IDA Ireland has approved funding that equates to almost double that which has been drawn down by companies over the period 2015-2020, according to a spending review carried out by the Department of Public Expenditure.
A series of spending reviews were published on Thursday, including an analysis of the distribution of enterprise supports. It primarily focuses on Enterprise Ireland, IDA Ireland, and Local Enterprise Offices (LEOs).
The review found the level of annual approvals each agency made was greater than the level of payments it made across the years 2015-2020.
This was “particularly the case” for IDA Ireland, where the mean annual approval was €181 million in comparison to the mean annual payment of €96 million.
This means that IDA Ireland was “making close to double the level of approvals relative to the level of payments”, the review noted.
“The annual Exchequer budget is undertaken on a cash accounting basis,” it said. “Therefore it is important for the enterprise agencies to ensure that the appropriate budgetary management procedures are in place when it comes to approvals to avoid any build-up of future liabilities that may exceed the agencies annual budgetary allocation.”
The average annual value of approvals for Enterprise Ireland was €205 million, while the yearly average amount paid out was €176 million. LEOs, meanwhile, approved an average of €18 million in funding, and paid out an average of 12 million.
There was a spike in approvals and payments made by the agencies during 2020. Enterprise Ireland approved 381 million and paid out 245 million, while the IDA approved 213 million and paid out 102 million, and LEOs approved €21 million and paid out €13 million.
This spike in payments was attributed to the increase in agency supports in response to the Covid-19 pandemic.
Guaranteed loans
Overall, 8,491 firms availed of borrowing via State guarantee schemes over the period, accounting for just over €1 billion in approved State guaranteed loans.
Manufacturing was the sector that received most payments across Enterprise Ireland and IDA Ireland (47 per cent). Next was information and communication (21 per cent) and then finance and insurance (21 per cent).
Manufacturing received a greater level of approvals (49 per cent) relative to the proportion of clients (40 per cent) in the sector.
This variance was much more significant for IDA Ireland, where manufacturing received 57 per cent of the value of approvals in comparison to 29 per cent of agencies being in that sector.
In contrast, information and communications receives a smaller share of approvals (23 per cent) relative to its proportion of the client base (30 per cent) across both agencies.
