Toby Perkins MP, Labour’s Shadow Small Business Minister, commenting on today’s British Banker's Association High Street Banking statistics for December, said:
“It is worrying that at a time when the government should be doing all it can to help firms grow, lending by the high street banks to business has fallen back significantly. This comes after the Bank of England confirmed last week that lending to SMEs contracted between April and November 2011.
“The Government has done too little to get the banks lending to business, in particular small and medium sized enterprises. Their Project Merlin deal has failed to get credit flowing, with net lending to businesses contracting in nine of the past twelve months.
“While firms up and down the country are struggling, we are still waiting for details on how credit easing will operate and when it will be up and running.
“For Britain to get back to growth to reduce the deficit, we need more people setting up, growing and working in businesses, but firms are struggling to get the finance they need to start up and expand and business owners are too often forced to rely on personal finance.
“Labour’s five point plan for jobs and growth would get the economy moving again by giving a tax break for all small firms taking on extra employees and temporarily reversing the Government’s damaging VAT cut.”