Minister for Finance Tonio Fenech told Parliament that 396 SMEs in Malta and Gozo had already benefitted from €25 million from the EU Regional development Fund.
Originally the funds available to Malta amounted to €20 million but after negotiations these were increased to €42 million. A call had been issued to make use of the remaining funds and applications were being evaluated.
Minister Fenech, who was speaking during the second reading of the Small Business Bill, said that over 120 SMEs had approached the Bank of Valletta under the Jeremy Finance Programme with requests amounting to more than €15 million.
In reply to criticism by the opposition, Minister Fenech said that during the last 10 years the government had embarked on a number of schemes which helped SMEs when these businesses were passing through difficult times.
The applications under the micro invest and micro credit schemes showed that SMEs were strong and were looking forward for economic growth and development. The government’s intervention in saving 7,000 jobs in industry benefitted SMEs because these were indirectly dependant on them.
The government had consistently emphasised a change in culture to think “small first” in line with the European Small Business Act.
The Bill was not a statement of policy but the norm on how the public sector had to work in approaching businesses. It had to be more sensitive and proactive towards SMEs. Public officials had to understand that this was a fundamental economic principle. One had to understand that funding Malta’s social system, salaries in the public sector and investment in education came from taxation and the economic sectors. This entailed that regulation had to be evaluated.
He criticised the opposition’s reaction because it rubbished the setting up of the College of Regulators that had been proposed by the GRTU. This showed that the opposition was cut off from reality in the business sector. It was inconceivable that the opposition was also saying it intended to vote against the Bill because it had not received the explanatory notes. Minister Fenech said the Bill was easy enough to understand but these notes would eventually be published.
The minister spoke on the tax credit scheme under which SMEs benefitted in saving up to 40 per cent in taxation, this increasing to 60 per cent in the case of SMEs in Gozo. Under this scheme, 276 new jobs had to be created. The tax credit and micro credit schemes were proof that SMEs had full trust in the economy and in government policy. Government had also launched the Gateway to Export in this year’s budget to encourage SMEs to start exporting their products.
Government departments had to find ways how to apply regulations with fewer burdens on SMEs. The Better Regulation Unit and the National Reform Programme were steps in inculcating this culture among public officials with the aim of becoming more business friendly and more conscious of economic realities which SMEs had to face.
This meant that the Bill was not about the licensing of SMEs but about the public sector in facilitating operations by these businesses. Impact assessments had to be carried out before publishing laws or legal notices that had a direct effect on SMEs. These businesses would be informed beforehand on the implementation of such laws.
The government was to set up a structure so that the SME test would be carried out smoothly. Another structure to be set formally was the Enterprise Consultative Council that had unofficially been meeting with him as a forum. This allowed for discussion on government proposals regarding the sector.
The Council and the College of Regulators aimed at facilitating the consultative process ensuring transparency, objectivity, efficiency and the uniform application of laws, Mr Fenech said.