Address by Minister Dr. Jimmy Devins, T.D., at the official opening of the Small Firms Association (SFA) Annual National Conference

Dublin Castle Conference Centre, Thursday 25^th September 2008

Ladies and Gentlemen, Good morning.

I am delighted to be here this morning to officially open your 2008 Annual National Conference.

The theme of this year’s Conference is “Reinvent Your Future”, and focuses on the need for small business owner-managers to determine their own destiny.

The SFA has provided you with a challenging topic and an impressive array of speakers. The international and Irish experts and entrepreneurs that are here today as speakers will share with you their insights with a view to helping you to identify opportunities and challenges, develop customer and staff relationships, deal with the Compliance Challenge and, thereby, continue to be successful in your respective businesses.

It sounds like a very busy day for you all but no doubt a rewarding one as well. I want to thank all of the contributors for giving of their time. It is only through sharing experiences and networking that we can all learn from each other. These exchanges of information should also help in getting through the current economic situation.

With the dramatic economic changes right across the globe over the last year still impacting, all businesses will have to take stock of where they currently stand from an economic, competitiveness and productivity perspective. This is not an easy challenge - but it is one that we must all face up to, including both Governments and business managers.

I contributed to the Foreword for your Conference Supplement in the Sunday Business Post on Sunday 7^th September. While I don’t want to repeat all I said in that article, I would nevertheless, like to re-iterate some of the points I highlighted there.

Growth in global markets through the internationalisation of Irish companies is the key to wealth and employment creation in Ireland. Technological progress and new ways of doing business set new standards and make new demands of firms.

A natural consequence of this change will be the introduction of new business models and the emergence of new markets. A particular focus must be on developing new knowledge and new ways of doing things as recognised in Government policies, particularly the National Development Plan 2007-2013 and the Strategy for Science, Technology and Innovation 2007-2013.

We must develop an innovation-driven economy that maintains competitive advantage and increases productivity. We must promote innovation across a broad spectrum. Innovation has no policy borders. To stay ahead, we must continue to deliver consumer-driven innovative products and services.

My Department’s Innovation Policy Statement, Innovation in Ireland launched earlier this year, by the Tánaiste and I, marks our progress to date and also explores opportunities as to where innovation can be better exploited.

The Government is committed to providing €8.2 billion over the lifetime of the NDP to making this vision a reality and making Ireland a key location for cutting edge research and development, and a location for high quality jobs that are underpinned by knowledge and high skill levels.

Now, more than ever there is a need to focus on investment, in high skilled, knowledge based technology. The challenging economic environment through which we are currently passing highlights the need to ensure we have the advantage of a highly skilled workforce that is competent in the use of cutting-edge technology.

My Department and its Agencies support small to medium enterprises in a number of direct ways. Enterprise Ireland (EI) partners with companies to address their needs. In line with its Strategy “Transforming Irish Industry 2008-2010”, EI provides supports – financial and advisory – aimed at developing all aspects of the critical business functions.

Financial supports focus on supporting start-ups with a high potential to grow; providing comprehensive funding for R&D; driving growth and innovation capabilities and supporting major projects for large-scale development.

Balanced Regional Development is also a key Government priority. Enterprise Ireland operates in a regional context, with client companies, not just located in major urban centres, but spread throughout the regions.

The strategy is designed to ensure that opportunities for Irish SMEs and entrepreneurs are maximised throughout all regions and that relevant support is provided at a local level to meet the increasing challenges faced by new, young companies in the global marketplace.

I recently launched the Sligo Business Innovation Centre at IT Sligo, an excellent resource to provide Sligo based entrepreneurs access to the expertise, facilities and equipment to be found on the campus of IT Sligo, a progressive third level institution. These Centres are now bases for 176 companies employing 641 people nationwide.

In addition to EI, the 35 County and City Enterprise Boards (CEBs) provide support to small businesses or micro-enterprises with 10 employees or fewer in the start-up and expansion phases, to promote and develop indigenous micro-enterprise potential and to stimulate economic activity at local level throughout the country.

Financial assistance for feasibility studies, employment and capital grants are available along with non-financial assistance, such as programmes covering management, mentoring, e-commerce, enterprise education and women in business networks.

