic audit carried by the South Dublin County Enterprise Board in 2004 showed the work that could be done when a proper enterprise board worked in tandem with its local authority. We must ensure that work can continue under the new arrangement. For several years Mayo County Council has been preparing for the new model by establishing an economic investment unit. Having seen how it operates on the ground, this model has assuaged many of my concerns. However, such a model will not be repeated everywhere unless the SLA is robustly enforced and county councils are sanctioned where they do not implement it. However, I do not think the local authorities will be the problem. Enterprise Ireland will have to come to the table with an understanding of local business, as well as the traditional clients. There will need to be consequences for its budget if it does not deliver. The SLA sets detailed performance targets for each local enterprise office, LEO, but what are the targets for Enterprise Ireland and what will be the consequences if it does not meet them? LEOs which break national averages for performance, support and applications should also be rewarded with bigger budgets. That is the only way we will engender a sense of responsibility for the new model.

My party shares responsibility for pulling local representatives from playing managerial roles in local authorities. I am sure the Minister of State, Deputy John Perry, brought his business experience to Sligo County Enterprise Board. A significant number of public representatives have contributed their time to enterprise boards, not for the glory of it - there is none - but because they want be involved in the economic development of their local authority areas. We have replaced this close involvement with a fluffy commitment in the SLA on establishing a reporting relationship between local authorities and their members in the operation of the LEO. In the past few weeks this House has dealt with a number of reporting relationships that have not worked well. Under the current system, the enterprise boards hold monthly meetings to update board members on activities and councillors have a responsibility to ensure the targets for the county are met. I ask the Minister of State to consider how elected representatives can be involved in the day-to-day operations of LEOs.

There is no sense in changing the entire model of local enterprise if we do not address the elephant in the room, namely, budgets. County enterprise boards had a budget of approximately €18 million last year for client activities, compared to the €89 million IDA Ireland spent on grant aid for its client companies. IDA Ireland does a great job, but I can only imagine what county enterprise boards could do with a fraction of its budget. They certainly need significantly more than what they are getting. They also have the potential to do much more. We have seen from IDA Ireland's visit figures that its investment is not being spread around the country. We are depending on the LEOs to drive economic development in areas where IDA Irealnd does not give a damn. It will be up to LEOs to deliver the fruits of recovery and change the culture of the country in order that it understands business is a noble activity and that if it does not work, one starts again. Cultural change is required in many areas, but the new model will have to drive that change. Unless the LEOs are properly resourced, they will not be able to be drivers of change.

I am delighted that the SLA gives LEOs a central role in student enterprise awards. We need to get the idea into schools from an early stage that setting up a business is a valid career option. Unless the enterprise offices are given the resources they need, they will not be able to foster this culture. I would like the SLA to provide more details on the student enterprise awards in terms of the models to be followed and the degree of consistency around the country. All of us have attended the Young Scientist exhibition at the RDS. Can we not do something similar through the LEO structure to have a national young enterprise exhibition?

One of the difficulties I have with the Bill is that we will get the usual spin from the Government about public sector reform. The county enterprise boards will be used as an example of the Government's efforts to abolish quangos.

It will be like the VECs where the Government claims credit for abolishing all of them as opposed to only the one structure.

The difficulty here is that we are abolishing the traditional enterprise board structure. The Minister for the Environment, Community and Local Government, Deputy Hogan, is putting the Leader companies into the local authorities as well. We are pulling the structure of local enterprise support into the centre, that is, the local authorities, and we are pulling them away from the communities. We must look at the management of the LEO to ensure that, as well as local representatives, there is some sort of community involvement. If we hand it over to the executive of the local authority in tandem with the executive of Enterprise Ireland, which is where we are going, then we will get something that will miss the necessary local input and knowledge that the enterprise board structure, with its mentoring and management board structures, can bring to it. That is something the Minister should look at in the context of the amendments on Committee Stage.

As we speak, in a press conference somewhere in this complex, the Taoiseach and the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton, are out clapping themselves on back for the Action Plan for Jobs 2013. No doubt they will throw the Bill in there as an action completed. When one looks at the jobs action plan, there has been considerable change and we welcome the employment growth. However, one third of the actions last year involved commissioning reports and other studies, another 12% was stuff that the Department should be doing anyway, and another 11 of the actions were all FDI and related matters. What is going on in Government Buildings is the kind of thing that really frustrates the 400,000 people who are still looking for jobs. What we need to do with the model contained in the Bill is say to a cohort of that group that they can start a business if they have a business idea. For an LEO to be successful, it needs to be on top of and working in tandem with the Department of Social Protection. We need to be completely on top of the back-to-work and back-to-enterprise allowances and have local resources to roll that out. We need mentoring. Deputy Áine Collins put a good paper on mentoring together at the Joint Committee on Jobs, Enterprise and Innovation and it, and its recommendations, should be rolled out through the LEOs. There is some reference to it in the service level agreement, SLA, but we need to be more successful in that regard.

