Donie's Ireland news BLOG Monday

Ireland’s SMEs sector deserve better recognition and support from the Irish Government  

    

Strengthening the SME sector should be given the same importance as we have always given to attracting multinational investment, writes Chris Martin of Musgraves

There is a somewhat narrow debate currently under way in this country about the importance of multinationals versus small and medium-sized enterprises (SMEs) in establishing a stable and prosperous economy.

A lot has been said about the crucial role that multinationals play in the Irish market and our journey back to economic recovery. The invaluable contribution that they make has been well documented. They provide significant employment and they give support to R&D ventures, infrastructural investment and to skill-base training.

In stark contrast, the critically important role that SMEs play in the vitality of villages, towns and cities around the country is often overlooked.

We need to recognise that it is not a simple case of one versus the other — multi-nationals or SMEs. Many commentators fail to appreciate the fact that SMEs are the lifeblood of our local economy and, by extension, of our national economic heartbeat.

Both multinational investment and a healthy SME sector are of critical importance to our economic recovery — and both should be equally prioritised.

The influential Blueprint report for Ireland’s Recovery was drafted by leading businesses and public figures, places SMEs at the frontline of our economic recovery. We, at Musgrave, also believe in the power of SMEs, and can provide a unique perspective on the multinational versus SME debate.

We are a multinational business with sales of €4.5bn in 2011. Following the acquisition of Superquinn last year, there are now 3,435 stores associated with Musgrave brands in Ireland, the UK and Spain.

In Ireland, our performance is dependent on the success of the 900 SME retailers that we partner. These local retailers own and operate SuperValu, Centra and Daybreak stores in towns, villages and cities across Ireland.

In many ways, Musgrave is a microcosm of how multi-nationals and SMEs together can deliver a strong national economy.

We supply the sourcing, sales, marketing and supply chain expertise that enable these 900 local SMEs to go head-to-head with the international supermarket chains.

Together with these retail partners, we are responsible for almost €6bn of annual economic activity in Ireland. This represents commerce almost exclusively conducted within and between local Irish communities. Musgrave and its retail partners employ almost 29,000 people in Ireland — that’s more than any other single business and more than any other organisation, save the Government itself.

For every one job created directly, cumulatively 0.7 jobs are created indirectly — this indicates that Musgrave and its SME retail partners are responsible for a further 10,500 full-time jobs. This means a total of around 40,000 jobs depend on Musgrave’s multinational/SME partner business.

We talk to hundreds of SMEs around the country every day and, as a result, have an in-depth understanding of the challenges they face in running sustainable businesses. We need to foster an environment that allows local businesses and enterprises to flourish. This in turn creates and sustains jobs.

There are a number of changes that need to be implemented in order to achieve this.

Restore confidence

The retail market in which we operate has changed utterly. In recent years, we have seen a more modest and value-focused consumer emerge. Consumers have less disposable income and are continuing to look for ways to control their spending. They are also saving and repaying debt much more diligently.

A recent report by the UCD Michael Smurfit Graduate Business School and the Marketing Institute of Ireland showed that the personal savings ratio, which includes savings and debt repayment, continues to rise in 2012 and is now around 13 per cent of disposable income.

Consumer confidence is being negatively impacted by high levels of direct and indirect taxation. While we recognise the extreme level of economic realignment that needs to take place and the limited options available to politicians, we must recognise that consumers will simply stop spending if taxation is too high.

More credit for SMEs

The SME sector is being crippled due to a lack of access to capital. To put it simply, not enough lending is taking place. The recent Central Bank report, Irish SME Credit Supply and Demand, Comparisons Across Surveys and Countries, confirms that Ireland has the second-lowest approval level for small business loan applications in the eurozone, just ahead of Greece.

It is critical that this downward spiral is reversed and enterprises and SMEs are provided with the financial support they need to do business. A State-backed enterprise bank should be established as soon as possible.

Lower business costs

The level of costs involved in doing business in Ireland is a barrier to employment and a threat to jobs.

A review of the administrative costs that are influenced or set by Government as well as the cost of locally traded products, such as property and payroll, will be critical to improving the competitiveness of the SME sector — and the Irish food retail market in particular.

If these costs can be minimised, it will be easier and more affordable for businesses to increase their workforce and build and maintain an environment in which businesses can thrive.

Minimise red tape

The amount of red tape that entrepreneurs have to go through in order to set up and run a business in this country is unwarranted and a drain on their limited resources.

This bureaucracy needs to be minimised so as to make it as easy as possible for our entrepreneurs to focus on running successful businesses.

