Written answers

Thursday, 17 May 2018

Department of Jobs, Enterprise and Innovation

State Aid

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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145. To ask the Minister for Jobs, Enterprise and Innovation if she will report on the recent state aid modernisation working group meeting which took place here in April 2018; and if discussions with respect to changing state aid thresholds at EU level were held. [21957/18]

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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151. To ask the Minister for Jobs, Enterprise and Innovation if her Department has completed or is sending a formal application to Directorate General for Competition requesting that the state aid ceiling under EU Regulation No 1407/2013 be temporarily adapted as a policy response to protect vulnerable businesses that are impacted by Brexit. [21963/18]

Photo of Billy KelleherBilly Kelleher (Cork North Central, Fianna Fail)
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152. To ask the Minister for Jobs, Enterprise and Innovation if she has requested other member states to support a formal application to Directorate General for Competition requesting that the state aid ceiling under EU Regulation No 1407/2013 be temporarily adapted as a policy response to protect vulnerable businesses that are impacted by Brexit; and the member states contacted on the matter since the UK referendum to leave the EU in June 2016. [21964/18]

Photo of Heather HumphreysHeather Humphreys (Cavan-Monaghan, Fine Gael)
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I propose to take Questions Nos. 145, 151 and 152 together.

The State Aid Modernisation Working Group meeting took place in Dublin on 27 April 2018 and was attended by State Aid experts from the 28 Member States. The Agenda comprised:

- Welcome speech by Dr Orlaigh Quinn, Secretary General, DBEI

- Presentation of the organisation of Ireland on State aid – State Aid Unit, DBEI

- Preparation of the next High-Level Forum: presentation by the Chair (France)

- Outcome of the monitoring exercise: presentation by the Commission

- Start-ups and scale-ups: introductory point with a presentation from Belgium

- Economic / non-economic activity and ancillary activity: presentation by the Commission, Denmark and the Netherlands

The mandate of the Group is to discuss best practice, share information and knowledge etc and this feeds into the High-Level Forum on State Aid which meets 1 – 2 times a year. It is not a policy forum and therefore it is not the forum to discuss changes to State Aid thresholds in the context of Brexit.

In terms of discussions in relation to State aid, in November 2017, the then Tánaiste met with Commissioner Vestager, the European Commissioner for Competition who has responsibility for EU State aid policy to discuss, amongst other things, the impact of Brexit on Irish businesses. An outcome from this meeting was the establishment of a Technical Working Group comprising representatives from DG Competition, the Department of Business, Enterprise& Innovation, Enterprise Ireland and the Department of Agriculture, Food and the Marine. The objective of the Group is to scope and design schemes to support enterprises impacted by Brexit in line with State Aid rules. The Working Group has met monthly since November and in between these meetings, there has been engagement on specific issues in order to continue to progress matters. Should issues arise that require an approach that does not fit within the existing State Aid rules, this will be raised as part of the Technical Working Group discussions and not at the State Aid Modernisation meeting.

My Department is carrying out extensive work to prepare for all Brexit eventualities. Informed by detailed research, my Department has been putting in place a package of measures that will allow us to respond to the needs of businesses including the Brexit Loan Scheme which was launched in March 2018 and which will provide affordable working capital financing to eligible businesses that are either currently impacted by Brexit or will be in the future.

By using a counter guarantee from the EIB group (through its InnovFin Guarantee) means that the €24 million exchequer funding announced in the 2018 Budget (€14 million from my Department and €9 million from the Department of Agriculture, Food and the Marine) has been leveraged to provide a fund of €300 million. The Brexit Loan Scheme is open to businesses of fewer than 500 employees which can demonstrate that they are significantly exposed to the impact (or potential impact) of Brexit. They must be a viable business, doing business in Ireland, and they must have a business development strategy demonstrating that they plan to innovate or adapt in response to Brexit. This scheme operates within De Minimis State Aid Regulation.

On 4 May 2018 the EU Commission approved an extension to the Rescue and Restructuring Scheme for Ireland to include temporary restructuring aid. This provides a further 10 million euro of State support to those companies experiencing acute liquidity needs and is in addition to the original 10m euro announced in November 2017 under the Rescue and Restructuring scheme. Together with the Brexit Loan Scheme, this temporary restructuring aid will provide valuable stabilisation to businesses as they respond to the immediate and long-term impacts of the UK’s decision to leave the EU.

My officials are also examining policy proposals for a new longer-term Business Investment Loan Scheme to support businesses to invest strategically for a post-Brexit environment and a new Business Finance Advisory Hub service which would focus on business development.

The Agencies of my Department are at the forefront in working with firms to ensure they are equipped to deal with Brexit and to enhance their performances in an increasingly competitive global trading environment through lean programmes, skills development and reducing business costs.

Enterprise Ireland (EI) has launched the 'Brexit SME Scorecard', an interactive online tool which can be used by all Irish companies to self-assess their exposure to Brexit. EI is also offering a 'Be Prepared Grant' of up to €5,000 to support clients to develop a Brexit Action Plan and it continues to support clients to improve their competitiveness, acquire new markets and enhance management skills.

The Local Enterprise Offices (LEOs) are organising workshops, seminars and training to assist companies to better understand the challenges of Brexit and have a range of supports to help clients to respond to those challenges, to become more competitive and to source new markets.

InterTrade Ireland is also working to minimise the impact of Brexit on north-south trade.

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