Thousands of small businesses will close or go bankrupt unless Government supports improve dramatically - Pearse Doherty TD
Sinn Féin Finance spokesperson Pearse Doherty has warned that thousands of small businesses face closure unless Government dramatically scales up financial support for the SME sector. Deputy Doherty again called for a more ambitious recovery package for SMEs; including direct grants, an extension of the commercial rates break and zero-interest loans.
Teachta Doherty said:
“Small and medium sized businesses throughout the State are at risk of closing or going bankrupt in the coming months unless Government changes its attitude towards the SME sector.
“Despite countless press conferences and briefings, a paltry €60 million has been paid out to businesses through the Government’s 'flagship' loan schemes. This is despite the Central Bank estimating that affected SMEs require €2.4 billion to stay afloat in the next 3 months alone.
“In Britain, Government-backed loan schemes have seen over €30 billion in lending to business approved. As ISME, IBEC and others have said, this Government is lagging behind its European counterparts, with costly consequences for jobs and our economy.
“In stark contrast, this Government has been slow to support small and medium sized businesses, putting hundreds of thousands of jobs at risk.
“Sinn Féin have called for the immediate introduction of a suite of measures to support our SMEs; including scaled-up direct grants, an extension of the commercial rates break and zero interest loans with a 100% State guarantee.
“For years this Government has thrown its weight behind big business at the expense of our SME sector. Unless that approach changes quickly, jobs will be permanently lost. Without the recovery of our SMEs, there will be no economic recovery.
“On the 13th April, myself and our party spokesperson for Business, Enterprise & Innovation Imelda Munster wrote to Minister Donohoe and Minister Humphreys calling for a number of measures to increase the scale and improve the access of credit to our SME sector, including:
- An SME Grant Scheme; similar to that introduced by the Executive and Sinn Féin Finance Minister Conor Murphy where one-off grants of £10,000 and £25,000 were provided to SMEs. The current policy in the south of providing grants equivalent to no more than a firm's 2019 commercial rates bill is totally inadequate to address the cash flow problems that our SMEs are experiencing.
- A Back to Business Loan Scheme that would provide loans of between €2,000 and €60,000 for small firms, with a 100% guarantee to participating finance providers. Unlike the current SME Credit Guarantee Scheme, SMEs would not be required to make any repayments in the first 12 months with zero interest rates applied.
- Reducing the cost of borrowing under existing government loan schemes such as the Covid-19 loan scheme through Microfinance Ireland by applying zero interest rates in the first 12 months.
- Extending the commercial rates waiver for businesses whose commercial activity continue to be affected by public health measures.
“These are policies that should be implemented as soon as possible to support our SMEs - who are the backbone of our economy."