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Small Businesses

Volume 493: debated on Tuesday 2 June 2009

To ask the Minister of State, Department for Business, Enterprise and Regulatory Reform what recent steps the Government has taken to fund small business growth. (245470)

[holding answer 12 January 2009]: On 14 January 2009 we launched the Real Help for Business measures to support businesses in the current economic climate, building upon the commitments we made in the pre-Budget report on 24 November 2008.

The £1.3 billion Enterprise Finance Guarantee supports lending to viable businesses that would otherwise not be available. As of 13 May 2009, over £375 million of eligible applications from over 3,340 firms has been granted, being processed or assessed.

With respect to the £75 million Capital for Enterprise equity scheme, the appointed fund managers have now made offers totalling around £6 million to four businesses and are continuing due diligence on the further proposals that have been put forward. The Working Capital Scheme, though not available directly to businesses, enables participating banks to increase the amount of working capital they can make available to businesses with a turnover of up to £500 million.

We are also working with UK banks and the European Investment Bank (EIB) to maintain existing lending and make more credit available to SMEs. With the EIB, Government have helped UK banks to negotiate credit lines of more than £1 billion to provide loans to small and medium businesses. In addition the UK is the first country in the world to have negotiated legally binding lending commitments with banks receiving state support. RBS and Lloyds have committed to £39 billion of additional lending over the next 12 months; at least £6 billion of this is to SMEs. Both agreements are already in effect.

Small and medium-sized businesses can find information and support at:

http://www.businesslink.gov.uk/realhelp