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A NEW INCENTIVE scheme to get at least 10,000 Irish businesses online is being launched by government today.
As part of the first phase of the National Digital Strategy, small and medium-sized enterprises will be able to avail of a ‘trade-on-line’ voucher programme, once the firm matches the amount granted.
The scheme is capped at €2,500 per company but businesses may request less funds, depending on the project.
The money can be used for banking systems or to extend a customer base but ultimately, the Department of Communications wants to get 2,000 more firms trading online over the next two years.
Minister Pat Rabitte said the cost of the scheme will be included in Budget 2014 this October.
“Many of our schemes have ceilings but this is one that if demand exceeded expectation, it would be a good thing…Performance will definitely shape the future of it. It is amenable to tweaking.”
The scheme, which will be trialled with 50 companies in Dublin before being rolled out across the nation, will be managed by local enterprise offices.
Currently, just shy of 23 per cent of SMEs in Ireland trade online but 73 per cent of the €3.7 billion spent by Irish consumers online last year leaked out of the economy.
Speaking in Leinster House yesterday, Rabbitte said the leakage out of Ireland cannot be stopped completely, but it can be competed with.
The government is in the process of recasting the economy and a digital strategy is needed as part of that task, continued the Labour TD.
Ireland is not getting back “the good old days” of construction jobs and high tax takes, he said. “We’re never going back there…that is an economy of the past.”
According to his department, the government has not been successful in grasping digital opportunities despite the presence of many leading ICT players and a digitally-literate workforce.
“An uptake of 23 per cent is frankly disappointing,” he said, noting that small companies utilising and exploiting all technological advances available to them can double growth, output and employment.
The Minister believes there is some reticence on the part of the SMEs because they are already dealing with recession, tight budgets and bureaucratic red tape.
“They do not see technology as an enabler to grow. It is about persuading them of the advantages of the technologies…Some evangelising may be needed.”
Non-liners?
The National Digital Strategy also aims to halve the number of ‘non-liners’ (people who have not yet engaged with the Internet) by 2016. Data examined by the department shows that almost one in five adults – that is 577,200 people – have never used the Internet. Almost three in ten who do use it, do so less than once a week.
Rabbitte noted that there are some concerns with connectivity but neither availability or cost of broadband are the main barriers to access. However, he did recognise that digital exclusion can become a problem is the issues that lead to it are not addressed.
“There is a regular trickle of complaints from rural Ireland in regard to poor broadband connections but it ought to be, at least of similar concern, that there is perfectly fine connectivity and the uptake isn’t what it should be.”
According to Rabbitte, women have generally been more responsive digital skills training courses than men but all demographics will be targeted as part of the strategy, including older people and those with a lower level of education.
Other strands of the first phase of the NDS include education and e-learning initiatives and cross-government measures.
The next iteration will focus on other issues, including trust and confidence, cloud computing, copyright, open data and privacy.
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What a complete waste of money, this is going to be a bonanza for dodgy fas trained web designers putting up lame websites for dog groomers and hairdressers. Any business that has a genuine online business model should invest in their own business. Instead of a grant why not a low interest loan?
Joe, I have grown a business from 1 employee to 14 without any financial backing over the last few years, so I feel qualified to comment here. First off, I think this is an excellent idea – for a small business this would be a huge help. Businesses NEED to be on the web these days, but it does cost about 2500 for the most basic decent web presence (unless you are a web designer yourself). Small businesses don’t have that kind of money. It’s a vicious circle. You know you could increase sales (way more than 2500 per year) with a good web presence, but you don’t have the spare money to get one and the banks won’t lend it to you unless you are buying something tangible that they could repossess if they had to. Websites do not fall into this category.
Second, there’s nothing wrong in Fas trained people. Whenever I hear people talking down FAS training, I know they have never employed anyone who has completed a fas course. It’s an unfounded prejudice with no basis in fact, you are merely quoting “bloke down the pub says…” and it doesn’t reflect well on you. I’ve employed 4 fas trained people and they are excellent.
Having said all that, yes, I think the idea of a low cost loan, with a long repayment period is a fair compromise, though.
I agree with most of your points Andy, but I think Joe is talking about FAS trained web designers. I am a web designer myself and I agree with him that a course in web design with FAS doesn’t make you a designer. You might learn how a website can be created, mostly with outdated software and techniques, but the design part is not taught. This results in pretty ugly bloated websites.
