July 2019

Enterprise Supports

Across Government, various departments and their agencies/bodies have substantially reoriented their suites of enterprise supports, strategies and structures to cover the spectrum of potential Brexit impacts. These range from preparedness vouchers, liquidity support through short term working capital loans for SMEs impacted by Brexit, and restructuring aid for businesses in severe operating difficulties. These measures aim to assist businesses in identifying key risk areas and practical preparatory actions in advance of the UK’s withdrawal from the EU.
Brexit-Related Enterprise Supports

Since the June 2016 referendum result a wide range of Brexit supports have been put in place for businesses including:
 A €300 million Brexit Loan Scheme launched in March 2018 providing loans of up to three years to businesses impacted by Brexit;

 A €300 million Future Growth Loan Scheme approved in Budget 2019 which will enable eligible Irish businesses and the primary agriculture and seafood sectors to support strategic long-term investment in a post Brexit environment;

 A €150 million Brexit Loan Scheme was introduced in 2017 to provide low cost loans for farmers

 Enterprise Ireland (EI) is working closely with regionally important larger companies in exposed sectors such as food to support strategic investments to build resilience – EI invested €74 million in these businesses in 2018. As an example, the dairy processing sector announced over €700 million of new investments in 2018 supported by EI, in large part focused on diversifying from existing cheddar production and UK markets;

 InterTradeIreland vouchers of €2,250 and €5,625 and Enterprise Ireland voucher of €5,000 for business to start and implement their Brexit plans;

 A ‘de Minimis’ support scheme comprising of co-funded equity support or cofunded loan support to eligible manufacturing and internationally trading firms impacted by Brexit. The funding will support up to 50% of the cost of a business plan to transition the firm to a new business model. The loan support would require the commencement of the relevant sections in the Withdrawal Act 2019. EI is putting in place a panel of credit assessors and other operational requirements to give effect to this and R&R support

 New LEO and MicroFinance Ireland repayable grants and loans to support Brexit impacted micro firms;

 The EU State aid Rescue and Restructuring and Temporary Liquidity Schemes have been approved for €200m ceiling and will allow the Government to put in place a fund, if required, to be available to businesses in all sectors that meet EU criteria, with a focus on SMEs of scale;

 The MicroFinance Ireland loans assist micro firms unable to get bank loan facilities and the Credit Guarantee Scheme are available to firms where associated lending risks have increased for banks;

 EI’s Global Footprint plans is for an additional 18 posts in 13 locations across the world in 2019 to support market diversification. DBEI and the Department of Agriculture, Food and the Marine (DAFM) have introduced an expanded range of market development supports for exposed firms to diversify markets and to consolidate market share in the UK where appropriate;  Bord Bia uses its Brexit Barometer to target supports to individual companies on supply chain, currency, customs issues and international market diversification opportunities in the agri-food sector;

 The National Food Innovation Hub at the Teagasc Moorepark Campus provides infrastructure, expertise and opportunities to SMEs in the agri-food sector to innovate and engage in research activities in an affordable way;

 Bord Iascaigh Mhara has a range of supports for seafood businesses to prepare for Brexit. Companies can avail of specific mentoring and consultancy of up to two days to help develop their Brexit strategy to mitigate associated risks;  Fáilte Ireland has developed a customised suite of supports including a Brexit Readiness Check and workshops in Market Diversification, GB & NI Market Retention and Growth, and individual mentoring.

The majority of the above schemes are open to all SMEs and not just agency clients.

Businesses are encouraged to identify the appropriate preparedness and economic supports to assist their preparation for the impact of Brexit. The Local Enterprise Offices (LEOs), which have a presence in every county, are working with the broad range of small and micro indigenous enterprises across sectors to ensure that they are informed about Brexit and have plans in place to manage the new trading relationships on the island and with the UK more generally. This includes a customs training programme for all businesses, exporters and importers, rolled out in conjunction with Enterprise Ireland.

