Small businesses vital to economy, warns minister

The economy must generate more small businesses to sustain itself, Minister for Enterprise, Trade and Employment Micheál Martin warned today.

Mr Martin has set up a small business forum to see if high energy, electricity and local authority costs are deterring entrepreneurs and to examine what incentives need to be put in place.

“Change has to happen if we are to sustain our competitiveness. If we stand still we will not survive,” said Mr Martin.

Around one in 12 of the workforce are involved in entrepreneurial activity according to State body Enterprise Ireland.

Mr Martin said there was a good culture of entrepreneurship and a very good environment for setting up more businesses which included the lowest interest rates in decades, one of the lowest corporation tax rates in the world, historically low inflation rates and effective full employment.

However he warned there were still challenges ahead in an increasingly globalised world.

“Despite the improved economic climate, we still hear stories of people having difficulty in accessing finance,” he added.

The small business forum will be chaired by Joe Macri, the managing director of Microsoft Ireland.

He said that despite his role with one of the biggest companies in the world, he had experience of the sector through his work with Microsoft Small Business Division from 1996 to 1999.

“I’m only one person and the role of the chair is to have the views and opinions of the team,” he said.

The other 12 members of the forum will include representatives from the Small Firms Association, the Irish Small and Medium Enterprises association and the Chambers of Commerce of Ireland.

The forum is the first to examine the small business sector since the taskforce on small business 10 years ago.

It will look at the strategies for developing entrepreneurship in Ireland, the factors which are inhibiting the growth of new businesses, the availability of finance and the extent of research and development conducted in the sector.

It is due to deliver its recommendation by the end of March next year.