Thursday, 18 Feb 2021

Written Answers Nos. 1-5

Credit Guarantee Scheme

Ceisteanna (1)

John McGuinness

Ceist:

1. Deputy John McGuinness asked the Tánaiste and Minister for Enterprise, Trade and Employment his views on whether the credit guarantee scheme should be amended to ensure a greater approval rate from banks on loan applications and to give access to a wider range of SMEs; if the scheme will include refinancing of existing loans and overdrafts at a far more competitive interest rate to enable businesses rebuild their financial positions following the crash and Covid-19 putting them in a far better position to deal with the post Covid-19 challenges; and if he will make a statement on the matter. [9231/21]

Freagraí scríofa

Tánaiste and Minister for Enterprise, Trade and Employment

A new COVID-19 Credit Guarantee Scheme (CCGS) was developed and launched in September 2020. Loans of up to €1 million are available for up to five and a half years at reduced interest rates for working capital and investment purposes. Loans under €250,000 do not require collateral or personal guarantees.

The Scheme was developed in accordance with the European Commission’s State Aid Temporary Framework and is available to SMEs, small Mid-Caps and primary producers in a wide range of sectors that meet the eligibility criteria.

While the State provides a guarantee on these loans, the Department plays no role in the application or decision-making process in relation to loans offered under the Scheme, which, is fully delegated to the participating lenders. There are clear eligibility criteria including a minimum impact of 15 percent on turnover as a result of COVID-19 and a return to viability in the future. These features were set by the European Commission in their State Aid Temporary Framework. Private finance providers have the widest network and closest relationship with Irish businesses to make these assessments. Where an applicant has had a loan application refused, they may wish to appeal the decision to the Credit Review Office (CRO). The CRO helps SMEs who have had an application for credit of up to €3 million declined or reduced by the main banks.

A key focus of the COVID-19 Credit Guarantee Scheme is to make additional lending available to business for liquidity purposes and investment. It is a matter for individual participating lenders to determine the financial products that they make available under the scheme, with term loans being the dominant product currently being offered. All finance providers are required to demonstrate reduced interest rates to the participating business. The latest data in respect of interest rates charged on drawn loans up to the end of January, shows that interest rates range from 2.00% to 3.99%, with 98% of loans provided at an interest rate of between 2.50% and 2.99%. These are significantly reduced rates on commercial loans rates of the same term and size.

Refinancing may be permitted in respect of COVID-19 related expenses that were funded through short term or temporary facilities such as overdrafts. However, any provision for potential refinancing must have been agreed as part of the initial finance agreement. The wholesale application of refinancing is not permitted within the terms of the scheme as approved under the Temporary Framework.

My Department has worked extremely hard to ensure there is choice out in the market for Irish businesses seeking state supported lending. Since January, 19 Credit Unions and 3 non-bank lenders have successfully joined the CCGS as finance providers. More are expected to be announced in the coming weeks. This long-term policy goal of diversification will add competition in the market and ensure a wide range of loan products being available. I encourage businesses to consult the CCGS pages on the Strategic Banking Corporation of Ireland’s website for a full list of participating finance providers.

Covid-19 Pandemic Supports

Ceisteanna (2)

Fergus O'Dowd

Ceist:

2. Deputy Fergus O'Dowd asked the Tánaiste and Minister for Enterprise, Trade and Employment if matters raised in correspondence by a person (details supplied) on casual traders and the Covid-19 business aid scheme will receive a response; and if he will make a statement on the matter. [9065/21]

Freagraí scríofa

Tánaiste and Minister for Enterprise, Trade and Employment

I understand this is an incredibly difficult time for businesses and families across the country.

The Government has put in place a comprehensive range of measures to help businesses and workers during the pandemic, including the Employment Wage Subsidy Scheme (EWSS), the Pandemic Unemployment Payment (PUP), the COVID-19 Restrictions Support Scheme (CRSS), low-cost loans, the deferral and warehousing of tax liabilities and the waiver of commercial rates. Details of the wide range of COVID-19 schemes are available on my Department’s website at https://enterprise.gov.ie/en/What-We-Do/Supports-for-SMEs/COVID-19-supports/.

On 9th February last, I announced a new €60m Scheme, called the COVID-19 Business Aid Scheme (CBAS) that is being developed to provide grants to businesses ineligible for the Government’s other existing schemes such as CRSS and is designed to help with fixed costs. Wholesalers, suppliers, caterers and events companies down 75% or more in turnover and in receipt of a rates bill may benefit, including those that commenced after the 1st November 2019 where their turnover is below projections.

We are committed to helping businesses respond to the economic challenges arising from the pandemic with a particular focus on firms that do not qualify for the weekly CRSS grant from the Revenue Commissioners or existing sectorial schemes in areas such as the arts, transport and tourism.

This new CBAS will help some businesses that are not eligible for existing grants, largely due to the fact that the premises they operate from have not been closed to the public. We estimate that this will help approximately 7,500 businesses. While the grant is modest it will be of substantial assistance to smaller businesses with some of their fixed costs like rent, utilities and security.

The Government is very much open to proposals as to how we can help businesses further. However, our schemes are there to help meet fixed costs that cannot be avoided and to provide basic weekly income support up to maximum of €350 per week. We are not providing compensation for loss of personal income above this level or compensation for loss of profits for any sector.

