Government’s economy efforts ‘not enough’

Feb 10 2009 by Karen Dent, The Journal

THE Government’s efforts to stimulate the economy have not done enough, according to a poll of small businesses.

The 4,000 firms quizzed by the Federation of Small Businesses (FSB) found that VAT cuts, bank lending guarantees and pledges on payment practices have had no impact.

More than half of those who took part in the survey said their trade had fallen in the last two months since the Government put together its package of measures designed to help SMEs survive the recession.

And only 8% said their banks were making the Enterprise Finance Guarantee available to them while a fifth said they were still waiting longer than the 10 days the Government pledged to pay public sector contracts within.

Colin Stratton, FSB regional chairman, said: “These startling figures show there is still more to be done by Government and the banks to ensure businesses can survive in this economic climate.

“Small businesses are doing all they can to survive the slowdown but they need better support from the Government, the banks, and the public and private sector.

“The Government must use its meetings with the banks to monitor the guarantee scheme and assess why loans are still being refused, whilst both Government and bank branch managers must do more to promote these funds.

“The small business sector here in the North East is a vital source of employment and turnover for the UK economy, especially during these challenging times.

“These figures show that there is still an avalanche of stumbling blocks stopping this vital sector from surviving and recovering.”