Tuesday, 14 May 2019
Ceisteanna Eile - Other Questions
As a representative of a Border constituency, Cavan-Monaghan, I know there is much concern about Brexit and what the future holds or does not hold for people in the Border area. I am interested in the figures the Minister may have for the Brexit loan scheme, although I know she touched on this in responding to previous questions today. Will the Minister provide clarity on the uptake of this scheme, particularly for the Border area? I would be interested in hearing those figures.
I thank the Deputy for her question. As I have said on a many occasions, Brexit of any kind means change and we must prepare for this unprecedented challenge. A no-deal Brexit is the worst possible outcome and that is why we welcome the agreement of the European Council to an extension of the Article 50 process until 31 October 2019, which prevented a no-deal outcome on 12 April and provides the UK with more time to ensure an orderly withdrawal. However, notwithstanding that the Article 50 process has been extended, it is critical that we continue to prepare for all potential Brexit scenarios.
My Department and its agencies have, over the past two years, put in place extensive supports, schemes and advisory services to ensure that businesses are prepared for Brexit. These measures aim to assist businesses in identifying key risk areas and the practical preparatory actions to be taken over the coming weeks and months. The €300 million Brexit loan scheme provides relatively short-term working capital of between one and three years to eligible businesses with up to 499 employees to help them innovate, change or adapt to mitigate their Brexit challenges. The scheme is open to eligible businesses from all regions of the country, including those in the Border counties. Businesses can confirm their eligibility with the Strategic Banking Corporation of Ireland, SBCI, and if deemed eligible can apply to one of the participating finance providers for a loan under the scheme. The scheme was launched in March 2018 and as at close of business on 3 May, there were 608 eligibility applications received, of which 550 had been approved, with 124 loans progressed to sanction at bank level to a value of €27.76 million. The SBCI website also has details of the Government's new future growth loan scheme and the credit guarantee scheme, which may also be suitable depending on individual business needs.
I have seen a very positive uptake of the supports available but I encourage all businesses to continue to put necessary plans in place. There are a number of essential actions that businesses can now take if they have not already done so, such as registering with the Revenue Commissioners for their customs or economic operators' registration and identification number, reviewing their supply chains and contacting their UK suppliers and checking the certification of UK imports. While the UK’s exit from the EU will mean changes for Irish businesses, I want businesses to know that my Department and its agencies are here to help. The existing supports, schemes and advice are in place to ensure that businesses are prepared for any Brexit scenario. The full range of supports is available on the website.
The Minister knows that many of our agrifood and agricultural sectors have been feeling the repercussions in Cavan-Monaghan almost from the day of the announcement of the Brexit referendum result. The mushroom industry was very badly affected in the Cavan-Monaghan area.
The Minister mentioned the €300 million in the Brexit small and medium enterprise working capital loan scheme. That would be wonderful but as the Minister alluded to, the drawdown is only approximately 10% of the total fund if we go on the figures released. In other words, only one in five applications is being sanctioned for finance. I reiterate the point about Cavan-Monaghan. Will the Minister drill down into the detail in terms of the number of applications being made and the success rate for firms in Cavan-Monaghan? Why has uptake, at 10% of the fund total, been so abysmal?
I do not agree that the uptake has been abysmal. It is important to remember the Brexit loan scheme, whether it is the working capital facility or the long-term loan scheme I launched last month, comprises loans which businesses have to repay. I can understand a natural reluctance on the part of some businesses to take on debt until the full details of the Brexit challenge become clearer. The loan scheme is in place so businesses can avail of it when they need it. I encourage them to put in their applications and have them ready in case they need this assistance.
I meet representatives of businesses regularly and I am particularly familiar with the mushroom sector. I was delighted that in preparing the region for Brexit, I prioritised a number of significant investments in the Border region. A sum of €5 million has been provided, for example, for a new bio-economy research centre in Monaghan, which has the potential to create 200 high-quality jobs. That relates to research in the mushroom industry and right across the food sector, and it is very important that this is in the area.
Is a reluctance to apply for the scheme really the problem if only 10% of the total fund has been drawn down? It is a very low figure. The Government allocated €300 million for the future growth loan scheme, a long-term scheme for farmers, fishermen and food businesses that was announced in October 2017. It has taken 18 months for the scheme to open. Does the Minister agree the Government has been very slow in reacting to the Brexit fiasco? I question the Minister's comments about a natural reluctance among businesses to apply for this funding. Should we instead blame bureaucracy, which is deterring business people from engaging with this?
The Minister and other senior Ministers came to Cootehill not long ago to announce the Regional Enterprise Plan to 2020: North-East. It is a nice, glossy document that was launched with much fanfare but the chair of the implementation committee, Mr. Richard Hanlon, made stark comments on the day on infrastructural plans that the Government may have to put in place. He mentioned strategy etc. and asked what would be the practical outcomes. There was also mention of the north west to north east road links. All that road infrastructure will be very important if the Government is serious about Brexit-proofing the Border counties.
I worked in the banking sector for many years and I know businesses are often reluctant to borrow money because it must be repaid. If the Deputy can describe any cases of businesses having difficulty with this, she should bring them to me. I have had no complaints about this loan scheme so if the Deputy has such an example, she should give it to me and I will follow it up without any problem.
With respect to preparations for Brexit specifically on the Border, a design team has been appointed for a new IDA Ireland building in Monaghan. With the support of the Department of Rural and Community Development, we will build a new enterprise centre in Castleblayney that is vital for job creation in the town, given that the current enterprise centre is at capacity. A new regional development manager has been appointed by IDA Ireland to specifically focus on Cavan, Monaghan and Louth, and Donegal, Sligo and Leitrim have their own specific IDA Ireland person as well. Only yesterday, I announced €2 million in funding for a disruptive technology project at Bio-Marine Ingredients Ireland at Lough Egish food park in Monaghan, which is working with the National University of Ireland, Galway, Teagasc and the Marine Institute on groundbreaking research for the aquaculture sector. This project is the first of its kind in Europe and it is great to see it happening in the Border region. All these investments in the Border region, which I know the Deputy welcomes, will support the area in the face of Brexit.