Thursday, 15 October 2020
Department of Trade, Enterprise and Employment
Covid-19 Pandemic Supports
The Government is committed to taking all available actions to ensure we help and assist vulnerable but viable businesses, in particular small and medium enterprises, to deal with the economic impacts of the pandemic. The measures in this week's Budget are in addition to those introduced by the Government as part of the July Stimulus of €7bn of grants and loans for firms of all sizes, which includes the wage subsidy scheme, the restart grant, low-cost loans, write-off of commercial rates and deferred tax liabilities, all of which will help to improve cashflow amongst SMEs.
We are giving companies extra assistance through an enhanced Restart Plus grant of up to €25,000. On foot of the Level 3 restrictions recently introduced, a 30% top-up to the Restart Plus grant is being provided to help those affected through the three-week period. Businesses who have previously benefited from the Restart Grant will be eligible to re-apply for this top-up.
In addition to those available from my own Department, there are also a range of other measures announced in Budget 21 to support enterprise and the SME sector. These include the COVID Restrictions Support Scheme (CRSS) for businesses temporarily closed or who have significantly reduced turnover as a result of public health restrictions; the extension of the Employment Wage Subsidy Scheme; reduced VAT rate for the hospitality and tourism sector; extension of the Commercial Rates waiver and the extension of the tax debt warehousing scheme for employers and self-employed. These are all major elements in the overall package of assistance available for businesses.
I continue to work with my colleagues across Government to assist businesses impacted by COVID-19 to adapt to the changing business landscape.
The recently established SME Growth Taskforce meets for the second time tomorrow and will input to the National Economic Plan next month. The Taskforce and National Economic Plan will look to the future and set out how the Irish economy can best position itself for the twin transition to digital and green.
The COVID-19 Credit Guarantee Scheme was launched by Government on the 7thSeptember and is the biggest ever state-backed loan guarantee in Ireland.
The Scheme provides an 80% State guarantee on lending until the end of this year, for terms between 3 months and five and a half years and offers a range of lending products between €10,000 and €1 million including working capital and term loan facilities. Loans up to €250,000 are unsecured.
This Scheme aims to provide loans to businesses that have been negatively impacted as a result of the outbreak of COVID-19. It provides critical support to ensure businesses are facilitated in having access to credit facilities to assist in their trading needs. It is available to SMEs, small Mid-Caps and farmers.
The new Credit Guarantee Scheme was only launched 4 weeks ago. As of 9thOctober, 900 business applications have been recommended to the credit departments of the pillar banks for final approval to a value of almost €48m. 400 applications have been approved to date for over €21m: the number of loan facilities drawn almost doubled last week.
These loans are being drawn from all over the country, with businesses which have been deeply hit by the effects of the virus leading the way. The wholesale and retail sector accounted for 22% of loans drawn by value, the accommodation and food services sector accounted for 14% of loans, and the primary agricultural sector accounted for 10% , demonstrating that funding is getting to where it is most needed.
Further loan applications are in the pipeline with decisions yet to be made on those applications.
The Scheme is currently available through Allied Irish Banks, Bank of Ireland and Ulster Bank. In recognition of the need to make this Scheme as widely available as possible, an open-call for new lenders has been completed and proposals are being reviewed by the Strategic Banking Corporation of Ireland. I therefore expect to confirm a number of new lenders will be joining the Scheme in the coming weeks.
It is expected that greater numbers of lenders will increase the accessibility of the Scheme for more businesses and primary producers and help get much needed funding into the market.