If this structure does not work, and we are taking a big gamble here with a structure that has served the country well since 1993 and has strong job creation credentials, then we will destroy the chance for many regions to take part in the economic recovery. That is why I welcome the detailed SLA. Unless the SLA is enforced and unless there are consequences if its targets are not being met, for both Enterprise Ireland and the local authorities, then it is not worth the paper it is written on.

I welcome the notion of the centre of excellence within the micro and small business division of the Department. That has to be robust, well staffed and well resourced. The Minister for Finance, Deputy Noonan, when he presented the budget in October last, announced that there would be a big initiative in 2014 about the range of supports that are available for business, putting them all in one area and supporting them with a big PR campaign, yet the Minister of State, Deputy Perry's, budget for promotion in the Department was cut by 17%. On the one hand, there is this Government announcement that they will provide more information about the supports that are available and on the other, they cut the ability of the Department to get that information out there. There is no sense in us creating a structure like the LEOs with a strong SLA unless it is properly budgeted, unless they are properly run locally and unless there is proper local accountability to the communities that they serve. If we create another super quango within the local authority, we will choke the chance of economic recovery and entrepreneurial activity and we will frighten those who have a business idea away from setting up a business and they will either continue on the live register or take a job if they are lucky enough to be able to get that chance. We cannot do that. No doubt while the Minister of State, Deputy Perry, is in the position, given his own track record, that will not happen, but he will not be there forever. We will not be in this House forever.

The structures that we put in place now, even though they will be reviewed every three years - that is another welcome idea - need to be robust enough to deliver to a community with high expectations. While they need to be robust, they need to be flexible in terms of where business is going and far more embracing of technology and business trends. For instance, for many local communities in which the LEOs will operate, the core business is retail, their core employer is retail and the core economic driver is retail. The county enterprise boards had a mixed relationship with the retail sector. Some supported the retail sector and some others did so as long as there was not displacement, but the LEOs, as the local enterprise driver, need to embrace retail from the start and be the agencies that drive employment in retail, push retail into new technologies and give it the support available because a local enterprise office has to respond to local enterprise conditions and, around the country, retail is where it is at for the business community. There needs to be a focus from the start within the LEO structure on retail.

A number of the local authorities, my own included, have put the units in place to take responsibility for local festivals, tourism projects and local investment, and the Minister of State made brief mention of it in his speech. That is all welcome. A strong unit, focused on enterprise but reaching out to all of the assets of any particular county, is something we all encourage and needs to get the support.

Every LEO around the country should also develop a relationship with the diaspora, with the Irish abroad who may want to come home and set up a business, the Irish who cannot come home who have set up their family lives across the world but who still have an Irish identity, and many Irish who moved abroad in various waves of emigration and are making major business decisions in companies across the world. Every local LEO should have a database of persons from within its area who are abroad, including where they are and what positions they hold, to use to promote the county and its services. They can use that range of people as part of their mentoring. One does not have to be physically in a place anymore for mentoring, and somebody who has been very successful in business can be made available to an LEO client through Skype or some sort of online presence. Many of those who have left this country want to be asked to serve in some way and the LEO structure offers those in business and technology a way to do that.

I continue to have reservations. I have huge respect and regard for Enterprise Ireland and I see what it does, but I am still not convinced - we fleshed this out with Enterprise Ireland and the Minister of State at the Joint Committee on Jobs, Enterprise and Innovation - that they understand local business that merely wants to get on with the job, that does not want to be a high potential start-up, HPSU, that does not want to take part in trade missions in whatever country is the latest growth market, but that wants the information it needs to provide a local service. God knows, to open a business in this country, the volume of information one needs to have is massive. That is one issue we need to look at and my party will be looking at in terms of its amendment.

Second, on the budget, it is not good enough to place an expectation on this structure, as we are in the LEOs, without properly resourcing it and giving it an adequate budget. In fairness, €18 million, in the context of the Department's budget, is not good enough and will not go anywhere near the kind of ambition Deputy Perry has, and we all share, for the LEO structure.

Third, the Minister of State should look again at some sort of formal involvement for local elected representatives in the running of this. We cannot keep handing power from local elected representatives who have a mandate to the full-time officials of each local authority - this Bill will do more of that - and reducing the role of the local elected representatives I mentioned in the service level agreement. Their role needs to be more robust than that. My party's amendments will address that. I hope the Minister will be open to those amendments at Committee Stage.

This needs to roll quickly. This has been a long time in the pipeline. I am aware there have been all sorts of difficulties, but it needs to roll quickly and consistently. There is no sense in us, in Mayo, having a fantastic operation and our neighbouring counties having not as good an operation. Business is entitled to the same level of service from each of these LEOs across the country no matter what part they are in.

We all have huge ambitions for local enterprise. One of the lessons that has been learned from the past number of years is that we have got to go back and give more support to our local business people and those who want to set up businesses. Those ambitions are invested in this local enterprise model.

They have big shoes to fill, given the success of county enterprise boards over the years. We all want them to succeed and the amendments we will table on Committee Stage are to assist them in that regard. I hope the Minister of State will be in a position to accept the amendments. Most importantly, however, let us get this model rolled out and into operation around the country.

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