To ask Her Majesty's Government what assessment they have made of the increase in the availability of bank finance to businesses as a result of the recent reductions in the bank rate. [HL594]

To ask Her Majesty's Government whether they will encourage banks and other financial institutions to increase the finance they have available to lend to businesses by borrowing from the private sector at reasonable rates and over long periods. [HL595]

Decisions by the private sector on whether and how to raise bank finances are matters for private sector businesses and lenders. The recent cuts in interest rates announced by the Bank of England's Monetary Policy Committee are expected to have a positive effect on inter-bank lending and credit markets more generally. As credit conditions ease, the banks should pass on savings to their customers wherever they can. The Chancellor has met with the CEOs of the major UK banks to make this clear.

On 14 January 2009, the Government announced a package of support to address the cash flow, credit and capital needs of smaller businesses. This package implements and builds upon the commitments the Government made in the Pre-Budget Report. Details are available at www.businesslink.gov.uk/realhelp/finance.

On 19 January 2009, the Government also announced a package of measures designed to reinforce the stability of the financial system, to increase confidence and capacity to lend, and in turn to support the recovery of the economy. Details are available at www.hm-treasury.gov.uk/press_05_09.htm.