Federation of Small Businessses plea for greater lending ahead of next week’s budget
The Federation of Small Business has called on the Chancellor of the Exchequer to address lending in his speech next Wednesday.
The plea from FSB’s East Anglia chairman Robin Twigge comes after an FSB economic report on the first quarter of 2013 found confidence amid small firms has increased, but plans for investment have fallen both due to a lack of access to finance combined with the domestic economy tightening consumer purse strings.
The report, which surveyed 2,686 people in the first quarter of 2013 showed confidence increase from a negative reading of -5.6 in quarter four 2012 to +6.3 in the first quarter of 2013.
However fewer businesses say they expect to grow this year – down from 56 per cent in quarter one in 2012 to 54 per cent in 2013.
“It is great news that confidence is beginning to edge up and is back in positive territory,” said Mr Twigge.
“This bodes well for GDP figures for quarter one and we would expect them to be better than the -0.3 per cent recorded in quarter four 2012. “However, we know that inflationary pressures are likely to persist in 2013, especially through rising energy bills and fuel costs and this will affect disposable incomes.
“Two separate reports last week showed that lending to small firms remains constrained.
“This is something which must be addressed at the Budget.
“A clear plan for the Business Bank must be put in place to increase help ease access to finance and to boost competition in the sector, both through encouraging non-bank lenders such as peer-to-peer lenders to join the market and through new ‘challenger’ banks entering the arena. Regulation has a key part to play.
“Measures must also be put in place to ensure that smaller banks can access the funding available on an equal footing so they can pass on the benefits to their small firms customers.”
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