SMEs need more government support

Speaking on the Small Business Bill in Parliament this week, opposition MP Helena Dalli called on the government to give SMEs more moral, technical and financial support.

Malta has 34,000 SMEs, 95 per cent of which were micro enterprises. A total of 88,500 people were employed in this sector.

Referring to a recent EU scientific research, Dr Dalli said Commissioner Joanna Drake called for more attention because the EU was not convinced that the government was doing enough in this sector. The report provided an unattractive image of Maltese SMEs and one needed to address the issue by being more responsive.

Relatively, Malta had the highest number of SMEs, 98 per cent of businesses. This was why urgent and sustainable reforms were required as the only way forward.

Malta had the lowest rate of the working population in the EU. People in the working age category were still failing to register for employment. On top of this, there were not enough family-friendly measures.

Speaking about women in employment, she said they had a huge potential but there was a lack of investment and a holistic plan to address difficulties. Self-employment was a channel to be exploited.

Going back to the EU’s analytic report, Dr Dalli said this supported the fact that Malta’s performance was below average. The report stated that the number of SMEs between 2002 and 2008 had gone by 12 per cent in Malta – lower than the EU average. It also stated that SMEs in the EU contributed to 12 per cent of increase in employment. The number of employees in Malta working within SMEs slipped by two per cent.

Value-added for SMEs had gone up by 28 per cent over the seven year period while in Malta this only rose by 19 per cent.

State aid in Malta was a mere one per cent, compared to the EU average of 10 per cent.

One could not move forward due to bureaucracy. What was really happening to our one-stop-shop concept? There were way too many complaints related to this issue.

If one claimed that SMEs were the driving force of the economy, then one needed to consult stakeholders to see how they could direct themselves in the right manner.

Time was an essential factor. Many private enterprises were running on the spot – in some cases, even running backwards.

Local entrepreneurs who did indeed take risks, despite difficulties, should be commended. But unless more moral, technical and financial support was provided, society would eventually be the loser. High tariffs and utility bills were another hurdle SMEs were stumbling on.

Some companies were resorting to closing down their businesses or opting for unemployment benefits.

There was a clear lack of correlation between education, training and national development. Had there to be a more defined link between the three, problems would be significantly less, particularly in the sourcing of adequately-trained employees, Dr Dalli said.