James Browne (Wexford, Fianna Fail) | Oireachtas source

I welcome the opportunity to speak on the Microenterprise Loan Fund (Amendment) Bill 2020 and welcome the expansion in supports this Bill brings about through Microfinance Ireland Covid-19 loan funds and for the Strategic Banking Corporation of Ireland, SBCI, future growth loan scheme. These provide vital measures and it is very important that the Bill progresses through the Dáil as quickly as possible to support microbusinesses. Public health is rightfully our most important concern at this time. However, the pandemic has had a very significant and serious impact on small businesses and in particular on microenterprises. They are the engine of our local economies. They provide local jobs and it is most often local families who run them and set them up. They are very often intergenerational. I have spoken to many of these businesses in County Wexford and many are struggling to survive. Many are questioning whether they will even reopen. We are talking about laundries, cafés, tradespeople, small hardware stores, young and small enterprises, gym businesses, and other ordinary small businesses with a few employees which have suffered very hard in the last months. They are the entrepreneurs, ordinary people, the ones who took huge risks to establish their small businesses. They are also very difficult businesses to set up, and when they are lost, they are very difficult to replace.

In any funds that are provided for these small businesses, speed of access is going to be critical. It is necessary that they can get the funding quickly and that the method to get it is simple and clear. These businesses are very worried. They are seeing their cash flow collapse and bills mount up. While there was some forbearance from some creditors, many of those bills are now flying in through the letter boxes. They are concerned at how they will be supported going forward in terms of rates, VAT, loans and grants - in short, costs and liquidity. Any small business has a cost of doing business. Access to funds is critical for them to survive. I am very hopeful that this Bill will help to allay some of their fears but we will need to see more supports for them in the next couple of weeks.

These businesses provide essential and valuable services throughout our local economy. For regions and counties, like my own of Wexford and the south east, that have undergone a very slow recovery, if any, since the last recession, they are the communities that are now very vulnerable. Wexford relies on tourism and small businesses and if they are lost, it will suffer extremely badly.

These are the small businesses which are very adaptive. They are the innovative businesses and they deserve our support. We hear much discussion about IDA Ireland and big businesses, and while the latter are very important, the backbone of the country and economy are small businesses. When an IDA Ireland business closes up and moves elsewhere, small businesses stay here. We need to support them.

County Wexford is highly reliant on tourism but the industry has already lost most of the season. The season usually starts to turn on 15 August when visitors start to trail off and by September things are quiet again. Many tourism businesses have only opened on a trial and error basis to see if they can survive. If they enter the winter period without the supports they need to survive, they will not reopen in spring. Those that are open have only been able to allow in about one third of the traditional customer base but they need twice as many staff and costs are increasing. They need support.

The food and accommodation sector has probably been the hardest hit. Many businesses in the sector are family owned or small and they will not survive without the support they need. We must acknowledge the value of these businesses to our economy and country. We must protect them and, in doing so, protect local economies, families and communities and retain social cohesion. The money spent in small local businesses is kept locally. When someone goes into a hardware store and buys a few bits and pieces, the money is spent by its owners and staff in the local economy. It is not lodged in a bank account before being transferred to an account in another country. It is critical we support these businesses. Looking back at the last recession, the small businesses that survived helped our economy and country to grow again. Many of the small businesses that crashed in the last recession did not need to crash. If they had been given a small amount of support, it would have got them over six or nine months and allowed them to get going again. Good businesses collapsed because their debtors went out of business and cash flow dried up quickly.

We are facing into a recession but it will be different from the previous recession because this time there are high levels of savings in bank accounts. The figures being bandied around indicate that €2 billion was saved in May 2019, whereas in May 2020 between €10 billion and €12 billion was saved. We need to get that cash flowing, which means giving people confidence and clarity about what they can and cannot do, what they can and cannot book and what they can benefit from.

A large number of Irish people holiday at home every year, but Irish people spend around seven times more on foreign holidays. Very few people will go on foreign holidays this year. We must find a way to encourage these people to holiday at home and spend their hard-earned money in local economies, including in pubs, restaurants, hotels and other small businesses to keep them going. I appreciate that it is not easy to give an answer to everything but we need these businesses to survive. If they go out of business, the owners and their employees will lose their jobs and end up on social welfare payments, which is another cost. These are good businesses which can survive and thrive with a little support.

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