JOINT COMMITTEE ON ENTERPRISE, TRADE AND EMPLOYMENT díospóireacht -
Wednesday, 25 Jun 2008

Bureaucracy and Regulation: Discussion with Small Firms Association.

Chairman

I welcome the delegation from the Small Firms Association. Mr. Pat Crotty's father was a distinguished Member and so he will appreciate emergencies arise in committee. I apologise that the delegation was detained longer than expected.

I draw the delegation's attention to the fact that while members of the committee have absolute privilege, the same privilege does not apply to witnesses appearing before it. Members are reminded of the long-standing parliamentary practice that they should not comment on, criticise or make charges against a person outside the Houses or an official by name or in such a way as to make him or her identifiable.

The Small Firms Association has already submitted a comprehensive presentation which Mr. Pat Crotty and Ms Patricia Callan will summarise for the committee. I am sure they will be subject to extensive questioning from members of the committee.

Mr. Pat Crotty

I thank the Chairman and members for the opportunity to make a presentation to the committee. We are accompanied by several of the association's council members, Mr. Aidan O'Boyle, Aalto Bio Reagents, Dublin, and Mr. Kieran Crowley, managing director of Dyno-Rod.

I have been involved in manufacturing-retailing and am now involved in the hospitality sector. The delegation covers a wide range of small firms' experiences. We noted many delegations to the committee comprise executive members of various associations. Our delegation comprises those who take the risks, borrow money, provide employment and invest in this country.

The economic success of recent years has been driven by direct taxation policy, a pro-enterprise culture, interest rates and an entrepreneurial spirt with social partnership providing a stable background. These are all under severe pressure. Challenges have emerged with our cost base, competitiveness and productivity. The association has been flagging challenges in energy costs, infrastructure, inflation and emerging producers in eastern Europe, Asia and India. These challenges have recently been magnified to an extraordinary rate which will hurt us economically both in the short and medium term.

The term "rip-off" has been used much over recent days. Between June 2002 and June 2007, the inflation rate for goods was 4.5%, which is less than a 1% increase per year. The inflation in services in the same period was 27.3%, an increase of 5.5% per year. Services accounted for 86% of all inflation over this period.

This is important to bear in mind when fingers are being pointed at manufacturers and high street retailers. The Government controls the majority of services that have caused this inflation. This covers a range of services from local authority rents to public transport charges which feed through to the cost of doing business. If it is not a direct business cost, it is a cost to our employees. As a result, they come under pressure and need to be compensated by us. The Government has a strong responsibility to respond to this instead of telling industry to be more competitive. Industry has been very competitive, particularly when one considers that goods inflation was less than 1% per year.

When rising costs in fuel and exchange rates moved the wrong way this year, there was no capacity in business to absorb those costs. As a result, those increases had to go on to prices. With matters still worsening, there is pressure and an expectation that business will absorb these costs. It will not be able to do so. Increasing wages at the national pay talks may not improve spending power but instead threaten jobs. Business cannot continue to absorb agreements that suit other people and do not allow it to prosper.

Local authority charges have become an evident issue for small businesses. There was a time when small firms paid a single rate and received services. Currently, every service — whether it is for water or refuse collection — is paid for individually. A small firm, for example, does not just pay for planning permission but also development levies to local authorities. It has no choice in this matter. Rates have increased extraordinarily in the past five years.

Ms Patricia Callan

This year alone, I have been interviewed five times by five different economic consultants on behalf of Departments examining how bureaucracy and regulation impinge on small businesses. We have had report after report but nothing is being done. This is the single largest issue that needs to be addressed.

There are three elements to this issue that need to be tackled differently. The first of these is the examination of what is already on the Statute Book and assessing and reducing the costs of that. The Small Firms Association advocates the use of a standard cost model in that regard.

The second element is the need to introduce regulatory assessments for all new legislation. I have seen many documents claiming this is Government policy. However, when Departments are requested for such an assessment, they claim they do not have to carry out one. It may be the case that this should be introduced into law to ensure it happens. If one does not understand the costs and benefits of a new regulation, is that good legislation?

For example, our retail members estimate the cost of implementing the provisions of the Intoxicating Liquor Bill 2008, such as alcohol being stored behind a counter and building shops within existing shops, will come to €200 million. No cost benefit analysis has been carried out on this proposal. The Employment Law Compliance Bill 2008 has the potential to cease all job creation. Again, no assessment was carried out on the implications of the Bill's provisions.

The third element is the red tape nightmare — the administrative burdens from filling in forms to getting permits. As one of our council members stated to me, if he were not in Leinster House this morning, he would be in his office filling in Government forms regarding compliance.

The high level group on business regulation, chaired by Mr. Sean Gorman and of which I am a member, has done good work in this regard. It is due to report shortly to the Tánaiste and Minister for Enterprise, Trade and Employment, Deputy Coughlan. Although much remains to be done, this type of approach, whereby businesses have access to a forum where they can identify specific red tape issues that Departments can act upon in a way that produces demonstrable cost savings, is the way to go.

The three elements I identified come under the remit of various Departments. While the lead Departments, including the Department of Enterprise, Trade and Employment, may perform well in this regard, the difficulty is getting that message into the other Departments whose activities also impact on business. That is one of the key priorities for us. We are aware of the Government's agenda but the business of issuing more and more reports and paying economic consultancies to do work that could be done by civil servants is another matter.

On the issue of community enterprise, many of our members already operate in the community enterprise spectrum. I was a member of the board of a community enterprise centre for many years. These centres do fantastic work but there is a significant level of confusion in the sector. The committee could do much in terms of offering a definitive articulation of what we want the community enterprise sector to achieve, particularly in view of rising unemployment and the emergence of economic black spots.

Community enterprise has the scope and potential to deliver effective results. Most if not all existing enterprise centres are operating at full capacity. This illustrates the level of demand from business start-ups for low-rent accommodation. The community enterprise centre model is an excellent one and support should be available to allow it to expand, including support for existing centres to expand their premises. The community enterprise sector has provided a phenomenal service to local communities in providing people with genuine opportunities to set up their own businesses. We should promote entrepreneurship in view of the increasing numbers of redundancies, particularly in those sectors where it may not be as easy for people to acquire the new skills necessary to secure a return to employment.

