Mary White (Fianna Fail)

I thank Senator Walsh for sharing his time. I am conscious of the challenges facing small and medium sized enterprises. For all businesses access to funding is highly restricted. A recent survey by ISME indicated a refusal rate of 55% among companies which had made loan or overdraft requests in the three months to February.

The new funding arrangements announced by the Minster for Finance are an attempt to regenerate enterprise in the country. I would like to focus on the first two of them, the first being the new lending requirements for AIB and Bank of Ireland. The Minister for Finance, Deputy Brian Lenihan, said in his speech in the Dáil on 30 March 2010, that his overriding concern throughout this financial crisis has been to make credit available to viable small and medium businesses, sole traders and farm enterprises. As of 30 March the Minister has imposed new lending targets on AIB and Bank of Ireland of €3 billion each for 2010 and 2011. This will mean €6 billion this year and €6 billion next year. This new lending target must include funds for working capital for businesses. Bank of Ireland and AIB are to submit, within six weeks of the 30 March announcement, small and medium-sized enterprise lending plans for 2010 and 2011. These lending plans must consider geographical and business sector spread.

The second initiative taken by the Minister is the new credit review process. This new credit review office was established by the Minister on 30 March and the Government has appointed Mr. John Trethowen as head of the office. As credit reviewer, he will examine the bank's lending policies and practices. Applications for credit reviews are invited from borrowers who have already undertaken an unsuccessful appeal to the bank through the bank's own internal appeals process and who believe the bank's decision is unjustified. The banks currently participating in the credit review process are AIB, Bank of Ireland, EBS, Anglo Irish Bank and Irish Nationwide Building Society. Those not included are Ulster Bank, Bank of Scotland Ireland and National Irish Bank.

The bottom line of these changes is that if a company has been refused lending by a bank and if the credit review processor accepts it is not a high risk, the company - the sole trader, the farmer or whatever - can go to another bank and say the credit review processor said it is not a serious risk. I hope this will deliver the goods. Many people are sceptical but I believe this could be the beginning of green shoots appearing in the economy.