While affording cautious welcome to the raft of business support measures announced by the Government to aid the posy-COVID-19 economic recovery, local businessman and prominent Fianna Fáil Councillor, Aengus O’Rourke, noting the detrimental impact of the virus from a professional perspective, stated the mechanisms introduced are not sufficient.
“At the outset of the crisis the wage subsidies and the COVID-19 emergency payment supports made available to businesses by the Government certainly helped to soften the blow for businesses and for employees.
“In recent days, the Government announced more detailed business specific supports in an attempt to give firms a possible route back to business when the restrictions are lifted. In the main these supports are welcome and badly needed, however in my view they don’t go far enough.
“The impact, financial and otherwise, of the Coronavirus on small businesses is huge and will change the way we move, socialise, shop and do business,” Cllr. O’Rourke stated.
According to the local businessman, it is a matter of “wait and see” for business owners as the economy seeks a swift recovery.
“This is not an easy or natural frame of mind to be in for those normally used to rushing around, shaking the bushes, doing deals, creating employment, taking calculated risks and making things happen. Right now nothing is happening.
“One of the key challenges for small businesses is access to cash and small businesses are particularly vulnerable in this area. Overhead costs like rent, payroll, insurance, rates and utilities leave very little liquid cash to do anything with, like owners taking a wage,” Cllr. O’Rourke added.
The Fianna Fáil Councillor noted that there are a number of things that needed to happen to support the SME sector where businesses have experienced a 25 percent (or more ) reduction in trade.
- A Working Capital grant needs to be provided for small businesses to enable them to open again when the restrictions are lifted. A grant and not a loan, businesses do not want to take on debt.
- Utilities need to introduce a reduced charges scheme for small businesses during and for up to six months after the crisis. Not a deferral, a reduction in charges.
- Lenders need to also give payment holidays to SME borrowers for potentially one year.
- Insurance companies need to honour their ‘business interruption’ clauses and their decisions around this issue need to come down on the side of the customer (in the words for the Central Bank ).
- Insurance companies also need to give premium discounts as appropriate for the period of closure.
- Commercial Rates for SME’s eliminated for one year - not deferred.
- The Government needs to appoint a Minister specifically for SME sector to ensure that policies are targeted in the right areas.
- There needs to be an extension to the examinership protection window for Covid19 impacted businesses.
- We need to ensure that as a state we are supported strongly by the EU in whatever measures the EU roles out in the weeks & months ahead to support member states.
- Where redundancies are unavoidable the state needs to support businesses in making the relevant redundancy payments.
“The new Government should also take this opportunity to scrap our ‘Victorian’ rates system which is a blunt instrument when it comes to taxing businesses in order to fund local authorities and implement a sales tax system would be a lot more fair and precise.
“Such a system would tax a business based on its sales. The current commercial rates system is based on the size of your building, but takes no account of the activity or business generated within its four walls. However, this is a debate for another day when we have a Government.
“The SME sector is the backbone of the Irish economy, it is the main source of jobs and enterprises in Ireland. This reality needs to be recognised by the new Government and meaningful, targeted support put in place very soon,” Cllr. O’Rourke concluded.