The Small Business Forum Report placed particular emphasis on issues such as: Access to Finance for SMEs; Promoting Entrepreneurship, Management Development and Reducing Administrative Burdens/Red Tape – all of which are themes for discussion at the Conference today.

The facilitation of access to finance, particularly with regard to SMEs is a priority aim for Government. To this end, the proactive use of State Aid instruments to promote such finance, through interventions such as the Business Expansion Scheme, Seed Capital Scheme, R&D Credits and the seeding of the Venture Capital industry in Ireland, are key responses to the SBF recommendations in this area.

Revenue data for the Business Expansion and Seed Capital Schemes show that 279 companies raised BES/SCS investments on or after 1st January 2007 amounting to a total of €80 million in the twelve-month period.

A thriving entrepreneurial culture also has the potential to make a substantial contribution to our economic and social development and to achieving balanced regional growth.

If we are to build a much greater number of competitive and innovative companies in Ireland, then we will need to see many new businesses being created now and in the years ahead.

The level of entrepreneurship in Ireland is strong and continues to the fore within Europe. The 2007 Global Entrepreneurship Monitor (GEM) Report for Ireland shows that the number of entrepreneurs increased in Ireland during the past year to the extent that, 2,700 individuals were setting up new businesses each month throughout the country - 1,000 of these are women.

The Management Development Council was launched in April 2007 and benchmarks Ireland’s current management development provision. The Council is currently conducting a detailed census of all the management development programmes, courses, schemes and services available to SMEs.

The Council is due to produce an Action Plan later this year. It will contain practical recommendations to my Department on supporting the development of world-class management skills within Irish SMEs.

I know that the SFA has also focused its efforts on the area of Management Development Capability through its “Better Business” series of Road Shows held earlier in the year and I commend you for your work in this area.

In 2007, the High Level Group on Business Regulation was established by my Department to look at concrete measures to reduce the administrative burdens in five areas i.e. taxation, statistics, environment, health and safety and employment and company law.

These areas were selected in direct consultation with business. The SFA is represented on the High Level Group, and again I thank you for your valuable contribution to its work.

The First Report of the Group was published on 6 August 2008. The Report identifies administrative simplifications that are already saving Irish business some €20 million in administrative costs this year through cutting out paperwork, revising the rules for small businesses and making much better use of secure on-line services.

Small businesses in particular have a lot to gain from participating in this process by making known to my Department, the areas where you feel that you are over-burdened by red tape.

To consider how to address these burdens, the Group must firstly be made aware of their extent and I would encourage all businesses to feed into the ongoing work of the Group, in this regard.

In March this year, the Government set a 25% target for the reduction of administrative burdens arising from domestic legislation, to be achieved by 2012. My Department has been charged with coordinating this process. In parallel, my Department is also leading the cross-Government project to measure the administrative burden arising from all domestic legislation.

Many of you may be aware of the EU Commission’s “Small Business Act (SBA) for Europe” which was published on 25 June 2008. Although styled an “Act”, the SBA is in fact a Communication from the Commission in relation to policy proposals and guiding principles aimed at keeping SME’s to the fore when devising policy at both Member State and EU levels.

Ireland is supportive of the SBA and welcomes the increased focus on the importance of SMEs and the general « Think Small First » principle which should be adopted by the European Commission and Member States when devising policies and measures for SMEs.

The Small Business Act for Europe is one of the agenda items for discussion at today’s Competitiveness Council in Brussels. The SBA is being given high priority by the current French Presidency and will be very much the driver of SME policies at EU level in the immediate future.

In conclusion, I wish you success at today’s Conference and hope that your day’s hard work will contribute positively to securing and developing your businesses into the future.

Last, but not least, I understand from Patricia Callan that the SFA are also using today’s Conference to launch its new publication called “Owner-Manager” which will be distributed to 8,000 SFA members on a bi-monthly basis. I want to wish the SFA every success with this venture. I am happy to officially launch the “Owner-Manager” publication.

The SFA has a short promotional video on the publication, which will now be shown to you.

Thank You

ENDS/IP62