Over the coming months, the Department of Business, Enterprise and Innovation (DBEI) will continue to work with Brexit exposed firms, in particular clients of EI, IDA and the Local Enterprise Offices (LEOs). While repositioning of enterprise is underway, the indigenous enterprise sector remains substantially reliant on exports to and imports from the UK – with the agri-food sector particularly dependent on the UK market. Other highly exposed sectors include construction, timber, consumer products, tourism and freight.
Bord Bia’s Brexit Barometer reported in June that Brexit preparedness is widespread among Ireland’s food and drink companies at 93%, representing 72% of all UK exports. Bord Bia offer specific Brexit training in critical areas such as customs compliance and readiness, logistics, financial risk mentoring, Sanitary and Phytosanitary (SPS) training, supply chain management, and currency management.

In June 2019 DBEI published an Overview of Supports for Indigenous Businesses which outlines the bodies and supports which are available to indigenous Irish businesses.
DBEI, working with the Department of Transport, Tourism and Sport and the Department of Employment Affairs and Social Protection, has identified liquidity as a key support requirement for the tourism/hospitality and freight sectors. Supports from the SBCI (Brexit Working Capital Loan Scheme), MicroFinance Ireland, and the Credit Guarantee Scheme are available. Fáilte Ireland and Tourism Ireland will continue as the key support agencies in getting the tourism and hospitality sectors Brexit ready and in supporting businesses in those sectors to access Brexit business supports through the relevant agencies in the enterprise sector.

Uptake of Brexit Business Supports

Table 3. Uptake of Brexit Business Support Schemes Scheme Uptake (as of 28 June 2019, unless otherwise stated)

Brexit Loan Scheme
663 applications received, 598 approved by SBCI, 145 Loans progressed to sanction at bank level to a value of €31.73 million.

Bord Bia’s Brexit Barometer 2019
130 companies completed this, representing 73% of total UK exports. 59 completions as inperson interviews (as of 2 July)

Bord Bia’s Customs Readiness Programme
120 companies completed to date, representing approx. 52% of total UK exports. (as of 2 July)

Bord Bia’s Supply Chain Mentoring and Workshops
88 companies completed to date (as of 2 July)
Scheme Uptake (as of 28 June 2019, unless otherwise stated)

Bord Bia’s Currency Risk Training Programme
24 companies completed to date (as of 2 July)

Bord Bia’s Brexit Consumer Pulse Survey
Issued to 2,000 UK and Irish consumers every 8 weeks since January 2019 (as of 2 July)

Bord Bia’s Commercial Marketing Strategy Workshops
Over 100 companies to date, over 60 one to one engagement sessions (as of 2 July)

Enterprise Ireland Brexit Scorecard
5,334 Brexit Scorecards have been completed. 1095 LEO clients have completed the scorecard.

Enterprise Ireland Be Prepared Grant 199 Be Prepared Grants have been approved

Enterprise Ireland Market Discovery Fund
171 projects have been approved under this initiative
Enterprise Ireland Prepare to Export Scorecard
3,833 Prepare to Export Scorecards have been completed

Enterprise Ireland Customs Insights Online Course
1,269 Customs Insights Course participants
Enterprise Ireland Agile Innovation Fund
55 Agile Innovation projects have been approved

Enterprise Ireland Brexit Advisory Clinics
16 Brexit Advisory Clinics have been run with over 1,200 in attendance

Enterprise Ireland Brexit “Act On Programme”
266 “Act on” plans have been completed
Enterprise Ireland Strategic Consultancy Grant

1,073 strategic Consultancy Grants have been approved
Fáilte Ireland Helping Business Get Brexit Ready
2,178 businesses participated in Business Supports programme focused on building skill capability in Market Retention, Market Diversification and Business Performance (Jan 2018 – Jun 2019)
Scheme Uptake (as of 28 June 2019, unless otherwise stated)

