Dr Jerry Cowley today outlined a number of initiatives set out in Labour’s policy programme that he believes will assist Mayo small businesses and enterprises. In a week where Údarás released figures which showed that in 2010 there was a net loss of 132 jobs in the Mayo Gaeltacht, and other major businesses are threatened by lack of credit, Dr Cowley has said it is time to look to Labour for solutions.
“To achieve that goal, we need investment finance. Labour is proposing a new 'greenfield' bank with a clear mission to support investment in SMEs and innovative firms, and to assist in the funding of infrastructural investment,” outlined Dr Cowley.
How it will work: The Strategic Investment Bank would be set up as an independent commercial operation, using €2 billion from the National Pension Reserve Fund as initial capital. The capital ratio of the bank would be set by the Financial Regulator. It would operate on a strict arms-length basis from Government.
Irish citizens and the Irish diaspora would be encouraged to make deposits in the bank, and to purchase Strategic Investment Bank Citizens' Bonds, which would be a way to invest in the recovery of the Irish economy, and would be of different maturities. The Strategic Investment Bank would attract funding from a number of sources, including consumer deposits and wholesale markets (once market conditions normalise ). It would use some initial funding from the NPRF.
Irish companies need growth capital. The Strategic Investment Bank would be a key lender to SMEs and innovative firms. The Enterprise Agencies would develop relationships with the Strategic Investment Bank to facilitate introductions of high potential firms. Investment decisions, however, would remain the exclusive preserve of the Strategic Investment Bank. The Strategic Investment Bank would also support investment in large infrastructure projects.
Dr Cowley concluded by saying: “I would hope to see this funding delivered through a local, community based and focussed network like the Credit Union movement or development agencies to ensure we have strong local economies to deliver a prosperous national economy.”
