A blunder by the Minister of State and the Department has left county enterprise boards without their full allocation for 1999. There are 35 city and county enterprise boards which were established on an informal basis in October 1993 and on a formal basis under section 10 of the Industrial Development Act, 1995. They get 25 per cent of their funding from the Exchequer and 75 per cent from the European Union under the Local Urban and Rural Development Programme, 1994-1999.
When the county enterprise boards were established a fund of £100 million was set aside for their use until the end of the operational programme. They were given a commitment that money would be available to them until the end of 1999. It has now emerged that, as a result of a blunder or, to use the Department's euphemism, a misinterpretation of the legislation, the Department assumed that there would not be retrospection and that the fund would last until late 1999. As a result the full £100 million has been allocated because the fund applied from 1993.
This blunder will have a devastating effect on county enterprise boards. When one considers their role – to deal with the promotion of small enterprises with ten employees or fewer at local level – one can appreciate immediately how promised jobs may not emerge because of the lack of a small grant. Capital grants are available up to a maximum of 50 per cent of the cost of capital or £50,000, whichever is the lesser. An employment grant of up to £5,000 may be provided in respect of each full-time job created in an eligible enterprise. It is also possible to obtain a grant of up to 75 per cent of the cost of preparing a feasibility study. These grants are in jeopardy in 1999.
I have been informed that the Minister of State will have to bring forward amending legislation which will not be ready before 3 April to make more money available but that may be too late for some projects. For example, Fingal County Enterprise Board had plans to take £45,000 preference shares in an innovative information technology business but it will not now be in a position to do so with the result that the company will be left in limbo; it may find its future threatened. The board is £166,000 short for the first quarter.
Because of the mistake made by the Department I call on the Minister of State to immediately make the same amount of funds available as would have been available if the misinterpretation had not happened. It should be possible to find a mechanism, in liaison with the Department of Finance, whereby the money can be guaranteed for 1999, if necessary through a Supplementary Estimate, so that we do not have to wait for the amending legislation to be enacted. A second choice would be to give county enterprise boards permission to raise bank loans with a commitment that the Department will guarantee them and cover full interest payments on them.
I pay tribute to all involved in county enterprise boards. During the period 1994 to 1997 they supported the creation of 11,000 full-time and 2,250 part-time jobs. The approximate cost per job is less than £4,000. This is tremendous value in ensuring family run businesses continue to thrive.
How did this blunder happen? When did the Department become aware that there was a misinterpretation of the Act and that the money would run out at the beginning of 1999? What actions have been taken to ascertain why the information was not available in time to amend the legislation before the Dáil broke up in December? Has action been taken to identify the responsible section or person and ensure a similar problem will not arise?
The Minister of State loses no opportunity to claim full credit for the establishment of county enterprise boards. He must, therefore, take responsibility for this blunder. I hope I will not receive the answer that has been given to county enterprise boards, that is, that legislation will be introduced by April. I want a different answer so that I will be able to tell them they will get their money before April.