Fáilte Ireland Service Excellence Programme
928 businesses with a total of 6,953 individuals attending workshops (Jan 2018 – Jun 2019)

Fáilte Ireland 1:1 Business Mentoring Supports
161 businesses benefited from specialist assistance from subject experts (Jan 2018 – Jun 2019)

Fáilte Ireland Developing Food Tourism Businesses
1,598 businesses with a particular focus in 2019 around the Taste the Island Initiative (Jan 2018 – Jun 2019)

Local Enterprise Office Technical Assistance Grant for Micro Export
605 clients were approved assistance under the Technical Assistance Grant

Local Enterprise Office LEAN for Micro
340 LEO clients have participated in the programme

Local Enterprise Office Mentoring

644 mentoring participants solely focused on Brexit

Local Enterprise Office Brexit Seminars/Events
4,655 participants at the Brexit Information events

Local Enterprise Office one-day Customs Training Course
531 participants attended Customs Training (Feb 2019-June 2019)

InterTradeIreland Brexit Advisory Service
3,219 SMEs have directly engaged with the Brexit Advisory Service in 2019. This is in addition to the 4,175 engagements in 2018.

InterTradeIreland Brexit Start to Plan Vouchers
There have been 1,613 applications, with 1,405 approved and 20 still pending assessment.
Pilot Online Retail Scheme administered by Enterprise Ireland
11 retailers were awarded funding in March 2019. A second call of the Scheme opened on 19 June and will close 31 July 2019

State Aid

For businesses in severe financial difficulty, in November 2017, the Commission approved a ‘rescue and restructuring’ scheme for Ireland to provide support, in exceptional circumstances, for a company which, without the support of the State, would go out of business, for aid of up to €10 million per undertaking. In May 2018, this scheme was extended to include ‘temporary restructuring aid’ for enterprises experiencing acute liquidity needs. Following ongoing consultation between DBEI and the Commission on the need to safeguard the future of Irish SMEs most exposed to Brexit, the European Commission in March 2019 agreed to a tenfold increase in the state aid approved ceiling of Ireland’s ‘rescue and restructuring’ scheme from €20 million to €200 million to allow the Government to put in place a fund, should it be required, to offer both rescue aid and temporary restructuring aid to SMEs.
The Commission has been clear that it stands ready to act urgently in mitigation against the impacts of Brexit on Irish firms. Over the coming months the Departments of Agriculture, Food and the Marine, and Business, Enterprise and Innovation will continue to work closely with officials in the Commission in respect of flexibilities under both State aid rules and the Common Agricultural Policy.

Recently, the European Commission announced an exceptional aid fund for the beef sector in the context of Brexit.

Enterprise Ireland Lending Powers

The Brexit Omnibus Act provides Enterprise Ireland with additional lending powers, which broadens the scope of the support that can be provided to firms under the de Minimis rules. Enabling EI to offer State aid compliant, low interest debt instruments will be a way to support the Brexit response and help to build resilience. The provision of non-convertible debt instruments, in particular, will allow EI to support vulnerable but viable companies in need of investment funding to reposition their company. This will allow EI to offer enhanced support to businesses as part of the response to limiting the negative effects of Brexit, and help Irish businesses to remain competitive, to innovate in terms of new product and service development and to grow in existing and new markets.

The Act enhances EI R&D supports to business and will allow EI to provide:
 research grants to the horticulture sector for the first time;

 grants to support critical research activity overseas in certain circumstances;

 research grants up to permissible EU State aid limits;

 advance partial payment of research grants to industrial undertakings of all sizes.

Postponed VAT Accounting

In addition, the Act includes provision for a system of postponed VAT accounting to alleviate the cash flow impact on business as a result of the UK’s status as a third country and, as a consequence, the requirement for business to pay VAT at the point of import rather than at the time of filing their bi-monthly VAT returns. Details of this scheme are outlined in the chapter on taxation.

