STATE bodies which are charged with supporting small firms are absorbing substantial sums of taxpayers' money but are giving little in return, it has been claimed.

The Small Firms' Association (SFA), which made the claim, wants the Minister for Enterprise and Employment, Mr Bruton, to review such bodies.

SFA director, Mr Brendan Butler, said it cost £100 million annually to fund over 700 jobs at Forbairt. Forbairt was Ireland's premier support agency "on paper" but in reality it was precluded from assisting 98 per cent of Ireland's small companies.

Mr Butler said that under the Industrial Development Act, 1993, Forbairt could only assist companies engaged in manufacturing or internationally traded services.

"The largest sector of the small business community, i.e. the services sector, has no access to Forbairt's services," he said.

Forbairt no longer catered for firms employing less than 10 people as this remit had recently passed to the County Enterprise Boards.

"Ninety per cent of Ireland's businesses employ less than 10 people," he said.

The argument put forward by the Government for denying small service sector firms access to support mechanisms was displacement - i.e. supporting one service sector company would threaten the viability of another with no net gain in employment.

He said statistics showed this argument no longer held. By 2000, services sector employment is projected to be more than twice that of the manufacturing sector and seven times the agricultural sector.

"The SFA is calling on the Government to give Forbairt full access to all small firms, irrespective of sector," he said.