Business groups call for changes to government support schemes

A joint statement by five leading business groups calls for changes to government schemes meant to help companies get access to finance, the BBC have reported.

The joint proposal came from the the Federation of Small Businesses, the Institute of Directors in Scotland, the Institute of Chartered Accountants of Scotland, the Scottish Chambers of Commerce and the Scottish Financial Enterprise.

It called for improved communication of the finance guarantees the UK government is willing to make available to banks to support lending to companies.

They also want the threshold threshold of the Business Growth Fund to be lowered to £2m, as it currently allows banks to take an equity stake of between £2m and £10m in companies with turnover of at least £10m.

This would bring many more small and medium-scale enterprises (SMEs) into the scheme.

They also suggested changes in the Enterprise Investment Scheme, which encourages long-term equity finance, saying it would help if it also supported short-term financing, making it more attractive to individuals to invest in firms through the scheme.

The joint statement by business groups called for the Scottish government to direct its £94m Scottish Loan Fund fairly towards companies with growth or export potential, rather than skewing it towards particular sectors.

Holyrood ministers, they said, should produce data on Scottish Loan Fund applications received, accepted and rejected, and on the cost of administering the fund through investment company Maven Capital Partners.
The fund was set up in February.

David Wood, of the Institute of Chartered Accountants of Scotland, said: "Our organisations are committed to working with government and the banks to improve the outlook for businesses across Scotland and the UK."

Further information:
BBC