In the past three years, we have done major work on ethnic entrepreneurship through the Emerge programme, which receives funding from the EU's EQUAL initiative. Our findings document was launched three years ago by Deputy Deirdre Clune, as Lord Mayor of Cork, and we sent copies to all Members and Ministers. Based on those findings, we have clearly demonstrated through our pilot projects in Cork, Galway and Dublin that the way to promote ethnic entrepreneurship is to target ethnic entrepreneurs directly. These are people who have come to the State without any knowledge of our banking system or of how government works. They are often suspicious of public bodies as a result of their experience in their own countries. It is up to us to make them aware of the supports that exist. Irish people will eventually find their way around the system and will know, for example, how to locate an enterprise centre. We take thousands of calls every year from people seeking that type of information. In the case of ethnic communities, however, we have to walk the streets in an effort to inform people of the available supports.

There is also a need for specific pre-enterprise supports and start-up training for non-nationals. Again, there are additional difficulties for people from other countries in terms of cultural differences, business language and an understanding of how business is done in Ireland. The 200 participants who came through the programme had a much higher success rate than those participating in a typical start your own business programme, and it was clear that they wanted to integrate with the mainstream business network as quickly as possible. They participated in our members' evenings and events and were able to meet people already in business here. This was an extremely welcome initiative.

There must be some differentiation of supports as between encouraging and assisting start-ups and integrating them fully at a later stage. We have made a submission to the Minister for Enterprise, Trade and Employment and the Minister of State with responsibility for integration issues which makes the case for specific funding to support ethnic entrepreneurship. We estimate that a provision of €250,000 would allow this programme to be rolled out successfully through the enterprise board structure. This is not a case of creating new bureaucracies but rather of proceeding in a slightly different way which will have an extremely positive outcome. It has been clearly demonstrated that Irish people are more entrepreneurial when they go abroad. A similar pattern is evident among immigrants to this country. The 200 people who participated in the programme included 30 different nationalities, all with different priorities and concerns. Encouraging that type of diversity fits in with the broader integration agenda. If we can encourage business people from ethnic minority backgrounds into the mainstream of business life in Ireland, there will be an opportunity to counteract many of the social issues arising from immigration, including the emergence of ghettos and so on. This issue has a far wider resonance than merely the business or enterprise agenda.

On job creation and economic black spots, we have several proposals for targeting support to encourage specific groups back into the workforce. In general, there has been a long-standing issue in that there cannot be competitive regions, towns, gateways and so on unless the infrastructure is there to support them. I refer not only to physical infrastructure in terms of roads and public transport but to communications technologies. In regard to broadband availability, the figures from the Department are not accepted by any of the social partners as reflecting reality. People cannot avail of broadband in many parts of the State even if the map says they can. There is much work to be done in this regard.

I will focus on three specific issues with reference to workers' rights, namely, the Employment Law Compliance Bill 2008, the proposed EU directive on agency workers and the Green Paper on pensions. The Employment Law Compliance Bill criminalises employers. It includes provision for 23 criminal prosecutions, many of which relate to administrative issues. For example, employers must provide employees with a detailed statement of their duties when they leave employment. Employers must obtain and retain a copy of a passport for every employee, which is essentially a national identity card in disguise. Small business owners must draft legally mandated notices and translate them into the language of every employee, and then find a notice board on which to put them. In addition, the Bill proposes record-keeping requirements that contradict the provisions of existing employment law. The list goes on.

We have made a 40-page submission on this Bill, which we contend represents a reaction on the part of the Government to the Gama and Irish Ferries case. Legislating on the basis of two isolated incidents, which occurred in large companies, is simply bad law. This morning, the European Commission published its proposal for a small business Act for Europe. This is a recognition of the necessity of thinking small first. Every Bill should be examined from the perspective of its impact on employers with one to three employees and work out from there. If the Commission has accepted this principle, we should do the same. It is the right way to make law.

There must be a balance between workers' rights and those of employers. Small business owner-managers generally know as little about bureaucratic requirements as do employees because they are trying to deal with everything else. My colleagues will share their personal experiences presently. Criminalising people who want to create jobs is the surest way of hindering job creation. Why would anybody tolerate a situation where a minor breach of bureaucratic requirements might lead to a criminal prosecution and a subsequent disbarment by the office of the Director of Corporate Enforcement? I cannot overemphasise our concerns in regard to this Bill.

The draft EU directive on temporary agency workers has moved ahead of itself since it was debated by the committee. It is now back to us as social partners to negotiate the terms locally. We are committed to doing so within the current review of Towards 2016. We want to have those terms agreed before we sign off on a deal.

Many submissions were made in regard to the Green Paper on pensions but nothing has persuaded us that there are clear and compelling reasons to implement mandatory pensions. On the contrary, such a move would be disastrous for both employers and employees in the current economic environment. We are strongly convinced that the system must be simplified in a way that still encourages people to save. The Government has an important job in ensuring that the State pension provides a poverty-proofing layer, which is not currently the case.

Rather than pass the State's obligations on to business and individuals, the current policy must be reviewed. The model we envisage is a simple SSIA-type scheme where people's contributions are matched in euros rather than tax credits. It should include a carrot in the form of an option to take out a certain percentage in five years' time. This would encourage people to save because they have the fall-back option of drawing down some of the funds in the future.

However, if five years later they do not wish to do so because they may have more money, are older and wiser and realise they need to continue to save, it would be a carrot that would be cashed in rarely but which would close the gap that exists in getting people in their 20s and 30s to save.

As this constitutes a sweeping summary of many issues, I hope I have been clear and I will be happy to discuss them.

Chairman

I thank Ms Callan. Five members wish to contribute and I will divide them into groups of three and two, comprising Deputy English, Senator Ryan and Deputy White, followed by Deputies Morgan and Calleary.

Deputy Damien English

I will not delay proceedings by asking too many questions as the witnesses have touched on many areas that members also consider to be necessary. They have been discussed by this joint committee and at Question Time as often as possible with the Minister and the Ministers of State. The problem is to get some movement and action in this regard. Ms Callan touched on the production of report after report on many subjects about which nothing has happened. The joint committee hopes to exert some additional pressure on those areas to try to get something done.

While I will not use the "R" word because I am not convinced it will transpire, the way out of the so-called problems we face will be to back small and medium-sized firms. If job creation is to continue, it will take place in that sector.

In the first instance however, we must put in place a plan to retain existing jobs. Last week I spoke about how the remit of enterprise boards must be broadened to sustain existing jobs. If problems arise with some of the association's firms, they must step in to try to hold on to what already is there. Although it does not make the headlines, it is common for two to three jobs per week to be lost in small firms about which no one hears. This must be admitted immediately by both the Opposition and the Government and attempts must be made to prevent it in any way possible, such as through grants and so on.

