The banks are ‘completely failing small businesses’ and must reappoint local Branch managers again, says Neath MP Peter Hain.
Speaking to a meeting of the Swansea Bay Federation of small Businesses in the Castle hotel, Neath, Mr Hain said that official statistics showed over 40 per cent of small businesses applying for loans were turned down. ‘Instead of supporting business to invest and create jobs like happens in Germany and other more successful economises, the banks are starving them of finance.”
Mr Hain said: “Surveys consistently show that small business owners believe access to finance is the biggest barrier to them growing their business. Labour will create the British Investment Bank, its priority will be investing to SME’s and it will be vital to helping develop a localised network of investment banks across the country.”
“Coupled with the Green Investment Bank it will help spearhead the recovery away from the South East by developing expert localised business knowledge to work with SMEs.”
The former Secretary of State suggested a number of measures which he felt would combat the disconnection he identified as occurring between centralised money lenders and the local business communities of South Wales, including having local branch managers able to lend substantial amounts of money to local businesses.
Mr Hain told the audience: This has been a problem and a dangerous game since 2010, it leaves our SMEs struggling with rising costs, yet they employ around 60% of the private sector workforce, more has to be done to not only help them survive but to grow and prosper.”
He continued by saying: “The next Labour government has a range of initiatives which will help small businesses, we will freeze energy bills until 2017, benefitting 2.5 million small businesses, saving them £1.5 billion in total.”
“We will cut small business rates in 2015, and freeze them in 2016, we need to place priority on small businesses in stark contrast to this government which is giving a corporation tax cut to the largest firms, a measure which only benefits the major urban areas.”
Mr Hain was also keen to highlight the successes of Welsh Government in helping support SMEs through better access to funding, he said: “During the past year Wales has launched the Wales SME Fund, which will give £40 million to SMEs, it is expected to create over 4,000 jobs.”