Ceisteanna-Questions. Oral Answers. - County Enterprise Boards.

Paul Connaughton


1 Mr. Connaughton asked the Taoiseach the specific funds which are available to the county enterprise boards for job creation; if the eligibility for such funds will be determined by the county enterprise boards or the lending agencies; if it is proposed to provide venture/risk capital in certain cases; and if the county enterprise boards will provide equity capital for some projects.

Paul Connaughton


2 Mr. Connaughton asked the Taoiseach the procedure he is adopting in filling positions on the county enterprise partnership boards; and if he will make a statement on the matter.

I propose to take Questions Nos. 1 and 2 together.

I would refer the Deputy to the Government statement of 1 October 1992, which refers specifically to the funding of county enterprise partnership boards and to the establishment and membership of the boards.

Funding for the boards will be provided as follows: by way of an additional £50 million of public funds; by way of additional EC Structural Funds through the EC global grant for local development being arranged with the European Commission and contributions of over £100 million from the financial institutions by way of loans and equity. In addition, a specific expenditure position statement will be prepared by the relevant State agencies for each county. These will be incorporated into the county action plans which will be based on an assessment of the needs and requirements for each county.

Evidence of commercial relevance will be required in respect of enterprise ventures and the bases of selection and policies whereby individual projects are approved locally will be established. Guidelines will be agreed by an interdepartmental steering group, representative of all relevant Departments, for the policy basis of selection — for example in relation to sensitive sectors — by the boards of individual projects. The boards themselves will be the final decision-makers for those individual projects within the guidelines.

Enterprise projects submitted to county enterprise partnership boards for funding will be evaluated in terms of commercial viability by an enterprise subcommittee of the board. Personnel designated by the financial institutions will assist in the evaluation and the board will decide the most appropriate method of funding, whether by direct grant, loan, interest subsidy or equity for approved projects. Officials of my Department are now liaising, and will continue to liaise, with the financial institutions on the detailed implementation of the scheme.

Loans by the financial institutions will be made available on favourable terms, including no guarantees in the case of incorporated entities, and the underwriting criteria will reflect a balanced view of the financial institutions' good commercial practice and social responsibility in playing their part in achieving the aims of the county enterprise partnerships in tackling the unemployment problem.

Discussions are continuing with the financial institutions, in particular with building societies and with the insurance companies on further contributions to the overall enterprise fund. The Government are satisfied that there will be a further positive response from the financial institutions arising from these discussions. Equity capital will be included in the further contributions, in particular from the insurance companies.

Each county enterprise partnership board will comprise a chairperson and 15 directors on rural boards and 11 directors on urban boards as detailed in the statement of 1 October.

An establishment team, consisting of representatives of theProgramme for Economic and Social Progress secretariat, the special projects officer of the Department of Finance, and the county Development officer or a nominee of the relevant county manager will, in co-operation with myself, work together in the various counties/areas to establish the new boards.

Full consultation will be undertaken at local level with the county development teams, with State agencies and other groups as appropriate. In particular, the establishment team as part of the local consultative process, will consult with the area partnership companies and Leader groups on the structures which would be most appropriate in a particular area.

Nominees for representation on the boards will be appointed from the public and community sectors. A meeting of delegates from all local community organisations will be convened, at which the concept of the county enterprise partnership boards will be fully explained. Delegates will be requested to nominate three community representatives to the boards.

The employer, agricultural and trade union organisations were asked to nominate their representatives for each partnership board. The employer organisations will nominate two representatives and one will be appointed to chair the board.

The establishment team are now in contact with the relevant people in each county and the new enterprise initiative is proceeding rapidly.

It appears that the Government are making up the conditions of the scheme as they go along. With every day that passes a new wing is attached.

Could the Deputy identify today's wing?

This is a very feeble attempt at getting people back to work and it will be seen as such. Let me ask a straight question. Will the commercial banks have the final or only say in whether or not a project is commercially viable or can the county enterprise boards themselves decide that a project is commercially viable so that the banks would have to invest in it? I want a straight answer.

There could not be a straight answer to the ambiguous question the Deputy has asked. The Deputy asked whether or not the banks will have the final say on the viability or non-viability of a project. The boards will have the final say on that. The boards will decide whether or not to give a project grant aid, to take equity in that project, to give an interest subsidy to a project or to recommend a project to the banks for funding. The enterprise boards will have the final say and the banks will advise accordingly.