The enterprise boards must be changed and perhaps their scope should be broadened. They should not be limited to start-up companies but should step in where jobs already exist. Perhaps Ms Callan should comment in this regard. Does she believe they should step in to sustain existing jobs? The categories under which enterprise boards are operating must be broadened. This issue does not simply pertain to manufacturing. Although there has been a move away from manufacturing in many parts of Ireland, the enterprise boards deal with that sector in the main and do not become involved otherwise. Many companies that fall between enterprise boards, partnership groups and so on do not receive the help they need or they get the run-around.

While I may be wrong in this regard, I believe that enterprise boards, which undoubtedly do much good work, often boast about their success rates, which I consider to be too high. If their success rates are so high it means they are being overly choosy about who they pick in the first place. Enterprise boards should have lower success rates and should have some failures on their books. This would mean they had given people a fair chance to try to create jobs and had given people the requisite backing. While Ms Callan should comment on whether I am misreading the position, this is my personal belief.

Ms Callan is correct to state that red tape constitutes a massive issue that must be tackled. Together with some of my colleagues in other parties, I have raised the point that even existing Bills are not being assessed for regulatory consequences and so on and major problems are coming down the line in this regard.

Ms Callan mentioned the Employment Law Compliance Bill 2008. While I have not yet studied it fully, I will examine it closely on foot of her comments because it appears to be applying too much pressure. In general, other Bills that are forthcoming have not been assessed. There is no point in discussing the issue or in setting a target of a 25% reduction in five years' time unless a plan has been put in place to so do. This again constitutes announcements without a plan and members can work on that issue.

While the issue of broadband is being covered by other committees, this joint committee can also take note of it. The issue of council charges is significant and has been raised by this joint committee, which is attempting to examine the matter. Businesses undoubtedly are being asked to take on too much. Development and contribution charges are a factor that undoubtedly prevents businesses from starting up. This issue must be tackled as it constitutes another form of taxation at a high rate and is preventing job creation in many counties. Moreover, it is unfair because rates differ between counties. This is not right and following the witnesses' presentations, a consensus should be reached among members to tackle this major issue. It is not sustainable to continually charge people for car parking, space they use and services. This simply cannot continue in conjunction with the imposition of rates and the obligation to pay for water and everything else.

The making available of more low-cost sites to companies must be encouraged. Many small businesses are under pressure because they are in the wrong location. Although they are stuck in town centres, which is costly, there is no real plan to move them to better-located sites at which they would have more car parking and space in which to do their business. A programme should be put in place to facilitate such a movement of companies. This would entail the provision of money by the Government to councils to buy up land to provide low-cost sites to those businesses that require them. There is an assumption both at council level and within many Departments that businesses can take on such costs because they are making plenty of profit. This assumption is both bad and wrong. In the case of developers and builders, while it was assumed they could continue to take it, it has become clear they cannot. As small firms cannot do so either, intervention is also required in this respect.

My final point pertains to agency workers. The witnesses are aware that a period of 12 weeks has been agreed to. I should clarify that I did not mean it has been agreed to by the Small Firms Association. The Government has stated it will work on this issue. Moreover, there is room for Ireland to deal with its own arrangement at the partnership talks. I believe that a period of 12 weeks is a little too short. There is disagreement among members of the joint committee in this regard. Some members believe that six weeks is acceptable while others would opt for a period of three to four months. I seek the witnesses' thoughts on what they consider to be acceptable because there must be agreement to some changes. In general, I am in agreement with everything they said and I do not wish to hog the entire meeting.

Senator Brendan Ryan

I thank the Small Firms Association for the well-structured and thought-provoking paper it supplied to members. Many of the issues raised have been discussed by members previously and are important to us. In general the issues raised concern matters about which members would agree.

While I do not wish to go over points raised by other members, I am in agreement with many of the comments on community enterprise. I have raised the issue previously. As for the possibility of having a one-stop-shop for this sector, although funding is available from Enterprise Ireland, firms must go to Pobal in respect of people. They may also have to approach local authorities. Consequently, I agree with the general thrust of the witnesses' comments on that sector. The potential can be seen.

I also wish to play devil's advocate to some degree on the concerns expressed by the Small Firms Association about the Employment Law Compliance Bill 2008 and the possible criminalisation of its members. Is it not fair to say that its members will only be criminalised if they fail to comply? Is something like this being put in place because over the years, many employers and small businesses have not complied with requirements pertaining to how they treat their people, health and safety and similar regulations? I suggest the logic of the Small Firms Association's position is that it assumes its members will fall by the wayside, will not comply and therefore might end up as criminals.

Deputy Mary Alexandra White

I also welcome the delegation, which includes some familiar faces from my constituency. I am sure the association has surveyed its members about developing new techniques in these challenging times pertaining to job creation and entrepreneurial skills. It is often said that in tough times, the best innovative brains come to the fore out of necessity. I come from a business background and set up a business in the tough times of the 1980s but thankfully we survived. Has the association surveyed its members in respect of new thinking such as, for example, working at home, particularly in rural constituencies? The provision of broadband is quite problematic, particularly in rural and mountainous area as one cannot receive a signal. However, I refer specifically to renewable energy technologies, whereby one could create dynamic, long-term and sustainable jobs among certain small firms, which are particularly well-geared to so do.

Mr. Crotty mentioned rates. Does he advocate a broader spread of the rates base? This has been mentioned previously by Chambers Ireland. I refer to the percentage of firms that are getting into new areas of work, outside of their traditional methods, because of high energy costs and the lack of broadband. Has the association noticed a trend among its members of diversification through the problematic times into which we face?

Mr. Pat Crotty

Ms Callan will begin because some of the questions were directed to her specifically.

Ms Patricia Callan

As for the first issue pertaining to the remit of enterprise boards, at present enterprise boards support companies with between zero and ten employees. In fairness to local boards, despite the restrictions that may be imposed they tend to be very helpful and will help anyone who is about to set up. Their difficulty is the corollary of their strength. The fact that they are all independent and locally-based in counties means that they are very accessible. However, the difficulty is that they are not known nationally so the man on the street has never heard of an enterprise board and does not know to go there for support so many people set up in business without them. I agree that if they are only backing companies that are successful, something is wrong. The idea behind the State support structures should be that they step in where there is a marginal case. If people are good enough straightaway in terms of their business plans, the financial institutions, to be fair, are very competitive in the start-up market. They are falling over themselves to support businesses. There is a gap there.

Fundamentally, all our supports both here and in the EU were set up for a time when manufacturing was our strength, so Enterprise Ireland only supports enterprise and, more recently, internationally-traded services. If one is in the domestic services sector, where between 60% and 70% of all employment in Ireland is to be found, one gets no State support. This is because of a concept called displacement where the State says that if it supports one business, it will be to the detriment of another one. We need to rethink all of this both here and at EU level because much of our funding criteria comes from there.

