Failure of Government Covid and Brexit Loan schemes raises questions for Varadkar

Aodhán Ó Ríordáin TD
08 October 2020
  • Small drawdowns confirms that schemes aren’t working for businesses.
  • Instead of sending letters Tánaiste should look at reducing the interest rate on loans.
  • Less than a quarter of Working Capital Scheme and Brexit loan applications approved

With less than 20% of government Covid-19 and Brexit supports being drawn down, Labour Enterprise spokesperson Aodhán Ó Ríordáin said it raises serious questions about the much trumpeted supports from government, and the Tánaiste needs to address the failure of his schemes rather than writing letters to over 200,000 businesses.

Deputy Ó Ríordáin said:

“As reported in the Irish Independent today, less than a fifth of the money made available to businesses in response the pandemic and Brexit has been drawn down. There are clearly big problems with the loan schemes.

“The Tánaiste is writing to 225,000 businesses today, but his time might be better spent reducing the interest rate on state backed loans.

“For example, the working capital scheme has seen only a quarter of loans approved, and over €300m is still available for drawdown.

“It’s a similar story for the Brexit Loan Scheme run through the Strategic Banking Corporation of Ireland, with a very small amount of €56.3m awarded for 280 applications.

“The Tánaiste should quickly address any issues with these loan funds, at look at making them more attractive, and speed up the application and approval process.

“There is clearly also an issue with the interest rate charged on these loans, and the Minister should address that. With the State able to borrow at negative or very low rates, that needs to used to reduce rates. Irish SME’s pay significantly more in interest charges than their EU counterparts.”

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