Ireland's Publication for the refinishing & associated Industries

SIMI wants questions answered on start up payments

The Society of the Irish Motor Industry (SIMI) has called on Joan Burton, Minister at the Department of Social Protection to confirm if the department is involved in subsidising social welfare recipients to set up it the motor industry in direct competition to exisiting businesses in the sector.

Last week revealed that the Department of Social protection is offering financial assistance to fund the purchases of workshop equipment (workshops lifts, compressors, tyre changers, wheel balancers etc.), for social welfare recipients to help set them up in business in direct competition to exisiting businesses in the sector.

A number of reputable workshop equipment suppliers that do not wish to be named have told that they have been paid by the Department of Social Protection for equipment that was purchased on behalf social welfare recipients.

Alan Nolan, Director General of SIMI said that had done the industry a huge service bringing this story to light and “with apparent evidence that requires answers from the Department.”

“My reaction and the reaction of members I have spoken to since the article appeared is one of intense anger if this information is true. No one in this industry has a problem with fair competition, with new entrants or indeed with strategically focused Social Welfare support schemes for unemployed people but that is not what is at issue here.”

He continued: “We have a number of very serious questions arising out of the evidence quoted in the article that we will want the Minister to answer directly.  If the Department’s published reply was intended to answer the questions raised in the article, then it’s like something from ‘Yes Minister’ in that it highlights the detail of Schemes that exist rather than any indication of what has been done in our sector.”

“For us there are some extremely serious questions at issue here. Decisions on these schemes are supposed to be based on consideration of demand for and supply of such services at local level, of viability, sustainability and must not involve displacement of existing business in the same industry.”

Nolan says the motor industry aftermarket has been devastated over the last five years with volumes and rates both down and with businesses and jobs continuing to be lost. “Many garages have just not been able to hold out any longer, given how impacted the business continues to be. It is a sector in crisis so it would be unbelievable if someone really looked at this, as they are required to, and actually decided that it was reasonable to add State supported entrants into this sector at this time.”

“But there are other questions on top of that; such as qualifications and insurance, given that motorists’ lives are at issue and there are requirements of planning and compliance with all of the business and sector specific regulations that professional garages must adhere to.”

“And then, specifically as this is the Department of Social Protection, what steps have been taken to ensure that such new State supported businesses are tax compliant, particularly given the history of an unfettered Black Economy that has continued to operate at the fringes of our Industry beyond the reach or interest of many of the State Agencies responsible to ensure enforcement?  We have compiled our list of questions for the Minister and will not let it drop until we have some clear answers.”