There is a job of work to be done. If we are saying that we are now moving to a services-based economy, the focus should be on how we internationalise services. If we have accepted that we are only in high-end manufacturing, there will not be as many jobs there. That is something for us all to think about.

There is a plethora of organisations in terms of enterprise boards, partnership companies, Enterprise Ireland, the IDA, FÁS and everyone else. It is confusing but, again, this is more of a communications issue. If one knows how to work one's way around the system, it works perfectly well. Some of my colleagues may wish to talk about it.

In respect of agency workers, the 12-week period came from an agreement in the UK which basically saw the directive come through. We would not accept that at all. Our starting point in negotiations is that we want the period to last for a year. There is a logic in that in that these employees will be the employees of the agency rather than the user. The only legislation that applies to the user is the Unfair Dismissals Acts which do not apply until somebody has been in continuous employment for one year. In particular, we will look for derogations in terms of smaller companies and sectoral-specific type issues.

This is a very complex area, particularly for small companies, because if the same principle of non-discrimination applies to fixed-term workers and the Protection of Employees (Part-Time Work) Act, the administrative burden of calculating what the pay, conditions, benefits and equivalent employees are will be complex. Quite often, one will not have an equivalent full-time employee in a small company and might just hire an agency worker to a particular job. Similarly, one might use agency workers for temporary contracts and seasonal work. In that context, anything within six to 12 weeks would be way too early.

We need to look at this from beyond the business perspective — what Deputy White spoke about in terms of flexible work. This is a key area for many people in choosing to work flexibly in that they can pick and choose assignments. It would be interesting to see if a study was carried out on this but from what I hear, very often, they are paid more, not less, because of that. Again, I would look to see who is abusing agency workers because I do not think small businesses are doing so. In terms of its overall competitiveness, one must also bear in mind that the recruitment agency sector is a huge contributor to the economy. We represent over 50 recruitment agencies in our membership. Something like this will spell the deathknell for them and their businesses because one must pay their fee in addition to equal pay. There are many issues which have still to be worked out there but the definitions will be very important.

In respect of Senator Ryan's point about the Employment Law Compliance Bill and the assumption that our members will fail, I can guarantee that every employer in this country, irrespective of size, would fail at this moment in time because the burdens being introduced are so severe. One month after this legislation is implemented, somebody in this building will have to get a copy of the passport of every single employee, which they may or may not choose to provide, photocopy it and keep it on file. Under the Organisation of Working Time Act, unless one has a clocking in system, every person must fill in weekly timesheets outlining their time and breaks. Due to the fact that we do not have an electronic signature that is acceptable to Government, they must be physically kept and signed for three years. In terms of the cost of renting out warehouses to put all this paper in — we have over 40 pieces of employment law — the volume of paperwork is incredible. Parental leave records must be kept for eight years yet this Act says they must be kept for three years so there are all sorts of odd things happening. If I cannot keep up with it and my job is to advise my members, how on earth will they do so because they are trying to focus on getting on with their normal business? There is too much in this and too much of an accusatory, criminal-type approach. We have had a voluntary industrial relations system in this country that has been the envy of the world for the past 60 years, so why have we now decided we must go down the criminal route?

In terms of the number of cases that have been taken against employers to date in any forum, be they equality or employment appeals tribunals, rights commissioners or health and safety inspections, the numbers are very low. The assertion that there are many breaches is based very much around anecdotal material played out in the media. In reality, the vast majority of employers are doing their best. There should be a difference in the way people are treated in cases where there are blatant breaches and people trying to get the competitive edge by abusing employees' rights and cases where people are simply trying to run a business and are treating people fairly but have not managed to fill in that form or sign that document. To criminalise them for that is outrageous.

In respect of working at home and rural areas, we are producing a guideline pack for member companies on how to introduce mobile and flexible working because we see this as a huge opportunity. It makes perfect sense. If people can start off from their own home rather than incur the expense of having offices or premises and technology enables them to do that, that would be fantastic. In terms of our members, we have a considerable amount of evidence of fantastic new businesses adapting. We run our national small business awards, of which the Taoiseach is patron, every year. The winner two years ago was a Tipperary company, Gerkros Boilers, which is a family business that had been around for 35 year and which completely reinvented itself over the years into renewable energies. Through the awards, we hope to promote them and say this is what can be done. There is a considerable amount of evidence that businesses will adapt but, again, they need the Government to create the environment in which they can get on with doing the business.

Mr. Kieran Crowley

I will pick up on some of the questions. Deputy English spoke about how the issue is getting something done. We can tell him about all the regrettable things that are happening all the time but it is well worth our while to identify where things have been done that have made things better.

There are two very significant movements in the right direction that this committee can recognise. The first is the work of the Company Law Review Group. This group recognised that the majority of businesses operating under the Companies Acts are small businesses and had the insight to put at the centre of its work the principle that the default position should be for small companies. That is a wonderful development that recognises the reality of what it is like for small businesses.

The second thing for which this committee has responsibility is the Personal Injuries Assessment Board. As a representative body for small businesses, we previously talked to the committee about this. Developments took place, the board has been put in place and it has led to lower premiums. It should be recognised that this has been a very successful outcome of the process in which we are engaged today. This is not to let anybody believe that coming to have this dialogue is futile. Very good results do come out of this dialogue.

I also share Deputy English's concern that we need to be strongly conscious of holding and sustaining jobs. As a businessman, I feel a cold chill at the back of my neck. One must look at the information flowing at us — what Government representatives, the international situation, exchange rates and the stock market are saying. One must consider public decisions on job losses, off-shoring and, as the Deputy pointed out, the unreported steady trickle of two jobs here and three jobs there, which is the case observed and experienced by all of our members.

Small business has been important to job creation. Foreign direct investment is critical to the economy, but its job has become more difficult due to political developments in recent weeks. We must nurture our SMEs, where most new jobs in the past ten years have been created. They have not been created in isolation, but people have been employed therein. If we mess the area up, we strike at our ability to sustain and create jobs.

Senator Ryan expressed his concern regarding the possibility of our members being criminalised for non-compliance. The challenge is to know with what one is expected to comply. For a small business, the breadth, depth and complexity of regulations with which we are obliged to comply are wide. There are standard regulations for anyone with an employee, but there are specific regulations in terms of waste or an industry-specific matter.

