Dáil Éireann díospóireacht -
Thursday, 6 Feb 2014

Vol. 829 No. 3

County Enterprise Boards (Dissolution) Bill 2013 [Seanad]: Second Stage (Resumed)

Question again proposed: "That the Bill be now read a Second Time."

Deputy Richard Boyd Barrett

The Government is nothing if not consistent in its determination to apply neoliberal economic doctrine to dealing with the plight of the economy in its approach to trying to create jobs. That doctrine is pretty simple and has been applied consistently by the current Administration as it was by the previous Government, albeit with minor tinkering. However, the broad strokes of the policy the Government pursues to create jobs are the same as those of the last Government, namely, to keep taxes low on profits and wealth, to slash public expenditure on job creation, public services and infrastructure, to drive down pay and conditions for workers, to cut back on social welfare in a so-called effort to activate people for jobs and to gear all of the institutions of the State and the economy towards facilitating multinational corporations in the hope this will bring in significant amounts of foreign direct investment. I put it to the Minister of State, Deputy John Perry, that this policy has failed. I argue that it contributed significantly to the crash that has devastated the economy. Moreover, as the Government continues to apply it, it has failed to bring about any meaningful recovery in the economy. The Government trumpets with great fanfare every new announcement of jobs that results from foreign direct investment and everyone, of course, welcomes any job creation, particularly against a background of mass unemployment and emigration, as we have faced in recent years. However, even in the best of all possible scenarios, foreign direct investment cannot compensate for the damage to the domestic economy and the small to medium-sized enterprise, SME, sector, which the Government claims to champion. It cannot compensate for the damage the Government has done and is doing to the domestic economy and the aforementioned sector.

SMEs provide 70% of all jobs, while foreign direct investment accounts for 10%, which is high by international standards. The idea that gearing everything towards foreign direct investment and facilitating multinationals, that is, the big corporates and the major chains, will provide any sustainable, stable platform for economic recovery is ideological claptrap that has failed us disastrously. A change of strategy is needed to help the small to medium-sized enterprise sector and, frankly, decorative changes to the county enterprise board structure really will make little difference to the fundamental problems facing small and medium-sized enterprises and the domestic economy in general. An absolute reversal of the policies the Government has pursued is what is required. Wages must be raised to put more money back into people's pockets in order that they can spend it in the small and medium-sized enterprises that are on their knees and which are going out of business daily. Moreover, something must be done about the rates that are crippling small and medium-sized enterprises. They are completely regressive, in that they hit disproportionately small and medium-sized enterprise but let off the big multinationals and corporates which can well afford them. With others, I have stated repeatedly that a progressive differential rates scheme must be put in place in Ireland in order that struggling small to medium-sized enterprises will have rates applied according to their profitability, turnover and ability to pay, rather than essentially having a flat rates scheme that has a disproportionate impact on small and medium-sized enterprises. On the issue of upward-only rent reviews and rents that are impossible to sustain for many small and medium-sized enterprises, I note the Government's unwillingness to really tackle this issue. Presumably, this is because the banks and NAMA are now the big landlords and have no interest in reducing rents, while the Government is not willing to take them on on this issue.

These are the major issues and against that backdrop, I cannot discern how what is proposed in the Bill can make much difference. I accept that there is a certain rationale to having a co-ordination of local enterprise support at a national level. That is the single point on which I can discern a certain logic in the Government's proposals in the Bill, whereby instead of having 32 separate or discrete county enterprise boards, some form of national co-ordination of the effort to support and help enterprise can be put in place. While I can see the logic of doing this, I fear that what really is running behind this measure is a corporatisation of local development and support structures.

I fear this runs parallel to what this Government is doing in other areas of local development, particularly in the community development sector, where it is dismantling the localised, more democratic and community-based structures in favour of a corporatisation of support for enterprise and community development generally. Removing the democratic element, the input from local people, small business people and elected councillors, and moving it into the more centralised executives of Enterprise Ireland or the top management of the local authorities puts an even greater distance between people on the ground and the structures that are supposed to really engage with them at a local level and work out ideas, solutions and suggestions for promoting and supporting business at a local community level. By doing this the Government is putting them at a further remove.

That is not to say the county enterprise boards and all our local community structures have been absolutely wonderful and brilliant. Often they are labyrinthine and confusing, and I can see a case for streamlining them. However, I worry that this is a move in the wrong direction in that the streamlining may be just a corporatisation which will put things at an even greater distance from the people the Government is supposed to be supporting and helping. I worry, as I said at the beginning, that this is geared more towards facilitating the big corporations and multinationals rather than supporting small and medium enterprises. I have been very concerned about this and have received many representations about it. It is part of the same pattern as the Government's plans to bring community development structures under the local authorities and outsource community development and local employment services by open tender, which is absolutely crazy. I see a parallel between that and the talk of outsourcing social welfare, so-called labour activation, to private corporations, which could come in and tender for local employment services, threatening jobs and those services. This could potentially lead to a bizarre situation in which companies such as G4S, which provides these services in England, or multinationals from other parts of Europe might come in and provide local employment or community development services in Ballyfermot, Dún Laoghaire or Ballymun. That is crazy. I see a parallel there and I worry about the direction of this but I will, obviously, follow the debate.

Deputy Catherine Murphy

We would all agree that the creation of jobs at every level needs to be assisted and facilitated. I have some concerns about the amalgamation or movement of the country enterprise boards into the local government structure. The micro sector is a key sector and has a positive knock-on effect when jobs are created. Because they are indigenous, most of the purchasing power will be retained in the economy. More than 90% of businesses in the EU, never mind in Ireland, fall into this category. There is no shortage of good ideas. Very often there is a difficulty in getting funding to get started and build those good ideas into small businesses. There was a debate between the Department of Jobs, Enterprise and Innovation and the Department of the Environment, Community and Local Government about where to position this sector.

It is essential that services are available reasonably locally and we accept that. It is not just a change of address because most of the county enterprise boards will have existed physically outside the county or city council offices. It is not just about saving on rent or overheads. The location is important because there is a cultural difference between the county enterprise boards and the local government system. I was on a county and a town council for a long time and my experience is that the local government system is very legalistic and internally focused. It is a process-driven set of services and I am concerned that the flexibility we need and that we saw in the county enterprise boards will be lost with the positioning within the local government system.

It will be an entity within that service - it is not just to be moulded in - but the executive levels will have a lot of dialogue with each other and management team meetings will most likely include the chief executive officer or director of services, who will have a responsibility here. We have constantly been told that the new reforms in local government are the most radical in over 100 years. I do not buy that mantra. I do not expect to see very radical changes and that is a missed opportunity. While this may not be a very radical departure, I have concerns that the culture will be one of the biggest problems.

There is a need to have a broader remit. For example, some county enterprise boards would have had money to spend and would not be able to spend it while others would have suffered because they had a queue of projects but lacked the money. Last year there was no money in Kildare from February until October, when some money was returned. There were very viable projects and it was a shame they did not get the go-ahead. The cost of creating jobs in the micro-enterprise sector is tiny compared with that of creating jobs further up the food chain in the multinational sector, where the jobs will tend to be much more high-tech. This sector has been incredibly important, with more than 30,000 jobs created since the county enterprise boards were founded in the early 1990s. The purchasing power has a very important knock-on effect.

The mentoring programme has been incredibly important. Very often people will say the mentoring programme has been at least as important as the grant they may get or the feasibility study that was supported. A range of people fall outside the category. They are the people I see on a reasonably regular basis - people who have been out of the workforce for a while, many of whom are women. People who have been self-employed do not get the kind of supports that would be available when starting a small business, such as the back-to-work allowance that would be paid through the social protection system, which should be a complement to the supports that come from the county enterprise boards.

A cross-departmental range of issues needs to be considered. Somebody who came to see me last week told me he had worked hard on his business plan and got all of the ducks in a row, but he cannot proceed because he does not have the funding to get it off the ground. Others will be able to point to people with the same difficulty. While initiatives like the seed capital fund can be helpful, some people are not able to leverage funds from them. These issues must be examined also.

Every business has concerns about the banking system. It remains incredibly difficult to get finance from the banks and a business must almost be a proven entity before a person will be allocated finance for it. The risks all seem to be on one side and receiving banking finance remains a problem. It is important to retain some connection between public representatives and sectors such as the micro-enterprise sector. Public representatives can bring something to the table. Much has been said about the reform of local government and providing councillors with more power. However, they are excluded from areas where they could offer assistance. This is one such area.

I have doubts that the Bill will add anything to the area of enterprise. I believe the proposal was born out of the quango cull. The greatest danger is one of culture and I do not believe the Bill will change the culture of the local government system in the foreseeable future. Change will be ongoing and the fact that the enterprise boards will now be part of the local government system is a risk for them. They have been reasonably successful and could have been even more successful had more funding been available. I do not suggest they should have lent irresponsibly, but that said, many potentially viable businesses have not got off the ground or have been limited in their effectiveness owing to the shortage of funding at that level. I hope this issue will be examined further. While there have been some improvements, a lot more needs to be done because some real opportunities are being wasted.

Deputy Damien English

I thank the Acting Chairman for giving me the opportunity to speak about this important Bill, the purpose of which is to reform the system of delivery of State supports to micro or small enterprises. We are all agreed that some reform is required in this area and various models for achieving this have been put forward in the past few years. While I was in opposition, this issue was discussed several times. We have had significant debate and discussion on the issue during the years, in committee and the Dáil and through the various business organisations. As a result, the solution in the Bill has been developed and it proposes to create a new enhanced support model to be delivered at local level through the local enterprise offices, LEOs.

The key issue for me is that we keep the term "local" as part of the model. The change being made involves dissolving the local enterprise boards which have been successful. Therefore, it is important that the new structure of the LEOs remain local. I firmly believe the local connection we had in the enterprise boards was a real driver in assisting business people and entrepreneurs and believe this can and will be extended under the new LEO structure. In my county of Meath the expertise and local knowledge built up over many years can be transferred to the new arrangement. I have no doubt that the excellent team built up in County Meath, under the CEO, Mr. Hugh Reilly, which has delivered jobs for the county will continue to lead and deliver in the new structure which will receive clear guidance from Enterprise Ireland which will be involved in the setting up of the structure with the local authorities.

I served on the county enterprise board in Meath from 1999 to 2004 and saw at first hand the great work done at that level. I also saw at first hand how local businesses valued the board's services and input, be it advice, mentoring, guidance, networking or financial assistance. The board gave many promoters of viable business plans the confidence to go and develop a business from what they were good at. Many entrepreneurs come up with great ideas and business plans, but they often lack the business know-how to make their business happen, drive it forward and create jobs. The role of the enterprise boards was to provide assistance and expertise. This work will continue through the new LEO structure, in conjunction with Enterprise Ireland and the county councils.

For many years many representative bodies of small firms have been calling for something such as a one-stop-shop to tackle the issue of providing business supports, whether it be mentoring, financial assistance or anything else. We now have this. I understand the change is difficult for many staff of the enterprise boards because they believe their boards were doing it right. I agree that they were, but the new structure is an opportunity to enhance and improve on what we had. I have heard concerns expressed that the pro-enterprise image of enterprise boards could be swallowed up by the county councils or be lost. However, I see this as an opportunity to make county councils pro-enterprise and drive the change needed.

Job creation and new business start-ups are everyone's business, not just that of enterprise boards. They are the business of local authorities and every Department. The Government's Action Plan for Jobs recognises this and that it is the business of every Department to help to create jobs and an environment in which jobs will be created. That is what is being done with the Bill. We are creating a new structure that will pull together Enterprise Ireland, the enterprise boards, local authorities and so on into a one-stop-shop that will serve people with ideas to create jobs, a new start-up or grow an existing business. All the advice, support, mentoring, etc. required will be available in this one-stop-shop. That is what is needed and I welcome it. I commend the Minister of State, Deputy John Perry, and his colleagues, the Minister of State, Deputy Sean Sherlock, and the Minister, Deputy Richard Bruton, for bringing forward the Bill and making this happen. I understand there are some issues to be ironed out, but everything is coming together.

I welcome the clarification provided regarding what will happen in April when the new offices are up and running. I also welcome the confirmation that there will be more funding, staff and services in each local authority for enterprise. Additional funding is being provided in 2014. I also welcome the new graduate recruitment programme which will help to supplement the already dedicated staff in enterprise boards and local authorities. The new system will combine new supports for businesses currently delivered by county enterprise boards with those being provided by local authorities in the first-stop-shop under the direction of Enterprise Ireland.

Some Deputies referred to the fact that some companies fell through the cracks. As I have seen, many companies did not fit the criteria to receive support from an enterprise board, but neither did they fit the criteria to receive support from Enterprise Ireland. For too long, thousands of companies have missed out on the guidance, advice and mentoring they need to help to drive their businesses, which is a shame. Now, thanks to the Government, this problem is being fixed and these supports will be available to all those companies that need or want help to start or grow.

