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Dáil Éireann debate -
Wednesday, 12 May 2021

Vol. 1006 No. 7

Loan Guarantee Schemes Agreements (Strategic Banking Corporation of Ireland) Bill 2021: Second Stage

I move: "That the Bill be now read a Second Time."

I apologise for being delayed. I cannot up run up the steps in this Chamber as quickly as I can those in the other Chamber.

I welcome the opportunity to present the Loan Guarantee Schemes Arrangements (Strategic Banking Corporation of Ireland) Bill 2021 to the House. This short, technical Bill will enable the Ministers for Enterprise, Trade and Employment and Agriculture, Food and the Marine to enter into agreements with the Strategic Banking Corporation of Ireland, SBCI, to facilitate access to finance for qualifying enterprises. The new Brexit loan scheme is being put in place as part of the Government's response to Brexit and enactment of this Bill will allow us to launch this scheme in mid-2021. The Brexit impact loan scheme will be an important support to Irish businesses throughout the country that are facing challenges from Brexit, while also dealing with the disruptions that have arisen due to the Covid-19 pandemic. It will be available to SMEs, including those in the primary agriculture and seafood sectors. To bring this loan scheme to the Irish market in the coming weeks, it is imperative that the Ministers are granted the necessary powers to enter into the agreement with the Strategic Banking Corporation of Ireland in June this year. That includes providing the necessary executor funding.

This scheme is an important component of the Government's Brexit mitigation measures for businesses as it will provide businesses with the opportunity to borrow for periods of up to six years for liquidity, working capital and investment purposes. The State-backed borrowing currently available to SMEs is related to the Covid pandemic or, for Brexit, is for shorter terms of up to three years. The new Brexit impact loan scheme has been developed to provide an appropriate option for access to finance for SMEs based on the dual impact of Brexit and Covid. It will provide for more affordable lending relative to the standard market rate and will help viable but vulnerable businesses, including farmers and those in the fisheries sector, that are impacted by Brexit and experiencing liquidity challenges or business owners who wish to invest in their businesses.

The Brexit impact loan scheme will be underpinned by a counter-guarantee through the European guarantee fund, which is managed by the European Investment Fund on behalf of the European Commission. The effect of the counter-guarantee is to allow for a scheme of up to €330 million in lending to be made available at a maximum executor cost of €29 million. This relates a multiplier effect of State funds by more than a factor of ten. The scheme costs will be covered on a 60:40 basis between the Votes of the Departments of Enterprise, Trade and Employment and Agriculture, Food and the Marine. The Department of Agriculture, Food and the Marine will contribute 40% of the costs on the basis that it is anticipated that of the order of 40% of the scheme will be used by food businesses and primary producers.

The counter-guarantee, through the European guarantee fund, offers a 50% risk cover which will be matched at 24% by the Government through the Strategic Banking Corporation of Ireland to provide an 80% uncapped guarantee to lenders participating in the scheme. The scheme is to be operated by the Strategic Banking Corporation of Ireland on behalf of the Ministers and the Attorney General has advised that primary legislation is needed to provide the necessary powers to both Ministers to enter into an agreement with the SBCI to deliver the Brexit impact loan scheme. The enactment of the Loan Guarantee Schemes Arrangements (Strategic Banking Corporation of Ireland) Bill 2021 will enable the Ministers to implement the Brexit impact loan scheme and provides the potential for the Ministers to enter into further agreements with the Strategic Banking Corporation of Ireland in the future, if needed. I will now briefly go through the heads of the Bill.

Section 1 defines the "relevant Minister” as the Minister for Enterprise, Trade and Employment or the Minister for Agriculture, Food and the Marine, as they are the Ministers entering into the agreement with the Strategic Banking Corporation of Ireland, SBCI, for the Brexit impact loan scheme.

Section 2 provides the Minister for Enterprise, Trade and Employment or the Minister for Agriculture, Food and the Marine with the power to enter into agreements with the SBCI with the consent of the Minister for Finance and the Minister for Public Expenditure and Reform. This includes providing the necessary financial contribution from the Irish executor and limiting this to an aggregate total of €50 million, should the Ministers wish to implement additional schemes concurrently. At present, the ask is €29 million. It also includes the discharge of any additional fees and expenses. Definitions for "qualifying enterprise", "SME" and "small mid-cap" are also referenced here.

Section 3 provides for a review of the operation of the Act after four years following the passing of the Act. Section 4 provides that expenses incurred in the administration of the Act be paid out of moneys provided by the Oireachtas. Section 5 provides for the Short Title and commencement provision.

In conclusion, this short Bill is important as it will allow the Minister for Enterprise, Trade and Employment or the Minister for Agriculture, Food and the Marine to enter into an agreement with the SBCI to implement the Brexit impact loan scheme, which we believe is a critical component in our response to Brexit and recognises the changes that have happened in recent years since the initial Brexit loan scheme.

Essentially, the Brexit impact loan scheme provides for loans of up to six years for liquidity, working capital and investment for SMEs, including primary producers. If we want to ensure that our businesses throughout the country succeed and prosper in the face of the fundamental challenges of Brexit and Covid-19, it is essential that we take the necessary steps to ensure appropriate loan schemes such as this are in place for businesses. Again, the whole premise of having the loan guarantee is that the powers are made available at a reduced interest rate and on better terms and conditions. We have seen an average 2% to 5% reduction in the interest rate with other schemes we have administered and we would expect to see something similar here.

I thank the Leas-Cheann Comhairle for the opportunity to speak to the Bill this evening. The Oireachtas Joint Committee on Enterprise, Trade and Employment had a very healthy discussion on this Bill some weeks back. Due to the need for the expedient passage of this legislation, we agreed to waive pre-legislative scrutiny. The Minister of State will know that I have no difficulty with waiving pre-legislative scrutiny on legislation. It is a very bad habit to get into, however. Everything cannot be a crisis and it is necessary sometimes for us to have pre-legislative scrutiny. It is a very important part of scrutinising legislation as it provides a good opportunity for debate. That said, we did not have difficulty with waiving it in this case. I am, however, conscious that it can, and has in previous instances, develop into a habit. It is not a habit I would like us to get into.

I thank Mr. Declan Hughes from the Department, who appeared before the committee to discuss this legislation and answered a good many questions from its members. The need for a loan guarantee scheme for small and medium-sized enterprises affected by Brexit and Covid-19 is apparent to all of us. It is particularly true of small and medium-sized enterprises and the agricultural sector. It is for that reason these businesses have been prioritised in this Bill and the scheme which will come from it.

While we support the Bill and the moneys it will help to loan out, as is ever the case, difficulties for businesses in accessing these moneys comes from what happens between the passing of the Bill and the actual loaning out of the money. The design of the scheme, length of repayments and interest charged all contribute to the success or otherwise of such a scheme.

We have seen this throughout the Covid crisis. Some loan schemes are more attractive than others. It beggars belief that in cases where the State has backed loan schemes which are not popular, the moneys behind those schemes are not moved laterally to better performing loan schemes where they can actually be of some use. I refer to loan schemes that people are using and from which they want to benefit. It is either that or engage with businesses to figure out what the issues are and rectify the schemes that have a low take-up.