I sit on the board and audit committee of a large plc where each department has specialised heads of function. In a small business, there is only one person. A large business has a legal department to advise it of its legal obligations and a compliance manager to advise it of upstream risk, monitor the business' compliance with regulations and investigate instances of non-compliance. This situation is inconceivable in small and medium-sized businesses. Everything is the responsibility of a single person, the way we live every day. A person who has had the courage to step out of employment, start his or her own business and take on the responsibility of job provision must conduct a valid commercial enterprise, identify the areas in which he or she wants to engage, find a customer and a price, make a product, provide a service, pay the employees and get paid by the customer. In most small businesses, this person alone must know the law in all of these respects. We can be criminalised if we unwittingly fail to comply with something that is too complex, wide and varied.

Deputy White referred to rates. It is difficult to know where we will go in terms of how to fund services. The tax base for local services has been narrowed to businesses alone, but local authorities engage in providing extensive services beyond businesses. As such, businesses are paying for services directed towards other parts of the community. If central government curtails its expenditure, local authorities will consider the examples given, namely, charges for development, waste and car parking. Businesses will not be able to absorb these charges and will pass them on to the consumer, which will lead to a spiral of increasing costs, make businesses here more expensive to visit than elsewhere in Europe and turn Ireland into an expensive base in which to locate an FDI enterprise or anything else. It would be a bad direction to take.

Mr. Aidan O’Boyle

My small company in Rathfarnham employs ten people and supplies raw materials to European manufacturers of cancer, heart disease and thyroid diagnosis kits. Some two thirds of our income is in dollars. Five years ago, the dollar was worth 84 cent. Currently, it is worth €1.58. We have lost half of our income for the same level of sales. No one, not even the Government, can assist in this. It is something one must manage.

Regarding bureaucratisation, our company must spend hours taking seven or eight actions, which I reviewed before this meeting — quarterly submissions, interest, the VAT 3 return and various CSO statistical surveys, one of which is seven pages of staggering detail and leaves no time for proper work to be done.

For three years in the early 1990s, I chaired the Small Business and Services Forum. After a similar forum in 2005, I found that none of the targets were being delivered. There is a high-level group on regulation, but there is no commitment to using regulatory impact assessments to examine the costs and benefits of each legislative measure and how it will affect small businesses. As Mr. Crowley and Mr. Crotty have stated, small business is creating most of the jobs. The 250,000 small businesses employ 770,000 people. After 30 years, our little company has experienced only one redundancy because of the downturn's effect.

The Government and the Opposition can influence non-pay costs. The challenge of commercial rates has not been addressed because it is a political issue. Since householders will pay the services' costs if the companies do not, the charges on companies are being multiplied. Companies will not be competitive in such a situation. In March 2007, the European Council committed to reducing regulatory costs by 25% by 2020. I hope the committee can push this work along.

Mr. Pat Crotty

I will respond to the points made by Deputies White and English on local authority charges. Deputy English correctly described them as a tax. The single difference between that tax and corporation tax — tax on profits — is that every local authority charge is due on 1 January before a company opens its doors to determine whether it has any customers, irrespective of whether it makes a profit.

Deputy Arthur Morgan

I thank Mr. Crotty and Ms Callan for their presentations. I also thank the other delegates for appearing before the committee and responding to our questions.

Chairman

I apologise to Deputy Morgan, but there is a Dáil vote.

Deputy Damien English

I intend to ask a question.

Deputy Arthur Morgan

I will be brief. Everyone accepts that indigenous enterprise is the way forward. We will not be able to compete with the Far East in manufacturing as we once could. Do our guests agree that it is a question of regulating better and not more? Do they accept that local authority development levies would be more accurately termed "development penalties"? They obstruct development.

Would it be possible to copy for the committee our guests' submission on the Employment Law Compliance Bill, as it would be useful? I agree that the Bill arose from the Irish Ferries and Gama situations, but it also arose from dozens of widespread smaller scale abuses. Not for one moment do I believe that employers generally fall into the abuse category. This is all about team building.

I have a question on employment law and regulation. Should Enterprise Ireland do more to give advice to employers in this regard? ISME and the SFA probably spend hours on end advising employers on this.

From talking to business people, most businesses are carrying between 60 and 90 days credit. Should there be measures to confine this to a maximum of 30 days? Is the SFA lobbying for this? The more we get into difficult economic times, the more businesses are exposed to serious risk through that and because of the credit crunch.

Chairman

There are three Opposition and three Government Deputies here.

Deputy Damien English

I have asked my questions and the delegation can revert with the answers.

Deputy Edward O’Keeffe

My question is very straightforward.

Deputy Dara Calleary

Can the delegation revert to us on the question about the community services programme? It referred to changes in the community services programme.

Everyone is with the delegation on red tape hell. Substantial changes have been made to the Intoxicating Liquor Bill overnight, including changes to the issues raised. I would like to hear the views of the delegation on the manner in which banks are squeezing businesses for credit.

Broadband was mentioned as a problem. Who is causing the problem? Is it solely at Government level or is it the incumbent operator?

I have great sympathy with the delegation on employment law. We were advised that the issue is going through the partnership process. Let there be no mistake — Gama Construction Ireland and Irish Ferries ran a coach and four through the traditional industrial relations position of this country. They exposed it and showed it to be lacking. This is the only response and the social partnership process is under way over the summer in respect of this Bill. There is no doubt that Gama Construction Ireland and Irish Ferries are responsible for this legislation.

Deputy Damien English

Can I ask a question?

Chairman

No, but we will be resuming the meeting shortly.

Deputy Edward O’Keeffe

The questions I wanted to ask have been put by Deputy Calleary.

Deputy Damien English

The delegation can answer by letter if it suits.

Chairman

We will adjourn for about ten minutes. Life does not move in circles or squares here.

Sitting suspended at 12.05 p.m. and resumed at 12.15 p.m.

Chairman

Small businesses are being strangled by bureaucracy such as environmental forms and Central Statistics Office surveys and a sanction is incurred if these are not returned. We need one condensed form which records everything, including VAT, and not a multiplicity of pages. Many small businesses cannot afford to allocate book-keepers specifically to these tasks.

We played a role in promoting the company law consolidation and reform Bill, which is important for business. Approximately 17 or 18 pieces of legislation running to 1,200 or 1,300 pages exist in company law. It is complex with a multiplicity of provisions. It is extremely difficult, even for high-powered companies with high-powered company lawyers, to work their way through this and the committee has taken this on board. This is a busy committee with a wide remit and it is difficult to do all of this work. I agree we should regulation-proof Bills, so to speak. It is easy to provide a headline figure of a 25% reduction but who measures the reduction achieved? My view is that we have only very limited reduction. It is more cosmetic than substantial.

