A large portion of the Autumn Statement this year was geared towards businesses, helping them to secure finance, encouraging investment and reducing the business charges payable.
The measures include credit easing in the form of the National Loan Guarantee Scheme. A pot of £40 billion will be allocated, with £20 billion made available initially. The money will be used to allow the Government to guarantee loans to small businesses, therefore reducing the interest rate payable. On average, this scheme will reduce the interest rate payable by one per cent.
In addition, medium-sized businesses will benefit from a £1 billion Business Finance Partnership, that will invest in funds that lend to such firms.
Of particular significance for investment in businesses was the new Enterprise Investment Scheme, which will provide 50 per cent tax relief to investors who choose to invest up to £100,000 in a qualifying new start-up business.
The Regional Growth Fund boost of £1 billion will also benefit businesses, supporting projects and programmes that lever private sector investment.
Meanwhile, some enterprise zones will get 100 per cent capital allowances, while the one year holiday on business rates for small businesses, which was due to expire in October 2012, was extended for a further six months.
The measures have been welcomed by business bodies. John Cridland, CBI director-general said: “The National Loan Guarantee scheme is a necessary pre-emptive strike to safeguard bank lending to SMEs. With the pressure on bank balance sheets, this is practical and immediately available help.”
While of support for medium sized businesses he said:”We are delighted that our campaign to gain support for medium-sized businesses has been heeded and we warmly welcome the Business Finance Partnership and measures to support exports.”