I welcome the new funding for young entrepreneurships to try to drive the concept of entrepreneurship among young people. It is also welcome that each LEO will be required to draw up a plan and set targets to boost local enterprise. For too long, we did not set targets, but now we will have them. I know some have concerns and doubts about this legislation, but I see the change being made as positive, one which will result in more start-ups and jobs in the future.

Deputy James Bannon

I welcome the opportunity to speak on the Bill, which we all hope will have positive implications for the establishment of small businesses throughout the country. The Bill is part of a series of measures to boost small and micro-businesses. It aims to create a centre of excellence within Enterprise Ireland and develop new thinking and best practice with regard to delivering supports for small and micro-businesses. It will establish local enterprise offices, LEOs, and create a first-stop shop in local authorities to support small and micro-business at local level within the framework of an integrated national network.

The Bill will combine enterprise support for business at local level with the business support service and expertise of local authorities to create the best possible local environment for small businesses. A strong network in support of entrepreneurship will be developed through working with local businesses and the wider community. All of these measures are designed to increase the record of job creation and innovation in the sector, which in turn will increase exports from micro and small businesses. The intention of the Government is to create a national connected approach with streamlined delivery. This should ensure more efficient use of resources, create a clearer picture of the support available and provide local firms with a more developed support system, including support at national level.

The Bill was outlined in the 2011 programme for Government, which stated that we would merge local enterprise and job support functions of local, regional and national agencies into a single business and enterprise unit in local authorities to allow streamlining of local job creation and support functions and increase shared knowledge, capability and resources while saving on administration costs. This is the intention of the approach the Government is taking.

The decision to dissolve the county enterprise boards and transfer their assets, liabilities and functions to Enterprise Ireland will ensure all small and micro-enterprises will be able to access the support they need to establish and expand their operations in the quickest and most effective way possible. This reform of our business support infrastructure is the first radical overhaul of how we deliver for our entrepreneurs since the county enterprise boards were established 20 years ago. The new model will see local authorities providing services on behalf of Enterprise Ireland through the LEOs, which will act as one-stop shops providing support and business development services to the highest possible standards tailored to our business leaders of the future. By making advice and guidance easily available we can help our entrepreneurs to chart the best way forward for real success down the line. The changes being made now will see local authorities, Enterprise Ireland and the LEOs all working together to provide a service which is second to none, has smaller businesses at the heart of everything it does and harnesses the know-how of all of the arms of the State business support infrastructure to maximum effect.

Small and micro-businesses are the key to local and community economic development and if properly supported will lead to increased commercial success in the midlands. More than 86,000 small businesses throughout the country provide employment for more than 700,000 workers and generate €90 billion in turnover annually. The owners of these businesses have demonstrated their willingness to invest in their communities, provide vital employment and generate enterprise. Government policy must reflect the success of such ventures by being supportive of new business ideas and ensuring the vital flow of lending is in place.

This brings me to an important issue which is dear to my heart. It is important that we get the banks lending again, as credit is the lifeblood of the market economy. In recent years businesses have been starved of credit facilities and many good businesses are still going to the wall as a result. Since taking over the wrecked affairs of the State in 2011 the Government has been doing its best to restore the flow of credit to the business sector through financial supports for businesses and the Action Plan for Jobs. We have continuously pointed the way forward by placing job protection and creation at the heart of our recovery plans. The financial supports for starting one's own business, growing businesses and accessing credit are the main ingredients of our stimulus package to rebuild the economy.

If we are serious about supporting and developing small business enterprises we must examine over-regulation, red tape and the form-filling required for various Government bodies. This is expensive time-wasting and stifles small businesses. I plead with the Minister of State, Deputy Perry, to step up to the mark, which I have no doubt he will, demand a reduction in the administrative burden of regulation on small businesses, and let it be known that the new LEOs will have to deal with less bureaucracy and red tape from various Government agencies and that they will be allowed greater flexibility in awarding grants and determining their limits. I am disappointed with IDA Ireland because, based on responses to recent parliamentary questions, it does not visit every county or promote each county equally. I would like to see the Minister of State taking on this matter. I would not like to see the new LEOs being restricted in the type of business they can support.

When discussing small and medium enterprises, the agrifood and creative sectors are often overlooked. Local farmers, food processing industries and auxiliary services provide local jobs and play an important role in many rural communities throughout the country. Almost 200,000 people depend on this industry for employment. These are very important businesses and they struggle with the same obstacles as businesses in other sectors, such as high energy costs, high rates and excessive bureaucracy and red tape.

We need to move faster to overhaul the myriad of agencies involved in food safety inspection and regulation with a view to establishing a single food monitoring body. This would not only reduce red tape for small businesses but would also ensure efficiency and consistency in monitoring procedures. Such a single food monitoring body could also be responsible for the long-overdue food labelling legislation to support producers and processors who adhere to strict quality and safety regulations but struggle to compete with imports of questionable quality.

The Crafts Council of Ireland and Craft Northern Ireland designated 2011 as a year of craft. This gave us a great insight into the richness and vitality of the craft industry throughout the island of Ireland. Refined over centuries, the craft and creative industries sector is of immense importance to our economic activity as well as our culture. A significant number of new jobs could be created in this sector if proper initiatives and incentive schemes were put in place by the new LEOs.

What impact will the new LEOs have on community-owned enterprise centres and their contribution in promoting enterprise and jobs?

Many people in every county have innovative ideas that could be developed into craft enterprises. As a country, we have a distinctive and renowned heritage in craftsmanship, and Irish craft is precious and unique. As I have said many times previously, if investment was accelerated in this area, further development would directly contribute millions of euro to our export and domestic markets.

It is only by encouraging entrepreneurs to follow through on new business ideas and to take the necessary risks involved in setting up small or micro-businesses that the essential regeneration of our local economies will take place. While rationalisation of State agencies may be challenging, it is to be welcomed.

Deputy Seán Kyne

I am happy to speak on the County Enterprise Boards (Dissolution) Bill. Unfortunately, there is a cynical school of thought that regards any effort to reform this area as a cover for cost savings and reductions. While it is true that cost is always a factor, and no more so than when the State is recovering from a severe economic shock, the reforms being implemented in this Bill are about much more than cost savings. Efficiency and prudent use of public money is a factor, as it always should be in every State endeavour, but the County Enterprise Boards (Dissolution) Bill represents the fulfilment of a commitment in the programme for Government to build on the enhanced role of the local authorities and local public representatives in the local economy, as included in the Government's Local Government Act.

The Putting People First document produced by the Department of the Environment, Community and Local Government promotes the fact that local government has a presence throughout every county and the need to harness that as a provider of services across as wide a spectrum as possible.

We appreciate the expertise and competence of staff within our local authority sector, especially those of us who served as local authority members. We appreciate also the positive role of devolving greater powers and decision-making to local elected representatives. Local areas and local services being dealt with in their own area provide a sense of ownership and local ambition, and the equality of the local service is enhanced by the awareness of local needs, priorities and circumstances on the part of the elected representatives and also the staff within the local authority sector who live in their own communities and know the issues at stake in terms of job creation.

Time is crucial for business, and it is also crucial for Government. We can see that time is of the essence in the successful passage of all the legislation the Government would like to pass. At a regional action plan for jobs meeting in Galway in 2013, time spent on navigating regulatory frameworks, sourcing information and trustworthy advice, and preparing documents for securing finance were cited by many of the local businesspeople present as being of concern. The more time businesspeople and entrepreneurs spent on albeit important administrative issues, the less time they had to develop and grow their businesses. That in turn has a direct impact on employment.

The creation of one point of contact as envisaged in the Bill will without doubt provide entrepreneurs and owners of existing local businesses with more time to focus on their own business.

Cuirim fáilte roimh na bearta a spreag na hoifigí fiontar áitiúla a bhí sna contaetha chun acmhainní a thabhairt le chéile agus comhoibriú ar bhonn réigiúnach chun seirbhísí agus tacaíocht speisialta a chur ar fáil. Is deis iontach dóibh siúd i gceantair Ghealtachta teacht le chéile chun gnó a fhorbairt agus poist a chruthú sna ceantair sin. Tá forbairt na tuaithe le tapú maidir le cruthú post i ngach cheantair tuaithe, ach tá an-tábhacht ag baint le seo sna ceantair Ghealtachta, áit a bhfuil nasc idir an fhorbairt sin agus todhchaí ár dteanga dhúchais.

I gcomhthéacs an Bhille, tá scóip mhór ag na LEOs i nGaillimh, Maigh Eo, Dún na nGall, Ciarraí, Corcaigh, Port Láirge agus an Mhí comhpháirtíocht a chruthú agus comhoibriú le hÚdarás na Gaeltachta chun tacaíocht a thabhairt do na ceantair Ghaeltachta. There is a major role here for the local enterprise offices, LEOs, in conjunction with Údarás na Gaeltachta, to work together for the Gaeltacht areas. I would like to see greater co-operation between the two on the setting up of the LEOs. The Gaeltacht areas are served by local authority members also and in that regard there is a good deal of scope for greater interaction.

Galway county and city enterprise boards have played a vital role in the success of many local businesses in Galway in providing invaluable support, advice and assistance to businesspeople and entrepreneurs. Some of the largest employers started as small local business owners and they have now established themselves with assistance from our city and county enterprise boards. In this Bill the Government is drawing on the positive work the city and county enterprise boards have undertaken and that is combining with the new supports, including expert advice on obtaining finance for expansion, introduced in the past three years.

Supporting our small and medium enterprise sector is hugely important. One extra job in an SME could result in over 200,000 jobs being created in our country. Similar sentiments were expressed by Daniel Crespo at a recent meeting of the European Commission's Directorate-General for Enterprise and Industry to the effect that SMEs are valuable and an extra job in that sector could have a major impact on unemployment in a European context.

I welcome the Bill and the greater role for local authorities in terms of providing jobs and supports for SMEs. I am confident this new legislation will increase job creation and the number of jobs provided in our country.

Deputy John Browne

I welcome the opportunity to speak to the Bill. My party would have significant reservations about the dissolution of the county enterprise boards and the subsuming of their role into local authorities. My colleague, Deputy Dara Calleary, will table amendments to the Bill on Committee Stage. That is not the best decision in the interest of counties because while many of the job announcements are welcome, they are not going to counties such as Wexford or the south east where we have a serious problem with the IDA and Enterprise Ireland in terms of their efforts to encourage companies to set up in the south east. We have had very few job announcements in recent years, particularly from the IDA, and as previous speakers pointed out, from replies to Dáil questions we found out there were only three visits in 2012 - we do not have the 2013 figures yet - by IDA-supported companies looking at the possibility of setting up in Wexford. Many of the larger companies appear to want to locate in Limerick, Dublin, Galway, Cork or other major areas of population, despite the fact that many counties now have good roads, water and sewerage infrastructures. They have all the requirements to meet the demands of a modern company coming to this country, but we believe we are not getting the fair share in that regard.

Enterprise Ireland is an excellent organisation with an outstanding track record in job creation, but it is strange that the county enterprise boards will now be part and parcel of Enterprise Ireland. Enterprise Ireland usually deals with companies that intend to export in the future whereas county enterprise boards deal more with people who have ideas to set up their own companies or business. That has been proven to be successful because the Minister stated that over 33,000 jobs across the country have been supported since 1993, as well as an average of 900 new projects per annum. In addition, there were 25,000 participants in training during that period.

County enterprise boards deal with a different clientele than those dealt with by Enterprise Ireland and the Minister should explain the reason they are now being dumped, so to speak, into Enterprise Ireland and then based in the local authorities. The local authorities are good at housing, planning, and the provision of recreational facilities but they have very little expertise in the area of supporting entrepreneurship or small companies seeking to set up from humble beginnings. Before the county enterprise boards were set up, Wexford County Council and other county councils across the country were trying to do that job but were not capable of doing it.

It is a major mistake on the part of the Government. A strong case can be made for retaining and streamlining the existing structure to facilitate greater co-operation across county enterprise boards to share best practice while retaining the ability to respond to specific local needs. County enterprise boards and local development companies have been responding to local needs and demands for a number of years, while the bigger picture was dealt with by Enterprise Ireland or the IDA.

This Bill will not create a one-stop-shop because SOLAS, the education and training boards, social welfare offices, local development boards, Enterprise Ireland and the IDA will maintain their own offices. These bodies, which offer support for enterprises and job creation, will not be based in the county hall in Wexford or in other county councils. The Bill will not help to support local industry in any way.

Concerns have also been expressed about how the new structures will be funded. The local authorities will be expected to provide matching funding but they are not even in a position to cover day-to-day operations such as housing and road repairs. The Minister of State, Deputy Perry, might explain how they will find the money to offer co-funding under the new system. Is it the intention to make additional funds available to local authorities for this purpose?