I know the Minister of State will acknowledge this because he sees it in the figures he gets. Some of the schemes are very popular. They have immediate engagement and much of the money is drawn down. Other schemes are not as popular and should not be left to languish and elapse. We need to see the Minister of State being proactive in this regard.

I note this scheme has a built-in review. I hope the preliminary assessment into the performance of the scheme will be carried out within six months to a year, but definitely no more than a year and preferably within six months. It is now, when Covid-19 and Brexit are hitting the hardest, that small and medium-sized enterprises and family-run businesses will need access to credit.

The twin crises of Covid-19 and Brexit have caused untold difficulty for businesses but there is some light at the end of a very long tunnel. There are opportunities for SMEs to expand in domestic operations and with regard to trading internationally, especially within the EU.

The exit of Britain from the EU and the Single Market leaves trading opportunities with our European counterparts. I have no doubt there is scope for indigenous SMEs and agribusinesses to expand and secure some of these trading opportunities. The role for the Government and for us in the Oireachtas is to help facilitate this. That is why these schemes are important and why it is crucial that they work effectively and efficiently.

The reality is that the State is a critical player in the economy, economic development and economic direction. We have seen this with progressive governments across Europe and with the Biden Administration. It is up to the Government to play its part in working with businesses, workers in the trade union movement and others to help deliver a more robust, progressive economy, a high-wage, high-productivity and a high-growth economy that will provide for everyone. That is the best way to deliver for business and workers, especially as we exit this Covid crisis.

As much the Minister of State would love it, we cannot go back to the status quo, which was low pay, precarious work and insecurity for workers in many industries. We saw that with the Covid pandemic. We cannot go back to the status quo. After the financial crisis and the austerity years, the economy was simply put back together the way it was. This has not worked for ordinary people, workers or any of our indigenous SMEs and family-run businesses. Post Covid-19, we cannot go back to business as usual and simply have a reconstitution of the economy back to the same way that it was. I will borrow a phrase from Joe Biden, who I know borrowed it from someone else: we have to build back better.

We will be supporting this Bill. I have tabled an amendment on Committee Stage, which I hope will elicit some detailed discussion with the Minister of State regarding the particulars of the scheme. I look forward to some informed discussion and debate this evening.

It will come as no surprise that Sinn Féin welcomes any opportunity for investment for small businesses, and particularly for those in our farming community, who as one would expect, are going through a period of quite considerable anxiety. They face plenty of challenges over the months and years ahead with the new Common Agricultural Policy, CAP, and climate action developments. All these things are going to put increased pressures on them and any opportunity for investment or a line of credit, as this Bill will facilitate, will be quite welcome.

Of course, farmers will be asking themselves individually whether this will benefit their farm and ensure they have access to funds. They will be asking whether the Government is delivering the funds in a way that can help them best produce the food that not only feeds their own nation but also many across the world. Quite clearly, some will be able to draw down the funding this Bill will facilitate but it will not meet demand.

We have seen from the Revised Estimates from the Department of Agriculture, Food and the Marine that funding to the SBCI has actually halved this year. That paints a very clear picture in terms of the volume of credit that will be delivered to farmers. This will be compounded in the manner in which this funding can be made available. As Deputy O'Reilly noted, many schemes have a far higher rate than others. It seems that rather than being tailored to the specific needs of individual sectors for particular circumstances, the SBCI has a habit of simply rebranding schemes whereby a Brexit loan becomes a Covid loan, which becomes a Brexit loan again, with largely similar loan requirements. If, therefore, a loan is ineffective for one purpose, it is hardly going to become more effective simply by giving it a different name.

That raises questions as to the level of engagement the Department has had with stakeholders on an ongoing basis as to their actual needs. That is why it is really important that Government parties take Deputy O’Reilly's amendment seriously, and accept the amendments that would create an obligation on both Departments to engage with stakeholders from both the SME and agriculture sectors.

It is worth noting that when appearing before the Committee of Public Accounts in March, the SBCI highlighted seven schemes representative of the loans and services it offers, varying in focus from Covid to Brexit to agriculture. The single scheme referred to by the SBCI that was fully subscribed was the agriculture cash flow support loan scheme. That speaks for itself. Farmers will be incredibly disappointed to see the new Brexit impact loan scheme standing at €330 million. Following the appearance of the SBCI at the Committee of Public Accounts, farmers were left with the impression that there was a new €330 million agricultural scheme coming down the line as reported in the agriculture sector media. It would be invaluable if the Government will clarify that this is what the SBCI was referring to at the time or if we should expect a separate dedicated agriculture loan scheme to emerge later this year. The latter would be the most appropriate.

Funding not drawn down from the SBCI should be reallocated to schemes where funding is eagerly awaited, whether in the SME or farming sectors. There needs to be that flexibility as we move forward. The agriculture cash flow scheme has been incredibly popular and has worked. It only had a third of the balance loaned out waiting repayment as of March. That is a clear indication that there is a need for it and that the farmers were clearly a solid investment in terms of returns. The opportunities are there and it needs to work.

As Deputy O'Reilly said, we will support the Bill. However, it needs to be operated on the basis that it will be continually reviewed. The Sinn Féin amendment tabled by Deputy O'Reilly deserves consideration. I would urge the Government to back it. There is nothing to fear by having an obligation to engage with those at the coalface delivering for our domestic economy, whether that is SMEs or the members of our farming community.

This is a technical Bill which does exactly what it says on the tin. It gives the relevant Ministers power to enter into agreements with the SBCI to implement loan guarantee schemes. The reason for the Bill's introduction is to enable the Government to deliver the Brexit impact loan scheme. The cost to the Exchequer of the Brexit scheme will be a maximum of €29 million with up to €500 million in low-cost finance being made available to viable micro-SMEs and mid-cap enterprises. It aims to assist them to adapt their businesses to the challenges caused by Brexit.

We have one amendment from Deputy O'Reilly, which aims to get the Minister to engage with the relevant stakeholders and groups regarding favourable interest rates from moneys loaned under the Act, which is fine. The Labour Party will support both the Bill and the amendment.

I want to raise some concerns about the Bill, related schemes and the other existing schemes, which are not enough. There are businesses falling through the cracks. Many small businesses were hit by Brexit and then suffered the double whammy of being smashed by the pandemic. However, they do not qualify for support from any of the current Government schemes and are not suitable or will not qualify for this one either. My concern is that too many of these businesses, particularly micro businesses, will be thrown to the wolves as they fall outside the different schemes being rolled out.

I want to use the example of a small Irish service business connected to tourism but not a tour operator, whose owner was in touch with me yesterday. His business is headquartered and pays tax in Ireland. He had turnover of over €2 million at its height, mostly services exports, and has a good chance of a return to that when he can resume. Due to the nature of the business, he took a serious hit and was preparing for restructuring due to the threat of a hard Brexit. Then the pandemic hit and his business was eliminated almost overnight. He employs dozens of people directly and a similar number indirectly. The core of the business is in Ireland but his service is dependent on travel. As soon as recreational travel returns, the business will be able to recover and expand. However, it has been savagely hit by the lack of income and the standing costs it has had to support over the past year.