During the next three to five years, the lifeblood of this economy will depend on small and medium enterprises, especially in rural areas. Foreign direct investment will continue to play a major role but this will gravitate to large urban centres with all of the facilities and infrastructure available. With regard to telecottaging businesses, I remember being in Kiltimagh approximately ten years ago where a small business had commenced. Through telecommunications, the businessman in question was able to sell his product in Russia, China and everywhere else.

There is no need to be an Einstein to know where the future lies. The greatest opposition we face is ourselves and the regulatory frameworks. This is why the way we set about disseminating broadband throughout the country left a lot to be desired. It has resulted in people having egg on their faces and it has been a disaster. Let us call it what it is — an absolute disaster. In rural areas, people are treated like they were on the hind tit. We are on the hind tit and are going nowhere.

Deputy English is correct in arguing that the remit of the county enterprise boards must be widened. The expansion of teleconferencing and telecommunications happened in France 15 years ago and it has worked for them. We should grab the ball and run with it. Perhaps the economic slowdown — I hesitate to use the word recession — is a wake-up call. We were in an artificial balloon, circling above the clouds and now we are back down to reality. We had better start realising that the people whom the witnesses represent must be listened to. They are highlighting the obstacles, namely, a lack of competitiveness, high costs and strangulation by bureaucracy. The witnesses were milder in their description, but it is strangulation. Let us call a spade a spade. I have said this in the Dáil several times and am not simply saying it here for the benefit of the witnesses. We are strangling the country with bureaucracy. We must tackle it and the presentation today gives us greater fortitude going forward in our efforts to overcome the obstacles. In that context, the witnesses have done an excellent day's work, despite our meeting being disrupted and the witnesses being detained here for longer than they would like. They are probably losing money by being here but if this committee goes ahead and tries to rock the boat, so to speak, in the areas which the witnesses have brought to our attention, it will be a profitable day in the long run.

The presentation was excellent. Deputy O'Keeffe, to give him credit, is heavily focused on e-commerce and information and communications technologies. I have no doubt he will raise these issues, as well as referring to the banks. I will leave those matters to him. It would be unfair to take the ground from under him, given that banking is an old chestnut of his. I warn the witnesses that he is a man who reads all of the financial journals and they had better be ready for some technical questions, which I would not be capable of asking.

Deputy Edward O’Keeffe

I have a number of simple, straightforward questions. I apologise for missing the presentation, but I had an urgent call from a constituent who was in difficulty.

The enterprise boards were mentioned and in rural Ireland we have the Leader programme also, which has significant funds at its disposal. The Small Firms Association represents rural small businesses as much as urban ones, although it is based in Dublin. What is the association's opinion regarding an amalgamation of the enterprise boards with the Leader programme? Ms Callan made a point regarding the number of State agencies involved and at one time I counted 75 agencies in total. That was when we were in opposition, approximately ten or 15 years ago.

Deputy Damien English

It is much more than 75 now.

Deputy Edward O’Keeffe

I suspect the number has grown substantially since then. There is a great deal of work involved in trying to figure out what assistance is available and from whom. One can move from Billy to Jack and back, constantly. Should we have a one-stop-shop in this area, whereby organisations such as FÁS, Cert and so forth are incorporated into one body? While I do not want to be critical of the Leader programme, I would question where its money is being spent. It appears to be spent on commissioning reports and having meetings. Most Leader groups could fill the biggest library in Ireland, at Trinity College, with all of the reports they have produced, which only gather dust on the shelves and are not read.

Broadband is another important issue. We have only copper cable in rural areas, rather than fibre optic cable. If there is no investment in that area, we will see no more small businesses starting up in rural Ireland. We already have a large number of small businesses in rural Ireland and they are the lifeblood of rural villages and towns now, particularly with the loss of much of our traditional industries and the rationalisation of much of our food industry. There is a lot of ground to be made up but if we do not have access to broadband in rural Ireland, people will not wait around.

Small business people have approached me in recent months regarding the attitude being adopted by the banks towards them in terms of capital and current moneys to run and expand their businesses. Obviously, there is a liquidity problem within the financial institutions in this country which is quite serious. I was told yesterday that this problem arises from the Basel agreement signed by the banks, but I do not know whether that is true. To what extent is the credit squeeze affecting the development and day-to-day running of businesses? I understand it is having a severely negative effect. The banks are coming down hard on small business people at a time when they have their own difficulties because of reduced consumer spending. I understand that is creating hardship for business people and is leading to unemployment.

Mr. Pat Crotty

Deputies O'Keeffe, Morgan and Calleary raised a number of related issues. I will begin with the issue of the banks. Deputy Morgan made reference to credit terms but credit terms are already dealt with in law. The difficulty for small businesses is that if they try to enforce them, they are likely to lose customers. Small businesses are generally selling to bigger businesses or are retailers. If they are retailers, they get cash over the counter. If they are selling to a bigger business, however, they are happy to be doing business with them and want to do more business with them. They do not want to stick thorns in their side and end up losing their custom, which in turn would lead to a loss of income and ultimately, a loss of jobs. It is a very difficult issue.

Deputy Arthur Morgan

I accept that, but should we appoint a person to ensure the regulatory terms are met? I know of many business people who are afraid to ask their customers to abide by the credit terms because, as Mr. Crotty argues, they will lose business. In that context, should there be some sort of device to check this and ensure terms are met?

Mr. Pat Crotty

Possibly an independent check, yes, because that would mean the person who should be paying knows it is not the client who is putting them under pressure but an independent body or mechanism. That certainly would be of help. I wish to relate that directly to the credit squeeze position. If one is owed money, the situation with the banks regarding liquidity is such that one will have difficulty obtaining funds from them. There appears to be a shortage of cash in the banks. As a result, if one is not paid, one cannot pay one's creditors either. It becomes a vicious circle that puts everyone in difficulty. I have had personal experience in recent times, given the current funding situation with the banks, whereby they are much more willing to give one extended overdraft facility than term loans. That is because they can charge almost 11% interest on overdrafts, compared with 5.5% or 6% for term loans. In this way, the banks are putting more pressure on small businesses, which are already under a lot of pressure. That is a fact and is happening at present. Mr. Kieran Crowley is more qualified to speak on this matter from a global point of view but I am relating the experience of people on the ground. People have raised the issue with me and I can verify that this is what is happening.