Let me get this straight. Is the Minister telling the Dáil today that the enterprise boards have the final say even though the banks will be involved commercially?

I am disappointed that the Deputy in misinterpreting what I have said. The position is that the new enterprise structure being put in position will have a number of options available to them to assist a project. They will have to take into account national sensitivities, the viability of a project——

We have understood all that.

——they will have to assess that project and after their assessment they can decide to give it grant aid, to take equity in the project, to give an interest subsidy to the project, to recommend the project for loans. That will be the decision of the enterprise partnerships boards. The Deputy has inferred that we are putting wings on this as we go along. No such thing is happening. It is ade facto decision as of 1 October. The Deputy used the word “feeble”. If the Deputy thinks our effort is feeble let him look into the mirror and ask himself what his party have done, a party that refused to participate in the Oireachtas Committee on Employment, a party that denigrated our initiative——

The Minister would not sit on it himself.

It is not a function of any Minister to sit in and impose his will on any committee. It is a matter for the Members of this House. We are responding to the recommendations of that committee. The Deputy's party have condemned the enterprise initiative at Oireachtas level. However, funnily enough, Fine Gael members around the county have warmly welcomed it. In the Deputy's own county the distinguished mayor of Galway and the distinguished chairman of Galway County Council have given it a warm welcome and are proud to sit as directors of the new Galway board.

Will the Minister accept that the use of the word "mirror", as far as he is concerned, is the appropriate word? Would he not accept fully that his enterprise boards were designed solely to give the appearance of activity on the part of a Government who are totally bereft of any policies to cope with our appalling record on job losses? Would he now accept that in the light of the election that is going to be declared tomorrow these are white elephants even before they are established?

I will not anticipate or speculate about what will happen tomorrow. Suffice it to say that the record of this Government during the past six months is one of action and decisiveness.

There are 300,000 people unemployed.

We have put new structures in place and created opportunities for the people, particularly for the unemployed. The Deputy's party failed to put forward a scintilla of a submission——

Has the Minister of State read our jobs policy?

When the Deputy's party called meetings around the country they could not get their branch members to attend. Now they are trying to denigrate the efforts of the Government——

We filled them.

——who have taken the initiative and are trying to create opportunities for the people in a new partnership.

We will send the Minister of State a copy of our jobs policy.

The Government have taken a historical decision to demarcate small projects from medium and large projects in a new partnership initiative involving the State and the commercial sector working together and backed up by Government professional services in an effort to create an enterprise culture and to provide an opportunity for people with entrepreneurial flair to help themselves at local level.

May I ask a final supplementary question?

We have dwelt for some ten minutes on these questions and I think we have dealt with them sufficiently. A brief question, Deputy. I will allow a final question from Deputy Flaherty, if she so desires.

The Minister of State appears to be contradicting the bank official who was interviewed last week on the national television network during the course of which he said that the banks will evaluate all the projects because it is their money that is involved.

We will send the Deputy a copy of the written reply.

The Deputy is making a statement rather than asking a question.

Is the Minister of State saying that the banks are wrong? Can either of the Ministers of State clarify this matter?

This is Question Time.

I have no difficulty in saying that what I have said today is consistent with what I said on the television programme in which I appeared with the Deputy's colleague, Deputy Noonan. As I have said, it will be the responsibility of the banks to provide loans on the recommendation of the county enterprise partnership board. The technical details have been agreed and we have received a commitment from the institutions that they will provide £100 million. Further commitments and further innovative plans to deal with unemployment are on the way.

Had they not given that commitment already?

Attempts are being made however to stymie the Government's efforts to create employment and opportunities for the people, but I am quite confident that they will give their answer and vindicate our performance.

A final question from Deputy Flaherty.

I have a specific question. Is the Minister of State aware that a very successful, in limited terms,Programme for Economic and Social Progress partnership is operating in Finglas and in other parts of Dublin? Has he considered how this can be integrated with the local partnership scheme?

I am aware there is a very good area partnership board in Finglas and in other parts of Dublin as well as in the rest of the country. I had a meeting with the distinguished Lord Mayor of Dublin and with the city and county manager. Our officials are working on a plan for Dublin and further meetings will be held. I am confident that the public representatives and the people of Dublin will be more than pleased with the structures that will be put in place which will complement existing structures and the services provided by the State and local authorities.