Only a Business Bank will address gap in business finance

17th January 2014

Commenting on the Labour Leader Ed Miliband's speech on banking reform, John Longworth, Director General of the British Chambers of Commerce (BCC) said: -It is good news that Ed Miliband recognizes the need for a culture of long-term planning and policy, including around the need for improved education and skills in our country.

Businesses across the Britain will be pleased with his focus on access to finance, as many firms find non equity finance hard to come by. Only a fully-fledged Business Bank will address the long-term structural gap in UK business finance and it must be capitalized to lend directly to companies that need it, and not through existing banks. It remains to be seen whether the suggested Business Investment Bank would fulfil these criteria.  -It is important however to recognize that financial services are an important part of our economy in their own right, and if the Labour Leader believes there is a competition issue in the sector, it is right that he should leave this to the Competition and Markets Authority to investigate, free of political interference. As we gear up towards the General Election, economic growth should be the number one priority for all politicians, not short-term point scoring.