Pat Casey (Fianna Fail) | Oireachtas source

On the area of the guarantee, the big game-changer is that the State is now backing these loans to 80%.

A lot of the SMEs have been through a horrendous time with the banking industry. There is very little trust between the SME sector and the banking sector. The banks were offering the SME sector millions of euro in 2008 and 2009 but would not even give them a €50,000 overdraft in 2011 or 2012 when they needed it to survive. The banks asked the SMEs to put their own pension schemes on the line and to put their children's education fund on the line to keep their businesses going. As such there is an element of mistrust between the banking industry and the SME sector. I want this to work. The Minister of State wants this to work. Everybody wants this to work because it has to work for us to survive. This goes back to the independence of the banking sector in making decisions. I am the last one who wants to add layers of bureaucracy to this process. I want to get access to this funding as quickly as possible. However, the funding provided to the sector must stand up and must be credible. There is no point in us funding businesses that probably cannot survive.

This is where the industry lead, which in my industry is Fáilte Ireland, has a great role to play as the intermediary. Perhaps I should be going to Fáilte Ireland for approval of my potential loan with a banking institution, whether it be for improvements to the business, health and safety improvements that need to be done and so on. I could walk into whatever bank I choose with an 80% guarantee under my arm which says: "I have a guarantee of 80%, all I am asking you to do as the retail bank is to take the risk on the other 20%". It might help create better trust in the system. It is very late in the day to bring this but these things can evolve over time. As the Minister of State said, this is a different scheme. The old scheme clearly did not work for the SME sector and the figures are there. This is a change. I want it to work. I am the last person who wants to add layers of bureaucracy to this but perhaps there is an independent way where our lead body, in my case Fáilte Ireland, has a role to play in this process. It would be a greater role to play than they had before. Years ago they were funding hotels to the tune of £100,000 to £250,000. They had no problems in doing that. As such, the capacity is within the organisation to identify what the industry needs specifically, what it should be funding, and perhaps how viable that particular business is, because they understand it. Not all banking institutions understand industries.