Call for fund to help small businesses

A MOTION to address the “credit famine” being faced by small businesses following the financial crisis is to be debated in the Dáil this week.

The Labour Party motion calls on the Government to establish a fund for small and medium-sized businesses to address the current shortage in available credit.

It suggests the establishment of a small business operational fund, with money sourced from the €15 billion Small Business Operational Fund established in September by the European Investment Bank.

It calls for speedier settlement of bills by Government departments and agencies and an expanded role for the County Enterprise Boards in supporting small companies.

The motion condemns “the refusal of the banks to make available the normal credit streams” and criticises “the failure of the Government to either ensure the banks make credit available or to provide alternative sources of credit”.

Labour Party spokesman on Enterprise, Trade and Employment Willie Penrose said unless action was taken, many more jobs would be lost. “While most of the attention has focused on a number of announcements of major job losses in big companies, the rate of attrition among smaller companies has been ever greater.”

He said companies that could easily access credit in the past now find the door being slammed in their face by the bank manager. He said it defied belief that Irish banks had not accessed the €15 billion fund established by the European Investment Bank specifically to assist companies in difficulty.