Minister outlines supports that are in place to assist provincial newspaper sector

Longford Leader reporter

Reporter:

Longford Leader reporter

Email:

newsroom@longfordleader.ie

Minister outlines supports that are in place to assist provincial newspaper sector

Longford / Westmeath Fianna Fáil TD Robert Troy

Responding to a Dáil question posed by Longford / Westmeath Fianna Fáil TD Robert Troy, the Minister for Business, Enterprise and Innovation Heather Humphreys TD outlined the supports her Department is working on to assist the provincial newspaper sector.

Deputy Troy also enquired if her attention has been drawn to the extreme financial strain which many publications are currently experiencing. 

The Minister's written response was;

"In order to assist businesses to address the challenges posed by Covid-19, the Government has put in place a comprehensive suite of supports for firms of all sizes, which includes the wage subsidy scheme, grants, low-cost loans, write-off of commercial rates and deferred tax liabilities.

These supports are designed to build confidence, to further assist businesses in terms of the management of their companies and to allow them to begin looking to the future and start charting a path forward for weeks and months ahead. For a full list of supports for business please see https://dbei.gov.ie/en/What-We-Do/Supports-for-SMEs/COVID-19-supports/.

The full range of Enterprise Ireland, Local Enterprise Office (LEO) and Údarás na Gaeltachta grant and advisory supports continue to be available to eligible firms to help with strategies to access finance, commence or ramp-up online trading activity, reconfigure business models, cut costs, innovate, diversify markets and supply chains and to improve competitiveness.

In that regard, Government will continue to explore funding potential for all enterprises including micro-enterprises as they work through the challenges facing them, including through any mechanisms allowable through the EU’s state aid framework.

Also read: Number of Longford people in receipt of Covid-19 unemployment payment falls

The Covid-19 Working Capital Scheme is offered in cooperation with the Department of Agriculture, Food and the Marine, and is supported by the InnovFin SME Guarantee facility. The scheme is operated by the SBCI. It currently makes available a fund of up to €200 million to eligible businesses that have been negatively affected by impacts arising from the outbreak of Covid-19 to enable those businesses to innovate, change or adapt in response to the current business environment. Following a further announcement this Scheme is now being significantly expanded. The scheme is open to eligible SMEs and small mid-caps (businesses of up to 499 employees) negatively impacted by Covid-19. Loans under the scheme range from €25,000 to €1.5m and are for periods of up to three years. The maximum interest rate under the scheme is 4% and loans of up to €500,000 are available unsecured.

The Future Growth Loan Scheme currently makes up to €300 million of loans available with a term of 8-10 years and is operated by the Strategic Banking Corporation of Ireland (SBCI) through participating lenders. We have seen strong demand for the scheme since its launch in April 2019, resulting in a rapid take up of the scheme. Funding made available by the scheme facilitates long-term, strategic investment.

The scheme is open to eligible SMEs and small mid-caps (businesses of up to 499 employees), including those in the primary agriculture and seafood sectors. Loans under the scheme range from €100,000 (€50,000 for farmers) to €3m per eligible business, with loans of up to €500,000 available unsecured. The initial maximum interest rate is capped at 4.5% for loans up to €249,999 and 3.5% for loans more than or equal to €250,000 for the first six months. These rates represent a significant saving compared with the prevailing rates that are otherwise being offered for similar loans on the market.

Also read: Killoe couple in race for EY Entrepreneur of Year honour

This scheme has been expanded by a further €200m to facilitate longer-term lending to COVID-19 impacted businesses and my Department is working through the details of this expansion and will bring this funding to market as soon as possible.

The Covid-19 Loan, available from Microfinance Ireland (MFI), was introduced as a support to microenterprises to help them access funding arising from the Covid-19 crisis.  These loans are available for eligible microenterprises responding to Covid-19-related difficulties, the negative impact of which must be a minimum of 15% of actual or projected income or profit.  Loans up to €50,000 are available with terms that include a six months interest free and repayment free moratorium, with the loan to then be repaid over the remaining 30 months of the 36-month loan period. 

An interest rate to 4.5% applies on the Covid-19 loans provided by MFI.  This reduced rate is available to all micro-enterprises where the application is made through the Local Enterprise Network or referred by a bank or Local Development Committees. The new rate for direct applications to MFI is reduced to 5.5%.   As these loans are available interest free for the first six months, the net effect is to further reduce the net interest rate payable over the period of the loan.

Also read: Bord throws out Granard fast food public health concerns

Government has agreed a new €2 billion Covid-19 Credit Guarantee Scheme and this is a further development of the existing Credit Guarantee Scheme already available.  This Scheme forms a major component of the government’s strategy to aid SMEs in these difficult times by providing critical support to ensure businesses are facilitated in having access to credit facilities to assist a return to a more regular trading environment.  It will provide an 80% guarantee on lending to SMEs until the end of this year, for terms between 3 months and 6 years.  The guarantee will be able to be used for a wide range of lending products between €10,000 and €1 million that have a maximum term of 6 years or less. 

The Scheme will be available to all SME sectors, including provincial and local papers. It will also have interest rates below current market rates. The implementation of this Scheme will require primary legislation, the drafting of which has commenced.

There are a number of liquidity supports for Covid-19 impacted businesses available now, including the existing Credit Guarantee Scheme which was implemented in 2012, supporting loans up to €1 million for periods of up to 7 years.  The scheme is designed to support a range of debt products appropriate to the borrowing needs of SMEs.  An application to access the Credit Guarantee Scheme can be made through one of the participating lenders which are currently Allied Irish Banks, Bank of Ireland and Ulster Bank Ireland. 

My Department is encouraging any affected business to take advantage of the LEO COVID-19 supports. The situation is still developing from day to day and the Government continues to respond to these developments in an effort to protect and support Irish businesses. The LEOs will continue to work with existing applicants and recipients of Business Continuity Vouchers (BCV) and their subsequent business continuity plans. The awarding of vouchers under the BCV scheme will naturally taper off in the coming weeks as the Local Enterprise Offices process the outstanding applications. 

InterTradeIreland launched two new business supports, these are currently being targeted at companies who are already on one of their programs.

E-merge enables companies to engage consultancy support & advice (to the value of £2500/€2800) to help them develop online sales & ecommerce solutions.

Emergency Business Solutions: Fully funded consultancy support & advice (to the value of £2000/€2250) to address key business challenges in areas such as emergency cashflow, loan applications and HR/People.

The COVID-19 outbreak will result in a serious downturn in the Irish, EU and wider global economy. The downturn will be sudden and wide reaching. Businesses, the labour market and household spending will all be negatively impacted. In particular, the Restart Grant provides direct grant aid to micro and small businesses and some provincial and local newspapers. The grant is a contribution towards the cost of re-opening or keeping a business operational and re-connecting with employees and customers.

Funding in respect to the Restart Grant is provided by the Department of Business, Enterprise and Innovation and is administered by the 31 Local Authorities.

I can assure the Deputy that I continue to work with my colleagues across Government to examine further appropriate supports to assist businesses impacted by Covid-19 and will continue to keep the supports provided for enterprise under review."

Also read: PICTURES | Longford GAA clubs raise over €14,000 for charity