Imelda Munster (Louth, Sinn Fein) | Oireachtas source

I hope the absence of any Fianna Fáil representative to speak on behalf of SMEs is not a sign.

I welcome the opportunity to contribute on the Revised Estimates, which Sinn Féin will support. We are in a situation where entire sectors of the economy are at risk of failure if the State does not provide adequate supports and incentives for SMEs. I do not mean to say that this will happen. If the State and other stakeholders do their bit, there is no reason it should happen, but given the current level of support on offer from this Government, it is a real danger.

A number of schemes have been introduced since the crisis began. Some have been more successful than others. Unfortunately, only one Covid-specific grant scheme has come on stream. We all know that businesses are struggling with the low level of grant funding, which is estimated by IBEC to be an average of €3,000 per firm.

In the Revised Estimates, the additional €483 million for enterprise supports falls entirely within programme A - jobs and enterprise development. The majority of that amount will go to Enterprise Ireland and double the allocation previously made under this heading. Given the scale of the current disaster, however, it is an extremely small allocation.

The main allocation under this heading comprises €180 million to the sustaining enterprise fund and €250 million to the restart fund, amounting to €430 million. The remainder appears to be additional funding to Microfinance Ireland, the future growth loan scheme and local enterprise development.

At the end of this debate, the Tánaiste might be able to answer a question on business continuity vouchers. A number of weeks ago, I received a response to a parliamentary question from the Minister, Deputy Humphreys, where it was made clear that the business continuity voucher scheme was to be closed to new applicants. Does its allocation of €27 million under these Estimates mean that the scheme will reopen or is this money that has already been spent and the scheme will remain closed?

I had assumed that these figures would be much higher. Does this mean that the Government does not expect increased funding under the restart grant scheme? Once the €250 million is gone, will the scheme close? What about the July stimulus? Does the Government expect to introduce a Supplementary Estimate later in the year to accommodate that or should we be worried that very little Exchequer funding will be allocated to it?

We know what is needed - we have been saying it since the crisis began. We need grant aid for businesses and we need interest-free loans for those who are in a position to borrow. We also need options for businesses to deal with rent and other debts. None of these matters has been adequately addressed, though. The same issues that were there on day one are still there and there has been so sense of urgency from the Government in addressing them.

We welcomed the temporary wage subsidy scheme, TWSS, and the pandemic unemployment payment, PUP, that the Department of Employment Affairs and Social Protection introduced as well as the introduction of several loan options, the restart grant and the rates freeze, but these should have been initial steps.

This is simply not enough at this stage of the crisis.

Some practical measures were introduced by Government, including the restart grant and the rates freeze. I will speak shortly about the issues around the restart grants but we need clarity on a further suspension of rates, in particular for sectors that will not be recovering any time soon. These are a good start but we need to build on this and introduce further measures such as additional grant aid targeted at specific sectors, interest-free loans, measures to manage debt and rent and ways to stimulate growth and development. The Government might consider Sinn Féin's proposal for the tourism and hospitality sector as a starting point. We also put forward ideas for grants and loans to the Minister for Business, Enterprise and Innovation and the Minister for Finance. What businesses need is very clear. When one looks at the Department's loan tracker, the number of enterprises availing of these loans is worryingly low. Under the Covid-19 working capital scheme, only 584 loans were sanctioned, only 581 under the Covid-19 loan and six under the sustaining enterprise fund. Grants have unsurprisingly had a stronger uptake, with 9,754 restart grants sanctioned, 10,642 issued under the business continuity voucher and 3,218 under the trading online voucher. If we want to genuinely support businesses we need more grants and interest-free, easily applied for loans. The uptake figures speak for themselves. I hope this is reflected in the July stimulus plan. If it is more of the same approach then businesses will, I fear, be in real trouble.

Loans that have interest rates a percentage point or two below what they were in February are not going to save Irish SMEs. They need grant aid. Then we need loans without interest, which thankfully we are in a position to provide at this time due to the low cost of borrowing and changes to state aid rules. Grants will obviously cost the State significantly, no one is saying otherwise, but it is not money down the drain. It is an investment in our future and one that is long overdue.

