Confidence is key to growth, minister told
THE Small Firms Association (SFA) has told new minister for small business John Perry that he needs to restore confidence to the sector urgently.
Association chairman Ian Martin told Mr Perry a number of measures needed to be instigated urgently if small and medium enterprises (SMEs) were to regain their confidence at a time when the sector was continuing to struggle.
The SFA wants a loan guarantee scheme to be implemented as soon as possible to improve access to credit. It says sensible regulation is also needed.
"It is critical that the restoration of access to credit is created for small firms along with restoring confidence to the economy. The Government also needs to reduce business costs if firms are to survive, grow and create sustainable employment," said Mr Martin.
"Many viable small businesses lack two key ingredients to access financial support from the banking system. They lack collateral because of the property bubble collapse and associated high negative equity and they lack a good track record over the past two to three years because of the recession, loss of consumer confidence and spending at home."
"The banks are commercial entities and will not move from risk assessment criteria about what is a viable business and, therefore, we require urgent government intervention to bridge this gap.''
A competitive environment must be created through tackling energy costs, local charges, the regulatory burden and waste and water charges, added Mr Martin.