THE Government must urgently revamp its taxation policy if unemployment is to be addressed, the chairwoman of the Small Firms Association (SFA), Ms Lorraine has Sweeney, said.
She said small firms were facing several problems in trying to run their businesses including the tax wedge, bureaucracy, late payment and crime. "We need a culture that promotes an appreciation of enterprise," she said.
She told delegates at the SEA's annual conference it was recognised that larger companies would continue to downsize.
"If the Government wants to address unemployment, it must work with the business community and, particularly, the small business sector which created 36,000 jobs in 1995 and will generate 43,000 jobs this year," she said.
She said that, if the Government adopted a culture favourable to enterprise, small firms would act as "the breeding ground for real job growth".
The Enterprise and Employment Minister, Mr Bruton, told delegates that the Government realised the importance of the small business sector.
He said services was a very important sector and he was currently finalising a strategy statement on services, which would review the contribution of the sector to production and employment in Ireland. It would also review the type of state supports available to assess whether they were appropriate or adequate.
Mr Bruton said the strategy would be aimed at "redressing an imbalance in policy that has existed against services for some time, with the objective of create employment".
The SFA has been strongly pressing for the Mentor Programme, which provides firms with temporary advisers, to be made more widely available to the services sector. Mr Bruton said that new businesses which had a mentor appointed commanded a significantly greater survival rate than those without a mentor.
The matter, he said, was now being examined and he indicated that it would he extended. "Initiatives such as Mentor could help companies significantly increase sales, particularly export sales, boost growth and create new jobs," he said.
AIB, in conjunction with Forbairt, the State agency charged with developing indigenous industry, is to launch a capital venture fund to help small firms.
Forbairt aims to raise £10 million from the private sector, a figure which the EU will match.
AIB said yesterday that it would contribute the first £3 million to the fund. The £3 million will be paid in over five years.
The fund will be formally launched in the next few months.
It is aimed at start ups with high growth potential - i.e. capable of achieving a minimum turnover of £1 million in three years - and early stage companies with similar potential. Other private sector financial institutions may also contribute to the fund.