IT Developers can not be got at the moment, lucky for them they are flat out if they are good.
Good sentiment here but poor execution again. Grants are a joke. We need on the ground assistance, less red tape and a lowering of costs for doing business.
This is like what FF did in the 90s &00s horsing out grants to build and worsened a “building bubble”. IT Developers will do as the builders did and jack up prices.
I wonder if an IT lobby had anything to do with this decision??
Oh I am getting very cynical about politics in this country.
Andy I have what I believe to be a brilliant web based business idea but cannot secure funding to get it off the ground,as a man who seems to know about such things what would you recommend my next step to be? Thanks in advance.
John, I’m working on a few ideas online myself at the present with a business partner. There are ways of doing it cheap. Drop me an email if you’re interested, darrenoceall@gmail.com
Use open source software, dip into your own pocket and start designing.
John, try kickstarter. Crowd funding is really taking off. Either that or talk to enterprise Ireland about their hpsu (high potential start up) programme. Good luck.
Why not cut real business costs for us like rates! If 2,500 was gone off my rates bill this year it would be a start! Government please start listening to small business’s, we are on our knees. Asking business’s who don’t have a shilling to spare to “match” any money invested by government is down right insulting at this moment in time, as we struggle daily to pay government induced costs. We need urgent incentives that mean something, not watery options like this were only a few will benefit!
Lets face iy it looks better for Rabbitte to be seen givng out (taxpayers) money than cutting rates and sorting out restrictive rent contracts.
Your rates aren’t set by central government they’re set by your local authority.
In the meantime at Enda’s breakfast table…eur 50 tax for every new domain plus we can create the mb tax, that works out at…
Once the money is handed over to a damn good web designer or developer then I think it’s a great idea for small business. Portfolio and good testimonials/refererrals can help you find the right developer or else It’s money down the drain.
Seconded.
People with MONEY to purchase products, thats what small business requires.
A business owner that needs to be incentivised to get online, is not a business owner that should be in business.
I just find it incredible that just 37pc of SME business in this country use the internet and now they are being subsidised by the taxpayers with a grant to do do,i have used it for years and im nearing 70,and would find life impossible without it, as would most people,as i say it just beggers belief.
sPEND IT IMPROVING THE BROADBAND NETWORKS OUTSIDE OF DUBLIN, THEN MAYBE A BUSINESS CAN ACTUALLY GET ONLINE TO SET UP A WEBSITE!
Super idea! Good move by the govt!
You really must be stupid.
Hey Brian,
Take your negative comments and name calling some place else. If you have a counter suggestion on how the govt can assist small companies I would love to hear it.
Name calling is for little boys.
Good lad Brian.
It is not name calling its an observational comment, Unlike your back Kenny and Co at all cost reductions contribution.
Kenny has his major faults however this initiative is a great one. To think it is stupid is stupid, are you stupid?
Actually you sentence does not make sense. It’s grammatically poor.
You are correct the word “reductions” should have been “ridiculous”
No counter suggestion then Brian or are you just a negative person who points out faults and doesn’t contribute?
The majority of SME’s are begging for cash flow. Free up cash to assist in this. And not thro the corrupt banking system. Companies like pay pal, visa etc take up to 6 months to forward payments to suppliers from
On line sales. Where is the working capital for even 60 days coming from. No bank over drafts or credit facilities for established SME. What chance a new start venture have???
Support for SME’s. Started a new business, promised before I came off the live register of a grant from my local development office. Went for grant to be told in April I may add that there was no funds left for that grant for the rest of the year. Disgraceful !!
As initiatives go, it’s a step in the right direction, but there is a caveat – and this is not a complaint, but a genuine concern, which I hope will be yielded by even one SME business owner.
I hope there is some vetting involved in sourcing the website designers and developers, before a lump sum is paid out. My fear is that a growing number of template-merchants and hack ‘designers’ will be running (if not sprinting) to cash in on this.
So – please vet any third party based on portfolio, testimonials, ask for ‘links’ to previous work (and how these sites are doing on Google), and an outline of their working process, discuss website warranty etc
A hint; if you receive offers of simply ‘x pages for x€’, this is selling on a template as a commodity, and ‘not’ an invested designer interested in finding a ‘solution’ for your business.
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