Create an entrepreneurial environment

In these difficult times, the focus can often be on challenges rather than opportunities. Some of Ireland’s finest businesses operating today started in the teeth of the 1980s recession.

Working together, Government and business must encourage those risk-taking entrepreneurs who are the founders of start-up companies around the country.

Capital is key, and ensuring access to seed money for entrepreneurs with viable business ideas should be a priority. However, it goes beyond the simple finances. Business owners need mentoring, support and advice as to how they go about starting and maintaining a successful company. Enterprise Ireland is carrying out good work in this area, and we would like to see this extended and strengthened.

At Musgrave, we have experience from working with Enterprise Ireland, Bord Bia and Teagasc. Through our SuperValu Supplier Development Programme, we identify start-up food suppliers and provide them with a six-month programme of mentoring, workshops, advice and the support they need to develop to a stage where they can achieve a supermarket listing. It has been a hugely successful programme. To date 26 firms have achieved listings.

We see this as a promising example of Government and business working together in a practical, positive manner. It is this oft-referenced ‘joined-up approach’ to the promotion of entrepreneurship that is required on a wider scale.

The Musgrave business model highlights how SME development must become a key driver of growth in Ireland. The national economy is the accumulation of all the local economies in the cities, towns, villages and suburbs around the country; both the local and national are inter-related. We need to recognise that a crucial and sustainable factor in our economic recovery is right here on our own doorstep, and that investing in a better future is actually about supporting Irish entrepreneurs who are the bedrock of local communities.

Our economy needs small businesses that are innovative, ambitious and connected to communities. Our society needs jobs that enable people to live in their own localities. We shouldn’t just wait around for a multinational to come in and create jobs and prosperity to local communities. While foreign direct investment is most welcome, we must also prioritise local entrepreneurs to build a strong platform for future growth.

Reforming Ireland’s constitution a big challenge for Mr Kenny & co

   

This Government came to power offering fundamental reform, declaring that “failures of the political system were key contributors to the financial crisis”. Taoiseach Enda Kenny and Tánaiste Eamon Gilmore spoke of radical, root-and-branch change that would meet the needs and aspirations of the Irish people and a constitutional convention to deliver in that regard. Now, one-third of the way through its term of office, the convention has yet to be established and its agenda is a poor shadow of what was originally indicated.

Last week, Mr Kenny said he hoped to make an announcement about the convention “shortly”. He did so at the launch of a book on Eamon de Valera’s 1937 Constitution that identified the German, French and Polish constitutions that helped to shape it; the political astuteness that directed it and the skilled draughtsmanship that gave it flexibility and endurance. The Taoiseach made no reference to urgent transformation. Instead, he thought it “timely” to look at the 75-year-old document and ask if it met the needs of a modern nation.

The constitutional convention has, however, been denied such terms of reference. Its initial task will be to consider whether the presidential term should be reduced from seven to five years and the voting age from 18 to 17 years. Hardly transforming stuff! After that, the role of women in society, blasphemy and same-sex marriages will be discussed, along with the electoral system.

Recommendations on the latter issue have the capacity to convulse Irish politics. But because one-third of convention members will be TDs, that may not happen. In any event, the Government is not bound to accept any of the recommendations made.

In identifying “failures of the political system” as key contributors to the financial crisis, both Fine Gael and the Labour Party acknowledged that an absence of accountability and the dominance of parish pump politics had damaged the common good. Sweeping success in multi-seat constituencies in the general election appears to have dampened the ardour of both parties for change, even as Fianna Fáil’s electoral collapse brought support for single-seat constituencies along with a list system involving proportional representation.

Down the years, politicians have acknowledged the faults of a system that rewards constituency work at the expense of the national interest. But party considerations blocked reform. Support from Fine Gael and Labour Party TDs at the convention will be needed for change to gain a foothold on this occasion.

Even then, a referendum may not be held because of Government apathy or public opposition. Notwithstanding those considerations, this is the only issue before the convention that offers an opportunity for fundamental restructuring. A referendum to abolish the Seanad is being prepared separately by Government while Minister for the Environment Phil Hogan continues to vacillate over local government reform. So much for a radical approach to participatory democracy and constitutional change!

‘Staggering’ Arctic ice loss smashes melting records

    

The Carbon Market is Growing! Get a Free Carbon Credit Trading Brochure. A report out later is expected to confirm Arctic ice shrank to record lows in the northern summer. 

We are a few hundred miles from the north pole. The air temperature is -3C, the sea freezing. All around us in these foggy Arctic waters at the top of the world are floes – large and small chunks of sea ice that melt and freeze again with the seasons.

