The statement I have laid before the House today details recent progress, including the appointment of individuals to chair the bank’s advisory group and lead work on the institution’s design. Good progress is also being made on designing the bank’s interventions. To that end, my officials have been engaging closely with challenger banks, non-bank lenders, the main high street banks, financial advisory firms and financial services representative bodies.
Although I welcome the Chancellor’s commitment to funding the business bank quickly, in contrast to the 13 years of boom and bust under the last rotten Labour Government, will the Secretary of State reassure me that this measure, together with others, such as lending funds to businesses, will do much to reassure local businesses, given the challenges they currently face?
Of course I recognise that the borrowing position for many small companies dealing with the banks remains difficult. The evidence suggests that the funding-for-lending scheme that the Chancellor introduced is having a significant impact, and the British business bank will significantly improve the level of finance available to British businesses, especially SMEs.
My constituent Sally Hares runs a business, Hare’s Moor, which repackages fresh products for making curries. She cannot access a loan of £5,000 for a repackaging machine. Will the Secretary of State meet her to find out which fund she can access so that she can grow her business?
I will certainly ensure that the hon. Lady and her constituent get good advice on the range of opportunities available to them. This is somewhat removed from the immediate concerns in establishing the bank, but she legitimately raises an important issue; many small companies cannot get credit.
The small business bank provides the last chance for this Government to take meaningful action that could ensure the vital flow of cash to Britain’s small businesses. The reality among the small businesses that I speak to is that they do not have any of the confidence that the Secretary of State seems to be exuding about the access to finance that is out there. There is a worrying lack of urgency and clarity about the Government’s plans. Will he publish a timetable for the establishment of the business bank and update us on progress with all the main elements that will need to be in place, such as when it will apply for a banking licence, when lending will begin, and when state aid approval will be sought?
There is certainly no complacency. We recognise that there is a very serious problem that ultimately resulted from the collapse of the banks in 2008-09, which has had devastating long-term consequences, and we are seeking to address that with a variety of interventions. There are positive things, including the emergence of challenger banks. When the advisory group meets early in the new year we will set out a detailed plan of action, including dates and objectives. I am happy to brief Labour Members when we have concrete detail.