Thursday, 31 January 2019

Questions (2)

Maurice Quinlivan

Question:

2. Deputy Maurice Quinlivan asked the Minister for Business, Enterprise and Innovation the legislation and changes that will be needed in her Department to prepare for a no-deal Brexit; and if she will make a statement on the matter. [4700/19]

View answer

Oral answers (8 contributions) (Question to Business)

Will the Minister outline the aspects of emergency legislation that will be required in her Department in the event of a no-deal Brexit?

I thank the Deputy for raising this issue. On 19 December, the Government published our contingency action plan, which outlines our approach to no-deal Brexit planning. As part of that plan, the Government last week published the general scheme of a Bill that would be necessary in the event of a no-deal Brexit. The draft omnibus Bill - the miscellaneous provisions (withdrawal of the United Kingdom from the European Union on 29 March 2019) Bill - focuses on measures protecting our citizens and supporting the economy, enterprise and jobs, particularly in key economic sectors.

Insofar as my Department is concerned, Part 3 of the omnibus Bill consists of nine heads containing legislative provisions relevant to functions under my Department. They are aimed at improving the range of supports offered by Enterprise Ireland to help companies face the challenges of Brexit and remain competitive at a global level. Specifically, the intention is to increase the ability of Enterprise Ireland to provide a competitive and flexible offering to its client companies in terms of research and development grants and to allow it to provide low-interest debt instruments.

In increasing Enterprise Ireland's power to provide lending supports to businesses, we are helping to preserve the value of the State's investments in these businesses and assisting companies through restructuring or redevelopment programmes.

In addition to the legislative provisions contained in the omnibus Bill, my Department is progressing six statutory instruments that are also required to deal with Brexit. These are largely technical in nature to effect necessary changes in different policy areas: health and safety; company law; and the export of dual-use goods. These legislative changes are part of a wider suite of measures, both legislative and non-legislative, being undertaken by my Department to prepare for Brexit, including the deployment of new business supports, additional funding to the agencies and regulatory bodies, engagement with the European Commission on state aid issues, and ongoing direct engagement with business representatives.

I am puzzled by that response. The Dáil is 21 sitting days away from Brexit day, yet we only got sight of the heads of the omnibus Bill last week. It was my understanding that the emergency provisions contained in that Bill comprised urgent, new legislation that was being drawn up by the Government in the event of a Brexit crash-out. When I examined the section of the Bill relating to the Department of Business, Enterprise and Innovation, though, it became obvious that it was not new. In fact, it is a copy-and-paste job of the Industrial Development (Miscellaneous Provisions) Bill 2018, which the Joint Committee on Business, Enterprise and Innovation had sight of in October. I appreciate that such provisions will assist our enterprise agencies in the event of a no-deal Brexit, but these amendments to the Industrial Development Acts were not designed or drawn up in the past few months in preparation for a hard Brexit. They were on the way regardless. This looks like the Government is trying to pull the wool over our eyes by copying and pasting forthcoming legislation into the omnibus Brexit Bill in an effort to bulk it up and make the Government look more prepared than it actually is. Will the Minister clarify the situation?

Considerable work has been done with businesses through the agencies, including local enterprise offices, InterTradeIreland and Enterprise Ireland. A large number of supports have been provided to businesses.

We identified these legislative measures as being necessary to help businesses in the event of a no-deal Brexit. It means we can give them extra supports. Some 85% of Enterprise Ireland's firms are taking Brexit-related actions. A great deal of work is being done. Almost 3,500 companies know how ready they are for Brexit after using the Enterprise Ireland Brexit scorecard as a first step in developing their Brexit plans. A series of nationwide Brexit clinics have been hosted by Enterprise Ireland. The Brexit awareness campaign visited many towns and cities across the country. More than 625 Enterprise Ireland Brexit-exposed companies have completed sustainable growth plans. A great deal of work is under way across the Government.

I thank the Minister. I attended some of the meetings that she mentioned, and I commend the enterprise agencies on doing their best. However, I wish to express my surprise that no other legislation will be required for businesses.

To follow up on a question that Deputy Butler asked, what contact has the Minister or the Government had with the EU requesting emergency measures in the event of a hard Brexit? The Minister for Finance, Deputy Donohoe, announced this week that unemployment could increase by 2% in a no-deal Brexit. Would it not be prudent to prepare legislation for an employment assistance scheme to help companies that could find themselves struggling?

Is the Minister satisfied that the current Brexit business support schemes are working as well as they could? Their extremely low uptake rate suggests they need serious adjustment if we are to ensure that businesses are able to make use of them. Only 5% of the €300 million Brexit loan scheme has been drawn down to date. What is the Minister doing to ensure a higher uptake of that scheme? Does she intend to modify it to make accessing it easier for business?

I will answer the last question first. There has been a good uptake of the Brexit working capital loan facility. Almost €15 million of it has-----

Businesses have to decide what suits their financial planning. The facility is available and easily accessed and I have heard no complaints about people being unable to access it, but availing of it must be in line with their financial requirements. If someone borrows money, he or she still has to pay it back. Businesses are considering it and it is available to them. As we get closer to the Brexit deadline, more businesses may avail of it. I encourage businesses to do so just in case they need the facility. Were I a business person, though, I would first want to ensure borrowing was in line with my financial capabilities.

I met Commissioner Vestager last week. We outlined to her clearly the difficulties that Ireland would be presented with by Brexit, be it a no-deal one or otherwise. There is nothing good about Brexit for many Irish businesses. The Commissioner was very conscious of Ireland's special situation in terms of the challenges it now faces.

We had been doing a lot of work with her. She did say that the EU remains ready to assist in any way it can.