Jimmy Harte (Labour)

I thank the Minister of State for outlining the Bill and I thank him and his officials for putting it together. It is important legislation and has the potential to create many jobs. I come from a small business background and know how difficult it is to start and maintain a business. The fact the Bill focuses on the employment of fewer than ten people is important. We in this country have always been traders and the ability stems from cattle dealing and trading various goods in times past. We still have the ability to make money locally through trading locally and that is where our future lies. Many families have traded for years but they find it difficult to borrow even small amounts of money in the current economic climate.

I would like to Minister of State to clarify a few points for me. People want to access the new scheme but are there exclusions? Can they use it to clear off debt that is holding back their company? A company may be owed money by a supplier or someone who has gone out of business. If the debt was cleared, a company could move on and progress, and I am sure there are many people in the position through no fault of their own. Businesses can be viable but they may need an injection of cash to clear their name with suppliers and get their heads above water. Can the fund be used for renting? Are there exclusions? Is it only for capital or training purposes? I have not read anything it disallows. Perhaps the legislation is broad enough to allow more uses.

I shall make a suggestion that could help small businesses in the future. A lot of small businesses start with good ideas but as many as 50% of them will fail in the first year, and some of that is due to inexperience. When I set up my business, I never encountered the Revenue Commissioners or the social welfare until I needed them or either organisation had a reason to call. Perhaps a visit from officials from the Revenue office and the Department of Social Protection in the first year of business would help small businesses by contacting them directly. Many people meet Revenue officials for the first time when they are in bother and there may be a difficulty by that stage. Any time I dealt with Revenue, I found its officials to be very efficient and good communicators. Many small start-up businesses do not have that knowledge but they do not generally go to enterprise boards. They may wish to set up a clothes shop, a hairdresser or supply goods or services and they do not feel the need to go to the enterprise board. In many cases people start off with a great idea and premises and go straight into business because the knowledge has been passed down through the family. It would be of great advantage if someone from Revenue called by, introduced themselves, outlined what a new business needs to do and gave a direct contact number in case of any difficulties. Sometimes accountants do that, but in many cases they are more concerned about getting the books prepared at the end of the year and getting the returns in. That could be an issue for consideration in the future.

Many small companies do not have large borrowings, but the loan fund could give a company an opportunity to take on another employee or make a purchase as it cannot dip into its cashflow to do it. This reminds me of a local man, Mr. Hugh Green from Raphoe, who is now in New Zealand, who was named a Donegal person of the year and on whom a documentary was done recently. He left Raphoe more than 60 years ago and is one of the richest people in New Zealand. He started off selling cattle as a 12 year old. He knew who would buy from him and who would pay him. He had no formal education but is one of the biggest contractors and farmers in New Zealand. He said that because he ran his business by his own intuition, he never had to borrow money and has given money to local charities in Donegal and throughout the country. He is more than 80 years of age and returns to Donegal each year. He is an example of the Irish spirit, how we can trade and do things well, but many businesses need start-up capital to get off the ground.

I hope the loan fund will be successful. The small and medium-sized businesses will bring the country through the recession. All towns are experiencing a downturn. The European, Chinese and world economies are experiencing difficulties, but we in Ireland can trade through those difficulties. The Microenterprise Loan Fund Bill is an example of a hands-on approach to it, but I hope it does not get bogged down in red tape. The experience with banks has been that they will say something is a great idea, but there is always a "however" after that. That is the bottom line. With the Bill I hope there will be more leniency. Banks are discouraged from lending because of poor records and low technical management skills. Perhaps the Department could arrange for the local enterprise boards, when set up, to have a person from Revenue with them to provide a contact. In the event of an issue with Revenue, it would be much easier if people knew the name of a person rather than Revenue and the sheriffs calling when people are in arrears.

I congratulate the Minister of State on the work he has done in this area and look forward to the results in 2016.