Cool reception for 'business bank'
A GOVERNMENT plan to provide £1 billion of taxpayer's money to help small and medium-sized businesses that are struggling to borrow from high street banks has been met with a mixed reaction in Gloucestershire.
Under the move, a new "business bank" will be handed the public cash, which should generate up to £10 billion to companies.
Steven Munnoch, chief executive officer of Gloucester-based Avon Metals Ltd, which exports aluminium alloys, scrap and speciality metals, said the news was to be welcomed, but questioned how significant it would be to local business.
"Banks have generally been happy to support well-established and successful trading businesses like Avon Metals, but smaller, younger more entrepreneurial businesses have been less successful in raising credit despite being more reliant on this kind of funding," he said.
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"The proposals seem to represent a step in the right direction, although while £10 billion sounds like a big number, the impact at a local level will not be significant and will take time to filter through to the local economy."
Mark Owen, chairman of the Gloucester branch of the Federation of Small Businesses, said the Government should be concentrating on more important issues.
"There are other problems in the economy they should be concentrating on such as youth unemployment, the budget deficit and helping UK manufacturing," he said.
The state cash, which it is hoped will be matched by private finance, will be found from existing budgets and not require extra borrowing beyond the current spending plans.