A number of speakers referred to mentoring. Many successful local businesses have been mentored through county enterprise boards. The Wexford County Enterprise Board under Tom Banville has been very helpful to businesses by providing mentoring and back-up support both while they were being established and for a number of years after they got up and running. Where companies got into difficulties, they were also available to lend assistance. The county enterprise board model was established in 1993 in the context of a previous jobs crisis. Now that we are facing a similar situation it does not make sense to abolish them. Boards have assisted a wide range of new business activities across the country.

Enterprise Ireland and the IDA focus on activities related to research and development and scientific innovation. That is not the case for county enterprise boards, which give greater attention to what they call the highly effective creation of jobs at local level. I can identify a considerable number of individuals in County Wexford who have established businesses that employ between one and three people thanks to the support they received from the county enterprise board or Wexford Local Development. County enterprise boards have proven to be one of the most effective types of support for small businesses and it is not a good idea to merge them with Enterprise Ireland and the county council offices.

Enterprise board members were drawn from a variety of backgrounds, including trade unions, employer organisations, State agencies and local businesses. Members gave up their time on a voluntary basis and their understanding of local needs and demands meant they had a fair idea of whether a project was viable. How will this valuable expertise be made available under the new structure?

The fact that the SME sector remains in a critical condition has been overshadowed by the welcome success of the exporting multinational sector. The abolition of the county enterprise board will be a further setback to the SME sector. Instead of abolishing them, we should give them additional resources to support local enterprise development. The latest SME quality survey, which was published in December 2013, found that 50% of companies applying for funding in the preceding three months were refused credit by their banks. This Bill will not take us in the right direction and we will be putting forward amendments to it on Committee Stage.

Deputy Joe O'Reilly

I welcome the opportunity to speak on this reforming Bill, which allows the Government to honour commitments under the programme for Government and the Action Plan for Jobs by merging the employment support functions of local agencies and enterprise boards into a single entity or one-stop-shop. Counties Cavan and Monaghan do not benefit from foreign direct investment to the same extent as the eastern counties. The IDA facilitated three visits to County Cavan in 2012 and only two in 2013. Small businesses need strong support to compensate for this lack of foreign direct investment. I ask the Minister of State, Deputy Perry, to give an assurance that he will positively discriminate in favour of counties like Cavan and Monaghan by providing them with additional funding to correct the imbalance. While we will continue to demand our fair share of investment, we also want to support small businesses.

All of us recognise the vital role that the small business sector plays in our continued economic recovery. A consultation paper on the reform of the national micro and small business sector published by the Department of Jobs, Enterprise and Innovation found that over 90% of our enterprise base is made up of companies with fewer than ten employees and they contribute €10 billion to our Exchequer every year. In light of the contribution the sector makes to our economy, it is crucial that we support it. Small enterprises are the lifeblood of small towns and villages throughout this country.

Section 6 of the Bill deals with the transfer of functions from the existing county enterprise boards to Enterprise Ireland, which has an excellent record in promoting Irish business abroad and ensuring the continued growth of our export market. Enterprise Ireland chiefly deals with businesses which employ more than ten members of staff. It provides funding, expertise and support to these businesses. County enterprise boards were the traditional support system for mirco-enterprises and local and indigenous traded services. Their track record is similarly impressive and it is important that we recognise the good work they have done over the last 20 years. On average, 1,000 micro-enterprise projects are given direct grant assistance, mentoring and support management every year.

In my county, the Cavan Enterprise Board continues to perform its key role in stimulating economic activity and developing the indigenous enterprise potential of the county. Last year, they approved €419,500 in assistance to a range of 23 different enterprises, which have the potential to create 60 new direct jobs. They are active and are doing an extremely good job. As we bring in the new regime, I should acknowledge the good work done by Mr. Vincent Reynolds, Mr. Jim Fox and all the staff of the Cavan Enterprise Board. They will be available in the new LEO to work for the good of enterprise and to merge their capacities with those of the local authority.

In the area of food, for example, we ran the very successful food fair, with support from the enterprise board and masterminded by the local authority. We also have held the successful Fleadh Cheoil over three years in Cavan. These are indications of the good enterprise culture in Cavan County Council, we have a successful enterprise board and the merging of the two in no way scares me. I do not accept the thesis that local authorities are not capable of dealing with enterprise. We have an enterprise culture in our local authority and I think it can be increased under the legislation.

The reforms contained in section 6 intend to optimise job creation by increasing the efficiency of the county enterprise boards, incorporating them as one under the umbrella of Enterprise Ireland. It will bring micro-enterprise and small business supports together in one place, creating a new centre of excellence. This new centre will monitor, benchmark and standardise best practices nationwide. From speaking with local entrepreneurs and business owners in Cavan, I am aware that they need the one-stop shop so that they can access all of the services under one roof. This is part of the Action Plan for Jobs as well.

Each local enterprise organisation will develop a local plan and that will be important. The local authority will have to support this plan in a myriad of ways. It will increase the enterprise culture of the local authority and the existing expertise of the local enterprise boards, which is considerable and cannot be denigrated, will be brought into play there too.

I welcome the news that it will be up and running in April, with additional funding of €3.5 million and 170 dedicated staff, which as I stated, will incorporate existing staff from the enterprise boards.

The LEOs will be the single source of support. The new services will include the vital young entrepreneurship fund, the Microfinance Ireland fund, the credit guarantee, and access to services from Revenue and the Department Social Protection. These all will be under one roof in one centre, and, ultimately, with democratic control at local level.

In terms of the staffing of the new LEOs, the Minister has already stated that he will be maintaining the staff of the county enterprise board. The Minister of State, Deputy Perry might reiterate that in his reply because it is important there is reassurance in that regard. There will be a new graduate recruitment programme which is important to develop an enterprise culture.

We need more jobs in counties such as Cavan and Monaghan. We need local enterprise supported.

Deputy Finian McGrath

Deputy Joe O'Reilly should not forget the north side.

Deputy Joe O'Reilly

We need positive investment to compensate for the pull to the east and to population centres of inward investment. That is crucial.

Section 10 of the Bill will ensure that any loans or grants approved by existing county enterprise boards will be honoured by the new Enterprise Ireland umbrella. There need be no uncertainty or fear among existing clients of the enterprise boards. An implementation group comprising representatives of county enterprise boards, Enterprise Ireland and various Departments, founded in 2012, aims to tackle the administration side of the transfer and I am sure that the carryover of pre-approved grants will be dealt with here.

In a similar vein, I would argue that there is a need for a degree of flexibility in eligibility for supports, including financial. In that context, it should have the least bureaucratic obstacles to those trying to start up a business. Everything should be put in plain language. There should be support to access funds and simplify matters. It should not be an obstacle race. On the contrary, we should revel in and be proud of those who want to create an enterprise. We should applaud such persons, affirm them and give them the wherewithal to get started, and not put obstacles, a multitude of inspections, bureaucracy and form-filling in their way. If necessary, information should be extracted, from those who might not always have the competencies, through conversation and written down for them. I do not see why a lack of capacity to fill forms should be an obstacle to an entrepreneur. If such flexibility and commonsense was not applied, I would be afraid of people losing out.

There is a problem in accessing finance. There is a need for the local enterprise offices to support clients in getting finance. I would be hopeful of success in that area.

The LEOs will deliver business information and advisory services, enterprise support services, entrepreneurship support services and local Enterprise development services. As is usual best practice, the Minister for Jobs, Enterprise and Innovation will still retain overall responsibility for national enterprise policy. That is how it should be. I am pleased with the local democratic input.

All the agencies of the county need to focus in on the LEOs to get a job creation culture going in every county. At present, there is nothing more important than the creation of jobs. We are doing well with the private sector creating 1,200 new jobs per week but we need to improve on this.

Acting Chairman (Deputy Seán Kenny)

Deputy Joe O'Reilly needs to conclude.

Deputy Joe O'Reilly

All of our economic policies, all of our fiscal policies and all budgetary strategies are really predicated on the idea of creating jobs. Every job is vital, for the human being concerned and in terms of the social welfare budget.

I commend the legislation. It is an exciting new adventure. It will bring the best of what exists together with a democratically controlled expertise of the local authority. With proper funding, it can work well. I look forward to an assurance on funding.

Acting Chairman (Deputy Seán Kenny)

Deputy Joe O'Reilly is over time.

Deputy Joe O'Reilly

Counties, such as Cavan and Monaghan, which do badly out of jobs announcements should do well out of this.

Deputy Joe Carey

I welcome the opportunity to speak in support of this important Bill. I commend the Minister of State, Deputy Perry, and the Minister, Deputy Richard Bruton, on bringing it before the House for debate today.

This Bill gives effect to the Government's decision to reform the system for delivery of State supports to micro and small enterprises by dissolving the current county enterprise board structure and creating an enhanced national enterprise support model to be delivered by local authorities on behalf of Enterprise Ireland through local enterprise offices.

The new local enterprise office network will become the first port of call for new entrepreneurs and will also be charged with the responsibility of providing the necessary supports for existing micro and small business owners. Local enterprise offices will be supported by Enterprise Ireland's micro enterprise and small business division. This type of approach will ensure there is a standard uniform progressive approach to supporting indigenous micro-enterprise and the small business sector which is vital, particularly as the economy emerges from the recession.

County and city enterprise boards have a strong track record in job supports over the past 20 years. I pay tribute to Mr. Eamonn Kelly, the CEO of the Clare Enterprise Board, and his staff, and those who worked previously in the county enterprise board, for their work. The new LEO structure will ensure that his good work will continue as the new system will build on the strengths of the county and city enterprise boards.

The new local enterprise offices will deliver tailored supports to the highest standards, benchmarked by Enterprise Ireland through its centre of excellence and delivered in partnership with the local authorities through a service level agreement.

Enterprise Ireland's microenterprise and small business division, having established a centre of excellence, will lead, develop and manage the enhanced support service that this Bill will deliver. The key functions of the centre of excellence will include promoting innovation in the approach to supporting start-up and entrepreneurship; developing the capability of the LEO network to set best-in-class standards; a lead role within Enterprise Ireland for the development and review of service level agreements and the promotion of high levels of performance and appropriate metrics; reviewing and benchmarking the services and supports available from each LEO to promote best practice; and developing a common approach to mentoring and mentor management.

The small business sector is the major employer in this country. We have more than 200,000 SMEs in Ireland employing more than 650,000 people. The move towards creating this new service will mean that national enterprise policy and local business supports will be brought together to strengthen the local business culture and environment. There is huge merit in combining the best of the county enterprise boards and local authorities within a framework set by the Minister for Jobs, Enterprise and Innovation and overseen by Enterprise Ireland.

The 31 local enterprise offices will have 171 dedicated staff who will be supported by additional local authority liaison personnel creating a local hub for enterprise support. This hub will deliver direct grants, mentoring and training. It will use local business expertise to evaluate projects and provide training and mentoring on starting a business, including drawing up a business plan or accessing commercial space, direct referral of clients to Enterprise Ireland, and direct referral to Microfinance Ireland and loan guarantee schemes, together with providing an enhanced advice and guidance service embracing all other local and national supports. Each LEO will develop a local plan which will provide a focus on boosting enterprise. This approach will energise the local enterprise environment, which will promote further start-ups and expansion of small business.

Like the previous speaker, Deputy Joe O'Reilly, I renew my call for a focus on job creation in the regions. It is commonplace to hear of job announcements in Dublin, Cork and Galway but not enough job announcements in counties such as Clare. This is progressive legislation which will combine all supports under one roof. Business people in County Clare and those contemplating setting up businesses want to present at a one-stop shop where all the supports will be explored with people who have the expertise. The Bill will bring that about and for that reason I support it. The Bill will lead to the creation of a first-stop shop that will offer the full range of State supports that are available to the micro and small business sector, which is such an important sector in our country.

Deputy Finian McGrath

I thank the Ceann Comhairle for the opportunity to speak on the County Enterprise Boards (Dissolution) Bill. I welcome the debate and the chance to focus on jobs and an efficient use of our resources that can create more jobs in this country. Let there be no mistake: everyone's focus in the House has got to be on creating employment in order to improve the economy. We need to get people into work and back to work and into the tax net to ensure we can have health and educational services for our people, which they deserve as a right. That is what the Bill should be about and, hopefully, it will be about that. That is the bottom line. Otherwise we come in here and are just talking hot air. We need reform, change and efficiency, but above all we need radical new ideas in regard to the creation of employment. The debate should also be about our 28% youth unemployment and the emerging gap between rich and poor in this country. It should also be about our young emigrants who are forced to travel abroad for work. We need to focus on this area and develop and assist our young people, many of whom are very talented. We need to stop putting barriers in the way of job creation, such as high rents, crazy commercial charges, and the rejection last night of the Companies (Amendment) Bill 2014 proposed by my colleague, Deputy Stephen S. Donnelly. These were ideas put forward to try to assist in the area of enterprise and job creation.