He feels the State is offering him next to nothing, however. He got rate support for which he is grateful. He applied for the Covid restrictions support scheme, CRSS, but got nothing. When he applied for the Fáilte Ireland scheme, he was told by the Department he would get nothing. Under the terms and conditions of the loan scheme enabled by this Bill, he will also get nothing. If we do not support businesses like his and he is forced to close or is constrained in recovery, there is no guarantee that the business will be replaced by another Irish headquartered entity. The danger is we lose jobs, tax and revenue for lack of vision and flexibility in our supports structure.

I put down a parliamentary question to the Minister on behalf of businesses like this. Hopefully, I am wrong and there is some scheme they can avail of which will help. Otherwise, viable firms like this could go to the wall. Small, medium and micro enterprises provide 70% of enterprise jobs. While we support this scheme and the Bill, it is important to remember at whom it is aimed. The Minister of State should make funds available for those firms which do not qualify for other schemes. No company should fold due to Brexit or the pandemic when there is a reasonable chance for it to regroup and rebuild its enterprise. It would be far cheaper to save existing jobs than to spend to regain others.

I welcome positive engagement from the Minister of State on the constituent's business to which I referred. Hopefully, there will be a scheme available which will be helpful for similar businesses.

Small and medium-sized enterprises have been hit desperately hard by the Covid-19 pandemic. Across the country, business owners have been put to the pin of their collars. Family businesses, which may have gone down through generations, have had to close their doors because of the pandemic. Many of them may never open up again. It is vitally important that we support as many of them as possible to ensure they have the opportunity to recover, whether it is shops, pubs, restaurants or other retail units. These small and medium-sized businesses are the backbone of our towns and cities. It will take time for them to recover. Footfall in our towns may be slow to recover. It is important to support legislation such as this.

It is important that schemes such as the employment wage subsidy scheme, EWSS, and the pandemic unemployment payment, PUP, continue to play a role. Certain sectors will struggle to get back up to the level that they need to be at. Aviation is another one affected, as well as small and medium-sized businesses. One category of business which has not received a great deal of support is those without premises. It might involve a minority of businesses but they do exist. As many of them do not have rateable premises, they have not been supported. We need to look at that and ensure they are supported.

Sometimes we do not think of them as businesses but taxis are also a form of small business. In many instances, they have not received the support they need either. When one combines the amount they are entitled to claim and to work, it does not work out as a living wage. That should be taken into account.

This is a short technical Bill that is quite limited in scope. It is certainly one that should be supported. It relates to the agreement between the Ministers for Enterprise, Trade and Employment and Agriculture, Food and the Marine and the SBCI, which the Ministers must sign before the end of this month to deliver Brexit impact loans by the end of quarter two.

The effects of Brexit are still beginning to make themselves known. It is difficult to disentangle them from the pandemic. The latest trade numbers between Ireland and Britain show a major decline in exports and imports. According to the Central Statistics Office, CSO, the value of imported goods fell by 57%, or €1.6 billion, during the first two months of the year when compared to the same period last year. Exports declined by 12% over the same period. The effects are particularly evident in the food and drink trade between Ireland and the UK. The agrifood sector was identified as being most at risk from Brexit. However, it has not been the sector most impacted by the onset of Covid but that does not mean it would have an impact. Export of food and drink products to Britain fell by 35% from €641 million to €418 million in the first two months of 2021 when compared to the same period in 2018.

In the past year, the combination of the UK's formal exit from the EU and the Covid-19 pandemic have obviously left many SMEs in dire straits. Small businesses are particularly vulnerable to red tape and logistical issues caused by the UK leaving the European Union. They cannot afford the kind of lawyers and advisers a big or medium-sized company might be able to employ, so it is essential we do everything to keep these businesses afloat.

Since 2016, this Government and its predecessor have introduced a number of schemes to prepare businesses for Brexit and to assist those impacted by Brexit. These schemes have varied in terms of their success and take-up rates. I see a repeated pattern of making these schemes inaccessible to small businesses, not simply with the eligibility requirements but through the arduous application process. As of January there had been no draw-downs on the microfinance Ireland Brexit business loan. Those were the most up to date figures I could find, although maybe the Minister of State has more recent figures. Perhaps there have been some draw-downs; it would be useful to hear if there have been. By comparison, there has been approval of €21.8 million in loans to 848 businesses from the Covid-19 microfinance loan scheme. This scheme was introduced only three months earlier than the Brexit loan scheme. There is no doubt there is a demand for Brexit support among SMEs, and the low take-up rate is concerning and must be examined. We must learn from the business supports that do work and make the necessary changes to the ones that do not.

Many businesses are also reluctant to take on loans at this time, particularly given the levels of economic uncertainty in both the domestic and global economies. Many do not want to take on further debt and some of them cannot; that is just the reality of it. It is the responsibility of the State and the Department of Enterprise, Trade and Employment to see these businesses through this very difficult time and provide all the certainty and support it is possible to give. We must remember this is a sector that employs a very sizable number of people. When one considers the cost of creating a new job, this is a good investment provided the company is viable. The Minister of State must engage with the businesses that are not taking up loans to find out why they are not engaging with these supports and adapt the scheme where necessary to meet the need, where an SME is viable.

I am glad to see this scheme will assist businesses with the joint disruptions of Covid and Brexit. Few small businesses have escaped the damaging effects of the pandemic and those businesses which have been also affected by Brexit should not be forced to jump through multiple hoops and lengthy application processes to get the assistance they need. The effects of one crisis can be hard to distinguish from those of another so this broader approach is welcome. Indeed, this scheme will now be broadened to include primary producers for the first time and will allow them to lend for activities aimed at addressing the pressing challenges affecting us all, namely, the climate crisis. The Central Bank's lending survey from January indicated there would be an increased demand for guaranteed and un-guaranteed business loans this year as businesses begin to find their way out of the immediate effects of the pandemic. Similar to the many effects of Brexit, which are only gradually making themselves known, the ripple effect of the pandemic on SMEs is not entirely forseeable but we can be certain it will take some time for the sector to recover. The extension of this loan scheme through 2022 is welcome in providing a level of security to business and we must be open to extending it further if need be.

As I understand it from the committee discussion on this Bill, 19 credit unions are involved as lenders under the scheme. The inclusion of credit unions in these lending schemes is welcome but should be expanded across the country. It has been a number of years since the 2017 recommendations by the finance committee on the development of the credit union movement. Reform of the movement is happening but it is happening at a snail's pace, with only very limited progress toward establishing the sector as a strong competitive force vis-à-vis the main banks, and we have fewer of those now with the exit of KBC Bank and Ulster Bank. We must focus on the development of lending expertise in the credit union sector, particularly with regard to business lending. The Social Democrats believe much more must be done to drive greater competition in the banking sector. The extensive roll-out of a strong not-for-profit banking sector based on a reformed credit union movement would support this.

I will conclude by observing that pre-legislative scrutiny was waived for this legislation. Sometimes it is not required but the Opposition has been very generous to the Government on waiving pre-legislative scrutiny. The last time I looked there was something like 16 requests since last October. I am a great believer in pre-legislative scrutiny where appropriate. It is a really good stage of our legislative process. While one might think it would shorten the process, very often it gives more balanced legislation, reduces the need for amendments on Committee and Report Stages and we end up with a process that has been more inclusive. I would not like to see the waiving of pre-legislative scrutiny becoming the norm. It is very understandable because of Covid but we must put down a marker that this is not a desirable way to proceed. We must return as quickly as possible to having a full legislative process, including pre-legislative scrutiny.

