Dáil debates

Thursday, 12 October 2023

Ceisteanna Eile - Other Questions

Business Supports

11:10 am

Photo of Aindrias MoynihanAindrias Moynihan (Cork North West, Fianna Fail)
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6. To ask the Minister for Enterprise, Trade and Employment if he will consider expanding the range of financial supports currently available under the local enterprise offices nationally to include domestically focused retail, personal services, professional services and construction services; and if he will make a statement on the matter. [44427/23]

Photo of Aindrias MoynihanAindrias Moynihan (Cork North West, Fianna Fail)
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Táim ag fiosrú mar gheall ar an slí inar féidir tacaíocht a thabhairt do chomhlachtaí beaga atá ag freastal ar phobail áitiúla. Will the Minister consider expanding the range of financial supports available to a wide range of small retail and other domestically focused businesses that are serving markets and people with a range of services locally?

Photo of Simon CoveneySimon Coveney (Cork South Central, Fine Gael)
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I thank the Deputy for raising this issue. It is something that gets raised with me all of the time. The Government recognises that domestically traded sectors account for a significant number of firms in Ireland and, more importantly, for a high proportion of employment across the retail, construction, hospitality, leisure, and many other sectors. They contribute to the economies and social fabric of towns and villages across Ireland and help create jobs in every single region. Government policy has ensured a competitive business environment for all firms based on a world-class economic infrastructure, a competitive tax regime, supports for start-ups, scaling, and investment, and strong institutions that provide access to skills and research and development.

To further improve our assistance for businesses, as part of budget 2024, the Government announced a new national enterprise hub. This will have a dedicated website and phone line with a hub adviser to help businesses to access State supports. Any business, including those referenced in the Deputy's question, can call it for direct help in navigating the comprehensive suite of supports that are on offer to business throughout Ireland.

Since their establishment in 2014, the local enterprise offices, LEOs, have acted as a first-stop shop for providing advice and guidance, financial assistance and other supports to those wishing to start or grow their own businesses. The LEOs have dramatically expanded their reach over the past number of years and the White Paper on Enterprise sets out a pathway for the LEOs to enhance their advisory services for these domestically traded sectors through the training, development and mentoring supports that are available to all enterprises. Furthermore, the local enterprise offices can help small businesses to improve productivity and reduce energy use and carbon emissions through the digital start and energy efficiency grant schemes. However, there are significant challenges to providing direct grant supports to domestically trading firms. These include the need to avoid excessive displacement or funding activity that would have taken place anyway and ensuring that we do not raise barriers to entry for entrepreneurs and new firms by supporting incumbents, thereby reducing competition and innovation for consumers. In the budget that was agreed just this week, we have set aside almost €10 million extra for the local enterprise office network so that these offices can support as broad a range of businesses as possible.

Photo of Aindrias MoynihanAindrias Moynihan (Cork North West, Fianna Fail)
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I acknowledge the work of the LEOs and of an t-údarás in supporting local businesses, whether through training courses on starting your own business and the mentoring the Minister outlined or through various other advice and support services. However, many of these smaller businesses face issues. For example, Conor wanted to have a three-phase power supply installed in a workshop. A panel beater serving a local community needed a paint shop. A hairdresser and beauty salon needed to get a lot of capital equipment to get up and running in the beginning. These businesses face capital costs. They are ratepayers and provide services locally to a huge community. Supporting them with capital equipment to get them up and running is very important. The advice is useful but it is also about help in dealing with initial and ongoing costs. Has the Minister looked at ways of supporting businesses in that regard? I acknowledge the new national hub and the funding the Minister has outlined. Will that funding be steered towards those kinds of needs to support those kinds of companies in getting operational?

Photo of Simon CoveneySimon Coveney (Cork South Central, Fine Gael)
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We hope we will be able to support many of those kinds of companies in moving to new digital platforms and new online sales processes. These are the kinds of things for which we can potentially give grant aid. In the latest round of the online retail scheme, 98 retailers received €2.3 million in funding, with 79% of successful applicant companies based outside of Dublin. There are schemes available but we have to be careful about looking for local enterprise offices to give grant aid to businesses that are competing with other businesses locally. If you give grant aid to one local manufacturing facility to upgrade, you have to give it to everybody. Otherwise, you generate unfair competition through the use of State supports. We are trying to do strategic things such as helping companies to reduce their energy bills through decarbonisation or to become more efficient through the use of new digital platforms. We have to be careful not to give unfair competitive advantage to one local business over another local business by giving grant aid to one and not the other. There are some restrictions but I assure the Deputy that there are plenty of ways in which local enterprise offices can support local businesses of all types.

Photo of Aindrias MoynihanAindrias Moynihan (Cork North West, Fianna Fail)
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I thank the Minister for the overview. I acknowledge the support that will be available for online retail stores. However, many of these businesses serve customers locally and there is very little of an online nature to them. They deal with people one to one. It is good to have such services available and it is very important to get them up and running. The panel beater depends on his own skills but this includes his personal skills in winning over customers. It is similar with the beautician and hairdresser. It is the people on the ground that we need to support. We need to make capital funding available to them to get them set up and running. It should be remembered that, if they were larger-scale businesses, they would be able to access many other sources of funding. It is because they are smaller, with only four or five or even just one single person involved, that they are caught. If they were larger manufacturing businesses, the Minister would be satisfied to support them.

11:20 am

Photo of Simon CoveneySimon Coveney (Cork South Central, Fine Gael)
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First, Enterprise Ireland's remit has expanded from the end of last year. Until the end of last year, LEOs were only able to support and work with businesses that employed less than ten people. That figure has been increased to less than 50 people for companies that are manufacturing and exporting. If this is an exporting company, we can provide supports because it does not create potential displacement in local economies. There are companies that are not, for example, interested in moving to online trading platforms and so on, which there is grant aid support for. I accept there are some businesses that do not want to do that. They are focusing on local clients. There are areas where they can get help too; for example, energy-efficiency grants.

We now have a single portal - supportingsmes.gov.ie- where a person involved with an SME can access different areas of support such as mentoring, advice, grant aid, decarbonisation, digitalisation or other levels of supports. There is a lot more clarity there now for companies. We are going to improve that even further in terms of improved single communication so that businesses can get the information they need. There are a lot of small businesses out there that do not even know that there are supports available for them because they do not think they are in the right category or whatever. One will find that most businesses can get some support through their LEO.