It is high time that Irish SMEs were prioritised by Government. Giving grants to SMEs at this time will save us money in the long term, people can stay in their jobs, businesses will be able to diversify and communities and town centres will be supported. If we do not provide grants businesses will fail, people will lose their jobs and there will be a knock-on effect on other businesses and sectors that we know are already in dire straits. Every business group has said this, and we know it. The only group that is not on board appears to be the Government.

Will the Tánaiste clarify what businesses can be expect will be announced in the July stimulus package? There has been so much uncertainty in recent months. Businesses need to plan and to know what is going on.

Other countries have provided much more comprehensive support for businesses from the very beginning of the crisis. Germany and Britain had much higher loan and grant amounts available to ensure that businesses maintained liquidity. In Germany businesses with up to ten employees were eligible for grants of up to €15,000. Up the road in the North, the average available to businesses is between €10,000 and €25,000 in grant aid, depending on the type of business. The average grant received by Irish businesses is by comparison a paltry €3,000 and there is only one Covid-specific scheme available, and it is clearly not enough. Goodbody has estimated that Ireland has given out €95 million in liquidity supports while Britain has given out €41 billion. If one scales the British supports to Ireland that would be €4.5 billion, 4.5 times more than the Government is currently offering.

I have spoken on numerous occasions about the problem with the restart grants. They are badly-designed and underfunded. We need to end the link to rates that bar so many other people from applying. We need to ensure that those most in need are given the best chance of survival and we need much more in the pot than €250 million.

Loans and debt are other issues we need to address. Will the Government make provision for interest-free loans for small businesses or will the profit of banks continue to be a priority for them? What plans does the Government have to address the matter of debt?

They are still accumulating debt and have been doing so since March. Last week, IBEC estimated that the average Irish SME has run up debts of €50,000 during the lockdown. Some of this is owed to banks and large corporate landlords, groups that might have to take a hit in light of the current situation, but much of the debt will be owed to other small businesses so the knock-on effects of this could be catastrophic. Businesses need a support plan now. Will the Tánaiste confirm the Central Bank and Government are formulating a plan of this type which does not rely on the State to step in and take on the debts of major landlords and banks and other large profit-making entities? Will the Government consider getting rid of tax breaks and loopholes provided for CEOs of multinationals and multinationals themselves to free up spending for small businesses? We need to see a radical shift in how the State interacts with SMEs. It cannot be piecemeal. If we are to recognise the importance of SMEs in terms of our economy, employment and communities we must shift the balance from kowtowing to foreign direct investment and focus on investing in SMEs for the duration of the Government.

In terms of cost we need to be strategic. Blanket measures were initially implemented by the Government in terms of supports. This was appropriate at the time but now we have a clearer idea of what is needed and we can be more strategic. Not every sector suffered. Some need more help than others and we need to treat sectors according to their need. We cannot give up on vulnerable sectors.

We keep hearing about the new normal. This has to include a changed attitude towards how we deal with SMEs and the State re-evaluating how banks, corporate landlords and multinationals are put on a pedestal and cannot be interfered with in terms of their profits. We need an entire systems change whereby the State will intervene in private business for the betterment of the economy. It will not cost the State money but the benefit for SMEs will be enormous. The State should be able to instruct banks and large landlords to take action that might interfere with their profits in the short term but will ensure the State's economy can benefit as businesses stay open, jobs are saved and local economies are protected. The time for asking them nicely is long over. We do not think the State should step in and write a blank check; nobody is saying that. We are just asking that everyone takes their fair share of the burden. Certain interest groups are always protected by the State but this time they will have to do their bit. The State should invest in business in a targeted and strategic way, and that way we will reap the rewards for the economy generally.

I ask the Tánaiste to answer a couple of questions on the new grants. Does the Government have plans for new grants? Will the Tánaiste ensure the groups that have been excluded for arbitrary reasons will be included? Will more than €250 million be allocated for restart grants? That money is clearly not enough. Will a debt management plan be included in the July stimulus?

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