Arne Sorensen, our Danish ice pilot, is 18 metres up in the crow’s nest of the Arctic Sunrise vessel. Visibility is just 200 metres and he inches the 1,000-tonne Greenpeace ice-breaker forward at two knots through narrow passages of clear water.

The floes are piled up and compressed in fantastic shapes. Two polar bears on our port side lift their heads but resume hunting.

Sorensen has sailed deep into ice at both poles for 30 years, but this voyage is different, he says.

The edge of the Arctic ice cap is usually far south of where we are now at the very end of the melt season.

More than 600,000 sq km more ice has melted in 2012 than ever recorded by satellites. Now the minimum extent has nearly been reached and the sea is starting to refreeze.

‘‘This is the new minimum extent of the ice cap,’’ he says – the frontline of climate change. ‘‘It is sad. I am not doubting this is related to emitting fossil fuels to a large extent. It’s sad to observe that we are capable of changing the planet to such a degree.’’

The vast polar ice cap, which regulates the Earth’s temperature, has this year retreated further and faster than anyone expected.

The previous record, set in 2007, was officially broken on 27 August when satellite images averaged over five days showed the ice then extended 4.11 million sq km, a reduction of nearly 50% compared with just 40 years ago.

But since 27 August, the ice just kept melting – at nearly 40,000 sq km a day until a few days ago. Satellite pictures this weekend showed the cap covering only 3.49m sq km. This year, 11.7m sq km of ice melted, 22% more than the long-term average of 9.18m sq km.

The record minimum extent is now likely to be formally called later today by the US National Snow and Ice Data Centre (NSIDC) in Colorado.

Record smashed

The record hasn’t just been broken, it’s been smashed to smithereens, adding weight to predictions that the Arctic may be ice-free in summer within 20 years, say British, Italian and American-based scientists on the Arctic Sunrise.

They are shocked at the speed and extent of the ice loss.

The Cambridge University sea-ice researcher Nick Toberg, who has analysed underwater ice thickness data collected by British nuclear submarine HMS Tireless in 2004 and 2007, said:

‘‘This is staggering. It’s disturbing, scary that we have physically changed the face of the planet. We have about 4m sq km of sea ice. If that goes in the summer months that’s about the same as adding 20 years of CO2 at current [human-caused] rates into the atmosphere. That’s how vital the arctic sea ice is.’’

The NSIDC scientist Julienne Stroeve adds: ‘‘In the 1970s we had 8m sq km of sea ice. That has been halved. We need it in the summer. It has never decreased like this before. We knew the ice was getting thinner but I did not expect we’d lose this much this year. We broke the record by a lot.

‘‘The acceleration of the loss of the extent of the ice is mostly because the ice has been so thin. This would explain why it has melted so much this year. By June, the ice edge had pulled back to where it normally is in September.’’

‘Extreme edge’

In the past, Stroeve has shown that ice melt has been happening far faster than the models predicted. Her new research, published last month in the journal Geophysical Research Papers, shows humans may have been responsible for most of the ice loss in recent decades.

‘‘It suggests 60% of the observed decline in ice extent in Septembers from 1953-2011 was due to human activity. The decline is linked to the increase in temperatures,’’ she says.

‘‘This year is significant. At the moment, the [ice extent] is below what the next Intergovernmental Panel on Climate Change (IPCC) report will show in 2014. We are on the extreme edge of the models, suggesting that ice loss is happening much faster than the models suggested.’’

All over the Arctic, the effects of accelerating ice loss and a warming atmosphere are being seen. The ecology is changing rapidly as trees and plants move north, new beetles devastate whole forests in Canada, Siberia and Alaska, and snowfall increases.

Whole coastal communities may have to be moved to avoid sea erosion. With the ice loss has come a rush by industry for Arctic resources. Oil, gas, mining and shipping companies are all expanding operations into areas that until only 20 years ago would have been physically impossible.

Last week, a historic first drilling operation by Shell in the Chukchi Sea off Alaska was halted after sea ice was seen moving towards the oil company’s drill ship.

Jet stream

Other new research suggests that the loss of ice could be could be affecting the path and speed of the jet streams, possibly explaining why extreme weather in the northern hemisphere is lasting longer. From now on until June, the Arctic sea ice will refreeze, growing up to 100,000 sq km a day until the melt season begins again next year.

But, says Toberg, because of the massive melt this year, there will be less old, or multiyear, ice, which is thicker and less prone to melting. The new ice will be more vulnerable to melt, hastening the loss of ice next year.

