Finian McGrath (Dublin North Central, Independent)
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227. To ask the Minister for Jobs, Enterprise and Innovation to set out the reason for not implementing the social entrepreneurial axis under progress microfinance of the employment and social innovation programme; and if he will make a statement on the matter. [14871/15]

Gerald Nash (Louth, Labour)
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The new EaSI programme 2014-2020, managed by the European Commission and totalling EUR 919 million, consists of three axes which build on previous EU programmes, namely PROGRESS, EURES and Progress Microfinance. Under EaSI,Progress Microfinance has become Microfinance and Social Entrepreneurship.Organisations that can apply for funding under the Microfinance and Social Entrepreneurship axis are public and private bodies established at national, regional or local level and providing microfinance for persons and micro-enterprises and/or financing for social enterprises. Critically, applications for participation do not require State involvement and the Department of Jobs, Enterprise and Innovation does not have a direct role in the implementation of the Microfinance and Social Entrepreneurship axis of the EaSI Programme. It is overseen directly by the European Commission.

One of the objectives of EaSI is “promoting employment and social inclusion by increasing the availability and accessibility of microfinance for vulnerable groups and micro-enterprises and by increasing access to finance for social enterprises.”

Over EUR 86 million have been earmarked through Microfinance and Social Entrepreneurship to stimulate, broaden and speed up the development of the social finance markets across Europe between 2014 and 2020. Its funding will be evenly spread between microfinance and social entrepreneurship, with a minimum of 45 % going to each. Cross-cutting projects will account up to 10 %.

Microfinance Ireland(MFI) is the selected intermediary for the micro-finance strand which will continue to facilitate access to microfinance for individuals and micro-enterprises. In November 2012, MFI and the European Investment Fund (EIF) signed an agreement under the European Progress Microfinance Facility (Progress Microfinance). This initiative is managed by the European Investment Fund on behalf of the Commission and the European Investment Bank. The EIF does not provide direct financing to micro-entrepreneurs, micro-businesses or individuals. Financing is made available through intermediaries participating in the Facility. Each agreement is negotiated individually and is subject to approval by the European Commission following due diligence. Applications for participation do not require State involvement.

While continuing the microfinance support as under the current programme, Microfinance and Social Entrepreneurship will include several new elements:

- Funding for capacity-building in microfinance/social enterprise institutions – the EaSI-Microfinance Social Entrepreneurship Work Programme includes activities to support capacity-building activities for microfinance and social entrepreneurship. Such funding could take multiple forms and could be used, for example, by a microcredit provider to buy an IT system.

- Investments for developing and expanding social enterprises – the European Commission has been developing the new financial instrument for social entrepreneurshipto promote social entrepreneurship by making available hybrid financing for social enterprises in the form of a combination of equity, quasi-equity, loan instruments and grants. Complementarity will be ensured between these actions and those undertaken in the framework of cohesion policy and national policies. The total amount that a social enterprise can receive is €500,000, while respecting state aid rules. Programme support will be limited to enterprises not listed on the stock market, with a turnover or annual balance sheet not exceeding €30 million.

I welcome the progress made by the European Commission in devising and publishing a new standard to allow social enterprises of all sizes to better measure and demonstrate their social impact and so help them in their discussions with partners, investors, and public sector funders. The standard will help European social enterprises to benefit from EU level funding via EaSI and the European Social Entrepreneurship Funds (EuSEF).

I should point out that a number of Government Departments are engaged with the Social Enterprise sector. The State currently provides substantial funding to Social Enterprises through a range of programmes and schemes. These include the Community Services Programme managed by Pobal for the Department of Social Protection, Community Employment schemes, the Wage Subsidy Scheme for the employment of people with disabilities, public sector contracts through the HSE and others, the Social Finance Foundation, and LEADER and Local Community Development Programme (LCDP) funding from the Department of the Environment, Community and Local Government.