Economic Update

Bill Esterson Excerpts

Tuesday 17th March 2020 Commons Chamber

[Rishi Sunak]

My hon. Friend is right that speed is of the essence. The loan programme will be available from early next week. My right hon. Friend the Chief Secretary to the Treasury is doing an excellent job working with the banks to make sure that those applications will be processed at speed, so businesses that need that support will get it quickly.

[Bill Esterson (Sefton Central) (Lab)]

The amount of money announced for the loan guarantee scheme is a massive sum, but will businesses want to be saddled with debt when they have no income and no means of paying it back? Previous loan schemes were poorly taken up because the banks ignored the guarantee part of the scheme, so how will the Chancellor make sure that the loan guarantee scheme is delivered by the banks at the scale and speed needed?

[Rishi Sunak]

I thank the hon. Member for the thoughtful question. He is right to ask about that particular point. He will be pleased to know that, compared with previous loan guarantee schemes, the generosity of the Government guarantees is significantly increased to provide a strong incentive for the banks to provide that lending. We have spoken to all the banks individually specifically on this measure and have their assurance that they will work at pace to deliver it. As a result of our entreaties, they have also unilaterally unlocked £21 billion of their own extra lending capacity to provide to the sector, so I am confident that they will deliver as required.