This is a very positive Bill that provides a legislative basis for the Minister for Enterprise, Trade and Employment and of course the Minister for Agriculture, Food and the Marine to enter into an agreement with IBRC so they can implement the Brexit impact loan scheme. Once launched, it is intended the scheme will open up to SMEs and those that employ up to 499 people. It will provide loans ranging from €25,000 to €1.5 million.

We mush consider this is the context of May 2021. We certainly hope we as a nation are on the back end of Covid. Vaccinations are on the up and in recent weeks we have had announcements about the easing of restrictions each week. It feels like we are on a slow pathway back to normality. With that there is much hope and expectation but also it means some of what Covid has masked will come to the fore again. Each and every day of the past week we have heard stories of the housing crisis and the need to house families is back on the airwaves. At the same time we are also going to see just how impacted by Brexit businesses have been, because Covid has been masking all that. We have been in a bubble world for the past 14 or 15 months, with a lot of businesses closed and cotton wool wrapped around them by means of State support and subvention. Suddenly, they are about to reopen. They will be supported and the Taoiseach has said time and again there will be no cliff edge; businesses will be supported until they are back on an even keel. Notwithstanding that, we have had a perfect storm over the past 12 months with Brexit and Covid coming together and wreaking havoc on our country and large swathes of the European Union. We do not yet know what impact Brexit will have on a lot of our SMEs, so what we are passing enables Government, the Civil Service and financial institutions to start rolling out this very important capital loan which will recapitalise businesses that are struggling and will continue to struggle. It is a good thing therefore and Fianna Fáil in Government fully support this Bill right through to its enactment.

Deputy Mairéad Farrell is next but is not here, nor is anyone from Solidarity-People Before Profit. We will hear from Deputy Murnane O'Connor.

I thank the Ceann Comhairle. There is no doubt the industries and sectors most exposed to Brexit need additional support and financial aid, especially when we are still dealing with the impact of the Covid pandemic. This new scheme to help viable businesses is very welcome. This year we still see much demand for support and there has been and still is a place for loan guarantee schemes for viable but vulnerable businesses. More than €931 million has been sanctioned in State-backed loan guarantee schemes for around 8,000 businesses. However, thousands of jobs are now on the line and businesses and SMEs need much greater support and assistance.

It is most welcome that primary producers will be included in this scheme and it is so important for us to look after our agricultural sector. It has been the lifeblood of our country for years and, like our businesses, the people in it have done an excellent job.

There is absolutely no room for complacency when it comes to safeguarding jobs and economic prosperity, especially now as we emerge from the Covid-19 pandemic and adjust to a post-Brexit trading environment. The Department of Enterprise, Trade and Employment has been to the fore in helping businesses to deal with Brexit and continues to provide grants and training to assist with new customs arrangements arising from Brexit. That is most welcome. In August last year, our loan guarantee scheme mobilised €2 billion in support for companies affected by the coronavirus and many businesses stayed afloat because of that support.

Much has been done and a new scheme is very welcome, especially now with the double challenge of Brexit and coronavirus. Many businesses are still weighing up the cost of both. It is important we pass this Bill quickly because businesses need our help as soon as possible. My chief concern is that not enough information is out there about supports. We must ensure we can give the proper information. I know some businesses could not meet the criteria of the previous Brexit loan scheme. It is important for us to look at this carefully as we must try to help as many businesses as we can.

I am working with a business that did not apply for the scheme on time. I cannot find an appeal mechanism and the date cannot be extended. What are we doing for businesses which, through no fault of their own, did not get the information on time? I am trying to see if I can help this business, which could do well with a bit of support. Again, I have been told there is no appeals mechanism and nothing can be done about the deadline. As part of the progress, I ask the Minister of State to consider such matters. This is very important to businesses.

Grants are great and loans are brilliant but if they cannot be accessed, it can be a big concern. Working with all the different businesses and our agricultural sector, dialogue is important. There must be some sort of communication and I am firm believer in communicating and working with everyone. I ask the Minister of State to take my concern on board.

This Bill would permit a scheme to mitigate Brexit and Covid-19 impacts but would allow for future agreements to be entered into. If we do not have schemes to support businesses, we must find new ways to provide financial supports to viable but vulnerable businesses. I fully support this Bill. I ask the Minister of State to revert with something that can be done for businesses that, through no fault of their own, did not apply for grants. Could we consider an appeals mechanism?

I welcome the opportunity to speak today and I welcome the Bill in principle. The full effects of Brexit are not yet being felt. Coming from a Border area, I know the real consequences of Brexit will be enormous. We are starting to see that already as the cost of goods is starting to rise. I know from speaking to people in many businesses in the construction sector that there are substantial price increases on the way, for example. Raw material prices are increasing across the board by as much as 30% and 40% in some cases. This will have a devastating effect on the cost of housing, among other things. There is also a fear that Brexit and the Covid-19 pandemic are being used by many companies as an excuse to raise prices. I would be extremely disappointed if it emerges that that is the case. The issue may have to be looked at.

Getting back to the Bill before us, although I support it, I have reservations as well. It is stated that the total cost of this Bill will be at most €50 million and that the cost to the Exchequer of the Brexit impact loan scheme will be a maximum of €29 million. In theory, there will be no cost to the Exchequer as these will be loans given to businesses that will be repaid. Could we get a breakdown of the figure of €29 million as it seems to be extremely low? There will be thousands of businesses affected by Brexit and €29 million will not be enough.

It is important that we also discuss how these and similar schemes are operated. I have engaged with a number of businesses in the Dundalk area that have tried to access these schemes over the past 12 months but have found it very difficult to get approval. The red tape in many cases has been the issue. Surely in this day and age we can introduce systems and procedures that will eliminate such red tape.

A number of the schemes are being operated by the banks on behalf of the Government. Businesses feel they are simply applying for a bank loan in these cases and not a Government-backed scheme. The banks are operating normal credit criteria, which really defeats the purpose of these schemes. The reason businesses are looking for help is that they have been affected by Brexit and the Covid-19 pandemic. How can these businesses be assessed on normal credit criteria terms in this case?

I should be clear that businesses welcome this scheme that has been introduced by the Government but we must not have a scenario where they cannot avail of them because the banks are applying normal credit criteria. These are not loans in the traditional sense but rather supports to help businesses get through Brexit and the Covid-19 pandemic. These are supports to help businesses with liquidity issues as a direct result of Brexit and the coronavirus pandemic.

In principle I support this Loan Guarantee Schemes Arrangements (Strategic Banking Corporation of Ireland) Bill 2021. However, I have raised the question of the relatively low amount that is being forecast to be required. It should be a much greater amount. I also urge the Government to examine the administration of these and similar schemes to ensure businesses that most require support actually receive it. We cannot have businesses drowning in a sea of red tape when trying to access these schemes. Finally, we must look at how the schemes assess the suitability of applicants and again ensure that those businesses that actually need the support get it.

I come from Dundalk and like in every town and village in the country, businesses are struggling there. Many of the businesses in the town are family businesses governed by tradition. The bottom line is they do not want to give up and they are fighting morning, noon and night. This process is meant to be about Government loans but people have to speak with people in banks. All they want is a bit of clarity.

