Friday, 6 September 2019

Questions (764)

Robert Troy


764. Deputy Robert Troy asked the Minister for Business, Enterprise and Innovation her views on the statement by the head of an organisation (details supplied) that supermarket shelves here could start to run bare within two days of a hard Brexit; and the supports and resources being provided by her Department and agencies under her remit for haulage firms to take immediate steps to improve supply chains. [36861/19]

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Written answers (Question to Business)

Brexit of any kind means change, and we have to be as well prepared as possible for this unprecedented challenge. While Government can assist in supporting businesses in the face of a hard Brexit, businesses must, of course, also prepare themselves despite what I know to be very difficult circumstances.

As part of the whole of Government response to Brexit, I and my Department officials are working to support the grocery retail and distribution sector in its efforts to prepare for Brexit. Indeed, my Department has had ongoing engagement with the retail sector in relation to Brexit since 2016, principally through the Retail Consultation Forum (RCF) which I chair.

Membership of the RCF includes retail associations such as Retail Ireland, Retail Excellence, CSNA, RGDATA, other bodies such as ISME, SFA and Chambers Ireland, a number of retailers, the City and County Managers Association (CCMA), and a number of relevant Government Departments.

Also, I have convened a number of roundtable discussions with the main Retail Grocery and Distribution players to better understand the contingency planning that is ongoing within that sector to provide for continued food supplies. [13 December 2018, 24 January 2019, 19 February 2019, 26 March 2019, 11th July 2019]. The February meeting adopted an interactive workshop format and attendees included representatives from the haulage sector. For these discussions with the industry players, I have also included the relevant State authorities: Revenue; Department of Agriculture and the Marine; Department of Transport, Tourism and Sport; Food Safety Authority of Ireland; and Dublin Port.

There has been very constructive engagement through these meetings, and we will continue to work together to ensure that the processes being put in place operate as efficiently as possible to minimise the disruption for businesses, supply chains, and the consumer. Through the dialogue we are facilitating with the Retail Consultation Forum and other roundtables, retailers and distributors have given assurances that they are intensively making preparations for Brexit.

For example, they are examining their own supply chains and seeing what adjustments need to be made, they are availing of advice and information from the various State authorities that they will need to engage with and they are engaging with their suppliers down the line.

More broadly, my Department and its agencies have been working to prepare Irish businesses, including retailer and haulier businesses, for the potential challenges posed by Brexit by helping them to assess their preparedness and helping them to implement practical action plans in areas such as customs, supply chain and sourcing, and financial management. While we cannot yet know the form that Brexit will take, these measures aim to assist businesses in identifying and managing key risk areas and develop practical preparatory actions regardless of the circumstances of the UK’s withdrawal from the EU.

The Government’s suite of Brexit supports include preparedness vouchers, consultancy and mentoring supports, tariff advisory services, research on new markets and innovation supports through Enterprise Ireland, the Local Enterprise Offices and InterTrade Ireland. Supports and advice are also available from the National Standards Authority of Ireland, the Health and Safety Authority, IDA Ireland, Revenue, Skillnet Ireland, the Strategic Banking Corporation of Ireland, Bord Bia and Failte Ireland.

The most immediate consequences of a hard Brexit are likely to be currency movements, supply chain constraints, delays, duties and tariffs. In the first instance, there will be a strain on the working capital position of businesses.

Of the Government’s suite of supports, the €300m Brexit Loan Scheme is designed to address working capital challenges brought about by Brexit. Under the Scheme, loans of up to €1.5 million are available at a rate of 4% or less, with loans of up to €500,000 available on an unsecured basis. Similarly, the €300m Future Growth Loan Scheme is designed to support strategic long-term investment in SMEs in a post-Brexit environment.

InterTrade Ireland also plays a major role as part of Ireland’s Brexit response and offers Brexit-related advisory services to eligible businesses. So far this year, more than 3,200 SMEs have directly engaged with the Brexit Advisory Service.

ITI offers a Brexit Start to Plan voucher and Brexit Implementation Voucher schemes, which enables businesses to get professional advice on how best to plan, prepare and implement for the UK's withdrawal from the European Union. These supports help businesses obtain advice on specific areas such as tariffs, currency management, regulatory and customs issues and movement of labour, goods and services.

ITI Brexit Start to Plan vouchers are worth up to €2,250 (inclusive of VAT) each. 1,613 businesses have applied for a Brexit Start to Plan voucher, of which 1,405 have been approved. ITI new Brexit Implementation Voucher provides financial support up to £5,000/€5,625 (inclusive of VAT), with InterTradeIreland paying 50%. This will allow businesses to implement critical changes making them better prepared to deal with a new trading relationship.

In August, ITI launched a new advertising campaign and a new online resource to encourage and assist firms in preparing for Brexit. The online “Bitesize Brexit” resource is a one-stop-shop for cross-border traders, presenting information in easily digestible segments and includes specific actions businesses should take in preparing for Brexit.

The Irish Government, in association with key industry partners, also launched a new support measure to help customs agents, intermediaries and affected Irish businesses develop the capacity to deal with the additional customs requirements due to the UK’s departure from the EU. The new initiative called Clear Customs comprises of a training programme and a customs financial support to assist with the costs of recruiting and assigning new staff to customs roles.

In addition, the Government has held over 100 Brexit information seminars and events since last September. Furthermore, my Department has engaged with enterprises through the Brexit Consultation Forum and continues to host a series of Brexit information meetings in the Border Region in collaboration with the Accountancy Bodies of Ireland.

We are confident that we are as ready as we can be, but it is important that businesses do what they need to do to be ready. As Chair of the Retail Consultation Forum I will continue to engage with the retail grocery and distribution sector on preparatory actions.