Good news for local businesses
We know that local businesses are struggling.
They will tell you that high taxes, endless regulation and paperwork and of course less money in local buyers' pockets, are creating a "perfect storm" of difficulties for our local small businesses and shops. They are cutting overheads, and hoping for an improved environment.
Meanwhile, the banks may not be paying much to depositors, but borrowers still have high financing costs and more challenging credit terms to negotiate. There seems to be plenty of money sloshing around the large banks (some now nationalized) but very little to support the businesses that need help.
So I was delighted to hear about a new initiative form East Sussex County Council that goes straight to the heart of providing finance for local businesses. The county council has entered into a partnership with NatWest to make it easier for local businesses to get the loans that they need to get through this recession.
It has agreed to provide a deposit of 20million out of normal cashflow to NatWest to enable the bank to increase the amount of money available to local firms.
There is no risk to the county council, and therefore us tax-payers.
They are providing "liquidity" to the bank, to allow them to have the funds to make the much needed loans.
There is no transfer of risk to the county council. It supports the stated desire of NatWest to make the necessary loans, by actually increasing the finance that they can draw on.
East Sussex County Council is to be congratulated on an innovative and thoughtful way of trying to help our local businesses. By taking this step, NatWest will be more likely to make the much needed loans.
Conservatives have been saying for a while that we need a National Loan Guarantee scheme to stimulate lending to our businesses.
In the absence of a national scheme this local one should help our businesses, and therefore local employment.
Good news – let's hope it provides the much needed local support to get through the recession.
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Weather for St Leonards-on-Sea
Friday 25 May 2012
Today
Sunny
Temperature: 11 C to 24 C
Wind Speed: 22 mph
Wind direction: East
Tomorrow
Sunny
Temperature: 12 C to 22 C
Wind Speed: 14 mph
Wind direction: East