A colleague mentioned the word "communication" and no matter which walk of life we are discussing, communication is very important. Has the Minister of State sat down with many people representing businesses over the past few months? I am sure he has sat down to see what businesses need to keep going.

This morning, I spoke to the Taoiseach about the introduction of a minimum price per unit for alcohol sales, saying that if we increase the price of alcohol next January, people here could suddenly have to pay double the price charged for the same product in the North. People living in Dundalk and the surrounding areas will be able to go 10 km across the Border and buy those products at half the price. How can we compete when those products will be half the price?

We must be practical and understanding. Let us try to listen to the people. If the Government gives people the opportunity to get a proper loan and get businesses back on solid ground, this country will be a far better place.

I welcome this Bill, which proposes to allow the Ministers for Enterprise, Trade and Employment and Agriculture, Food and the Marine to enter into agreements with the Strategic Banking Corporation of Ireland to implement a loan guarantee scheme for small and medium enterprises, including many of our primary producers.

The financial gearing of this scheme could deliver up to €330 million in available lending at an Exchequer cost of €29 million. Primary lenders may access the funding with an 80% loan guarantee from the State. It is proposed that the interest rates shall be fixed at 4%, with many parties being offered repayment plans of up to six years. Covid-19 and Brexit have created significant difficulties for many businesses and sectors, affecting both supply and demand curves, especially for domestic and exporting small and medium enterprises and primary producers.

This proposed funding underlines the importance of the SME community to the Irish economy. These SMEs account for 67.5% of Ireland's overall employment, contributing 37.3% of gross value added to the economy. It is very important that this money gets out to the SME space as soon as possible and I welcome the urgency attached to this by the Government.

I remind the Minister of State of previous such initiatives, including an 80-20 loan guarantee, when pillar banks demonstrated great resistance to taking up the 20% proportion of loans, or underwriting loan requests.

We need to remind the banking sector of the facilitation the Irish State and people provided over the past decade in returning those pillar banks to solvency. Their efforts are underwriting the generous salaries, particularly at executive levels, that staff at these banks enjoy. I hope Departments will apply sufficient pressure to ensure there is significant uptake and underwriting of these loans.

The credit union sector has a significant part to play in providing SBCI-backed finance. It is imperative that the number of approved credit unions that distribute this funding continues to rise. Understanding that the banking landscape is shrinking, I urge the credit union sector to consolidate and collaborate on these lending opportunities and the potential for the sector to play a greater part in providing financial support for our SMEs and indigenous businesses. As the economy opens up and some of the current business and wage supports begin to reduce, a clearer picture will emerge for many businesses of the viability of their operations and the sustainability of their business activities. Many enterprises have had to begin a journey of critical self-analysis. Many have been forced to look again at how they are doing their business but, in truth, none can determine fully the future demands for its products and services until we see a full reopening and recovery in export and target markets.

It is imperative that we, as legislators, ensure that every attempt is made to make sure that no business is left behind and that everyone who has fallen is offered a helping hand as the country emerges from Covid and we continue to address the new realities of Brexit. On behalf of the many challenged entrepreneurs, business leaders and management teams that will need access to this funding, I welcome this proposed legislation.

I welcome the opportunity to examine the Loan Guarantee Schemes Agreements (Strategic Banking Corporation of Ireland) Bill 2021. I thank the Tánaiste and Minister for Enterprise, Trade and Employment, Deputy Varadkar, and the Minister for Agriculture, Food and the Marine, Deputy McConalogue, for bringing the Bill before the House. The Bill introduces the legislative basis to implement the Brexit impact loan scheme. Once launched, this scheme will be open to SMEs, specifically small and mid-sized companies which have up to 499 employees.

Particularly welcome is the extension of the scheme to businesses engaged in the farming and fishing sectors. I welcome the scope of the proposed arrangements, with flexible loans ranging from €25,000 to €1.5 million to be made available to eligible businesses. The flexible terms of between one and six years, discounted interest rates and loans of up to €500,000 to be made available on an unsecured basis will be particularly welcome. The scheme will provide an 80% guarantee to participating lenders on loans to Brexit-impacted businesses and will be underpinned by a counter guarantee through the European Commission’s pan-European guarantee fund, which is managed by the European Investment Bank. The new scheme, which will be administered by the Strategic Banking Corporation of Ireland, will make up to €330 million in lending available to help businesses to continue to respond to Brexit.

In many respects, the Covid pandemic has masked the true impact of Brexit in Ireland. As the uncertainty around the pandemic ends, businesses will continue to need help to deal with the consequences of Brexit, particularly when Britain brings in border or customs controls later this year. Access to finance for these businesses is critical, particularly for those businesses impacted by Brexit. This scheme will deliver important supports for the fishing, farming and food sectors and for businesses generally as we seek to ensure their ongoing viability. I welcome this Bill and I ask all Deputies to support it.

It is important that in the roll-out of the fund, a system will be put in place for businesses that have been trading for a number of years and are not just new entities applying for the supports. It is important that where a fund exists, it is targeted at such well established businesses and those that are particularly hard hit by Brexit or other factors. I mentioned the North and potential customs controls coming in. These businesses will require support. The previous contributor spoke from the perspective of the Border region. It is important that businesses in that region are given supports because, arguably, both the fishing and other sectors will be hit hardest.

I understand that this legislation facilitates the introduction of the Strategic Banking Corporation of Ireland Brexit impact loan scheme into the Irish market. I hope that, like many Government initiatives, this is not too little too late. Brexit continues to impact small businesses and farming families in counties Kildare and Laois and urgent action is needed if they are to survive.

I welcome the amendment proposed by my colleague, Teachta O'Reilly, which would require the Minister to engage with the relevant business and agriculture stakeholders and representative groups regarding the application of favourable interest rates to the moneys loaned in accordance with this Bill. The proposal is a no-brainer and I hope Deputies of all parties and none will support the amendment.

We need to learn lessons from the low uptake of the Covid-19 working capital scheme and the future growth loan scheme. Speaking to business owners in my constituency, the main reasons for their reluctance are relatively high interest rates and red tape. I know there should be sufficient oversight of public moneys but not to the extent that it makes the introduction of this scheme pointless. These businesses urgently need our support.

I am glad to speak on this important Government Bill. It is important at this time as the country begins to open up for many operators that have been severely hit, including SMEs, tour operators in Kerry, hoteliers, restaurateurs and publicans. I have to pass a yard in Killarney when taking the Killarney bypass every day where over 90 buses have been parked without moving for almost a year and half. It is terrible.

These people will need financial support to get off the ground and get going again. They created massive employment and were providing a massive service. They knew every aspect of their trade and had become masters of it but they have been closed for a long time now. The small supports that were given in the meantime were nothing like what they were used to operating with. When businesses finally open their doors it will not be the same as it was. It is important to remember that. Many of them will need financial support and cheap loans to ensure they get off the ground. Loans should be meted out directly to operators that require them because if people have to comply with the banks' requirements, it will never happen. People are losing confidence in the banks by the day because regional banks no longer have a face to them. People do not seem to know who the manager is and the manager does not have a say. The request for a loan goes up to Dublin and some faceless person decides not to give the loan in most cases.

