independent

Friday 18 April 2014

Bruton's axe set to fall on red tape and save €200m

BUSINESS minister Richard Bruton is planning a massive overhaul of the red tape strangling small businesses.

The Department of Jobs, Enterprise and Innovation estimates that the cost of doing business has fallen by €200m through savings introduced following the streamlining of companies office and health and safety regulations. The rationalisation of State employment agencies will also bring "significant" savings.

State agency Forfas was osmosed back into the department last year and has been examining how to cut the redtape burden, especially with regard to the plethora of licences needed by shops.

"This year we're looking at the retail sector. We intend to reduce the cost of licences by 33 per cent by having a single portal for agencies," the minister said.

The new companies act will also bring hefty savings for businesses creaking under rate increases and upwardonly rent-review clauses. The new regulations cut down the need for physical AGMs, make it easier to avail of limited liability and remove the need to employ lots of directors.

Start-up companies will save €6m from these new measures, although the savings will be felt across the broader business community.

"It's to garner what all-over government can do. This is joined-up government," the minister said.

Bruton cited initiatives from other departments, such as Education and Skills Minister Ruairi Quinn's move to double ICT capacity, Health Minister James Reilly's innovation hubs and the Department of Justice's implementation of an international visa programme for start-ups.

Bruton also outlined his plans to cut the number of quangos run under the aegis of his department.

"Forty agencies have been rationalised," he said. "The key bits of legislation are on the A-lists. Getting them through the Oireachtas and getting them signed by the President will take time," he said. "It'll certainly be by the end of the year, but hopefully before that."

While the Government has created €2.5bn in new funding for business through alternative means, Bruton is pushing the banks to start lending.

"Banks have to transform," he warned. "That transition has not happened. You can see from the numbers on lending and the high refusal rates and big turnover of decisions by the Credit Review Office that banks aren't making the right decisions. There is a transformation that needs to happen and it still has a long way to go."

However, he said the banks would not be forced to lend to all businesses. "We're not going to turn banks into a public service. Ultimately the taxpayer wants to get their money back and have commercially orientated banks. You can't have public servants coming in and trying to interfere with risk decisions."

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