I mentioned earlier that youth unemployment was at 28% in this country. That is a figure we do not hear enough of when the unemployment figures are given. That means that 60,000 young people in Ireland are out of work and have no jobs. Across the European Union the number is 5.6 million. Many of these unemployed young people are very creative, many are highly educated and many are not, which is another issue on which we have to focus. In terms of education, we need to put the focus on assisting young people in staying in the system as long as possible to ensure they do not become long-term unemployed and end up on social welfare. This is an issue on which the Government must focus.

There are some good things happening in society. I welcome the fact that more than 90% of our enterprise base is made up of small and medium-sized companies which, between them, employ in the region of 622,000 people and contribute €10 billion to the Exchequer. Those are other figures we do not hear about. I pay tribute to those 622,000 people and their contribution to the Exchequer of €10 billion out of a turnover of €91 billion. We need to nurture and develop this sector. There should be none of the arrogance we see at times with the big boys coming in and creating 100, 200 or 300 jobs, when small companies, factories, businesses, restaurants or pubs are employing ten, 15 or 20 people. We should not look down our nose at those people because they contribute €10 billion to the Exchequer.

As my colleagues have done, I wish to focus on the need for investment, particularly on the north side of Dublin. There are many areas north of Dublin City that are black spots for unemployment. We need to focus resources on those areas. I have been a voluntary board member and director of the Northside Centre for the Unemployed in Coolock for the past 20 years. A good deal of our focus is on helping young unemployed and other unemployed people to get into the jobs market and assisting them in receiving education and developing their skills. This is something very positive. However, we need support for that work and we need to do it in a professional manner. I urge the Minister to keep a close eye on the need for developing small businesses on the north side of Dublin.

It is clear that the Bill will get rid of the county enterprise boards, which includes the city enterprise boards. These will be replaced by Enterprise Ireland, which has a good record. Local enterprise offices will be run by local authorities. I commend the staff at Enterprise Ireland for their magnificent work in developing new ideas and job creation. Enterprise Ireland already exists under the Industrial Development (Enterprise Ireland) Act 1998. The intent of the legislation is to create a first-stop shop for entrepreneurs at local level while providing a nationwide integrated system. Many people who have ideas need to be able to speak to somebody in the local area who will point them in the right direction. There is a need also for the broader picture, a national integrated system.

The Bill is an attempt to reform and bring together the micro-enterprise and small business supports provided by county enterprise boards, Enterprise Ireland and local authorities. It also removes anomalies in the system and will ensure all micro and small businesses can access support.

It is important to establish a centre of excellence in Enterprise Ireland with responsibility for setting policy and monitoring and ensuring delivery of world-class support for micro and small businesses in a consistent manner nationwide. The centre of excellence is a positive idea. If people bring forward positive proposals that have anything to do with job creation, I will support them, regardless of party politics. As elements beyond the dissolution of county enterprise boards such as the centre of excellence and specific targets such as increasing the number of start-ups, the five-year survival rate among start-ups, the number of start-ups created by women, exports from micro and small business and job creation are not specifically mentioned, we need to focus on them. The focus must be on the creation of jobs and enterprise.

The proposal for change came from the McCarthy report, commonly known as an bord snip nua, in 2009. It recommended that the functions of enterprise boards be transferred completely to Enterprise Ireland. The local government efficiency review group's report published in 2010 recommended that enterprise boards be merged with local authorities. I did not necessarily agree with everything proposed by Dr. Colm McCarthy and an bord snip nua, but in this case, I like the idea of transferring it completely to Enterprise Ireland because of its past record. It is important to develop ideas in an organisation such as Enterprise Ireland which is responsible for the development and growth of Irish enterprises in world markets through putting the focus on the promotion of business exports. Enterprise Ireland primarily deals with larger businesses than those dealt with by the county enterprise boards in that it provides funding and support for businesses with more than ten staff members.

Last week a young woman came into my clinic in Donnycarney. There are two people involved in a small business, with commercial rates last year of approximately €2,000. They have increased to €4,000 this year. What is going on in Dublin City Council? This is a woman who is providing a service and trying to ensure she stays within the system by paying VAT, PAYE and all other taxes. Within a couple of hundred metres, people are undercutting her prices by 30% or 40%. The business only has two people, but it could increase to five if she was given a chance. We should not always think big; we should also think small. There are 622,000 people employed in small businesses, which number could be developed further. We should not put barriers in front of small business; we should give them a break.

One of the concerns about the legislation is that the dissolution of the county enterprise boards will reduce the important connections in the local business community that were fostered by the independent nature of county enterprise boards and their membership. We must examine this issue carefully. It is important, when introducing reform and changes, that we do not lose contact with the local base. I encourage the Minister of State to be on his guard and vigilant about this. We do not want to create a gap between the person on the ground and Enterprise Ireland; we do not want to lose touch.

Section 6 provides for the transfer of the existing functions of county enterprise boards to Enterprise Ireland, which I support. Section 8 provides for the transfer of rights and liabilities of a county enterprise board to Enterprise Ireland. It also provides that, in the event of an action to sue, recover or enforce, Enterprise Ireland may do so in its own name without the need to give notice of the transfer to the person whose right or liability is transferred. This is a sensible section.

Section 9 will allow any claim for loss or injury alleged to have been suffered during the performance of county enterprise board functions to now lie against Enterprise Ireland. Section 10 will ensure anything commenced by a county enterprise board such as loan agreements, grants and equity investments will not fall on the transfer to Enterprise Ireland of the functions, assets and liabilities of county enterprise boards.

Section 11 empowers the Minister to designate staff of a county enterprise board to Forfás, Enterprise Ireland or a local authority. This is important because we need to ensure we have quality personnel dealing with these issues on the front line to assist local enterprises.

As well as passing this important legislation, it is also important that when we examine the ethos, we focus on the priority of creating sustainable jobs in local communities. We must not forget the SME sector. In the coming weeks I would like the Government to have a vision of creating jobs. It must focus on a clear objective, from which we should not shy away. Notwithstanding the economic crisis and what is happening with the banks, we should try to return to full employment. I do not think the Government understands we must do something about the debt crisis which is choking society and the economy. I have major worries about it and urge the Minister for Finance to go back to the European Union and demand some sort of a deal, as otherwise we will not be able to move on. We must also tackle the problem of excessive household debt and mortgage arrears which is not be sustainable.

I referred to the education system and early school leavers. We must give opportunities to children to live and work at home and include those who must emigrate.

At all times, we must have well managed public finances. We must learn the lessons of the past because without the public finances being under effective control and a stable and effective banking system we will not be able to develop the economy.

We should never fail to use the resources we develop, through the people paying taxes, to protect the vulnerable in society. We cannot take our eye off the ball in tackling poverty and developing public services for citizens who deserve public services. That issue is linked with the Bill. The figure of €10 billion created by small businesses for the Exchequer could have a major impact.

We must be careful, in supporting the legislation, not to become dependent on foreign direct investment. The world is now a small place and a company which may have 300 workers in Cork, Galway or Dublin may relocate in the morning to India or another country where costs are low. The SME sector must be the engine room. In this regard, the Minister of State must not take his eye off the ball and be carried away with big photo calls and announcements of 300 new jobs in Cork. In two years time the company concerned may relocate to another part of the world.

There must be effective management of the public finances. I accept that process has started, but we must be sure that what happened in the past will not happen again.

We should go back to the notion of public service. There is nothing wrong with that.

The staff working in Enterprise Ireland, doing a great job in formulating ideas and assisting businesses, are indicative of good public service. There are many good public servants out there who do a fantastic job that should be recognised. That is true in the health and educational sectors, but with this legislation it relates to enterprise boards and similar places. They have people who are working hard to regenerate the economy and get people back to work.

I welcome this debate, which is very important. As well as talking about this legislation, we must be constantly formulating new ideas and examining the barriers for people on the ground who are trying to create an extra two or three jobs in a sector. I make no apologies for asking people to buy or shop local and do their best to get products in the local community. Give everybody a break. An extra €10 or €20 spent by everybody in a local shop, supermarket or business can create 10,000 jobs. That is a conservative figure but it could be achieved if everybody spent an extra €10 or €20 per week in local shops. The people with a few bob - those who are reasonably well off in society - should not be afraid to spend an extra few bob, as that will create an impact in the local economy. When that happens it helps businesses create an extra job or two, and it would be fantastic for enterprise and job creation if we could create a ripple effect from this around the country.

I encourage people to formulate new ideas and I urge the Government to listen to any ideas rather than blowing them out of the water. If somebody brings something sensible to the table the Government should consider it. It is important to say that.

An Leas-Cheann Comhairle

The next speaking slot is to be shared by Deputies Ann Phelan, Olivia Mitchell and Dara Murphy. Deputy Phelan has five minutes.

Deputy Ann Phelan

I thank the Leas-Cheann Comhairle for the opportunity to speak on this very important Bill. I tentatively welcome the Bill as, to use a cliché, the proof of the pudding will be in the eating. The Bill is designed to dissolve the existing county enterprise boards, of which there are 35 in all, and replace them with a combination of Enterprise Ireland and a network of local enterprise offices to be run by the local authorities. This makes sense, as a business or start-up company seeking advice from the enterprise boards needs information about planning, zoning or rates, and it is sensible to have these under one roof. The experience of enterprise boards has been mixed so the Minister should take this opportunity to improve the skills of all the people in the area and make them fit for purpose. I thank all the staff who do good work, but some need to brought into 2014.

This Bill will remove current anomalies in the system and ensure that all small and medium enterprises and micro-businesses can access State supports. It will establish a centre of excellence within Enterprise Ireland, with specific targets such as increasing the number and trying to ensure the survival of new start-up businesses, which are so important to this economy. It will also try to target the number of start-ups by women - there has been great work in Kilkenny in that regard - and job creation. The task facing Enterprise Ireland will be to draw these agencies under one roof, improve the good work done to date by the county enterprise board and ensure that any start-up company will be looked after as it begins to grow by giving it the appropriate supports it needs to continue.

I draw the Minister's attention to a potential pitfall that needs to be addressed. There are companies in receipt of grants from county enterprise boards, and ultimately the taxpayer, which are flouting some existing employment law. This must stop. All companies operating in the State today should be compliant with existing labour law and, specifically, there should be no State support for companies not in compliance with employment rights and labour law. For example, a certain company may be in receipt of grant aid while being in breach of employment legislation by exploiting the workforce. Not only should that company have its grant aid rescinded, but there should be a mechanism whereby the State can claw back the grant aid that was given in the first place. It is not right that we live in a country where it is possible for a company to attain Government-funded grants for the business - this is taxpayers' money - and to use the funding in an environment where basic employment law is not being complied with.

There is an ongoing problem in our society, as some employers are not obliged to recognise unions. The right to free association and to join a union are enshrined in our Constitution as part of our fundamental rights, but employers are still not obligated to recognise such representation. Union recognition and company compliance with labour law further justifies the need for such laws to be tightened. Our employment laws exist to protect ordinary workers, and if a company refuses to pay appropriate overtime - for example, by giving proper time off or paying a minimum wage, to name just a few potential infringements - the taxpayer should not be asked to fund that business through grant aid. Such companies should have to repay any grant already paid. Avoiding exploitation such as this will be one of the challenges facing Enterprise Ireland, and I hope the Minister will take that on board.

I have fast-forwarded through some issues and I am assuming that everything will work according to plan. This is a small but important issue, as grant aid is not easily achieved, and if somebody is flouting the law, another party might put that funding to better use.

Deputy Olivia Mitchell

I welcome the opportunity to speak to the Bill and I welcome its import and intent. In the county enterprise board in Dún Laoghaire-Rathdown we have had a body of real excellence and I have had nothing but admiration for it through the years because of the work it has done. However, I confess that from the outset I did not support the setting up of those stand-alone boards, and even now I believe they should never have been set up. Supporting start-up companies and encouraging local entrepreneurship should always have been rooted in local authorities, which had all the local knowledge, existing administrative capacity and a vested interest, if we are honest, in having successful businesses and increasing local employment. They were the ideal natural home for a body to support local start-ups.

There is a certain criticism that with this move we will subject businesses to the dead hand of a bureaucratic State. That is an unfair assumption, and we never hear it aired with regard to the work of Enterprise Ireland. Local authorities have a vested interest in successful local business, not least in that they should be able to pay rates. Local authorities are not as secure as they would have been in the past from the cold hand of the market and knowing exactly what it is like to be in business.