I am calling for speedy assessment of loan applications because time matters greatly. People cannot wait. No credit is available anywhere any more, except maybe for a few days or two or three weeks. Gone is the day when people would pay at the end of the year and the farmer would come down and pay the shopkeeper, miller or whoever at the end of the year or pay the contractor for his work on the last fair day of the year in Kenmare or wherever.

This does not happen any more. People can no longer wait for their money. People will go down if they do not get financial support.

This is a time such as we never had before. We have been locked down for almost a year and a half and when we will finally open up, it will be different to what we were used to. This is why we welcome this facility and we hope it will be available to SMEs, farmers and tourism operators because Kerry has been practically closed down for the past year. All the lights have been out and the doors locked. I look forward to seeing them opening up and each and every one of them continuing as they were, giving the service they had been giving to our people and the people who visit us from China to Texas and those from all over the world who visit Killarney, Kenmare, Dingle and the Ring of Kerry, and Ballybunnion and Ballyheige in north Kerry. I appeal to the Government to make sure this loan guarantee scheme through the Strategic Banking Corporation of Ireland is made available to all those who need it, and many of those people do.

The objective of the Bill is to provide the necessary powers to the Ministers for Enterprise, Trade and Employment and Agriculture, Food and the Marine to enter an agreement with the Strategic Banking Corporation of Ireland to implement loan guarantee schemes for small and medium enterprises and small mid-caps, including many primary producers. Will the Minister of State advise the House of the interest rate on the loans being promoted under the new scheme? I understand the €150 million cash flow support loan scheme for the agricultural sector had a rate of 2.95% and was oversubscribed. This week, the eurozone base rate of interest is at an all-time low of -1%. However, Irish people are not feeling the benefit and the Government is entirely to blame. Will this scheme operate, as it should, at a 0% rate? If so, there would still be room for profit for the lenders given the margin of 1% between the European Central Bank, ECB, rate and 0%. Otherwise, if the scheme operates at a similar interest rate to the previous scheme, it will be a complete rip-off. It will allow the banks to garner huge levels of interest in a scheme underwritten by the State.

We need new solutions and imaginative thinking to help our SME sector in Ireland. The German and Danish Governments are providing loans at 0.3% and 0% over ten and 20 years to support their citizens. Why would the Irish Government introduce a State-backed scheme and charge a high interest rate when the source of all this money is the ECB? It makes no sense whatsoever. Why are Irish people at every level, from mortgages to SMEs to farmers, being completely ripped off every day by banks and financial institutions? Will the Minister of State advise on what are the benefits to the banks that will operate under the SBCI scheme? We know they make lots of money from these schemes. Will the Minister of State provide figures? It appears the only logical reason is that the SBCI scheme is not being advanced at a 0% interest rate, or at least a rate lower than 2.95% is to ensure the banking lobby is kept happy. This shows how the banking elites are being protected. It is in stark contrast to what is happening in Germany and Denmark.

The €2 billion Covid-19 credit guarantee scheme is operated by the SBCI and delivered through participating finance providers. These providers are the banks. We know that the banks are not, in practical terms, lending in Ireland today. We also know the banks are leaving Ireland today. Look at the appalling way KBC is treating its staff and customers who trusted it and put their faith in it. Look at Bank of Ireland closing branches in Bantry and Dunmanway, again showing shocking disrespect to their loyal customers in west Cork. Look at Permanent TSB, which is now in Bandon and Skibbereen but it has been reported it will close its counter services. Again, who will suffer? It is the customer. Ulster Bank is also on the way out of the country.

We know the banks are not lending in practical terms. However, they can participate in this scheme, which is underwritten by the EU and the Government, and make substantial margins in the process. The banks should have nothing whatsoever to do with lending under this scheme. They are not neutral players. They have a vested interest which does not align with the best interests of farmers, SMEs and ordinary householders.

To look at the numbers, if the full €2 billion under the Covid-19 credit guarantee scheme were allocated to Irish SMEs it would allow banks to make €40 million in interest income every year. We know the interest these lenders can charge is 4% despite no risk to the lender. Banks stand to make up to €160 million from that scheme alone every year. This is a scandalous amount of money. The big question is why the Government would allow this to happen. This is why we are so frustrated at how the legislation is being rushed through the House. Clearly, the Government tabled the Bill at the eleventh hour to minimise scrutiny of these issues.

It is clear, following what I have highlighted in the short time available to me, that the banks are making tens of millions of euro from the Government's schemes. This money should instead be going to the small businesses and farmers who need the funds. I know of many small businesses that are seriously struggling in west Cork at present and are desperate for a scheme whereby they could avail of money in the short term. Most of them are very successful businesses in Clonakilty, Bantry, Skibbereen, Castletownbere, Goleen or way out east as far as Innishannon but they are struggling at present and they do not need a scheme that means paying a high rate of interest, especially when in the first place it is being borrowed by the State at a low rate of interest. I ask the Minister of State to make sure this does not happen and that these business people do not have further pressure heaped on them and that the Government is seen to support them. It is not good enough to say they are being given a scheme if it will punish them in the long term. I would appreciate it if this is the first thing the Minister of State looks into.

I welcome the Bill, which provides the legislative basis to enable the Strategic Banking Corporation of Ireland to implement the Brexit impact loan scheme. The scheme will be essential for those SMEs, including those engaged in farming and fishing, that have been impacted badly by the effects of Brexit. It is expected that loans under the scheme will range from €25,000 to €1.5 million and will be available for liquidity for investment purposes, as well as for refinancing specific forms of existing debt.

The scheme will provide an 80% guarantee to participating lenders on loans to Brexit-impacted businesses. The new scheme, which will be administered by the Strategic Banking Corporation of Ireland, will make up to €330 million in lending available to help businesses continuing to respond to Brexit.

One of the consequences of the Covid pandemic is that it has masked the effects of Brexit. As yet, we do not fully understand the impact it has had versus the impact of the virus. Businesses will continue to need additional supports to help them as the Brexit situation evolves and with the pandemic. Access to finance is a critical issue. The scheme will deliver important support to farmers, fishers, food businesses and businesses generally as we seek to ensure that their ongoing viability will not be hindered by a lack of suitable finance. It is essential that such access to credit is made available to as many people as possible.

A particular area we need to look at to assist these businesses with credit is expanding the importance of the credit union sector in the Republic of Ireland. It is something many other EU countries are able to do but we have not mastered it quite yet. As other Deputies have said, access to credit is becoming an increasingly important issue in rural Ireland, as many people are losing their community banking facilities. We need to start to look at the whole issue of banking in general and, in addition to European schemes through which funding can be drawn down, also assist credit unions. This is of critical importance and is something we very much need to look at as a Government. It is something that is repeatedly being raised by people with whom I am engaging.

I have come into politics from a farming background. I grew up on a dairy farm in east Cork. There were extreme concerns about the full effect of Brexit. There is a lot of nervousness within the agrifood sector. Once we get through the Covid-19 pandemic and many of the supports have to be put aside it is very important that there will be a full commitment from the Government to ensure farmers get every support they require, including in constituencies such as Cork East, where tens of thousands of people are either directly employed or supported by the employment of people working in agrifood, which is one of the sectors most heavily hit by Brexit.

Cork East is the home of cheddar production in the Republic of Ireland. My understanding is that the vast majority of cheddar cheese produced here is exported to the United Kingdom. That gives an insight into how this issue is specific to my constituency and why we need to continue to see mechanisms, such as this one, to support these sectors. In particular, we need grassroots supports, as well as supports for larger business, for people working in food production in the Republic of Ireland.

