Address by An Taoiseach Brian Cowen, T.D. Small Firms Association National Small Business Awards Finalists 4th March 2010 at 7pm

It is truly an honour and a great pleasure to join you here this evening to recognise and celebrate success.

First, of course, it is about the success of the named finalists for the National Small Business Awards in each category.  They cover engineering, manufacturing, food and drink production, services and environmental sustainability and a special category highlighting innovation.

Tonight is about the success of all the companies here this evening because each of you, and all the people you employ, have made your vision and your ambition real.

You have taken what was once just an idea – even a crazy idea – and made it real, a real business, making money, creating jobs, winning markets.  You have taken the plunge, you have competed, you have persevered.  You have won and you are still winning now.

And every business owner knows that winning is not something that is done once, then kept forever, like having a medal on the mantelpiece.  It’s about constantly competing to win all over again.

So this event and what it means is really impressive.  And inspirational.  This show of talent, positivity, determination and business know-how is the best of what our country is and can be.

Positive message for St. Patrick’s Day

In the next few weeks, I and the members of the Government will lead a major marketing effort around the world.  It is a fantastic opportunity for Ireland every year that millions of people globally celebrate St Patrick’s Day and turn their attention with real good will to our country.

And I am bringing a positive message of hope and confidence about Ireland.

Yes, I am going to speak about how we have stabilised our national finances, taken tough budget decisions, and won increased confidence from investors in our country.

Yes, I will talk about how we are dealing with the banks, cleaning up their balance sheets and getting them fit to lend again properly.

But most of all, I am going to tell them about you.  Everything you do.  Everything we are celebrating tonight. 

Every ounce of ingenuity and effort and confidence that goes to make up your success and the success of hundreds of thousands of other Irish people who make business and jobs happen in and from our country.

I am going to tell everyone why I am confident and proud of Ireland;  what we have to offer and what will be the source of our success for the future.

And that is about your story.

It is about people –what we can do;  how we work with others;  how we solve problems;   how we innovate;  how we network in the world;  how we reward and encourage effort, enterprise and success  - including how we don’t punish honest effort that fails.

And the good news is that, in so many ways, we have the fundamentals of these success factors in place.  We have not lost them at all in this recession.  The foundations for economic growth are not destroyed, but are firmly in place, ready to be built on.

In fact, we are better positioned than the early 1990s or 1980s, with nearly 900,000 more people in employment.

We have high levels of education – and we will strive for higher levels, so that every young person can reach their true potential, best of all, in our country.

We are promoting and investing in R&D and innovation as never before.  The quantity and quality of research in our universities and businesses is far, far ahead of anything we had in the 1980s and early 90s.  Very soon, the Government will bring forward the report of the Innovation Task Force I set up last year, so that we innovate more in every way in our economy.

We have focused well – we have great strengths in food technology, the arts, tourism, financial and other services, pharmaceuticals, medical devices and information technology.  And we are growing new areas for focus, such as efficient energy technologies. 

We have shown flexibility and adaptability – we have got to be ever-more competitive in how we price our services and wages to ourselves and, crucially, to people globally who we’re selling to.

We’ve reduced our costs in the public service, and we will do more to provide services more efficiently and at less cost to business and taxpayers.

We have gone out and won new markets and business. The IDA, Enterprise Ireland, our Embassies and a myriad of businesses all working together have been great. Let’s continue to do this; passing on the learning, the contacts, the skills, the openings. 

We have developed networks worldwide that source finance and investment –that will continue to be part of Ireland’s success.

We have shown that export-led growth is not just something that big multinationals can achieve from Ireland.

Small firms who have been innovative and daring have also shown the way for export-led growth.  Exports can be soup or sausages; songs or scripts, silicon chips or services.

Export earnings also come from the smile of welcome for our tourists; the sound of music; the science of inventions. We can all play a part in export-led growth.

At our best, we Irish have a creative, solution-seeking mentality – we will continue to foster and reward this in education and work.

We have the hunger to win - let us never lose it, no matter what set-backs and challenges we face – and let us never be complacent about the next success.

Banks and lending

I am acutely aware of how much effort and determination it takes on a daily basis to achieve your business success – even just to stay above water in a recession.

And I am acutely conscious of how critical it is that we get our banking system fit for purpose again – fit and ready to support your working capital needs;  fit and ready to support your well-thought-out expansion plans;  fit and ready again to restore a true relationship with you and all their customers, built on trust and economic and business realism. 

That is what’s behind the massive effort we have put into the entire NAMA process, which is getting underway right now.

NAMA is absolutely necessary to clean up the balance sheets of the banks and to create a functioning banking system in Ireland. 