There was some criticism of the move in the Seanad, where it was characterised as a sort of mad and mindless rush to abolish, merge or eliminate agencies, or quangos, as they are sometimes rather insultingly called. It is true that after the economic collapse people wanted to tear down everything, which is perfectly understandable. Some bodies needed to be torn down, but less is not always best. I am not an absolutist when it comes to mergers, and sometimes there is a case to be made for keeping stand-alone organisations with a single focus. Nevertheless, when we consider the vast panoply of State bodies, there is the inevitable conclusion that not only could many be merged but that a significant number had outlived their usefulness and the purpose for which they were set up, so they needed to be axed immediately. One would wonder how it had escaped notice that a body's raison d'etre had entirely disappeared or that there was duplication, with other bodies absorbing functions or replacing them, and yet the bodies seemed to continue for years.

This is needed. It is delivering on a Government commitment to rationalise State bodies. It is the second Bill to have been brought before the House recently to merge bodies. The Minister for Transport, Tourism and Sport, Deputy Leo Varadkar, is to introduce a roads Bill next week to merge the Railway Procurement Agency with the National Roads Authority. In neither case is it fair to say the legislation is merely delivering on an election promise for the sake of it. The Bill before us makes sense not only because it will result in a more cost-effective way of delivering services but also because it will deliver a more effective service. That is what matters and it is the only criterion. The network of stand-alone enterprise boards with no mechanism for co-operation, cost sharing or the sharing of expertise should not really have been set up and structured as it was. It is timely that we correct that mistake and necessary that we do so.

It is a little unfortunate that the Title of the Bill includes the word "dissolution". That word has many negative connotations, although the legislation represents a really positive move, bringing about badly needed reform on which people should look positively.

Following the earlier Government decision to improve the system of delivering State supports to micro-businesses and small businesses, there were many possible approaches that could have been adopted. The method chosen – the retention and enhancement of local input, with a link to Enterprise Ireland – represents an inspired decision. The new system retains local knowledge but within the context of all the other local services provided by the local authority, while at the same time allowing businesses to gain access to the vast experience and expertise of Enterprise Ireland and other relevant bodies.

The local enterprise boards will provide a much enhanced and more comprehensive system of delivering State supports to micro and small businesses. They will provide access to all the State business supports and bodies, ranging from Microfinance Ireland to the Revenue Commissioners. That is a huge boon for small businesses which in the past would simply not have had the capacity alone or with the county enterprise boards even to become aware of State services, much less gain access to them. I am not saying this to criticise the city and county enterprise boards which have done excellent work for almost 20 years, but it is now time to change the structure of supports for small businesses which are the lifeblood of the economy, locally and nationally. They employ seven out of every ten people employed and are just too important not to be nurtured in the best possible way. They are too important not to be facilitated in gaining access to all of the State's business services and for us not to recognise the importance of a really supportive entrepreneurial environment for indigenous businesses.

The local enterprise boards will be a first-stop shop for new business start-ups, but they will also provide ongoing development services which are often crucial for businesses if they are to survive the difficult early years. Later, the involvement of Enterprise Ireland will be vital in allowing small businesses to grow and move seamlessly towards direct Enterprise Ireland services.

It has been remarked a couple of times that if there has been a gap in State services, it has been in helping small, established businesses to make the leap to become medium-sized or bigger. The new framework should help to address that issue. During the years we have heard reports on the Minister going all around the world and the work of the IDA in attracting inward investment. They have been tremendously successful, but it is sometimes easy to forget that Irish firms employ more people in the United States than US companies that employ Irish people here. We sometimes undervalue our own businesses. Irish firms operating in the United States are big employers, but I wish to highlight the potential of indigenous Irish firms and show that when they survive the early years and make the leap to the next level, they can keep growing without boundaries and become major international companies.

I commend the work of the county enterprise board in Dún Laoghaire–Rathdown and hope the staff will find a happy home in the local authority setting. I hope the move will not result in the loss of any of the motivation and dedication displayed by the staff during the years. With most Members, I am mindful of the difficulties associated with change and the challenge it presents for everybody, but this very strategic change will prove worthwhile from all perspectives.

Others have touched on education which is important to the future of Irish business and employment. Those who will be doing the leaving certificate examination in June have been through an education system that is pretty much the same as it was when I went through it, which was not recently. We really need a strategic change in support for business, but we also need to start earlier in preparing people for what is a totally new business world. I have examined training in places such as Switzerland and Germany and noted that we really need to consider strategic change in Ireland. We should prepare young people for what is a totally different business world and jobs environment. I refer not so much to plumbers and electricians who featured in the past but to those who must work with all of the technological advances. People coming out of school today should be prepared for a totally different world., but that is an issue for another day. I hope this considerable, strategic move will support the changes we are debating.

Deputy Dara Murphy

Like my colleagues, I welcome the opportunity to speak about the Bill. Having listened to the debate for most of the day, I have noted it is not particularly contentious, although Members have different views, of course. I had the pleasure of serving on the Cork City Enterprise Board for five years. These years were some of the most difficult for business that the country has ever experienced. I was struck by the remarkable determination, enthusiasm, innovation and single-mindedness of people who set up their own businesses. I noted a good link between Enterprise Ireland and Cork City Enterprise Board, but it is better that there be a seamless link between them. Obviously, the enterprise boards were set up to deal with smaller businesses, but the ambition for most businesses is to grow. Many businesses that start up, particularly in the areas of technology, science or medical devices, are better to go directly to enterprise boards.

I agree with previous speakers on local authorities to a certain extent but believe it is important that the enterprise boards have a completely independent and separate identity within them. One of my criticisms of all State bodies, particularly local authorities, concerns the degree to which staff tend to be moved within departments. The expertise people such as David, Olive and Adrian developed in Cork was developed over time as they came to know different people, businesses and types of businesses. I caution local authorities in this regard because the experience is different from that of moving between the various directorships.

Europeans are extremely risk-averse. The Irish are among the most risk-averse in the world, despite the fact that two thirds of us are working in small businesses. In countries such as China and the United States a significantly higher proportion of the population aspire to be self-employed.

We must look at the reasons for that mindset in Ireland, and an obvious one is the issue of reward. In recent years, mainly because of the high taxation rates in our country, the rewards that people can gain by being self-employed and working for 80 or 90 hours a week have diminished. That must be addressed. We must also get over our culture in Ireland in terms of how we treat people who fail. We need to adopt a more American attitude to business failure. In the US, it is widely believed that somebody who has failed is far less likely to fail again because he or she has learned from the experience of failure. That is particularly important now because we have large numbers of people who, through no fault of their own, have had to close their businesses. They now have poor credit ratings and so forth but they have the work ethic, the ingenuity and the determination to establish businesses and to employ people. There are 200,000 small businesses in this country and if every one of them was to hire one person we would reduce by half the number of people who are unemployed.

I welcome this Bill, which fulfils a commitment in the programme for Government. Greater efficiencies will be achieved by reducing the number of enterprise boards around the country and linking them in with local authorities. Cork city is twinned with Shanghai, a city with a population of 20 million. Representatives of the Shanghai enterprise board visited Cork and were very surprised - great as Cork is - that the county has several enterprise boards compared to the single board in their city. A commitment to greater efficiencies has been delivered but, more important, with the great work of Enterprise Ireland and the IDA, our top two semi-State organisations, we will continue to see our unemployment rates steadily drop.

Deputy Denis Naughten

I welcome the opportunity to speak on this Bill. Local businesses around the country are the backbone of the Irish economy. Approximately 80,000 such firms across the country employ an estimated 800,000 people and are putting billions of euro into the economy on an ongoing basis. Unless we can support indigenous, local companies, we will not create the numbers of jobs that we need to curb the haemorrhage of emigration and address our high levels of unemployment. As politicians, we will not create jobs. What we must do is try to make it easier for businesses to invest, hire staff and maintain existing jobs so that employers can look to the future with confidence. We must put the necessary support structures in place.

The biggest concern I have regarding the legislation before us has already been articulated by the Small Firms Association. In its submission to the Joint Oireachtas Committee on Jobs, Enterprise and Innovation, the association expressed concern about the poor relationship that exists between the small business community and local authorities. There is a strong perception among business people that the key objective of local authorities is to extract as much money as possible from employers. There is a fear that such an attitude to small businesses will filter through to the new enterprise board structures within local authorities. It is vitally important that the skills and expertise that have been built up over many years in the county enterprise boards are transferred into the local authorities. I must say that there are some very good local authority officials with a very progressive and open attitude who will do everything they can to support local businesses, particularly those that are starting up. However, there are also local authority officials who, rather than assisting people in setting up a new business will give them ten reasons that business will not get off the ground and will fail and why they should not go ahead with their project. That type of attitude must be eradicated, not just from local authorities but from the public sector in its entirety. We see that attitude in Government agencies and Departments and it must be challenged. There is enormous potential to tap into the resource that exists within local authorities and the knowledge that has been built up over decades but local authorities must be given the tools to assist the small business sector. They must be given flexibility in terms of how they structure their commercial rates, for example, which they do not have at present.

I am seriously concerned about the fact that local authorities will be expected to put up matching funding. In my county and in every other county in the country, the local authority does not even have the funding to repair local authority housing, never mind coming up with matching funding. That must be clarified by the Minister. The Department has a number of commendable objectives, including increasing the number of start-up businesses and the number which survive beyond the first five years. It also aims to increase the numbers of women starting up their own businesses and to support micro-businesses in developing export trade and driving job creation. All of that is very well and good but it is not specifically mentioned in the legislation, which is a fundamental flaw. Furthermore, the fact that it is not mentioned in the legislation means that there is no accompanying penalty clause when local authorities fail to meet the aforementioned objectives. Where local authorities fail dismally to achieve particular targets, some type of penalty should be imposed.

When the Minister responds to the debate later, I hope he will clarify an issue that was raised by my colleague, Deputy Timmins, a number of weeks ago, namely the administration costs in some county enterprise boards. The administration costs of the county enterprise board in Offaly, for example, are only slightly less than the amount of grant aid paid out by the board, while in Leitrim last year, the administration costs were actually higher than the grant aid provided by the board. I know there is a problem for many of the weaker counties in terms of getting access to funds. Funding should be front-loaded for those counties that are not tapping into foreign direct investment. Counties like Roscommon and Leitrim, for example, do not have a strong population base and are less attractive for foreign direct investment and should, therefore, be getting the lion's share of the funding for local micro-businesses in order to bring about some balance.

I hope the anomalies with regard to the ten employee threshold will be addressed. Furthermore, there are companies which are over that threshold and are involved in the food sector which Enterprise Ireland has shown very little interest in to date. I hope that the new attitude that is developing within the enterprise sector will include looking at job creation for its own sake and not just focusing on the issue of export-led growth. Import substitution and job creation must be given greater priority than has been the case heretofore.

I wish to put four proposals to the Minister of State, Deputy Perry, which can support and enhance opportunities for local businesses around the country. They are practical proposals, some of which are easier to implement than others. My first proposal is a simple one and I would ask the Minister of State to take ownership of it. I have already put it to the Minister for Communications, Energy and Natural Resources, Deputy Rabbitte, but he has washed his hands of it, as has his Department, which argued that it is a matter for the Department of Jobs, Enterprise and Innovation.

I refer to the establishment of an internationally recognised quality mark for websites based in this jurisdiction. We have had reports during the week concerning the Road Safety Authority which revealed that a rogue website in the UK is charging consumers an extra €20 to book a driving test. In one particular instance 4,300 people paid an extra €20 to get a legitimate driving test in this jurisdiction.

A recent report by the European Consumer Centre network which examined fraud in cross-Border e-commerce found that fraud was involved in the sale of tickets, counterfeit products, alleged free trials, phishing, and the purchase of used cars online. A total of 30% of participants in the survey reported instances of consumers being caught out with free trials that were not free. A proliferation of counterfeit goods was reported by 41% of survey participants. A Maltese consumer who ordered tickets for a football match from an online trader paid €827 for the tickets only to be informed subsequently by the trader that the tickets were no longer available and that he would receive a refund but he has not received it to date.

Irish consumers spend approximately €4 billion a year on online shopping. Right across Europe and the world a huge amount of online trading is taking place but people are very concerned about putting their details online and whether they will get the goods for which they have paid. There is a niche in the sense that no internationally recognised quality mark exists for online trading. Ireland could take the lead in that regard and established a quality mark for businesses based in this jurisdiction. The information already exists but it is not easily accessible to consumers. If we put the facility in place for businesses based in this country it would create new jobs in IT and also distribution. Ireland could become for websites and online trading what Switzerland is to the banking sector. There is no reason not to do it. We have the data centres and some of the biggest online traders and online businesses such as Google are already in this country. We have the capability within the NSAI to do it. It has international contacts. Let us establish an internationally recognised quality mark in Ireland and use it as a driver to create new businesses, not only foreign direct investment but indigenous businesses that could sell on a worldwide basis.

