We are all used to hearing the Great Lord Protector of All-of-Us announcing schemes to save British business from the effects of US sub-prime bank lending-induced recession. And we are used to hearing how successful these have been in reducing the numbers of people that would have become unemployed if they had not been introduced.
But have they really been effective?
Lobbydog has been passed some interesting information by the Conservative Party which sheds some interesting light on what has really happened.
Capital for Enterprise Fund
A £75 million fund to invest in small businesses needing equity, announced on January 14th 2009. Only seven businesses have received money from the fund in its eleven months of operation.
BIS Working Capital Scheme
A scheme pledging £10 billion in guarantees to cover credit to businesses with a turnover of up to £500 million a year, announced January 14th 2009. The Government provides banks with guarantees covering 50% of the risk on existing and capital projects worth up to £20 billion. It was delayed for months, and then agreements were only signed with three banks (RBS, Natwest and Lloyds) for £2 billion, a fifth of the scheme’s original allocation. Rosie Winterton recently announced that the remaining funding for this has been reallocated.
UK Innovation Investment Fund
A £1 billion scheme to invest in innovative business, announced 6 months ago. No investments yet made. It has not appointed a fund manager.
BIS Trade Credit Insurance Scheme
The scheme allows suppliers which have seen trade credit reduced to buy taxpayer-guaranteed ‘top-ups’ worth up to £2 million, announced in April. Some £5 billion in insurance was pledged, but only 72 firms have benefited. Only £13 million – or 0.4% of the £5 billion allocated to the scheme – has been handed out.
BIS Automotive Assistance Programme
The programme involves two forms of help for car manufacturers. One involves guarantees to unlock loans of up to £1.3 billion. The other involves loans or loan guarantees to support up to £1 billion of lending. No loans have been made. A loan was offered to one car firm, but the company rejected because it thought it could get a better deal elsewhere.
So, how credible is it for Brown & Co to claim that they have done more than any previous government to help business ride out this recession? Remember that this a recession that they told us we were in a better position than other countries to survive because of their brilliant management of the economy.
Never trust a Labour Government with your money!