Deputy O'Keeffe referred to the plethora of agencies in existence. I am not from Dublin, but from Kilkenny and we have both an enterprise board and a Leader programme there. We will be delighted to see the Deputy in Kilkenny in September. As someone who has been involved in business and with various agencies and bodies, I see value in the concept of a one-stop-shop, simply because half of the money that enterprise boards, Leader programmes and others obtain is spent on infrastructural costs. They are all renting buildings, paying for support works and so forth and there must be the capacity to create efficiencies there. They could all be in one building, with one front door and have the capacity to meet people with various needs, including ethnic entrepreneurs. Such people do not know where to start but if they were able to go in one door and find out all the information they needed, it would very useful. The agencies could certainly rationalise clerical supports and back-up staff. New synergies could be created by virtue of the fact that people who were working in different agencies and in different buildings would be talking to one another every day. They would know what the next good idea in a town, village or county was and be able to offer their support and assistance. That is needed because everyone operates independent kingdoms at present. Several counties have created boards in an attempt to bring these people together but achieving better efficiency would release more money to places where something can happen.

I possibly should not speak about the issue raised by the Chairman in regard to the complexity of CSO forms and the time required to fill them in. SFA members have suggested to me that some of the information sought by the CSO is almost impossible to provide on a quarterly basis by a small business owner who has to perform multiple tasks. I would vouch that much of the information being provided is either a best guess or an estimate, which damages the value of the process.

Mr. Aidan O’Boyle

I agree. The seven page form I have before me is mind boggling. There is no way we could generate some of this information, so we just have to write "not applicable". In the context of regulatory impact assessment, consideration should be given to the value of sending forms such as this to small companies. I am sure the 80:20 rule applies in that data from 20% of companies could be extrapolated. That would save people's money and time. The value of the information recorded on some of these forms is questionable.

Mr. Kieran Crowley

I will return to Deputy O'Keeffe's comments on banks. It is true that our members are finding that their relationship with banks have changed. One reason is that all the banks in the world have moved to comply with the Basel II accord, which requires them to carry sufficient capital for the risks they face. One of the rules under that accord is if one account is out of order for an individual or a business, all other accounts owned by that person or business are also out of order. If, for example, one has a €1 million loan on a property and a personal account with an overdraft of €5,000, the entire property loan would be out of order if the overdraft limit was exceeded through inattention. The Deputy understands that is not how business people in Ireland have conducted their relationships with their local branches, so there has been a change in the way we behave which involves keeping our less important accounts in absolute accordance with the bank's agreement. That is being driven by local bank managers but customers are irritated that the change is affecting accounts they consider relatively unimportant in the overall scheme of their relationships with their banks.

Banks have also entered a period of unprecedented difficulty, which reminds me of an example given by the chief executive of Glanbia several years ago. He said that even though Glanbia was a big business in Ireland, it was a small player in its global market. Similarly, Irish banks are not dictating the pitch on which they play. Toxic loans are the consequence of the subprime crisis in the United States. It is like playing the children's party game of pass the parcel. Nobody is sure who will be left with the parcel when the music stops, with the result that banks are afraid to lend to anybody and capital markets are not functioning. Our banks can at present only lend what they raise through deposits. The evidence for that is in front of us because we can see the increase in deposit interest rates being paid by banks because deposits are the only source of fuel for lending. For that reason, our members are finding it increasingly difficult to seek loans from their local branches.

Deputy Damien English

Through my work on the Joint Committee on European Scrutiny, I have noted an increasing recognition that previous European legislation put too much pressure on businesses, especially in the area of food safety for small companies. Does the SFA note a similar change in attitude? I envisage more changes in that regard.

What proportion of firms' expenses are comprised of distribution costs? We are all aware of the pressures being faced by the distribution sector. What would be the effect on small firms and their customers of changes in that sector?

Is the area of employing people with disabilities too complicated for firms and is the appropriate help available? I do not expect to receive all the answers today. Supports are supposed to be made available when a disabled person is employed but I do not believe that is always the case. The person giving the support seems to disappear after one month. I have experience in that regard.

This committee is considering the issue of e-payments, which should lead to reductions in costs for firms as well as banks. The SFA might submit a written opinion on that issue to the committee. This country remains cheque-centred and we lag behind our European counterparts. During our examination of e-payments, electronic signatures arose as an important issue. We passed legislation in that regard several years ago but did not pursue the matter further. It is a problem for banks and other companies. Why are we not proceeding on the issue?

Deputy Edward O’Keeffe

I am glad the value of small depositors has finally been recognised. Previously, banks did not even want to see their depositors.

Is the 100% mortgage problem more significant for Ireland than subprime mortgages in America? Full mortgages were given out to purchase cars as well as houses in many cases. The darkest period in our economic history was probably 1987 but are we facing a similar period? The SFA appears to have a strong grasp of economic issues.

I completely agree in respect of the 30 days. When I operated my business, if I was not given more than 30 days, I would find a fellow up the street who offered 90 days.

Chairman

I am sure the Deputy will broker 60 days.

Ms Patricia Callan

Deputy Morgan raised the issue of Enterprise Ireland giving advice on employment law. That agency has a total of 3,500 clients out of a total of 250,000 businesses, so even if it moved into that area it would not be relevant. Their expertise is on the business end and we should leave them there.

NERA has been tasked with giving the advice and information but the difficulty is that NERA is the enforcer as well as the adviser. We have had this issue with the Equality Authority over many years. It refuses to advise employers so that if a case is taken against an employer, that employer cannot say the Equality Authority recommended a particular action. Unless one is a member of the SFA or another body, one has nowhere to go to ask how one should implement the Employment Equality Acts, which is one of the most complex areas to be covered. This is specific to the Equality Authority. At least NERA still helps and advises employers generally. This issue of how the various bodies interpret the law about how they were established must be addressed. If one has a law there must be somebody at State level who can tell people how to implement it. It is simple and straightforward.

The Prompt Payment of Accounts Act introduced the 30 days provisions where people did not have other terms and conditions agreed. The issue is that because there is no small claims court for business, enforcing that Act is very expensive. If I have a debt of €5,000 or €10,000, I will not pay lawyers to enforce that in the normal courts system and it will probably take me years to process it. A small claims court for business similar to the small claims court for domestic issues is very important to implement that legislation.

Chairman

Under what figure should it have jurisdiction? Under €20,000 or €25,000?

Ms Patricia Callan

Yes, I think so.

A Member

That seems low.

Chairman

Above that there is an overlap with the Circuit Court.

Ms Patricia Callan

Yes. That is critical because when people weigh up the cost——

Chairman

We could suggest that.