Many speakers have referred to the need to incentivise and support local businesses. I urge the Minister of State, Deputy Perry, to do one thing only, namely, give them the same opportunities and supports we give to American multinationals coming into this country. They should have the exact same incentives on taxation, grant aid and supports. A level playing pitch should be provided. One job created by a local business in Sligo, Roscommon, Galway or Leitrim pays a greater dividend to the economy than a foreign direct investment job yet we have structured our incentives, supports and taxation the other way around which penalises indigenous business. Simplifying the taxation and PRSI system, in particular for start-up businesses, would encourage them to get off the ground in the first place.

I will provide an example of the crazy logic of our taxation system. It is another issue the Minister of State might examine. I refer to capital gains tax. We have a bizarre situation where we incentivise people with cash to put it into a property, sit on it for a number of years and then dispose of it when the market rises rather than incentivising someone to take the cash and put it into a new business that is trying to get off the ground or an existing business that wants to create jobs. People should be facilitated to invest in jobs and new enterprise. Does that not make far more sense in terms of long-term sustainability instead of trying to facilitate and encourage another property bubble in this country? The Minister of State should change the ingrained thinking within the Department of Finance that investment must be in bricks and mortar and nothing else. Let us start to create and support jobs. Let us also create a level playing pitch for indigenous local jobs as we do for foreign direct investment.

Another issue for the Minister of State to examine is energy. It is politically sensitive at the moment, in particular in our part of the country. The suggestion and proposal I have relates to an area just north of the border in Wales. The Minister of State, who is from Sligo, is not too far from the Border. Just north of the border in Wales there is a very successful carbon loan scheme. Business loans of 0% are available to businesses wishing to invest in energy-efficient and low-carbon equipment. I am aware of a business in my constituency that could create ten new jobs tomorrow morning if such an incentive were available to it. The company knows it could save a significant amount of money and that it could be far more competitive by upgrading its energy equipment but it cannot get the capital from the bank at the moment. It must prove to the bank that it does not need the money before the bank will give it a loan. Small business after small business could give similar examples.

The size of the loan on offer north of the border in Wales and its repayment period is based on the projected carbon savings. The Government will be penalised for not making carbon reductions. It is a no-brainer from an economic point of view to give out such interest-free loans. Now that we have access to money from the Germans we should use it to introduce such incentives. A loan of £1,000 sterling is given for every 1.5 tonnes of carbon saved or taken out of the atmosphere on an annual basis. That would achieve two goals; first, it would reduce overall energy consumption and as a result reduce the overall impact of carbon on the environment. It would also reduce the potential penalties we would face in the future. Second, it would drive efficiencies for business and create jobs, such as in the example I provided where ten jobs could be created by a company that currently employs 60 people. The company could employ 70 people tomorrow morning if it had access to such an incentive.

On energy, and given where both the Minister of State and I come from, he is aware that a very detailed proposal has been put forward by the Western Development Commission to bring gas to the west and north west. It would save local businesses in the area €16.5 million every year. If we had access to gas it would save householders approximately €485 a year in energy costs. Currently, businesses in Carrick-on-Shannon lose approximately €7 million per annum because they do not have access to gas. Slightly less than that amount is being lost in Sligo town. Boyle is losing approximately €180,000. Roscommon is losing approximately €1 million. I could go on to specify the amounts lost to other towns in the region. Significant savings could be made by indigenous businesses if they could get access to cheap energy through the gas network.

We are disposing of Bord Gáis by means of selling it off. I suggested that a small proportion of the money raised through the sale be used as seed capital to extend the gas network to the region.

Not only would it dramatically improve the efficiency of businesses in our region, leaving them on a competitive par with businesses in other parts of the country, it would sustain existing jobs and encourage additional job creation. It would also take away some of the pressure in terms of the need for increased electricity energy generation. If combined heat and power plants were put up in many of these businesses, it would take pressure off the existing electricity network and reduce the need to construct additional pylons across the country. I hope the Minister for Communications, Energy and Natural Resources will look into this particular issue again.

My colleague in the Seanad, Senator Fidelma Healy Eames, raised an issue some time ago regarding an employer in the manufacturing sector trying to employ a general operative at 1.5 times the minimum wage but not being able to get anyone to fill that post because of the barriers put up by the social welfare system. Recently, I had an instance of a woman with family illnesses who had a medical card but, because she got an extra hour working in Tesco, lost the card. There was no way around this with the way the medical card eligibility system is structured. The only way to hold on to her medical card was to get her employer to reduce her hours. Instead of encouraging people to take up employment or increase their hours or move into full-time employment, as was this woman’s wish, the system is built against their doing so.

There are many other anomalies that Members have highlighted which undermine the medical card system. These barriers being created to people extending their hours of employment or even taking up full-time employment need to be addressed. In doing so we would be supporting many local businesses across the country and in Ireland as a whole.

An Leas-Cheann Comhairle

I call Deputy Lawlor, who is sharing time with Deputies Áine Collins and John Paul Phelan.

Deputy Anthony Lawlor

Having served for several years on Kildare’s county enterprise board, it is with a tinge of sadness that I see their dismantlement. Coming from a business background, it was great to work with those on the board, who had a get-up-and-go approach. Deputy Naughten referred to the administration costs of some boards, but there was a small staff on the Kildare board which used its funding well and purposefully, as can be seen in the number of jobs it generated in Kildare. My problem was with those county boards which did not use up their full allocation from Enterprise Ireland. Perhaps Deputy Naughten was referring to those counties which would have had higher administration costs. The three remaining staff on the enterprise board in Kildare will move to the newly formed LEO. I wish them all the best. Their initiative and drive was the reason so many jobs were created in Kildare through the enterprise board.

I often questioned my role as a board member. While sometimes I felt the board was just rubber-stamping projects, because there were representatives from the community, Enterprise Ireland, the agricultural sector and local businesses, inputs came from a good cross-section of the county’s economy. I hope this kind of make-up will not be lost with the introduction of the enterprise offices. While I am saddened to see the county enterprise boards go, I welcome the new LEOs. One of our objectives when we set out in government was to use funding more smartly. Bringing the enterprise offices under the remit of the county councils gives a better and clearer objective as well as ensuring better value for money. The large administration costs associated with certain counties, which Deputy Naughten highlighted, will now be absorbed and funding will be utilised better within the county council system.

I am concerned, however, about the ability of various councils to drive enterprise, a point also raised by Deputy Naughten. In Kildare, we are fortunate to have personnel with drive and initiative on the enterprise board who will transfer to the LEOs. One example of this drive was the way they went about the youth and student enterprise awards. Through it, there was a focus on getting young people involved in enterprise at an early age. I am glad the youth entrepreneur scheme will be part of the LEOs, with ring-fenced funding made available for entrepreneurs under 25. I thank Celbridge Youth Group for highlighting this to me two years ago. In turn, I made a presentation to the Minister on this matter to have it included in the enterprise office set-up.

Will the Minister consider ring-fencing elements of the microenterprise loan fund scheme for young entrepreneurs? As I have argued before, a young entrepreneur might not have a credit rating or line, making it difficult for him or her to get funding from the banks. Many of these young entrepreneurs have good ideas that some of us who are older have had beaten out of us because of the amount of red tape associated with establishing one’s business. While it is welcome that multinationals are locating in Ireland regularly, getting back on our feet will also be down to indigenous small and medium-sized businesses and young entrepreneurs who are full of enthusiasm. Accordingly, we should help them as much as we possibly can.

I always saw the county enterprise boards as the first stop for someone starting a business and a real source of funding on the ground. We must examine this in a broader sense and determine how much more we could use funding at enterprise level. Deputy Áine Collins is full of enthusiasm for mentoring start-up enterprises and the need for more of it. I am on for getting as many young people as possible to start businesses. I know matching funding is required from local authorities. If start-up indigenous companies and enterprises are the country’s future, it is through the enterprise board that they will make their first contact with funding.

It will be their first port of call and they should be helped as much as possible. I again appeal to the Minister of State on the increase of funding in this regard.

Finally, as I stated earlier, I wholeheartedly welcome the much smarter use of available funds, as well as the pulling together under a single umbrella of all start-ups, and those which are going beyond the start-up phase, in order that they can get assistance wherever possible within the local authorities. I appeal to the local authorities to embrace this development and not to be fearful of it because this is a real opportunity for them to become actively involved in their local business communities. Local authorities have stood back from so doing for a number of years as they focused solely on garnering money from this group of entrepreneurs and business people. It is vitally important that local authorities embrace this opportunity and take it on board with the same enthusiasm some of the staff members of the enterprise boards who are being transferred to the LEOs have had for a number of years. I thank the Minister of State for bringing forward this proposal. I again thank the Minister, Deputy Bruton, for taking on board youth entrepreneurship, which is an excellent idea. I will be supporting this Bill.

Deputy Áine Collins

I also welcome the opportunity to speak on this important Bill, the Title of which is misleading to a certain extent. The real intention and purpose of the Bill is to allow for reform of the system of supports to microenterprise and to focus on the small to medium-sized enterprise, SME, sector, thereby driving growth and encouraging a culture of entrepreneurship as a career. As the Minister has noted, the indigenous microenterprise and small business sectors are the lifeblood of the economy. Reform of supports for this sector is central to economic recovery, job creation and the future development of the economy. The new structures are designed to make the operating environment more coherent, responsive and conducive to entrepreneurship at local level.

The Bill is part of a process to bring together the microenterprise and small business supports currently provided by county enterprise boards, CEBs, Enterprise Ireland and the local authorities into one central location. At present, there is an overlap between the CEBs and business supports provided by local authorities in their economic development units. Not all local authorities had business development strategic policy committees, SPCs, that were effective. Some local authorities, such as Cork County Council, already have put in place a strong economic development structure in the form of an SPC. In County Cork, this committee has a budget of €1 million a year and the SPC works very closely with the enterprise boards and the Leader groups to try to ensure that worthwhile projects get off the ground. However, until now, Enterprise Ireland was not part of this process..

Many small businesses and start-ups found the sourcing of supports confusing and difficult. Local authorities, because of their many functions that affect or encourage small businesses, should be at the centre of any one-stop-shop concept. Issues such as land use, zoning, road infrastructure and environmental regulations all are considerations that must be taken into account by expanding existing businesses or start-ups. The work of enterprise boards is to be subsumed into the economic development section of local authorities. While Enterprise Ireland would not normally supply direct support to small businesses, the new structures envisage the creation of a specialised section within Enterprise Ireland to develop best practice with regard to supports for small businesses and microenterprises, thereby ensuring that all staff working in the new enterprise offices will be trained to the same level as the staff in Enterprise Ireland. It is intended to establish LEOs and to create a first-stop shop within local authorities and this will be achieved when Enterprise Ireland enters a service level agreement with each local authority. I welcome this morning's announcement that they will be up and running by April 2014, which is fantastic. This connectivity among all agencies also will allow businesses that have clear high-growth potential to be fast-tracked to the next level of support from Enterprise Ireland or other State agencies.

At the other end of the spectrum, it remains to be seen how the business development section of the old Leader groups will fit into the process. I appreciate that as the Leader groups will form part of the new local development companies, LDCs, they will be integrated into the system. At present, they are part of the economic development SPC. However, under the current system, local development companies were not as restricted in grant-aiding businesses in their specific areas as were the enterprise boards or the economic development sections of local authorities. Local development companies only needed to be concerned with displacement in their own or adjoining areas and were less restricted in the type of business they could support. This issue is important for peripheral areas and areas under development, where services for the public might not otherwise be available. This issue must be considered and recognition must be given to the fact that national or county guidelines will not provide basic services or jobs in these areas unless special provision is made. I refer, for example, to funding for cafes, restaurants and perhaps some retail in some of the more regional rural areas.

Mentoring is a crucial part of the State supports offered and in many areas it is more important or at least as important to a developing business as is financial support. Together with the Joint Committee on Jobs, Enterprise and Innovation, I have been working on this issue for almost two years. We commissioned a report and conducted some research, which led to the report being taken on by Forfás, which carried out an in-depth study. Some key recommendations have arisen therefrom, which I am sure the Minister will be glad to tell me will comprise part of the action plan for jobs that will be announced next April. I would welcome that.

This is an important Bill and I am glad its passage finally is under way. I acknowledge that it has been a longer journey than expected, but it demonstrates the Government's commitment to the SME sector, to entrepreneurship and to supporting all the regions, not just the urban regions, for which the Government sometimes gets criticised. However, it is important to generate sustainable jobs and to begin to examine different models of achieving that. In this context, consideration also must be given to co-ops and social enterprise, which will be fantastic. While I appreciate that the day-to-day workings of the LEOs might not have been worked out fully yet, the staff in these new offices also should visit the regions to meet people. At present, they usually work behind walls and one must telephone them, after which they might come out. However, were it to be made known that they would be present in a region on a particular day each month, the staff would be on the ground more often and would gain knowledge in so doing that could feed into the system and have better outcomes. I commend this Bill to the House.

