ANGLO IRISH Bank is actively considering providing funds to small and medium-sized businesses, a board member of the State-owned back has said.
Speaking at Isme’s annual conference in Dublin yesterday, Commission on Taxation chairman and Anglo Irish Bank board member Frank Daly signalled that lending to the SME sector forms part of the bank’s restructuring plan currently being developed for EU submittal.
“It would be our intention, as the new board of Anglo, to look at whether Anglo has a role in the future in relation to the small and medium enterprise sector. It is an area that we are actively considering,” said Mr Daly.
The move would be a significant departure for the bank which has traditionally lent to larger, corporate clients.
Meanwhile, Bank of Ireland’s director of business banking, Mark Cunningham, insisted the debate on credit flow to small businesses was “skewed” and Bank of Ireland was lending to small businesses.
“So far to the end of September we have lent an additional €2.1 billion to the small and medium enterprise sector. Eighty-one per cent of the applications we are receiving are being approved. Those figures have been independently verified by Mazars.”
Over 350 representatives from the small and medium-sized business community attended yesterday’s annual conference at which Isme chairwoman Eilís Quinlan called for the abolition of the social partnership process.
Arguing that social partnership is “completely unrepresentative of the wider business community”, she said that the current system needed to be replaced with a national representation forum which would include the SME sector.
“Isme over 12 months ago were the only organisation to identify that wage rates were not sustainable . . .This was at the same time when the social partners, including the big business lobby Ibec, were actually agreeing a deal that would increase wages by 6.5 per cent. If the SME sector had been allowed representation . . . this scenario would not have been allowed to develop.”
Ms Quinlan also called for a reduction in public sector numbers and pay. Quoting from a recent OECD report she said that the public sector is “not a victim of the crisis but rather a part of the problem”.
Trade union Unite strongly criticised Isme’s demands for public sector cuts. Regional secretary Jimmy Kelly said that a cut in public sector jobs would accelerate the collapse in consumer spending and as a result “force many of [Isme’s] members out of business”.
Delegates also heard from UCD economist Colm McCarthy who warned that it would prove “more difficult” to recover from the current economic crisis than the 1980s recession because of the “surge in exchequer spending since 2001”. He said that while Government spending in real terms did not rise significantly between 1982 and 1987, since 2001 it has risen significantly more than the rate of inflation. There has been a “public spending bubble” and there needed to be a permanent correction.
