Bernard Durkan (Kildare North, Fine Gael)
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96. To ask the Minister for Finance if he is satisfied regarding the amount of working capital available to the hotel and catering industry; and if he will make a statement on the matter. [33042/16]

Michael Noonan (Limerick City, Fine Gael)
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As the Deputy is aware, small and medium sized businesses, including those in the hotel and catering industry, play a central role in the sustainable recovery of the Irish economy.  Government policy is focused on ensuring that all viable SMEs have access to an appropriate supply of credit from a diverse range of bank and non-bank sources.  

In terms of monitoring the requirements for SMEs, my Department commissions biannual surveys to ascertain the demand for credit by SMEs.  This survey series, most recently conducted by Red C on behalf of my Department, is the most comprehensive survey of SME credit demand in Ireland, covering 1,500 respondents and involving over 6,000 direct telephone calls to SMEs. SMEs of all sizes trading in all sectors, excluding property development and speculative activities, are included.  The survey covers demand for credit from both bank and non-bank sources.

I would draw the Deputy's attention to the most recently published Department of Finance SME Credit Demand Survey covering the October 2015 to March 2016, which can be found at www.finance.gov.ie. The results of this survey shows that, when pending applications are excluded, 89% of credit applications to banks were approved or partially approved (up 4% from the previous survey). Working capital requirements were provided as the main reason for applying for bank finance with 39% of respondents stating that they required finance for working capital (down 9%). When asked about sources of finance for working capital, internal funds/retained earnings were the main finance source of working capital with 67% of working capital coming from this source (up 4%).  The survey also showed continued positive trends in terms of trading performance, profitability and employment.

Fieldwork is currently underway for the next wave of the Department of Finance SME Credit Demand Survey covering the period April 2016 to September 2016.  The results of this are expected to be published in November.

The SME State Bodies Group, chaired by my Department, provides a forum for the development and implementation of policy measures to enhance SMEs' access to a stable and appropriate supply of finance. As the Deputy will be aware, Chapter 7 (Finance for Growth) of this year's Action Plan for Jobs (APJ) sets out a range of commitments to ensure viable SME's can access appropriate finance at a reasonable cost from both bank and non-bank sources.  These Government policies have supported a year on year increases in new lending in the Hotel and Catering sector, as measured by the Central Bank.

The Government remains committed to the SME sector, as reflected in the Programme for a Partnership Government, and sees it as a key engine of ongoing economic growth.  Consequently my Department and the Credit Review Office, working with the other relevant Departments and Agencies, will continue to monitor the availability of both bank and non-bank credit on both a macro and sectoral basis in order to ensure that sufficient access to finance is available to facilitate participants in the SME sector to reach their full potential in terms of growth and employment generation.