Deputy John Paul Phelan

I welcome the opportunity to voice my support for the County Enterprise Boards (Dissolution Bill) 2013, which, as Deputy Áine Collins has noted, probably is awkwardly named, to say the least. The Bill is about more than simply dissolving the existing enterprise boards, as it also provides for the establishment of a new system for local enterprise as an integrated part of local government. Unlike many of the previous speakers, I have never been a member of my local enterprise board in County Kilkenny. I commend the Government on introducing the legislation. While it forms part of the programme for Government, it also formed part of the proposals made in advance of the drawing up of the programme for Government at the time of the last election.

For many years, Ireland has not had a properly functioning local government system. One major reason for this is that certain powers which typically rest with local authorities and local government in many other parts of Europe and elsewhere in the world have traditionally not formed part of the role of local government here. The key aspect of this legislation is that local enterprise will now be integrated into the functioning of local authorities. As this is a positive step in the right direction, I disagree fundamentally with a number of the previous speakers who expressed doubts as to whether local government would be a suitable vehicle for promoting local enterprise. A number of previous speakers outlined their support for Enterprise Ireland, IDA Ireland and the successes they have had, particularly more recently, but also appeared to voice concerns that local authorities did not have the requisite personnel with the requisite skills to promote enterprise. Officials of Enterprise Ireland, like local government officials, are public servants and I do not believe a public servant who happens to work in a local authority could not have views of a more enterprising nature, as they are not mutually exclusive.

From my point of view, in the local authorities in Kilkenny, management and staff have always traditionally had a pro-active view to attracting and promoting enterprise in their local authority functional area. The basic tenet of this legislation, to establish a "first-stop shop" for local enterprise within local government is a further effort to reform how local government operates and to ensure functions that should properly be administered by local authorities are administered by them.

The Minister for the Environment, Community and Local Government has introduced a number of reforms, probably the most wide-ranging reforms since our system of local government was established in the late 1800s, when we were under a different jurisdiction in terms of reforming the structures of local authorities. This introduction is a further positive step combined with the fact that for the first time in many years local authorities will have a revenue-raising function in the form of the local property tax. These functions should be administered locally and that is principally why I am very much in favour of this legislation which proposes the establishment of these local enterprise offices. I do not conform to the views some have expressed that local government cannot be a place where enterprise exists. We should try to foster more enterprise in local authorities and this legislation will be a significant step in ensuring we can do that into the future.

Deputy Eoghan Murphy

I welcome the Bill and all that the Minister is trying to do to help small and medium sized enterprises and create an environment that will help create jobs and promote business in the domestic economy. The Action Plan for Jobs is key to the Minister's strategy. The Cabinet is discussing the iteration of the action plan for 2014. The evidence shows us that the Government is doing good work in this area in trying to make it as easy as possible for new businesses to get going and for existing businesses to survive and thrive. It has been said here before, and has become a mantra, that it is not the Government's responsibility to create jobs but to create an environment in which jobs can be kept and created. It is often repeated, but during the boom years the biggest sector for job growth was construction and after that the public sector. That was the Government directly creating jobs and it should not have done it that way. It was for other reasons, probably political, that it pursued that course but it was not to the benefit of the country, particularly when the economic collapse came.

The strategy being pursued regarding the Action Plan for Jobs is about giving small supports in a tangible way in key areas of the economy that could help private enterprise and individuals succeed, and from that create jobs and a healthier economy. One aspect of that action plan I hope to see promoted is peer-to-peer financing. I have mentioned this in the Dáil a number of times. It is a solid alternative to bank and Government lending and there is great space for it now. In the UK in 2013, 10% of lending to SMEs was peer-to-peer. The borrower gets loans at a cheaper rate while the lender gets a higher interest rate than from saving that money or putting it into less profitable investments. There is great benefit for everybody involved in the market. The other good thing about it is that it does not involve the banks, because that lending model is being challenged, and rightly so, and it does not involve the Government directly. That needs to be promoted and I hope the Action Plan for Jobs for 2014 can promote that in some tangible way through some sort of tax incentive or tax relief or through a small bit of funding that would follow private funding in that market once the different auctions have closed. There is a detailed submission on this in the Minister's office and I hope it will be considered.

We are, rightly, making it easier for businesses, new or existing, to navigate the difficult system when it comes to interacting with local government or with their responsibilities in general. That is one of the welcome aspects of this Bill, that it tries to reduce the red tape for businesses and make people aware of the supports available to them. In this sense a one-stop shop model is a very smart way to proceed. It should be possible for a business-minded person to go to a public desk in a local authority and in one interaction discover all he or she might need to do to set up a business, the files that would need to be completed, the forms that would need to be checked, any charges that might need to be paid and applications made for different types of business. There should also be a facility to point them in the direction of where other types of support might be found, such as mentoring, networking or low-level funding.

I am not sure the local authority is the best place to warehouse those services, and I will come back to that. When we talk about a business person interacting with a local authority or the Government in trying to establish or expand a business it is important that we acknowledge that too many charges and too great a variety of charges fall on a small business today. These charges make it far more complicated to administer and do one's business and are too high. A number of people have come to me who are in the process of trying to open a new business and they have a multiplicity of charges already levied on them. They have liabilities to the local authority before they have even begun to trade. That is a ridiculous situation.

In addition, the way we charge our local businesses through the commercial rates system needs to be completely re-examined and redrawn. We have a flat tax on business, on enterprise. That cannot be seen as a taxation strategy that promotes enterprise. Our taxes on employment are too high. We must acknowledge that that is a disincentive to creating jobs. If we use taxes in other areas of the economy to reduce activity, taxes on employment that are too high will also reduce that activity. The same logic must follow.

We must keep on addressing these two key issues in government. It is good that things like one-stop shops are being introduced. It is good to use the Action Plan for Jobs to put those key supports into particular areas of the economy. However, if basic things like the costs of doing business, in terms of the taxes levied on the business, or the costs of employment are too high, that will be a barrier from the get go.

The Minister's ambition in this Bill is the establishment of local employment offices and that is to be commended. It is a huge amount of work with many moving parts. Many people accessing those services across the country will benefit from the new arrangement. I previously sat on the Dublin City Enterprise Board. I am not sure if the solution for Dublin is to merge the local enterprise board into the local authority. There might be a good case for this in other areas of the country but in talking about our strategy for the country we need to recognise that a one-size-fits-all approach is not necessarily in the best interests of the capital. Dublin is different and should be treated differently.

The Dublin region is the economic engine of the country. We have the highest concentration of people. We raise the most GDP. There is greater diversity in terms of possible avenues for accessing funding. There are more networking events, people and, therefore, more mentors available to people. If it is working well, and it is working well, without the direct control of the local authority, why would we change it? It might be better for other regions of the country, but for Dublin, and the significance that it has for the wider economy, we must be sure we are moving in the right direction. I might be wrong. I defer to the Minister. However, my experience tells me that if one wants to be a successful support to small businesses, it is better to be a small business. If one wants advice on entrepreneurship, it is better to speak to an entrepreneur. That is the kind of mindset we should approach as we try to help people, private enterprise and the economy to get going again and rebuild the domestic economy.

I hope that by moving Dublin City Enterprise Board into Dublin City Council we do not in some way damage that small-business spirit that has led that company in trying to do its best for other small businesses in the city, and which did it very well in my experience and from everything I have seen since. I commend and thank all the members of the company and the board members for the service they have given to date. I wish them well in what they do in the future. I also wish the Minister well in his strategies for promoting job creation and with the Action Plan for Jobs 2014 that will be released shortly.

Deputy Bernard J. Durkan

I am delighted to have an opportunity to speak on this Bill. It is appropriately constructed and timed. It will help augment the Government's job creation strategy in general. It will bring a new impetus to job creation at local level.

When locating jobs in the micro-sector it is important to have local knowledge, information, input, expertise and employees. We are fortunate to have a highly educated population, both young and old. Unfortunately, over the past number of years we have had more people than there were jobs available, but this issue is being addressed. I would not have believed four years ago that we would now have reached a situation in which more than 1,000 jobs a week are being created. This is a great tribute to the efforts of everybody concerned - the Government, the Minister and his colleagues. It is also a tribute to those in the public sector charged with this responsibility, such as Enterprise Ireland, the IDA and the county enterprise boards, which have undertaken this work in the past. All credit is due to them for their efforts. They did not have an easy task. The work was all uphill and difficult. We were told on a daily basis that there was no hope, that the country could not survive and there was no hope for our youth. Despite this, there has been significant success.

Like most Members, I spent a long time as a member of a local authority and I have always claimed that the separation of local authorities from the Oireachtas through the abolition of the dual mandate was a negative step. The dual mandate was significant in ensuring the direct link between the Oireachtas and the local authorities was maintained on an everyday basis. This gave greater power and influence to the local authorities and gave the Oireachtas a better and more direct impression of what was needed at local level. However, that debate is for another day.

Everything changes with the passage of time. The county enterprise boards worked extremely well up to now. However, circumstances have changed. It is critical now that the new local enterprise offices will be able to strike out afresh, using the information that was available to county enterprise boards and the information and support that was available to central agencies such as Enterprise Ireland and the IDA to the advantage of the local people. They must try to ensure that there is a link-up with the educational system, through the schools, to ensure the skills being developed are suited to what jobs and opportunities are likely to become available in their area.

An important issue in regard to providing jobs of any description in any part of the country at any time is the availability of the infrastructure. We must have adequate roads, telecommunications, water supply and power. Despite the fact that rain seems to fall constantly, we are only now, through Irish Water, coming to grips with the issues of water storage, treatment and supply. Energy supply is also an important issue. All of these areas of infrastructure need to come together in the creation of a package that is vital to a new entrepreneur or a business person who wishes to expand. We must be aware of the role that can be played at local level in this regard.

We should remember that it is now possible to set up multinational corporations from very small beginnings. Let us not forget that many major enterprises worldwide grew from small and humble beginnings, for example, Glen Dimplex and the enterprises of Bill Gates and various others. Intel was founded in a garden shed and started off very small. We need to nurture this culture. In the past, we tended to allow opportunities to pass us by without giving sufficient notice or attention to the potential of enterprises or what could be achieved by adding to those we already had and creating jobs.

It is possible to provide many jobs from small beginnings, even in remote parts of the country, through the use of modern technology, communications, road networks and facilities. Therefore, we must ensure that when developing industry and businesses we spread the opportunities across the country rather than concentrating on one area. This will have a beneficial impact on the wider economy. In the past there has always been an imbalance in this regard, and larger towns and cities have tended to draw industrial development to them. However, modern developments facilitate smaller industries, even in remoter parts of the country, and we must highlight this.

If a young entrepreneur or anybody with a business idea requires a patent, I would advise them to apply for a patent before they seek support in the marketplace, because too often other people will pick up and develop their idea to their advantage. I have been witness to one or two such cases in which an obvious unpatented business idea was developed by someone other than the originator. I hope the concept we are now unfolding will guard against this occurring.

It is no harm to use the new local enterprise offices to strike out anew and develop a new concept. They should be aggressive in their pursuit of people who have the ability to create jobs and enterprises, local or international. Access to local information is hugely beneficial. A number of people have raised concerns as to whether the new LEOs are the right places for this. I believe we do not do our local authority personnel justice in this regard. Many of them have skills and expertise and are well capable of assessing business opportunities, evaluating the concepts laid before them and making a judgment call that will benefit the local area. There is nothing so frustrating for someone as to be told "I will have to send that to headquarters," so that somebody else's opinion will determine whether the enterprise gets off the ground. That is not the way it should be. We should always be prepared to trust the people with the skills, ability, wherewithal and business acumen to be able to assess what is laid before them in a businesslike fashion. The county enterprise boards have proved they can do that and I have no reason to believe we do not have adequately skilled people in the local authorities to do the same in the future.

If we have a structure already, we should utilise it. The local authorities are already in place.

We have spoken about reform, and reform is taking place. Notwithstanding this, we should never forget if we do not give an opportunity to people at local authority level to exercise their flair it will never happen. Their commitment to the public good will be restricted because if they are always overshadowed they will not blossom, flourish or give their all, which is what is required at present.

Interaction with local business people and budding business people will continue to be important but we must also recognise our culture. The culture here has always been to anticipate failure. If one comes to the House any morning, afternoon or evening again and again one will hear the anticipation of failure, negativity and the inability to see anything positive. This is a change because the House was not like this. I have sat in various perches in the House over time and there has been a massive development of negativity. If we could harness the negativity in the House, bottle it and export it we would have an abundance that would keep the country going for a long time. The quicker we realise the degree to which we have at our disposal adequate resources, brainpower, ideas and management skills required to do the job in today's challenging world the better for ourselves, for the country, for the people and for the economy in general.