Departmental Funding

Ceisteanna (3)

Seán Sherlock

Ceist:

3. Deputy Sean Sherlock asked the Tánaiste and Minister for Enterprise, Trade and Employment the contact details for the sections that deal with all ongoing and established grant funding in his Department and in each agency under the remit of his Department in tabular form. [9126/21]

Freagraí scríofa

Tánaiste and Minister for Enterprise, Trade and Employment

My Department has recently established an Enterprise Information Centre to provide information to the public on the wide range of supports that are available to help businesses. Contact details are available at the following link:

https://enterprise.gov.ie/en/What-We-Do/Supports-for-SMEs/Enterprise-Information-Centre/

The Enterprise Agencies under the remit of my Department manage a range of direct grants, loans and other tailored supports to businesses. Contact details for the agencies are available at the link below. Details of the various supports offered by the agencies are available on their individual websites, which can also be accessed through the link below:

https://enterprise.gov.ie/en/Who-We-Are/Offices-Agencies/

Covid-19 Pandemic Supports

Ceisteanna (4)

Neale Richmond

Ceist:

4. Deputy Neale Richmond asked the Tánaiste and Minister for Enterprise, Trade and Employment if he has considered implementing a Covid-19 support scheme that does not require being a commercial rate payer; and if he will make a statement on the matter. [9197/21]

Freagraí scríofa

Tánaiste and Minister for Enterprise, Trade and Employment

The Government has put in place a comprehensive range of measures to help businesses and workers during the pandemic, including the Employment Wage Subsidy Scheme (EWSS), the Pandemic Unemployment Payment (PUP), the COVID-19 Restrictions Support Scheme (CRSS), low-cost loans, the deferral and warehousing of tax liabilities and the waiver of commercial rates. Details of the wide range of COVID-19 schemes are available on my Department’s website at https://enterprise.gov.ie/en/What-We-Do/Supports-for-SMEs/COVID-19-supports/.

On 9th February last, I announced a new €60m Scheme, called the COVID-19 Business Aid Scheme (CBAS) that is being developed to provide grants to businesses ineligible for the Government’s other existing schemes such as CRSS and is designed to help with fixed costs. Wholesalers, suppliers, caterers and events companies down 75% or more in turnover and in receipt of a rates bill may benefit, including those that commenced after the 1st November 2019 where their turnover is below projections.

We are committed to helping businesses respond to the economic challenges arising from the pandemic with a particular focus on firms that do not qualify for the weekly CRSS grant from the Revenue Commissioners or existing sectorial schemes in areas such as the arts, transport and tourism.

This new CBAS will help some businesses that are not eligible for existing grants, largely due to the fact that the premises they operate from have not been closed to the public. We estimate that this will help approximately 7,500 businesses. While the grant is modest it will be of substantial assistance to smaller businesses with some of their fixed costs like rent, utilities and security.

The Government is very much open to proposals as to how we can help businesses further. However, our schemes are there to help meet fixed costs that cannot be avoided and to provide basic weekly income support up to maximum of €350 per week. We are not providing compensation for loss of personal income above this level or compensation for loss of profits for any sector.

Covid-19 Pandemic Supports

Ceisteanna (5)

Neale Richmond

Ceist:

5. Deputy Neale Richmond asked the Tánaiste and Minister for Enterprise, Trade and Employment if he has considered allowing companies that are not paying commercial rates but that are registered and tax compliant to avail of Covid-19 support schemes such as the employment wage subsidy scheme, Covid restrictions support scheme and Covid-19 business aid scheme; and if he will make a statement on the matter. [9198/21]

Freagraí scríofa

Tánaiste and Minister for Enterprise, Trade and Employment

The Government has put in place a comprehensive range of measures to help businesses and workers during the pandemic, including the Employment Wage Subsidy Scheme (EWSS), the Pandemic Unemployment Payment (PUP), the COVID-19 Restrictions Support Scheme (CRSS), low-cost loans, the deferral and warehousing of tax liabilities and the waiver of commercial rates. Details of the wide range of COVID-19 schemes are available on my Department’s website at https://enterprise.gov.ie/en/What-We-Do/Supports-for-SMEs/COVID-19-supports/.

On 9th February last, I announced a new €60m Scheme, called the COVID-19 Business Aid Scheme (CBAS) that is being developed to provide grants to businesses ineligible for the Government’s other existing schemes such as CRSS and is designed to help with fixed costs. Wholesalers, suppliers, caterers and events companies down 75% or more in turnover and in receipt of a rates bill may benefit.

We are committed to helping businesses respond to the economic challenges arising from the pandemic with a particular focus on firms that do not qualify for the weekly CRSS grant from the Revenue Commissioners or existing sectorial schemes in areas such as the arts, transport and tourism.

This new CBAS will help some businesses that are not eligible for existing grants, largely due to the fact that the premises they operate from have not been closed to the public. We estimate that this will help approximately 7,500 businesses. While the grant is modest it will be of substantial assistance to smaller businesses with some of their fixed costs like rent, utilities and security.

The Government is very much open to proposals as to how we can help businesses further. However, our schemes are there to help meet fixed costs that cannot be avoided and to provide basic weekly income support up to maximum of €350 per week. We are not providing compensation for loss of personal income above this level or compensation for loss of profits for any sector.

My colleagues, Minister for Social Protection, Heather Humphreys T.D. and Minister for Finance, Paschal Donohoe T.D. would be best placed to provide more specific information in relation to eligibility for the Employment Wage Subsidy Scheme and the Covid Restrictions Support Scheme.