Start-up Loans

Lord Stoneham of Droxford Excerpts

Wednesday 20th November 2013 Lords Chamber

[Lord Stoneham of Droxford (LD)]

My Lords, the shortfall in business investment is the biggest problem facing the economic recovery. I welcome this announcement of increased support for small business loans but recognise that it is one of many channels required to stimulate investment in small business. I have three questions. Are the Government sure that enough is being done to mentor, support and help networking for business people to take full advantage of these schemes and are they doing their best to make these schemes as simple as possible? Are technical and further education colleges being made the focus for small business development and for courses on how these loans can be used and how specific small businesses can take advantage of them? As well as technical and further education colleges, universities should be involved in this as well. Are the banks, particularly the state-regulated banks, being pressurised to redevelop their local and regional systems and get back to their historic original role of helping local businesses?

[Lord Popat]

My Lords, on business investment, I am pleased to say that there is a return of consumer and business confidence in the economy. Bank lending to businesses is going up. In fact we had a large increase in gross domestic lending to businesses in the past 12 months, a lot more than we had in the early part of 2012. Although net lending has dropped compared with the peak of 2008, it has just started to increase, so there is some business confidence and that will help business investment, which will help our growth. As I mentioned yesterday, our growth forecast has gone up from 0.6% to 1.4%, which is good news. With regard to bank lending, we have a large number of schemes. Once again, we are marketing very strongly awareness of these schemes, which will enable a number of businesses to borrow money and grow further.