Business Lending Package, Too Late and Too Little

Guido’s main concern about the Tory plan to insure bank-to-business lending was that it would encourage risky lending in a failing economy. The lenders would not really have to worry too much about the risk because the taxpayer would pick up the tab. The government’s scheme will provide banks with guarantees covering 50% of the risk on existing and new working capital up to £20 billion. It shares the risk between the banks and the taxpayer, encouraging the banks to lend for the same profit for half the risk. This is in some ways smarter than the Tory plan.

The small business component is for a £1.3 billion of bank loans with a government guarantee of 75% to cover working capital. Presumably this is to reflect the riskier nature of small business lending. This is a drop in the ocean and will barely be noticed. We are six months into the credit crunch. The options were admittedly not very palatable. Why did it take so long to put a plan into place? Could it be Mandelson wanted to get the politics right to fit his timetable of spin? No rush..



Tip offs: 0709 284 0531
team@Order-order.com

Quote of the Day

Shadow Education Secretary Angela Rayner:

“We have no plans to write off existing student debt.”

Sponsors

Guidogram: Sign up

Subscribe to the most succinct 7 days a week daily email read by thousands of Westminster insiders.
Davis Accepts Donations from Top Blairite and TV Remainer Davis Accepts Donations from Top Blairite and TV Remainer
BBC #NotOnTheList Stars Paid Via Production Companies BBC #NotOnTheList Stars Paid Via Production Companies
Pants-Wearing Councillor Boasted He Had “Vaz in My Right Pocket” Pants-Wearing Councillor Boasted He Had “Vaz in My Right Pocket”
Champion: ‘Not Possible’ to Keep Student Debt Promise Champion: ‘Not Possible’ to Keep Student Debt Promise
BBC Rich List Revealed: Salaries In Full BBC Rich List Revealed: Salaries In Full
Torbynista Greening Loses Fight for New Money Torbynista Greening Loses Fight for New Money
New Labour Spinner Boasted of Bullying Angela Eagle New Labour Spinner Boasted of Bullying Angela Eagle
Remainers Behind Smears and Negative Briefings Remainers Behind Smears and Negative Briefings
Sunday Shows Sunday Shows
Byline Fined For Defamation in First Impress Ruling Byline Fined For Defamation in First Impress Ruling
Freedom From Abuse Not Abuse of Freedom Freedom From Abuse Not Abuse of Freedom
Milne & Blonde Pictured in Restaurant Milne & Blonde Pictured in Restaurant
Corbyn Spends Evening With Assad Loving Genocide Denier Corbyn Spends Evening With Assad Loving Genocide Denier
Osborne Defends Blackrock’s Investment on Front Page Osborne Defends Blackrock’s Investment on Front Page
Taylor Review Hijacked by Union Sock Puppets Taylor Review Hijacked by Union Sock Puppets
Assange Lawyer Named as Milne’s Mystery Blonde Assange Lawyer Named as Milne’s Mystery Blonde
The Great Fairtrade Scandal The Great Fairtrade Scandal
Stewart Jackson Tapped for Davis Job Stewart Jackson Tapped for Davis Job
Robbie Gibb New No 10 Comms Chief Robbie Gibb New No 10 Comms Chief