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Who is driving the bus carrying us out of the post Covid 19 shut down?

As the traffic builds, car parking places fill, and (socially distanced) queues for lunch grow, it is apparent that day to day the real economy is returning to work. Other than the shutdown payment to workers furloughed or made redundant, the organs of the State are absent from the exit from the commercial impact of Covid 19. This is unforgivable, will inevitably exacerbate the resulting recession, and is entirely avoidable.

For a small business owner providing services to small businesses I am constantly amazed by the resilience, hard work, and inventiveness of my clients across businesses such as hospitality, healthcare, agri-food, advertising, and professional services.

Without exception, in the teeth of extraordinary hurdles they have reorganised their business to make the most of the hand they have been dealt, from (for example) pivoting from restaurant to take away, and the speed at which they moved from an office to working from home environment. All this was done at the behest of the State arising from public health concerns from the effect of Coronavirus.

With salary supplements that were quickly implemented, initially the State took away the most immediate concern of business owners, which is their staff are taken care of when money from turnover dried up. The businesses mothballed or pivoted.

There is some money to assist companies from some organs of the State. In particular is the recently announced grant relative to the rates paid by a company impacted on by C19 closures, which is capped at €10,000. While small in the grand scheme of things, this seems to be relatively accessible, the qualifying criteria straightforward, and therefore what SMEs need.

Other sources of funds are larger, but most typically are repurposed Brexit aids which are aimed at companies already exporting and in the Enterprise Ireland or Local Enterprise Office (LEO) ecosystem. These exclude service companies and those in the retail and hospitality industries, coincidentally those with the greatest potential for jobs losses. Accessing the funds requires approval from the SBCI and credit analysis by pillar banks, neither of which spring to mind as exemplars of dynamism and functionality.

It is not like the State hasn’t been given guidance on what they need to do. John Moran who is the former secretary of the Department of Finance is chairman of a widely representative group under the name which sets out a number of measures that will assist SMEs. ISME have made submissions based on industry requirements, as have the Restaurant Association, IBEC, and the Banking and Payments Federation (BPFI), representing the pillar banks.

Many of the elements requiring action have no cost, so arguments that we can’t afford them carry no weight. For example, the BPFI said their members want non-bank lenders to manage many of the loans to SMEs because they are not set up for the volume of applications, and are not particularly interested in this sector. The State has done nothing in response. ISME suggested a moratorium on C19 related debt incurred by SMEs since 1st March, to be repaid in full over 36 months from a date to be decided by the Minister for Business Enterprise and Innovation (DBEI). Silence from the State., BPFI and ISME have called for reform of the rules on examinership to make it less process driven, and therefore less expensive. Nothing in response.

No one is saying the exit is going to be easy, and will not be expensive. No-one is complaining about what is happening. People understand the steps that have to be taken, and the cost of protecting our vulnerable.

The amazingly frustrating thing is that experts in business, economics, restructuring, finance and insolvency have come together and have solutions from an informed place that identify and fix flaws in the system, often at no cost. We have seen no response from the State, which is failing its citizens with inertia and indifference. This is an insult.

Current manoeuvrings to get power betray the political class. SMEs have no time to spare become active in the economy again. They need to know the State has their back, with systemic reform and some funding. Now they are just being ignored. In a short time they will be out of business. This is nothing short of a scandal for which we will be paying for many years.

Shame, shame, shame on them.

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