Pearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

We are not going to see eye to eye on this issue. Perhaps the Minister is more hopeful that the reports that come from the banks will be acceptable. As I stated, a report can be made to appear as if it fulfils the requirements.

I take the Minister to task on his statement that "additional" is the key word. Nowhere in the legislation does it state that lending must be "additional"; it actually just refers to making credit available. That is probably a good example of how the Minister's intention in drafting this legislation is not reflected in the text. If one examines the stated purpose of the legislation, one will note it is to encourage the giving of credit in a prudential manner to enterprises, etc., and that it does not say anything about additional lending. It refers to "availing of credit and making credit available through on-lending to enterprises", "the making available of funding for the provision of credit to enterprises, particularly SMEs" and to availing of sources of funding. It does not state "additional credit". It is clearly the intention of the Government and this House to ensure that additional credit will be available, but rules are rules. If one lays down a rule for a bank, it may say additional credit is not required. I hope there may be provisions that will allow the SBCI to state that there must be additional credit, although it does not state that in the legislation.

It is for these reasons that I believe the Central Bank should have a role in stipulating that at least some of the funds lent be "additional". Perhaps there is an argument for stating that not all the funding needs to be additional and that some of the credit might simply be credit made available in a more flexible way. Some SMEs are availing of credit at this point in a way that is making them unsustainable, so access to credit in a new manner envisaged in the legislation might make them sustainable or increase their activity, thus leading to a spillover in terms of economic development and job creation. However, there needs to be additional credit. I am disappointed that there is no role at all for the Central Bank of Ireland.

I listened to what the Minister said about how the system operates in Germany. That may be the case, and I am not suggesting it is not, but I just believe that if we are to have a State-guaranteed institution that will on-lend to the banks, some of which will be private and others of which will be in our ownership, as at present, we should be including protections so that the legislation will do what it says on the tin, namely, allow for the provision of both credit and additional credit to the SME sector.

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