Denis Naughten
Ceist:6 Deputy Denis Naughten asked the Minister for Enterprise, Trade and Innovation the steps he is taking to support local enterprise start ups; and if he will make a statement on the matter. [45444/10]
Amharc ar fhreagraThursday, 2 December 2010
Ceisteanna (6)
Freagraí ó Béal (9 píosaí cainte)
The growth and development of small Irish businesses, is central to economic recovery and it is essential that Irish enterprises continue to be supported. As I have stated previously, my priority is to ensure that the business environment is supportive of enterprise and encourages growth in all areas of the economy, including entrepreneurs in both the start-up and development phases.
The national recovery plan sets out specific actions to spur further improvements in competitiveness across all sectors of the economy, including measures to cut costs to business in energy, waste, transport, professional fees and property. The plan also includes measures to ensure that barriers to employment creation are removed. Specific actions will benefit start-up companies, including the review of the business expansion scheme, extension of the 15-day prompt payment rule and the use of public property for incubator centres. In addition, the State continues to support local enterprise start-ups directly via the supports offered by the enterprise agencies. The complementary remit and activities of Enterprise Ireland and the county enterprise boards, CEBs, ensure that as broad a suite as possible of State supports are available to start-ups. The CEBs provide a range of supports to micro-enterprises and I recently secured an additional capital allocation of €3.3 million for the CEBs to enable them to support additional business projects this year.
Under the auspices of Enterprise Ireland, the Government has invested significantly in the broader environment for business start-ups. This includes investment in incubators, seed and venture funds, angel networks and mentors, as well as specific funding for high-potential start-ups. Enterprise Ireland also provides support to community enterprise centres, CECs, and business innovation centres, BICs. These centres provide a range of facilities that enable entrepreneurs to establish new businesses, provide employment and grow their businesses in their own localities.
The supports offered by the CEBs and Enterprise Ireland should be as seamless as possible and should facilitate further the transition from an innovative micro start-up to a high-potential exporting SME. I intend to table proposals before the Government on this matter shortly.
What are the Minister's proposals for the future of county enterprise boards? He has been discussing this matter for a long time, so it would be important to know what he is proposing. He will be aware that, last year, the demand for micro start-ups was up by 20%. Unfortunately, his budget dropped by approximately 10%, so many people needed to be turned away. Will the Minister consider specific initiatives that have been proposed to him? The Commission on Taxation proposed unincorporated businesses should have a start-up tax holiday but the Government has not given any indication in that regard. Does the Minister support that and will he be seeking its inclusion in the finance Bill? Its costs would be extremely low, I understand. Furthermore, his Department has had small business credit initiatives in the past. Would he consider introducing small business credit initiatives? It seems bizarre that two years into the most severe financial crunch we have ever had, his Department has not come up with one initiative in the area of credit. The guarantee, which the Minister has been peddling for months, still has not got into the starting traps and we do not know whether he even has the authority to do it since it appears to have been delegated to the Department of Finance. We all know what will come from that quarter.
I am just wondering about specific initiatives because yesterday there was a report to the effect that lending to non-financial corporates was down €2,500 million in 12 months.
Regarding the county enterprise boards and the Leader programme, I believe there should be a seamless transposition between the two. I am not satisfied that the two entities are working as well as they might. For that reason the Minister of State with responsibility in this area, Deputy Pat Carey, and I have set up a group to look at where the two entities are working. There is €450 million——
I thought the Department had proposals prepared. Surely we are not talking about another study.
There is €450 million available up to 2015 for the Leader programme, and obviously that has to do with enterprise development. CEBs on average got €18 million this year. I want to ensure there is proper interaction and development of start-up businesses, particularly in rural areas.
The Deputy says there was inadequate funding for CEBs this year and I want to nail that to the cross. When I came into this office I asked the CEBs to let me know what jobs they could create before the end of the year. I wrote to them all and asked them to let me know exactly what could be done. They indicated to me that they could create 450 jobs by the end of the year, and I provided the funding. I assured them that regardless of the numbers they could come up with, we would find the funding to create those jobs. Therefore, we answered the calls of the CEBs. Surely Deputy Bruton is not expecting me to provide the money for jobs they cannot and are not creating. Whatever they wanted in terms of job creation, it was a question of ensuring that the necessary funding was provided so that those jobs were put on the ground.
In the context of the satellite town study in which the Acting Chairman, Deputy Cyprian Brady, and the Minister of State, Deputy Calleary were both involved, I can identify at least one good feature of the four year plan, namely, that IDA Ireland could be squeezed to release its land banks across the country. I know the Minister referred to market value and all that nonsense, but that land is doing no good just lying there. Is it not possible to make this land available for business incubation, start-up units and so on right across the country? Otherwise this could represent a significant impediment to people getting out of the traps.
Is it possible to look at a licence system — something else we considered — rather than full grant schemes, because of the initial costs that can be involved? Much attention has been focused on high-potential start-ups, and that is extremely important in a job creation strategy. That will have to be focused on, regardless of what government is in power. I am talking about small firms growing into larger firms. In that context, has any consideration been given to scale-ups, especially in the IP areas that the Minister of State, Deputy Kelleher, spoke about, where many of them are developed and then sold off? Is there any policy to try to retain such initiatives within Ireland by allowing for such scale-up mechanisms? That would be important for the future regardless of which Administration is in power.
If there are good initiatives in prospect, from my point of view and those of the Ministers of State, we are very willing to examine them to find out how sustainable they might be. Enterprise Ireland is examining and pinpointing start-up firms which contain a research and development element that could be geared to the export market. Instead of having 75 of such companies, which was the norm formerly, we are now targeting and growing that figure to 100 because we see great potential there. We must develop the indigenous sector with research and development attached to ensure we create the type of employment at home that is necessary, and the exports that will ensure the long-term viability of the sector.
Regarding the previous discussions on the county enterprise boards, is the Minister ruling out their integration with Enterprise Ireland and will he address the question about when it is proposed to bring in the bank guarantee scheme?
We have two reports on the CEBs, one of which is the McCarthy report, which states it should all come under Enterprise Ireland, while another report, in the context of the restructuring of the local authorities, states that the CEBs should come under the local authorities. Obviously, I am going to make a recommendation to Government, hopefully within the next two weeks. I do not want to anticipate a decision of Government, but I have my recommendation. I have indicated I want a seamless transfer from micro-enterprises into Enterprise Ireland and also in terms of the operation of Leader and county enterprise boards. That would be very welcome because there is a view to the effect that if one goes to Leader, the enterprise boards have no time for one and vice versa. This is a small country and we are going to have to work together in partnership and co-operate. It is all about people and enterprise and generating jobs to ensure people can get off the live register and obtain meaningful work. As far as I am concerned, I will be practical, insisting that they form a partnership in the best interests of Irish people in general and young people who want to start up businesses.