Thomas Pringle TD – Supports For Small Businesses

I welcome the opportunity to contribute to the debate on the OECD report. It is interesting that in Ireland, the idea of an SME among members of the public is not an enterprise with up to 250 people employed. In the Donegal context, that would be looked on as a very large employer. When we talk about this, we should talk about small enterprises because that is the reality in rural Ireland. In regard to the supports that are available to such companies, we should concentrate on that level because it is those indigenous industries which can grow and develop and perhaps get to the point where they can contribute and compete.

We are caught by the fact we have a very small population so businesses and enterprises cannot grow internally to a stage where they get the critical mass that allows them to export or grow internationally. This happens in other countries, such as Belgium, which has a population of 11.5 million, or the Netherlands, with a population of 18 million or 19 million, but Ireland has a population of just 4.5 million. Small industries here do not get the chance to grow and develop internally and then be able to export abroad and grow. We should focus on very small industries – we should drop the M and just talk about SEs. This would be very important from a policy point of view and is something that could happen.

I carried out a business survey in the last couple of years in County Donegal. There were 105 responses to the survey and 75% were businesses that employed between one and five people. Some 75% of them were online and depopulation and the threat to rural services were of concern for 83% of them, given that is what impacted on them and on their ability to survive and keep going. More worrying, and this is a point that should worry the Minister, is that more than 80% of the businesses were unaware of any Government support for them. That was their response to the survey I put out, which is very worrying for us. Since the recession, almost 50% of businesses have seen their business decline or not improve. We should be targeting our resources to ensure those businesses can grow.

The first of the report’s key findings is telling. It states:

…business dynamism and the start-up rate are relatively low, Irish SMEs are not very active in international markets, and SME productivity growth is stagnant. There are also weaknesses in SME management skills, capital investment levels and technology adoption.

This is vital. It shows the difficulties with Ireland Inc., as we do not have the critical mass of population to allow SMEs to develop and grow due to the domestic environment. This is what we are missing. We need to find a way to replace that and ensure SMEs can develop and grow. We need to drop the M altogether and focus on SEs.