Small and Medium Enterprises (SMEs): Statements
Cuirim míle fáilte roimh an Aire Stáit chuig an Teach seo. I dtosach báire ba mhaith liom a rá go bhfuil an tacaíocht atá Rialtas an Aire Stáit á tabhairt do ghnóthaí beaga le feiceáil. Tá sé an-mhaith agus an-tábhachtach.
The support the Government is giving to small and medium-sized businesses is significant and appreciated. I see a lot of that support in action on the ground. I endorse everything the Minister of State said about the support mechanisms in place and the ongoing work of creating the environment for entrepreneurship and small business in Ireland. Over 98% of all businesses in Ireland are small. They employ well over 1 million people. Some 70% of the working population – those employed in private industry and in businesses – work for small or medium-sized interests. While this is important for our cities, it is even more important for the rural areas to which it is difficult to persuade large companies to move. The SMEs in those areas were among the worst hit during the recession. Those businesses were down in the dumps and had to try to make their way back up again. Some did not survive but many did, thank God.
In September, I intend to be the rapporteur of a public consultation committee that will deal with the issues facing SMEs. I would really welcome the input of the Minister of State to that committee and, if he is available, his presence at one of its meetings. The committee will be based in the Seanad. I have also been involved in bringing innovation hubs to the AV room, including, among others, PorterShed. Other such hubs, including university innovation hubs, will appear in the AV room this year. The idea is to link third-level education, institutes of technology, universities and industry, and to bring students across the divide from the academic and the practical side. This is hugely important and I know that the Minister of State, the Department and the Government all support the concept. Representatives from hubs will be here on 27 June. It would be great if the Minister of State and other colleagues could attend in order to see what is happening on the ground.
The SME fraternity feels that nobody represents it. Nobody is standing up and asking questions on its behalf. Other organisations and structures exist in Ireland, but SMEs tend to work in silos. That is my experience and the experience of colleagues involved in SMEs. They keep going. They plough ahead. The people involved in SMEs often work 16 or 18 hours a day. They remortgage their houses. I happened to bump into a bank manager in London who was retiring. He told me that most entrepreneurs reach one of three milestones: first, he or she loses his or her health, second, he or she loses his or her wealth, and, third, he or she loses his or her family. Those issues arise because of the focus these people have for building the business, and the passion they have for it. Unfortunately, it can lead to a silo-type situation. It is not always the fault of the Government. The people behind SMEs tend to focus on their own areas. They need to move away from that and they also need the Government to help create the culture and environment within which expansion can happen. Enterprise Ireland is working hard in that area, particularly in terms of female entrepreneurship. Significant focus has been placed on developing that area by the CEO and the team at Enterprise Ireland.
Enterprise Ireland is one of our greatest assets in helping Irish companies export their products. That is what it focuses on; it is the organisation’s raison d’être. We have thousands of SMEs. There are approximately 240,000 SMEs in Ireland. The vast majority of them do not qualify for Enterprise Ireland support. Some can go to LEOs, of which there are 32 in the country, for assistance. In the past 12 to 18 months, the Government has created one website which brings together all available support mechanisms. Previously, that information was scattered all over the place. That is one of my main concerns. As the Minister of State was speaking, I made some notes. In terms of supports for SMEs in Ireland, Bord Iascaigh Mhara, BIM, Bord Bia, Enterprise Ireland, LEOs, Fáilte Ireland, InterTradeIreland and others are available. We need to ensure that there is greater joined up thinking between those bodies and that we are all on the same page. The website that has been created is helpful, but it is only the starting point. It is really a brochure.
I recall being at a function that was attended by a colleague of the Minister of State, former Taoiseach, Deputy Enda Kenny, in 2011 or 2012. The latter said that he wanted to leave his mark and the mark of the Government on Ireland, ensuring that it would be the best small country in the world in which to do business. It is going very strongly in the right direction, but we have to keep pushing it on. Let us keep SMEs at the forefront, because those behind these enterprises are the people paying taxes with their blood, sweat and tears, and taking the risks in terms of their wealth, their families and their health.
Approximately 50% of SMEs survive for five years or more. The reasons for that are a lack of capital, resources and knowledge. I have a big issue with personal guarantees to banks. Particularly after the most recent recession, the last thing an entrepreneur wants to do is to put his or her family home on the line. I strongly urge the Minister of State, if nothing else comes from this, to encourage the banks to become more like those in Germany, France, the UK and the USA and get rid of these personal guarantees. Such a move would ensure that the banks would move in step with the entrepreneur in terms of taking the risk, rather than putting an extra layer of significant stress on the entrepreneur. That level of pressure is counterproductive in terms of his or her ability to think clearly and to carry out his or her business.
In terms of growth, management skills are an issue. The big problem with management skills is that—–
Tá brón orm. Tá fadhb mhór ann leis na scileanna bainistíochta. I actually think in Irish and speak in English. Gabh mo leithscéal faoi sin. A big problem with that is that the larger companies – the multinationals – are scooping up all of those people. Our unemployment rate is now 5.8% and it continues to go down. However, it is becoming increasingly difficult for SMEs to attract staff.
One of the major issues facing SMEs is legislation passed in both Houses of the Oireachtas that has unintended consequences for them. Those consequences can be severe. Is it possible that the cause and effect of the unintended business consequences faced by SMEs be considered in the context of all legislation, perhaps on Committee Stage? Sometimes we pass legislation which concerns multinationals but which affects all the SMEs and causes significant issues for them.
I fully endorse what the Minister of State is doing and I fully support the Government in its efforts. It is making a great effort and it is really appreciated. We have to keep it going, and make Ireland the best little country in the world for SMEs.