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Clegg pledges £250m extra for business lending | Clegg pledges £250m extra for business lending |
(about 7 hours later) | |
The government has pledged to put an extra £250m into the British Business Bank in a bid to help small and medium-sized companies benefit from the economic recovery. | The government has pledged to put an extra £250m into the British Business Bank in a bid to help small and medium-sized companies benefit from the economic recovery. |
Deputy Prime Minister Nick Clegg said the money, coming on top of £1bn last year, would allow greater funds for investment and taking on staff. | |
The bank, to be backed by government guarantees, will be based in Sheffield. | The bank, to be backed by government guarantees, will be based in Sheffield. |
Mr Clegg, an MP in the city, promised to do "all we can" to help firms. | Mr Clegg, an MP in the city, promised to do "all we can" to help firms. |
But Labour says the government's austerity package has damaged growth and that ministers have not done enough to ensure banks lend enough to small and medium-sized businesses. | But Labour says the government's austerity package has damaged growth and that ministers have not done enough to ensure banks lend enough to small and medium-sized businesses. |
The British Business Bank is in the process of being set up by the Department for Business, Innovation and Skills, and says it expects to generate more than £500m in new lending and investment for the UK's smaller businesses each year. | The British Business Bank is in the process of being set up by the Department for Business, Innovation and Skills, and says it expects to generate more than £500m in new lending and investment for the UK's smaller businesses each year. |
'Working hard' | 'Working hard' |
Mr Clegg's announcement comes ahead of Thursday's Autumn Statement, in which Chancellor George Osborne will present the government's plans for the economy and growth predictions from the independent Office for Budget Responsibility. | Mr Clegg's announcement comes ahead of Thursday's Autumn Statement, in which Chancellor George Osborne will present the government's plans for the economy and growth predictions from the independent Office for Budget Responsibility. |
He is expected to curb business rates as part of the package, as well as outline plans to reduce household energy bills. | He is expected to curb business rates as part of the package, as well as outline plans to reduce household energy bills. |
Mr Clegg will say the British Business Bank will be able to leverage the capital and use government guarantees to lend much higher sums. | Mr Clegg will say the British Business Bank will be able to leverage the capital and use government guarantees to lend much higher sums. |
He and his fellow Liberal Democrat, Business Secretary Vince Cable, are due to outline the plans in more detail on a visit to a small business in west London later on Monday, | He and his fellow Liberal Democrat, Business Secretary Vince Cable, are due to outline the plans in more detail on a visit to a small business in west London later on Monday, |
Mr Clegg said: "Small businesses are working hard to fuel our recovery and help us build a stronger economy. | Mr Clegg said: "Small businesses are working hard to fuel our recovery and help us build a stronger economy. |
"I am determined that we do all we can to help companies that have struggled to get the investment they need - investment that means they can employ those extra people, take on that new order, and buy new equipment." | "I am determined that we do all we can to help companies that have struggled to get the investment they need - investment that means they can employ those extra people, take on that new order, and buy new equipment." |
Last week, The Bank of England announced significant changes to the Funding for Lending Scheme because of the surging housing market. | Last week, The Bank of England announced significant changes to the Funding for Lending Scheme because of the surging housing market. |
Governor Mark Carney it would no longer be aimed at householders but would be focusing instead on business lending from January. | Governor Mark Carney it would no longer be aimed at householders but would be focusing instead on business lending from January. |
For Labour, Chuka Umunna, shadow business secretary, said the government "has failed to get lending going to businesses, in particular smaller firms, with business lending falling by more than £12 billion in the last year". | |
"Now into their fourth year in office, scheme after scheme trumpeted by Ministers has failed to significantly improve access to finance for our wealth creators. | |
"Labour is backing plans for a proper British Investment Bank supported by a network of regional and local banks so that firms across Britain can get the finance they need to invest and grow." |
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