13. What recent assessment he has made of the level of bank lending to businesses since May 2010. (905056)

Net bank lending to business in the UK fell sharply following the financial crisis. The Government have acted decisively to stimulate lending, introducing schemes such as funding for lending and the British business bank. Against that backdrop, the picture has now begun to improve and the most recent figures from the Bank of England show that gross lending to small businesses has increased steadily since 2012.

Those were not the figures released last week, which show that net lending to small businesses in Britain fell by £435 million between April and June. That followed a decline of £720 million in the first quarter. Two years on, has not the funding for lending scheme failed Britain’s small businesses?

No. The hon. Gentleman is completely wrong. The funding for lending scheme has undoubtedly made more credit available than would otherwise have been the case. As I have said, gross lending to businesses has improved and the Federation of Small Businesses has said that the outlook for small and medium-sized enterprises is now better than it has been before. I remind the hon. Gentleman that the peak-to-trough drop in GDP between 2008 and 2009 was 7.2%. That is the cause of the disastrous drop in the availability of bank funding to businesses in this country.

Bank lending is particularly important for new businesses. Will my hon. Friend join me in congratulating the record number of business start-ups—a staggering 1,965—in Brighton and Hove last year?

I am grateful to my hon. Friend for his announcement of what is going on in his constituency. It is fantastic news that so many new businesses are starting up. As we know, that is creating millions of new private sector jobs, and that, of course, is the way for our economy to recover.

19. I hate to contradict the Minister, but Ministers from the Department for Business, Innovation and Skills tell me that they do not think that banks are lending to small business. Could the Minister do even more—I know the Chancellor has done something on this—to encourage crowdfunding as a method of getting more money to start-ups countrywide? (905063)

The hon. Gentleman is quite right: more needs to be done. The problem is not solved. This Government are doing a great number of things to try to help facilitate not only bank lending, but crowdfunding and peer-to-peer lending. We are putting crowdfunding possibilities into individual savings accounts, as the Chancellor announced at Budget time. We are also taking great steps to improve the availability of new challenger banks, to ensure that banks provide postcode-level lending data so that new challengers can look for new opportunities and to ensure that banks share credit histories via credit reference agencies. All those measures are being taken to try to improve the availability of funding to small businesses. There is certainly more to be done and I would be happy to hear any ideas the hon. Gentleman has.