Oral Answers to Questions

Chris Evans Excerpts

Tuesday 21st June 2011 Commons Chamber

[Danny Alexander]

I can certainly confirm that we will not repeat that mistake. We have all seen the document entitled, “We’ve spent all this money, but what have we got for it?” It is very important that this country maintains the spending plans we set out in the spending review, in order to deliver the deficit reduction that this country needs to establish confidence in our economy.

[Chris Evans (Islwyn) (Lab/Co-op)]

7. What assessment he has made of trends in bank lending to small businesses in the first quarter of 2011.

[The Financial Secretary to the Treasury (Mr Mark Hoban)]

Under Project Merlin, the banks loaned a total of £47.3 billion to UK businesses in the first quarter of 2011, including £16.8 billion to small and medium-sized enterprises. The Government are encouraged that banks are broadly on target to meet their overall commitments. However, it is disappointing that banks are behind schedule on SME loans, and they clearly need to do much more work to deliver on their commitments.

[Chris Evans]

A number of small businesses in Islwyn tell me they have experienced an increase in the overall interest rate charged by banks, despite the base rate being at an all-time low. What are the Government doing to address that?

[Mr Hoban]

We must ensure that banks signal to businesses that they are open for business and that they have the capacity to lend to businesses. That is why we work with the banks to deliver Project Merlin, but, as I have said, there is more work for the banks to do to ensure they lend to small businesses, and we will continue to hold them to account on that.