But we don’t claim NAMA solves everything.  We don’t say NAMA is all we need to do.

We are certainly not telling banks that working with NAMA is all they need to do.  They know that we, the Government, taxpayers, the business community and our whole society, expect and demand a lot more than that. 

The Government is resolute and determined that our central and indepensible objective for banking will be achieved – the provision of normal credit on fair, commercial terms in our economy to business, large, medium and small, and to personal customers. 

I know that that day can’t come too soon for your businesses.  And I understand the pressures that many businesses are under.  I understand that, for many people in business, the banking situation has made a tough recession all the more difficult.

I honestly believe we will see these pressures alleviate this year. Not just because of the NAMA operations leading to fit-for-purpose banks, but because of wider, positive propects for the economy.

Restoration of growth and confidence

Most importantly, I am confident we will return to growth this year, and with that, new employment creation and a return towards normal levels of consumer spending.

Just to illustrate that, our savings rate is now about 11% of disposable income.  The normal rate for us has been around 7%.  In money terms, that’s up to €4bn annually that we can expect to start coming back into consumption – into buying your goods and services - as confidence grows about employment and about incomes stabilising.

As the international economy grows, we will be better positioned to win business because of the steps we are taking in both public and private sectors to boost our competitiveness.

Confidence is being restored – both internationally and at home, and for good, sound reasons.

We have taken big steps in the management of the public finances to give confidence to taxpayers here and to investors abroad, that this State has taken control of debt, spending and taxation. 

We have shown that we will not repeat the mistakes of the 1980s. 

There will be no debt spiral, loading on more and more debt until it becomes impossible to service.

There will be no public spending spiral, that becomes rapidly unsustainable.

And there will be no income tax spiral out of control, with people fearing more and more of the fruits of their effort and work being taken away.

So we will not try to tax, spend or borrow our way to sustainable economic growth.

As a sovereign nation, we are dealing with the issues are that are in our control.  This is what restores confidence.  We are certainly not going to take wild risks with the economy and Ireland’s reputation, such as declaring a default on debt or leaving the euro.  These may be interesting mental war games for some, but they are not the real world for anyone who has to take actual decisions in the true interests of the country, dealing with the real risks of different options.

In short, we are implementing a comprehensive and responsible economic strategy that includes prudent and controlled levels of taxation, spending and borrowing.  It also has at its heart policies targeted at new, sustained growth in business and jobs, based on competitiveness and innovation.  And we are investing deeply in the future, in education, in infrastructure and in research and innovation.

Rents

One area of concern to many here is the issue of rents.  Today, my colleague Dermot Ahern T.D. announced the establishment of a working group to look at the issue of commerical rent reviews.  The group will be asked to focus particularly on the arbitration process and the adequacy of the information available to all parties in the context of commerical rent reviews.  Having already banned upwards only rent reviews in new leases, we are now moving to bring together all the relevant Government departments to see how we can deal further with other aspects of concern in existing leases.

Concerns have been expressed about the adequacy of the information which is available to parties in the context of commerical rent reviews.  This matter merits examination.  It is in the public interest that there is confidence in the system whereby rent reviews are determined in the commercial sector.  The group will explore how the arbitration system can be better used in these cases.  The group has been asked to report to Minister Ahern by the end of June.

Conclusion

In conclusion, let me say this.  Last year was one of the most challenging for our country. It affected everyone in our society, every family, every community and every business.

This year will be better.  We are better positioned to meet the challenges ahead.  We can look forward to the return of economic growth.

We will see new jobs, many being provided by your companies.  This week FÁS and the ESRI predicted 250,000 new jobs will be created by 2015.  And the IDA, with its track record of success, said it was aiming see 104,000 new jobs created in the next four years through Foreign Direct Investment and related business.  2010 will see a start on that road.

And I am determined that you will also see the banking system clearly returning to prudent, fair, normal commercial lending to good businesses.

For the second half of last year, we put a major effort into three objectives, the Lisbon referendum, the NAMA legislation and the Budget.

Now, the priorities are the reorganisation of the way we do business at government and departmental levels to align ourselves with economic imperatives;  the further reform of public services; and the implementation of our innovation agenda.

Later in the year, we will have the next Budget and, again, it will be clearly focused on the necessary steps to achieve economic recovery, growth and jobs.

As we  in Government address these challenges and take a positive message about Ireland around the world, we will be inspired by the successes that all your companies have achieved. 

And I give you my word:  we will give you our total backing in everything needed to win more business at home and abroad, and to achieve the further success that you and Ireland richly deserve.

ENDS