I was not going to speak on this Bill, although my office has done great work on it. I read it because it is difficult to get my head around the amount of money involved.

I welcome this Bill and the fact that money will be made available for small businesses, including primary producers that were excluded from the previous scheme. According to figures from the Central Statistics Office, CSO, with which I am sure the Minister of State is familiar, small to medium enterprises employing fewer than 200 people account for 99.8% of all enterprises and 69% of all persons engaged and micro-enterprises employing fewer than ten people account for 92% of all enterprises. What the figures tell us is that these enterprises are the backbone of the country. That is almost a cliché that we hear repeated in the House all of the time. I am now repeating that cliché by talking about the small businesses being the backbone of the country.

I tried to get my head around this. We are talking about loans of between €25,000 and more than €1 million. There is a guarantee given up to 80% and the scheme will be put through the Strategic Banking Corporation of Ireland. I am not sure why we have banks in the first place if they are not functioning. Maybe it is for another day to discuss the banks we bailed out. We have very little competition. Ulster Bank and KBC Bank are about to exit the market and we will be left with only two or three banks and no competition. We need to face the issue of public banking. We tried in the previous Dáil to discuss having a public banking sector and we were laughed at. It is an issue to which we must return.

This is a specific short technical Bill with a narrow scope, as described by a Department official at a meeting of the joint committee in April 2021. It allows the Ministers to make agreements with the Strategic Banking Corporation of Ireland valued at up to €50 million. It is not the first legislation on this. We previous had the European Investment Fund Agreement Act 2018.

I do not want to sound like a parrot. I like to make information my own and understand it. I am having a little difficulty, however, especially as the committee did not do pre-legislative scrutiny. It is becoming a daily occurrence that we get legislation under pressure and pass it under pressure without pre-legislative scrutiny. We did this earlier with the Private Security Services (Amendment) Bill 2021 which I agreed with because it is good. It was an area that needed to be teased out and this area certainly needs to be teased out. We are talking Monopoly money here which we never seem to have for eradicating poverty, building public housing on public land or having an active role for the State. We have no problem with it here, however. I welcome that but it is not producing transformative change.

Let me stay with the positives in the sense that funding will be provided for primary producers, including smaller farmers and fishermen who were excluded. It will not be as difficult as it is now to get that funding, which will be available for a longer period of up to six years, and there will be more money involved. I looked at all the existing schemes and I could not work out how many are redundant and what analysis has been done on these, including those that will conclude at the end of this year. What money has been allocated that has not been used up? Where is that money going and what conditions are attached, if any, to learning from the pandemic that we can only go forward having transformed our economy?

I am from Galway and I am more than aware of how Covid has affected Galway city and county and the wider region. My opinion is backed up by the Covid-19 regional economic analysis published last year which identified the west, from Galway right up to Donegal, as being particularly affected and exposed because of Brexit and Covid. We also had the Spending Review 2020: An assessment of the impact of Brexit and Covid-19 on Údarás na Gaeltachta and its client companies. The Tánaiste, in a lighter moment, told me he would read it at Christmas in bed. I hope he did. These companies are particularly exposed because most of their exports are still going to England.

Where is the forum for monitoring what is happening so that we as Deputies who represent the people on the ground can explain what is happening and say what is good and bad and what has not worked? Like all Deputies, including the Minister of State, Deputy English, I have hairdressers telling me they will go under because they cannot get money from the bank and they do not want a loan and have never had one. The report from the Central Bank confirmed that most small enterprises did not want a loan. When they got into difficulty they wanted liquidity for a period of time. They did not want a loan. We have never really looked at a once-off grant to many of these businesses to allow them to restart and keep going. I am aware there are restart grants but I am not talking about such a minute basis.

I will support this legislation under protest. It should be scrutinised at committee level to educate those of us who are not on the relevant committee because we would take the trouble of reading the reports and presentations. That did not happen with this Bill.

There is such a list of supports now I do not know which ones are redundant. I am repeating and I am averse to repetition. It is very difficult for us, despite the best efforts of officials from the Department who appeared before a limited session of the committee and explaining the issue to it. I take my hat off to them. Does the Minister of State know what I am mean? We need a proper analysis if I am not able to go out and explain to businesses on the ground in Galway what is available, what is not available and what are the problems. What interaction has there been with Údarás na Gaeltachta in relation to all those businesses in the Gaeltachta that have been badly hit by Brexit, and then Covid on top of that.

I appeal to the Minister of State to use the committee system. It is all we have to scrutinise matters. Having spent four years as a member of the Committee of Public Accounts and having read the reports every week, what I learned was that scrutiny is essential if we are to avoid a waste of money, to put it benignly, not to mention corruption and all sorts of other issues that we should be looking at. The Committee of Public Accounts looks retrospectively. Membership of the committee was a university education for me.

Now we are back with very little scrutiny of all of these schemes. The most important aspect is that we are not even sure if the schemes we are introducing are meeting the needs of the businesses on the ground and primary producers. Until now, the take-up on a range of schemes has been so low, one would wonder how were they ever brought in in the first place. We need a debate on the transformative action that is needed arising from Covid and climate change and how we use State funding to best do that. I am the first to say such funding should go to the smaller enterprises because they are the backbone and we are utterly reliant on them in all of our towns, cities and villages.

My apologies to Deputy Ó Murchú. I should have called him before Deputy Connolly but better late than never.

Ní fadhb ar bith é.

Sinn Féin supports this legislation. Everybody accepts the absolute need for SMEs to have ease of access to necessary moneys. I hope the Minister of State, Deputy English, will consider Deputy O'Reilly's proposal on further engagement with businesses and all the relevant stakeholders. We need to offer schemes that are fit for purpose. In this context, that means appropriate interest rate levels and ease of access. It needs to be doable.

I have had a number of engagements with the Minister of State, Deputy English, specifically on other supports that are required by industries. Certain businesses have fallen between the cracks and have not necessarily got the supports they require to get them through this period. Obviously, I will continue that engagement. I hope in the near future that we can get solutions for those businesses, some of which are in my constituency. I expect there are also some in the Minister of State's constituency and constituencies throughout the State.

This is about ensuring that we can keep as many viable businesses as possible on the road. We must ensure that people have the correct supports combined with the correct type of credit. Ease of access is important, as are decent interest rates. We have already heard much commentary on our dysfunctional banking system.

I thank the Minister of State, Deputy English, for sharing time. I am very pleased to speak on this legislation relating to the Brexit loan guarantee scheme. This is crucial legislation and a further example of the Government's commitment to supporting our primary producers and businesses in dealing with the many challenges they face. The scheme has been a success so far and it is important that we see it progress as quickly as possible. Farmers are facing some serious and acute challenges at present, of which Brexit is one. As Minister for Agriculture, Food and the Marine, I see these challenges and pressures at first hand because I hear about them directly from farmers and their representatives. They can often feel isolated and under pressure, especially with regard to climate change and biodiversity.

