Written Answers. - Business Liquidations.
Liz O'Donnell
Ceist:
34
Ms O'Donnell
asked the
Minister for Enterprise and Employment
the measures, if any, being taken to reverse the trend of increasing liquidations among small and medium enterprises, which have shown an 18 per cent increase for the first quarter of 1996 compared to 1995.
[7659/96]
I assume the Deputy is referring to recently published figures from Stubbs Gazette which indicate that there were 194 liquidations reported in Stubbs Gazette in the first quarter of 1996, as compared to 165 for the first quarter of 1995. Stubbs Gazette analysts had predicted, in 1995, that liquidations would increase because the number of liquidations are affected by the number of new businesses established in previous years. The number of business start-ups increased by 29 per cent in the period 1992-95, reaching a record number of 16,265 in 1995. It is important, therefore, to view the recent increase in liquidations in the context of this very substantial increase in business start-ups. It is also relevant to mention that the number of liquidations in the first quarter of 1996 is, in fact, lower than the figure of 219 liquidations for the first quarter of 1994.
One of my principal concerns is to ensure that help is available to businesses to enable them to survive the critical start-up phase. A range of measures is already in place for this purpose and further measures are in the process of being implemented to improve the overall operating environment for small business.
The agencies which come within the responsibility of my Department, including FÁS, Forbairt and Shannon Development, provide a range of support measure to assist start-up firms and to help them to survive and develop. These measures include training, management development, advisory services and mentoring programmes. The nation-wide system of 35 county and city enterprise boards is designed to assist small and micro enterprises at start-up level through the provision of direct financial assistance (e.g. grants) or indirect financial assistance, including business advice, information, mentoring and management development assistance.
In addition, many State supported, local initiatives, such as the Plato programme, provide a practical support to small, and early stage business through a parenting arrangement whereby executives from large established companies provide expertise and lead groups of owner managers of small businesses on the programme.
An area to which I attach special importance is the financial environment for small business. The £208 million access to finance scheme is providing fixed interest rate loans for the creation of jobs and to increase the commercial viability of small business. This scheme, which carries a 6.5 per cent subsidised interest rate, was created to provide long-term, low rate finance to small business and service firms. In addition, I believe that the recently announced seed venture capital measure of the Operational Programme for Industry will be particularly important for the sector.
As regards initiatives which I am in the process of implementing, my Department is currently preparing legislation to resolve the problem of late payment of business debts, which is an area highlighted by the Task Force on Small Business as being of particular importance.
This Government has an ongoing commitment to help small business in the creation of enterprise and employment. This commitment is reflected in many aspects of Government policy. For example, the 1996 budget placed particular emphasis on the small business and services sector by reducing the rate of corporation tax, which was an area highlighted by the sector as being of particular importance.
