Small and Medium-sized Enterprises

Lord Mitchell Excerpts

Tuesday 19th November 2013 Lords Chamber

Asked by

[Lord Mitchell]

To ask Her Majesty’s Government what assessment they have made of the level of financing available to small and medium-sized enterprises.

[Lord Popat (Con)]

My Lords, under this Government credit conditions continue to improve. Survey evidence indicates that more small and medium-sized enterprises are using external finance. Recent data from the Bank of England show that gross lending is continuing to rise year on year and in September reached the highest level since 2009. More broadly, confidence is beginning to return to businesses, which are now more ready to borrow and invest than since before the financial crisis.

[Lord Mitchell (Lab)]

My Lords, yet again I am asking the Government why much needed financial support is not getting through to SMEs. According to the Bank of England, net lending to SMEs was down £600 million in the second quarter of 2013. The answer to the Question is obvious: financing that should be going to small businesses is in fact being used by banks to build up their profitable mortgage portfolios. Does the Minister accept that banks should be backing small businesses rather than helping to create another property bubble?