I wish to reaffirm to this House that our farmers are leading the charge and delivering on our climate ambitions. The current narrative that farmers are laggards is wrong and does not take account of the huge efforts they have made and continue to make to address the challenges of climate change and biodiversity. We have one of the most carbon efficient agriculture sectors in the world but we must and can do more. Farmers are determined that agriculture will play its part in improving emissions, enriching biodiversity and addressing water quality, all of which have been trending in the wrong direction in recent times. There is nothing industrial about Irish farms or about family farmers doing all they can to keep their heads above water and survive. As the son of a suckler and sheep farmer from the uplands and lowlands of Donegal, I see how farmers could be forgiven for thinking that the agriculture sector is the only one that must make radical changes in order to tackle climate change but this is not the case. We must remember that all sectors have to play their part. We cannot have a situation where farmers are regarded as the only ones who must contribute.

Farmers are adaptors and adopters. They have listened to the best science for decades and adapted it to benefit their farms. It is fair to say that some of the science from the 1970s and 1980s is now out of date and not fit for purpose but the farmers I know, and stand by, are visionaries. If the science points farmers in a certain direction, they will willingly take the lead and we must deliver financial supports to ensure the viability of those farmers who are at the forefront of delivering on our climate challenges. The results-based environment agri pilot, REAP, project that I launched recently closed on Monday with 11,000 applications for just 2,000 spaces. This in itself is a real example of how farmers are willing to adapt and adopt. They will embrace change for the benefit of the environment.

Agriculture is going through an evolution and is likely to look very different in ten years' time. As we move through this evolution, what we cannot do is undermine agriculture. Now is the time for clear heads and an all-of-society understanding of what farming and agriculture can do to tackle climate change as well as deliver for our economy. Farmers know what the challenges are. They understand where they need to go and are taking clear steps to get there. I launched the Ag Climatise document in late 2020, which puts agriculture on a path to carbon neutrality by 2050. Given the opportunity to adopt and adapt, farmers will get there. Our farmers are not looking for a free pass, they are constantly learning, gaining knowledge, producing top-quality, healthy food and adopting new technologies to meet our climate targets. All sectors in society have to do more and farmers and agriculture are very much central to that challenge. I spoke about the evolution in farming that we are currently living through and I want to look back at all we have achieved in a decade. The sector is delivering more for the environment and for our society and economy, with farm incomes central to all of this. Alongside this, farmers are dealing with the challenge of Brexit. We must continue to work to enable our agriculture sector to prosper and thrive and the legislation before us is very important in terms of supporting farmers to deal with that challenge in the time ahead. I welcome the valuable contributions Deputies have made to the debate on this legislation.

It was remiss of me at the outset not to thank the Ceann Comhairle and all of the Deputies, mainly from the Opposition to be fair, who agreed to facilitate the quick progress of this legislation through the Houses. The legislation did not have to go through the full committee procedure and that has assisted in its speedy progress. I thank everyone for their assistance in that regard. I accept that it is not something that we should do too often. We have tried to limit it, although I did write to the Ceann Comhairle a few weeks ago about another Bill but that was related to a Supreme Court decision. Deputies will appreciate that we do not overdo it. I totally value the scrutiny that committees bring to the legislative process. Having been on committees for many years, I know that they perform an essential role. We should always enable committee scrutiny where possible. When we do not do it, we do offer full engagement with ourselves and officials to try to tease through all of the issues. I hope that goes some way towards alleviating Members' concerns. I appreciate that for Opposition Deputies, not having the full scrutiny at committee can be difficult but it has helped us to bring this Bill forward tonight. We hope to get it signed before the end of May and to get this money into the system in June. That is our commitment to the House.

Concern was expressed that the Government is not engaging enough with the business and agricultural communities that will be accessing these funds but I assure the House that the Government does that every day, practically. The Tánaiste, the Minister of State, Deputy Troy, the officials and I engage with businesses of all sizes and shapes all over the country. Likewise, the Minister for Agriculture, Food and the Marine and the Ministers of State, Deputy Heydon and Senator Hackett, are engaging with the various stakeholders in that space. We react to their needs and try to respond to them and this Bill is part of that response. We are bringing forward a product that we believe will be of more use to them. There are longer terms, it is available to primary producers, it has been extended from three to six years and the requirement to show innovation has been dropped. There is also an open, competitive call not just for banks but for other lenders, including credit unions, to come forward to administer the scheme and make products available.

Deputies asked that we would continue to engage, which we will do. The monitoring of these loans and their drawdown is done by the SME and State Bodies Group, along with many others. There will be scrutiny by this House and the Credit Review Office will make sure that the banks are operating the scheme fairly. Again, it is an open, competitive call and the SBCI and the Government will scrutinise that. Those who want to administer the scheme will have to show that they are willing to apply it to those for whom it is designed. The objective is to make products available at much lower interest rates than currently available. That is what is happening with all of the other schemes. I can go through the details if necessary but all of the credit guarantee schemes being offered so far are 4% down. The majority of the 3,700 loans drawn down are in the 2.5% to 3% category, which is a reduction of between 2% and 4% on almost every other product out there under the credit guarantee. That is the proper application. I wish, as does everyone else, that our banks could make money available for even less but there is a cost to administer the loans. There is a cost to the State in terms of the risk to money. In addition, our banks operate under very strict rules regarding their capital reserves, which are different from those relating to many other European banks as a result of what happened in this country a number of years ago. We must respect that and the fact that there are reasons for it. The credit unions are not able to operate like the banks but they are clearly involved in this as well.

Concern was expressed that the legislation is being rushed through and cannot be scrutinised properly. All of the loan products we have to offer, all of the business products and all of the different interventions are available on our website for full scrutiny or through the local enterprise offices. I am happy to sit down with Deputy Connolly or any other Deputy and go through the various schemes that are available. There are lots of schemes and offers out there. I totally accept, as do the Tánaiste, the Department and everyone in government, that they do not go the whole way in terms of replacing every lost euro, lost profit or lost wage packet. They are an assistance towards the cost of doing business and trying to survive during Covid and Brexit and be in a position to continue trading thereafter. The taxpayer cannot step in fully to cover all costs. As I have said on many occasions in this House and in Seanad Éireann, the responses to Brexit and Covid mean that many businesses will have to do a combination of drawing down State supports, grants and wage subsidies, tapping into their reserves as well as doing financial planning and using some longer term financial products. This product is over six years, which stretches the repayment capacity of businesses and it is at much lower interest rates. I would encourage as many companies as possible to avail of these schemes while the framework is there. This one runs to December 2022, while the framework for the credit guarantee scheme will run until the end of this year.

We encourage companies to avail of these and we can respond to that demand. While this scheme is for €330 million of lending, if demand exceeds that, we can respond and introduce more lending. It is not capped in that respect. We will come back to this House to secure permission to do that.

I was asked why this money is available now when it was not available to build houses a couple of years ago. This is exactly the point we have been trying to make for a long number of years. We did not have access to finance to build houses ten or 11 years ago. I wish we did because if we had access to finance, we would have drawn it down and built houses and we would not have the supply issue we have now.

Thankfully, coming into Covid-19 and Brexit, our public finances were in order, thanks to much of the work done by the previous two Governments to ensure we got our public finances in order. Deputy Howlin was very much involved in that process. That means we can step up to help businesses and increase our expenditure because of Covid-19 to approximately €40 billion. It also means we are part of a European credit guarantee fund which enables us to help business and many other sectors because our finances are in order.

Question put and agreed to.