Now, ‘‘feedbacks’’ are thought to be hastening the ice retreat.

In recent summers, say ice experts, Arctic sea surface temperatures have been well above normal, partly because there is less ice to reflect heat back into the atmosphere.

The darker open waters now absorb more solar radiation, accelerating the melt. The longer term implications of the great melt of 2012 are hard to call, say climate scientists who caution that more research is needed.

Sea ice plays a critical role in regulating climate, acting as a giant mirror that reflects much of the sun’s energy, helping to cool the Earth.

What is suspected is that the formation of the sea ice produces dense salt water which sinks, helping to drive the deep ocean currents. Without the summer sea ice, many scientists fear this balance could be upset, potentially causing big climatic changes.

‘‘The Arctic ice cover is a lid on the planet that regulates the temperature. By taking it off you are warming it. Temperatures depend on it,’’ says Toberg.

Sea ice extent has varied naturally over the decades, with some Russian data suggesting similar or even greater ice loss in some local areas in the 1930s. But the models are clear, says Stroeve.

If you omit the observed records, keeping CO2 levels at pre-industrial levels, then none show a decline of ice cover.

When you do put CO2 into the models, they all show a decline, she says. ‘‘We can expect the Arctic to be ice-free in summer within 20 years,’’ she says. ‘‘That does not mean that natural ice variability cannot bring it back again, but the trend, we think, will be downward.’’

‘‘This is a defining moment in human history,’’ said Kumi Naidoo, director of Greenpeace International in Amsterdam. ‘‘In just over 30 years we have altered the way our planet looks from space and soon the north pole may be completely ice-free in summer.

‘‘Fossil fuel companies are still making profits despite the fact that climate change is so clearly upon us. Our politicians are putting corporate interests above scientific warnings and failing in their duties to the public.’

Researchers believe we could communicate and debate with robots within three years

 

• Researchers say robots and humans could decide on plans together – or even argue the best approach
• Humans could even order robots to break rules – but the robots may argue back

Robots and computers could soon be having meaningful conversations and even arguments with humans, potentially within the next three years.

A new research project at the University of Aberdeen will develop systems that allow men to debate decisions with robots – opening up the possibility of human operators discussing action plans with robots and, if necessary, ordering them to break rules.

While Isaac Asimov fans might baulk at that last possibility – it does open up a world where intelligent technology will make life easier for humans.

For their part, the computers would be able to argue in favour of decisions or inform their operators that certain tasks are impossible.

Lead researcher Dr Wamberto Vasconcelos, from the University of Aberdeen, said the aim is to increase human trust in intelligent technology – and that early versions of the software could be available in just three years.

‘Autonomous systems such as robots are an integral part of modern industry, used to carry out tasks without continuous human guidance,’ he said.

He added: ‘Employed across a variety of sectors, these systems can quickly process huge amounts of information when deciding how to act. However, in doing so, they can make mistakes which are not obvious to them or to a human.

‘Evidence shows there may be mistrust when there are no provisions to help a human to understand why an autonomous system has decided to perform a specific task at a particular time and in a certain way.

If robots gain a form of intelligence, and the ability to dialogue with humans, perhaps the creators should consider implementing the Three Rules of Robotics.

Written by science-fiction writer Isaac Asimov, the rules were meant to iron-clad man’s safety from robots, but as the author’s short stories make clear, the rules are not infallible.

1) A robot may not injure a human being or, through inaction, allow a human being to come to harm.

2) A robot must obey the orders given to it by human beings, except where such orders would conflict with the First Law.

3) A robot must protect its own existence as long as such protection does not conflict with the First or Second Laws.

‘What we are creating is a new generation of autonomous systems which are able to carry out a two-way communication with humans.’

Talking computers with the ability to converse with humans have long been a mainstay of science fiction.

Examples include Hal, the deadpan-voiced computer in the film 2001:A Space Odyssey, which goes mad and sets out to murder the crew of a spaceship.

The system Dr Vasconcelos is developing will communicate with words on a computer screen rather than speech. Potential applications could include unmanned robot missions to planets or the deep sea, defence systems and exploring hostile environments such as nuclear installations.

A typical dialogue might involve a human operator asking a computer why it decided on a particular decision, what alternatives there might be and why these were not followed.

‘It gives the human operator and opportunity to challenge or overrule the robot’s decision,’ said Dr Vasconcelos.

‘You can authorise the computer system to break or bend the rules if necessary, for instance to make better use of resources or in the interests of safety.

‘Ultimately, this conversation is to ensure that the system is one the human is comfortable with. But the dialogue will be a two-way thing. The supervisor might not like a particular solution but the computer might say: sorry, this is all I can do.’

