Oral Answers to Questions

Valerie Vaz Excerpts

Thursday 12th February 2015 Commons Chamber

[Greg Clark]

We have not ignored it. In fact, I had the privilege of attending the Agri-Tech Leadership Council, which involved many of our key players across the food and drink industry and my colleague, the Under-Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for Mid Norfolk (George Freeman) and the Minister in the Department for Environment, Food and Rural Affairs, Lord de Mauley. We met representatives of the industry precisely to plan and implement the strategy that the sector wants to put forward.

[Valerie Vaz (Walsall South) (Lab)]

10. What recent assessment he has made of the availability of finance for small firms and the level of lending by banks to small businesses.

[The Minister for Business and Enterprise (Matthew Hancock)]

Gross lending by the banks to small and medium- sized businesses has increased by 25% over the last year, and recent net lending figures have been positive. This week, my right hon. Friend the Prime Minister announced Help to Grow, to boost scale-up finance, building on the success of our start-up loans.

[Valerie Vaz]

Fine words, but how does the Minister reconcile that with the Bank of England’s money and credit statistics, which say that lending to small businesses has fallen in the last quarter by £1 billion? Too many schemes and not enough action.

[Matthew Hancock]

On the contrary, the gross lending is up sharply—around a quarter over the past year—and there are also greater repayments as businesses that are becoming stronger are able to pay down some of their debts. That means that the net figure has been increasing in recent months. We need to look through the individual figures and see the bigger picture of the expansion. However, there is of course much more to do to recover from the banking crash that occurred in 2008.