Government Promises to SME’s High on Hype and Low on Delivery – O’Brien
Speaking tonight in the Dáil, Jonathan O’Brien, Sinn Féin spokesperson on Jobs, Enterprise and Innovation claimed that the government is high on hype and low on delivery for Small and Medium Sized Industries.
Deputy O’Brien said,
“The economic collapse of 2007 and the actions of both Fianna Fáil and Fine Gael led governments have prolonged recession and undermined the SME sector. The SME sector faced the perfect storm with lack of credit, recession and stagnation in the domestic economy.
“It would appear that business closures and high unemployment are accepted collateral damage from governments focussed solely on the needs of banking and international markets.
“Credit is the life blood of SME’s it provides the working capital, to oversee the lean periods and provide stimulus for growth. The drying up of credit due to the banking collapse placed immediate pressure on SME’s. Strings of viable SME went to the wall as creditors went bust and no capital was available to carry forward work.
“The government is in denial with regard to the needs of SME and credit. They have set targets for the pillar bank lending and no doubt can point to these targets being met. However much of this is roll over funding.
“The Credit Review Office has found that 55% of cases that where refused credit wrongly. It is clear that the situation on the ground is that Banks are refusing to make loans
“The government response to the needs of SME has been high on hype and low on delivery.
“We called the establishment of Micro Enterprise Loans Fund based on internally models such as peer lending.
“The response of the government was to establish Microenterprise Ireland and claim that this loans programme would deliver €90million in additional lending to 5,500 micro-enterprises and create 7,700 jobs over 10 years. The set up and running costs for the first year have been in excess of €1.1 million and delivered only €1.6 million in loans 107 enterprises over the same period.
“The government also announced the Loan Guarantee Scheme that promise up to €150 million per year. It has delivered new lending of only €6 million to date with almost half the loans going to working capital and not investment for growth.
“The government is taking a sticking plaster approach to what is in effect a systemic failure by the banking sector to provide credit to SME’s
“There is also a need for the development and implementation of an economic plan for the domestic economy in parallel with export plan. Sinn Féin has put forward a number of ideas to make public investments in infrastructure projects that will enhance our long term competitiveness and productivity which the government has yet to make.
“I hope that the government listen and begin to work with the opposition parties and our business and workers to secure economic jobs and growth.
“As always I travel more in hope that expectation.”