Calls for urgent help for small firms

SMALL business leaders are urging the government to help the region’s struggling firms.

The Federation of Small Businesses is calling for range of measures to rescue many companies including easy access to the recently announced £4bn European Investment Bank (EIB) loans.

The FSB said small firms in the North West were in desperate need of new funds, with one in three saying they had problems accessing credit from banks. While money from the EIB is welcome, there are concerns it will not be practically available before spring 2009.

As part of its survival package, the FSB would like to see the Government free up access to its £125bn procurement budget for SMEs. A recent report by the Federation found that  50% of small businesses do not apply for public contracts due to the complicated application procedure.

It is also calling for an end late payment to small firms by big businesses through fining and naming and shaming companies who renege on registered payment terms.

Paul Henly, FSB North West policy manager said: “EU money is often announced amid much fanfare but gaining access to it can be nigh-on impossible for small firms faced with a labyrinth of red-tape. The easiest way to get it where it’s needed is via agencies like the NWDA. 

“We also need to see the Government exercise all of its power to end the ludicrous situation where large companies are getting away with breaking payment terms. And let’s not forget that small firms need fair routes to public sector contracts in order to put money back into the local economy.

“In the recession of the 1990s, an average of 1,000 small businesses closed every week. It’s vitally important that they aren’t overlooked today – don’t forget that they employ almost 60 per cent of the private sector workforce.”