Ms Patricia Callan

Yes. Deputy Calleary asked about the CSP, the fund that was moved to the Department of Community, Rural and Gaeltacht Affairs. The difficulty we find when we deal with Departments is that the main word in the Department's title affects its entire focus. One will get money from the Department of Enterprise, Trade and Employment for ethnic entrepreneurship if one is very clear that it is a business rather than a social initiative. The difficulty is that since this money has gone into the Department of Community, Rural and Gaeltacht Affairs, it has lost the enterprise focus. In its decisions on who to fund from that programme, that Department is cutting back on funding the enterprise centres and delivery through that structure and is putting more of the money into social initiatives. We need to revisit that and examine the community enterprise agenda.

We are examining the CSO issue in the high level group on business regulation. The difficulty, according to the CSO, is 85% of these requirements come from the EU. We have asked them to return to the EU and say that we are such a small country — 4 million people and 250,000 businesses — that our sample is much smaller than the likes of France and Germany. This means our people, on a random list, are getting these every six months rather than every five years. We have asked them to tackle it at that level. The other simple thing we could do is get a unique business identifier code for all transactions with business, which means one does not have to resubmit any data one has already done, so they can use it more uniformly. That would be critical.

At the high level group we have come up with some good formulae on how the measurement of cost reduction will be done. The challenge is to get all the Departments to do it. There is an interdepartmental discussion on how they will do it but it is only starting. Broadband is a significant issue we have inherited. We must get on with it. There are issues with Government funding and private sector operators. However, there is consensus at every level that the Department's figures are not correct. It is a question of seeking some movement and we have seen nothing original from it. We know it is difficult but we need solutions. We can think about that some more. We would be happy to submit our submissions on the Employment Law Compliance Bill.

I quickly will run through Deputy English's final comments. The EU has led the way through the EU Small Business Act, the principles on the changes in how the EU will do things. It set the 25% cost reduction. It took the then Minister, Deputy Martin, a full year to concede to that. There will be good aspect to it. I attended a conference in Brussels on Monday where the SME envoy, Ms Françoise Le Bail said this would have teeth and would not be like the SME charter. They will use that to work with the member states to make things better.

On the question of employment of people with disabilities, we have specific problems in that the scheme for support is not widely available. Even when people want to do anything there is a minimum requirement that the employee works more than 20 hours. In the company that called me, a person had a serious brain injury and was not physically capable of working that length. The average working week is 37.5 hours, so 20 hours is a lot. That needs to be examined, changed and made much simpler.

We are involved in the national payments implementation plan through the Department of the Taoiseach and IPSO and we have produced a good paper on how to go about it but at the time the euro was introduced one of the Nordic countries banned cheques overnight. That is one way to get through it. Our taxation system, and the fact that we tax cards, is wrong. We should address all these aspect.

To return to the issue of broadband, if it were quick and easy to use a card without having to key in codes for transactions under €25, that would solve the difficulty. I took a taxi yesterday but had no money with me. It was very embarrassing. What does one do? One faces that sort of problem all the time. I had to leave it in an envelope for the driver to collect.

The electronic signature is very complicated. Apparently the Revenue invested millions of euro years ago to get its electronic signature on the ROS system and it is specific to the Revenue. For the Companies Registration Office one has to print out the last page and send it back along with one's accounts. The Revenue says it is examining this but does not see any solution. Although I thought it had been introduced in law, for it to be legally enforceable it must be done through a particular means. If we are going down this route, particularly in terms of the new enforcement regime around employment law, then if we could get one that worked across Government the costs could be shared. However, all involved are undertaking their own small studies on it. That would be critical. We will get nowhere in the e-payments agenda unless we get the electronic signature immediately.

Mr. Kieran Crowley

I feel I am talking more about banking than about small business.

Deputy Edward O’Keeffe

That is the base of Mr. Crowley's business.

Mr. Kieran Crowley

My business is drain cleaning. I will comment on the US subprime problem and whether there are parallels with 100% loan to value mortgages in the Republic of Ireland. The US sub-prime market, by any measurement, would have to have been considered irresponsible, reckless and without thought of repayment. There are many acronyms going around but one of the more interesting was the "NINJA" loan, where somebody who had no income, no job or assets could still borrow money. The American situation was different for a number of reasons. One of the peculiarities of the American system is that the loan stays with the property so a person can walk away and is not exposed to personal recourse for his or her loans. That is why one can have that kind of behaviour in the States but not here.

In the American system the financial lending institutions were packaging the loans and transferring the risk to third parties. That does not happen in the Irish system. The credit risk stays with the original lender, so the original lender must be more prudent about the loan. In the institution with which I am most familiar, the 100% loan was a very restricted activity and was not the standard offering to every borrower, but was given in a very prudent way to people in steeply growing incomes and prospects, where it made sense.

The prospects of repayments of mortgage loans are not about loan to value ratios or the value of the property, but the risk is primarily associated with employment, whether people will be able to continue in their jobs and whether these jobs will continue to give them the levels of income to pay off the loans. A dip in the value of property in Ireland is regrettable. It may make some loans look as if they are underwater for a period of time, but as long as people are not forced to move, they will not have to realise those losses. It is really about employment, whether we will succeed in sustaining the jobs we have and if we are able to continue to build some level of new jobs. In answer to the Deputy, concern about 100% loans is not a worry at present.

Chairman

I sincerely thank Ms Patricia Callan, Mr. Pat Crotty, Ms Avine McNally, Mr. Kieran Crowley and Mr. Aidan O'Boyle for appearing before us. We had some unavoidable interruptions which are part of the parliamentary process of democracy that must be exercised. We apologise for the inconvenience. It shows we are not masters of our destiny, even when we set about a meeting such as this.

We thank the witnesses for being so patient and giving us a valuable and deep insight into the factors that will confront small businesses in the years ahead, particularly the challenges for all of us in ensuring small businesses rightfully play a meaningful role in the economy and the employment prospects of so many people.

We have several points we will consider further. Out of the acorn seed the oak tree grew. Some of the points made may seem small but on a cumulative basis they are extremely important. Some of the macro-issues will be taken up at other fora as there is a cross-departmental responsibility, to use a dreadful phrase attached to so many issues. Perhaps it is part of our problem. There may be too many bits and pieces flying on too many bushes, to use a rural analogy. That is my opinion and although I am not a business person I have significant contact with business.

There has been very fruitful discussion and we are delighted to have had the witnesses before us. We probably should have had them in earlier but they say the good wine comes in last, to use another phrase. We look forward to having the witnesses in again to speak on various other issues that will arise from time to time. We thank them for being so forthright in their presentation and in dealing with a multitude of questions of various complexities.

After three hours, it is time for us to adjourn the meeting.

The joint committee adjourned at 12.55 p.m. until 10 a.m. on Wednesday, 2 July 2008.