One factor that has to be taken into account is ensuring the computer’s responses do not seem threatening, rude or confrontational.

‘That’s something we’re going to have to look at,’ said Dr Vasconcelos. A psychologist has joined the team to help with this aspect of the research.

Conversing with robots would actually make humans more accountable, since failures could not conveniently be blamed on computer error, Dr Vasconcelos added.

‘With power also comes responsibility. All these dialogues are going to be recorded, so there is a name to blame if something goes wrong. It’s a good side-effect.’

British royals sue Berlusconi group over Kate topless photos

   

Prince William’s wife Catherine on Saturday faced growing embarrassment over topless photos after an Italian magazine said it would follow its French sister publication in printing them.

The British royals launched legal action on Friday against French magazine Closer – which is part of the media empire of former Italian prime minister Silvio Berlusconi – after it published paparazzi snaps of Catherine sunbathing with her husband.

The royal family may have hoped to contain the scandal by swiftly suing Closer – but Chi, an Italian weekly also published by Berlusconi’s Mondadori Group, announced late Friday that it plans to print a special issue on Monday devoting 26 pages to the candid pictures of the former Kate Middleton.

The pictures were taken while she was on holiday with her husband, the second-in-line to the British throne, in France this month.

Closer’s editor Laurence Pieau was quoted by British tabloid The Sun on Saturday as saying her magazine had more pictures that it had not printed yet.

“Intimate pictures exist that we haven’t published and will not publish,” she told the newspaper.

“Probably other newspapers will choose to publish them.”

A version of the front cover of Chi showed some of the photos with the headline “The Queen is Naked!”

“The fact that these are the future rulers of England makes the article more interesting and topical,” editor Alfonso Signorini told reporters.

“This is a deserving topic because it shows in a completely natural way the daily life of a very famous, young and modern couple in love,” he said.

Closer is published under a licensing agreement between Bauer Media and Mondadori, which bought the title in 2006.

Berlusconi, who part-owns the Mondadori Group, is himself no stranger to scandals involving revealing photos taken by paparazzi.

He launched legal action against the Spanish newspaper El Pais in 2009 over pictures of topless women lounging at his holiday villa.

William and Catherine, both 30, are suing Closer for invasion of privacy over the pictures.

The images evoked memories of the press harassment of William’s mother Diana, who died in a 1997 car crash as she was pursued through Paris by paparazzi.

William is believed to blame the paparazzi for his mother’s death.

Palace officials said the royals, who are currently visiting Malaysia, considered the pictures published by Closer to be a “grotesque” breach of privacy.

“Their Royal Highnesses have been hugely saddened to learn that a French publication and a photographer have invaded their privacy in such a grotesque and totally unjustifiable manner,” their office at St James’s Palace said.

“The incident is reminiscent of the worst excesses of the press and paparazzi during the life of Diana, Princess of Wales, and all the more upsetting to The Duke and Duchess for being so.”

Later, the royal family confirmed that “legal proceedings for breach of privacy have been commenced today in France by The Duke and Duchess of Cambridge against the publishers of Closer Magazine France”.

Pieau has insisted Closer has no regrets about printing the pictures.

“These photos are not in the least shocking. They show a young woman sunbathing topless, like the millions of women you see on beaches,” she told AFP.

Closer said the pictures were taken on the terrace of the Autet Chateau in Provence, southern France. The magazine said the chateau is owned by Viscount Linley, the son of Queen Elizabeth II’s late sister Princess Margaret.

The palace said the royal couple “remain focused” on their tour of Singapore, Malaysia, the Solomon Islands and the tiny Pacific island of Tuvalu to mark the diamond jubilee of William’s grandmother Queen Elizabeth II.

The pictures are a further headache for the royal family, following the publication last month of nude photos of William’s younger brother Harry in a Las Vegas hotel.

Comparing the pictures to those of Harry cavorting naked with a mystery woman as he played strip billiards, the magazine said: “Here there is no question of alcohol, of strip billiards or compromising positions, but simply a spouse at ease with her body, who has nothing to hide from her husband.

“Moments of grace, of complicity. Of love in its purest. Images of cloudless happiness.”

Rupert Murdoch’s top-selling British tabloid The Sun, the only British paper to publish the pictures of Harry, said it would not print the photographs of Catherine, and there was no sign of any other British publication doing so.

“The Sun has no intention of breaching the royal couple’s privacy. The circumstances are very different to those relating to the photos of Prince Harry in Las Vegas,” editor Domini Mohan said.