I mentioned the need for local skills and infrastructure. The LEOs will help focus attention on the requirements for local infrastructure in a way which has not been done before. This opportunity is being given to the LEOs at a crucial time for economic recovery and they will have critical influence in the major economic job to be done. In the past the economic development of the country has been cyclical. Over the years we have taken two steps forward and four steps backwards and we have never achieved a proper cohesive integrated and interdependent economic programme in a way which provides jobs for the population in the long term. In recent years every effort has been made to try to recover from a downturn when we should have been spearheading and showing the rest of the world the extent to which we can do the job thrust upon us even in difficult circumstances. This is being done now. We should avail of it, capitalise on it and use it as a means of promoting our image on the home market and abroad in such a way as to ensure we do not continue to bid goodbye to our young skilled workforce and have to visit them in other countries, and no longer ferment and create the impression with every new generation that somehow we are not as good as we should be. The degree to which very often our emigrants are successful abroad is due to the fact they are applauded when they strive to improve their lot, but this does not always happen at home.

Deputy Kieran O'Donnell

I am delighted to contribute to the debate. The county enterprise boards are being assimilated into local authorities under the auspices of Enterprise Ireland. I will speak about Limerick as it is the area I represent. The Limerick city and county enterprise boards will come together in the amalgamated Limerick local authority under the manager Conn Murray. A one-stop shop will be created. We speak a lot about structure but the skillsets of the personnel are what is most important.

I was self-employed from many years as a chartered accountant with my own practice. I dealt with self-employed people and know what they must go through. It is critical the service is made as accessible to them as possible. The one-stop shop under the local authority umbrella will include enterprise and innovation, planning, licensing and structures and it is very welcome. Success will come down to the personnel so it is extremely important the skillsets in the enterprise boards are retained in the new structure.

The structures will evolve over time and the integrated model whereby all the services will work together under one roof is the most efficient and effective model, but this will also come down to the skillsets of the personnel. One can have the best organisation in the world but if one does not have the people with the necessary skillsets running it the organisation may be highly ineffective.

Small and medium enterprises are the lifeblood of the economy and we must appreciate what is involved when somebody becomes self-employed. People may go into self-employment from being unemployed or from secure employment and the risk they take must be acknowledged, as must their concerns about collecting money and access to finance which is why the one-stop shop under the local authorities must be integrated with financial institutions, other State organisations, mentoring services and any grants which are available. People considering becoming self-employed should know when they go to their local authority they will be given very straightforward advice in a range of areas and will be told for what grants they qualify, the schemes under which they can get assistance such as the State-backed bank credit guarantee scheme and microfinance scheme, and provided with information on access to credit from the banks.

Limerick now has directors for economic planning and innovation and a marketing area manager, and all of these will come under the one-stop shop umbrella. Self-employed people and those becoming self-employed must know when they contact the one-stop-shop they will obtain services efficiently and at a low cost and will get whatever assistance is required. The critical period for survival for any small business is the first three years and in the following two years they should reach a stage where they make reasonable money. For existing businesses it is about survival and taking on staff.

This is about job creation.

I welcome this measure but it must be based on retaining skillsets and putting in place skillsets to help the small and medium enterprises sector.

Minister of State at the Department of Jobs, Enterprise and Innovation (Deputy John Perry)

We are aware that a target has been set by the Taoiseach that Ireland will become the best small country in the world in which to do business by 2016. This is an ambitious and achievable target. A key component for the delivery of this target is the reform of the national micro and small business support service. One of the pillars of the Government's strategy for promoting jobs and growth is ensuring that micro and small businesses can start up, grow and export. This legislation will enable the creation of the best possible local environment for micro and small business, and the development of a strong network for entrepreneurship.

We have had a very good debate. What the Taoiseach and the Minister, Deputy Bruton, announced today were the key features of the new local enterprise offices which include additional funding of €3.5 million in 2014 and 170 dedicated staff across the local enterprise office, LEO, system, supplemented by a new graduate recruitment programme to take place shortly and supported by additional local authority staff. Additional services include a new young entrepreneurship fund, which is very welcome, the Microfinance Ireland credit guarantee scheme, and access to services from Revenue and the Department of Social Protection. The system will combine new supports with business services currently delivered by county enterprise boards, CEBs, and those delivered by local authorities in the first-stop-shop to be located in local authority offices until the overall framework set by the Minister for Jobs, Enterprise and Jobs is in place.

Each new LEO embedded in a local authority will develop a local plan for boosting enterprise, with targets including new business start-ups, business expansions, jobs created or sustained, as well as wider impacts such as exports, mentoring, training and enterprise promotion, which cover many of the issues raised by Deputies in the debate. This represents a fundamental reform of local government to ensure services are delivered and decisions made closer to the people. There will be new training programmes for all staff in customer support, and a new customer service and charter will include targets for levels of service delivery. That is what was announced by the Minister, Deputy Bruton, and the Taoiseach earlier today.

Regarding some of the queries raised, Deputy Calleary referred to the elected members. I understand they will have an oversight on this area. It is critically important that they would have such oversight with the new municipal areas around the county, and it will be driven by the benchmark of Enterprise Ireland. It is very much a two-way process. The service level agreement will be a very clear document in that regard.

Regarding national awards, there will be major national awards involving up to 14,000 participants through the enterprise fund system.

The Bill is technical in nature but the main issues are the dissolution of the county enterprise boards and the transfer of their functions, assets and liabilities. The transfer of staff is equally important.

The point was raised about the Intreo office, joined-up thinking and the special budget. There is no matching funding required from local authorities in this regard.

I will not address every issue raised as many of them will be discussed in detail on Committee Stage. However, I will speak to a number of them.

With regard to local authorities working with business to support investment and business development at local level, that has been part of the remit up to now. It includes promoting and fostering entrepreneurship, the delivery of essential services to businesses, and responding to the needs of local business speedily and efficiently.

The wide reach of local authorities in the community makes them an ideal partner. Equally, combining the role of social enterprise in community and economic regeneration with the role of community enterprise centres in the communities will be very much part of this process.

The new structure will bring in the local authorities as direct partners in promoting entrepreneurship and supporting small and micro businesses. The Minister for Jobs, Enterprise and Innovation will retain responsibility for policy and budgetary matters.

Enterprise Ireland's focus will continue to be on the high potential start-ups, HPSUs, and companies with at least six staff that have potential. The word "potential" is important in that regard.

The local enterprise offices will continue the county enterprise boards' focus on micro-enterprises that are starting up or expanding. The new service will also provide soft supports to small business, any business with a query or an entrepreneur with a business idea. Any person with a commercially viable business proposal will be assisted. There is no specific policy focus on issues such as social enterprise.

As part of the robust metrics format, the service level agreement will be tailored to suit the size and the capacity of each LEO and included in a local enterprise development plan that will be agreed annually between each LEO and Enterprise Ireland. The performance under these metrics will be monitored by Enterprise Ireland.

The student enterprise award is well-established. There is a strong foundation for building upon that, which is our intention. The role the county enterprise boards have played in that regard will continue to be played in the LEOs.

We believe strongly in the benefits gained by mentoring at different stages of the life cycle of business, about which Deputy Collins spoke. Such a service is crucial to the success of many micro and small businesses, and also to medium and large-scale businesses. There will be a focus on that aspect as well.

On the question raised about consultation, there was a series of consultations during the development of this restructuring plan in conjunction with the launch of the action plan in 2012. The Minister, Deputy Bruton, produced a public consultation document, which was very informative. In addition to all those measures, the stakeholders in this process, including the staff and boards of the county enterprise boards, Enterprise Ireland and the local authorities, have been included and involved. This is being managed through the implementation working group, which has been very effective.

The total Exchequer allocation to the county enterprise boards for 2013 was €25.9 million, of which €15 million is for the capital budget. The Exchequer allocation secured by the Department will continue to be the primary source of funding for the provision of LEOs, grant aid and other supports to the micro and small business sector.

The budgets for the LEOs will be allocated by Enterprise Ireland. The funding given to Enterprise Ireland is under a separate, ring-fenced subhead on local authorities. It is also anticipated that the local authorities may provide additional funds for activities or projects, particularly in regard to enterprise and entrepreneurship, promoted through the normal budgetary process. Matching funding is not requested from local authorities.

The Government decision of 17 April 2012 provided for the dissolution of the county enterprise boards and the subsequent secondment of all the existing staff and the relevant local enterprise offices.

As part of the change to the county enterprise boards, all policies and procedures are currently being reviewed. This will include pre-grant check requirements, a point raised in the debate, on companies to confirm compliance with various statutes, for example, those on taxation, and compliance with labour law as a requirement for payment of a grant.

The local enterprise offices will continue to grant-aid company start-ups with fewer than ten employees with the potential for growth, which is an important point. The provision of soft supports such as training, mentoring, advice and information will be widened to include business start-ups with more than ten employees.

On the points raised by Deputy Calleary, he gave an example of a system that is in place in Mayo. It we could operate the system in Mayo throughout the country it would be very successful. We will take on board his input. The Minister, Deputy Bruton, will deal with the question of elected members but they will have a critical role in the new municipal areas in the outreach offices in Mayo, and likewise in County Sligo.

Deputy Colreavy raised the issue of rates imposed on businesses. There is a provision that local authorities may be able to give a derogation to businesses for the provision of services in towns and securing occupancy in vacant properties; they will have some discretion in that respect. The Minister, Deputy Hogan, is examining that idea. The Deputy also raised the issue of the private business sector, and the role of villages and towns in terms of community involvement. That will be examined also.

Deputy Wallace was somewhat negative on the potential of this initiative but I would be very positive about its potential. From cities to counties it presents a great opportunity.

Regarding Deputy Boyd Barrett's point, we are certainly not dismantling the structures.

We are improving the structure, not dismantling it. Our focus will be the real engine of growth, namely, micro-enterprises and start-up companies. The microfinance fund will assist in this regard, as will the COSME fund of €2.3 billion which was agreed to during the Irish Presidency. The COSME fund may be allocated through the local enterprise offices.

Deputy Dara Murphy spoke about the "think small first" principle and the issue of regulation. We are conducting a review of licensing.

Deputy Denis Naughten made a good suggestion about national standards and a quality mark for websites. He also spoke about foreign direct investments and grants. With a facility in every county, Enterprise Ireland and IDA Ireland will be able to collaborate on county plans. The Western Development Commission will play a critical role in the counties in which it operates.

Deputy Joe O'Reilly also spoke about foreign direct investment and county plans. The new structure will allow us to develop centres of excellence and cut red tape. Enterprise Ireland can play a critical role in this regard. The chairman of IDA Ireland, Mr. Frank Ryan, is a former CEO of Enterprise Ireland. Regional planning will be central to the structures.

Deputy Finian McGrath spoke about the youth guarantee. The Taoiseach has sent a clear message of support for it and the Intreo offices are actively supporting people in moving into business or employment. Deputy Ann Phelan spoke about the importance of employing experienced staff in the context of employment law.

Deputy Damian English spoke about the role the European Investment Bank could play in supporting micro-funds. The loan guarantee and community-owned centres will also play an important role. Deputy Anthony Lawlor spoke about micro-enterprise funds and start-up work spaces which will be incorporated into local action plans.

Deputy Áine Collins asked about mentoring, which will be ring-fenced and included in the Action Plan for Jobs. Deputy John Paul Phelan stressed the importance of job creation and recognising that every enterprise has the potential to create jobs.

On Deputy Eoghan Murphy's comments, the structures will work in Dublin. The high level group is reducing red tape for business. I agree entirely with Deputy Bernard Durkan on the need for positivity. This can work, but it will require the co-operation of business people and local authorities on the ground.

This is an important Bill which will assist the Government in its plans to reshape the landscape to more effectively meet the needs of micro and small businesses by bringing local enterprise supports into an integrated national network of local enterprise offices, creating a seamless support structure - the first-stop-shop - to offer the full range of State supports available to the micro and small business sector and ensuring this vital sector will benefit from an expanded and bench-marked service across all regions, with all forms of entrepreneurship fostered and supported. Some 31 offices will act as local hubs for enterprise support, delivering a comprehensive first-stop-shop service to local entrepreneurs and businesses. They will combine the direct grants, mentoring and training formerly delivered by the county enterprise boards with business supports; utilise local business expertise to evaluate projects; provide training and mentoring on starting a business; and provide for an enhanced advice and guidance service embracing all other local and national supports and, where necessary, direct referral of clients to Enterprise Ireland or the microfinance and loan guarantee schemes.

In addition to the drafting of this legislation to implement the 2012 Government decision to reform the system of supports, significant progress has been made on the restructuring project. I am optimistic about the new local enterprise boards and look forward to debating the Bill further on Committee Stage.

Question put and agreed to.