Next Steps

Over the period to end-October, steps taken by the Government will include:
 Government will continue to work with Brexit-exposed firms, in particular clients of Enterprise Ireland (EI), Bord Bia, IDA and the Local Enterprise Offices (LEOs) and including continued roll-out of existing supports and schemes.

 Additional measures that can be deployed in the event of a no deal Brexit, consistent with the macroeconomic framework set down in the Government’s Summer Economic Statement.

 Ireland will continue to engage closely with the European Commission in relation to supports and flexibilities under State aid rules, the Common Agricultural Policy and the European Maritime and Fisheries Fund.
Over the period to end-October, the Government calls on business to:
 Take steps to identify the appropriate preparedness and economic supports in preparation for the impact of Brexit.

 Access the relevant supports, schemes and advisory resources in place to support them in preparing for Brexit.

July 2019

Labour Force Activation and Training Supports

All government analysis to date has emphasised the negative impact that Brexit will have on the Irish labour market with job losses in the most exposed sectors. There are likely to be significant job losses in the most exposed sectors in a no deal scenario, with an estimated increase in unemployment of 50-55,000 after the UK leaves the EU.

There is also a clear variation in regional and sectoral impacts: agriculture, food and ‘traditional’ manufacturing and hospitality are expected to be the most severely impacted. While the border and midlands regions are forecast to be most affected, other regions will also be impacted.

As a first step, the Government has developed and reoriented enterprise supports, strategies and structures to assist businesses in preparing for the impact of Brexit, including building resilience to minimise job losses. At the same time, the Department of Employment Affairs and Social Protection (DEASP) continues to refine its contingency measures along with other government departments and agencies.

DEASP and the Department of Education and Skills (DES) have put arrangements in place to plan and coordinate responses in the case of a no deal scenario. The arrangements involve the two departments, SOLAS and representatives of DEASP regions and Education and Training Boards (ETBs). The Group receives regional reports, ensures regional engagement and can coordinate strategic responses. This structure facilitates the two departments in monitoring the employment situation in each region with a view to supporting affected workers.
The arrangements were recently expanded to include DBEI to capture enterprise agency intelligence. Finally, the DEASP and labour market research unit of SOLAS are continuing their work on regional and occupational analysis, specifically to ensure that re-skilling can be deployed in the most affected sectors.

There will also be close engagement with employers and trade unions, at national and regional level, to monitor emerging trends and required responses.
Intreo and ETB Collaboration

Over the past number of years there has been significant institutional and strategic reform to ensure collaboration between these services which are now better equipped than ever to deal with supporting people into employment. Well-developed approaches to skills profiling and activation have been put in place alongside formal protocols agreed between the Intreo and ETBs services on referrals, service planning and bespoke interventions. These protocols provide for regular meetings of regional teams.
ETBs and Intreo office staff members meet regularly to share information and provide feedback of their analysis. ETB training for unemployed people is largely contracted and this can be scaled up to meet additional demand. Over the coming months, Intreo offices and the ETBs will monitor ongoing developments as we approach a possible no deal Brexit.

National Training Fund

Investment from National Training Fund has moved towards supporting people in employment, including new investment in those with low skills. In the event of a hard Brexit, there would be a requirement to access more of the NTF surplus to deal with forecast rises in overall unemployment and to support sectoral or regional training initiatives and this will be kept under active consideration by the Department of Employment Affairs and Social Protection and the Department of Public Expenditure and Reform. Additional NTF-supported activity is also provided through initiatives such as Skillnets, and apprenticeship in Brexit-relevant skills, such as logistics.
European Globalisation Fund

The European Globalisation Fund (EGF) has supported intensive responses to major job losses. There has been engagement with the European Commission and agreement on the potential for the EGF to be used if Brexit results in shifts in EU-level trade patterns.
The employment situation will be closely monitored to assess the potential for EGF applications and engagement will be progressed with the EU if necessary.

Share this article