Vince Cable tells sceptical firms that the Business Bank ‘will happen’

Amid a sceptical reaction from trade groups, the Business Secretary denied that the bank would be merely a portal or holding vehicle for other Government funding schemes, reports The Telegraph.

“It will be more detailed than that.” Mr Cable told reporters at the launch of the Coalition’s new industrial strategy. He added: “It will happen. The issue is scale and scope and timing. These still need to be bottomed out.”

Business groups were optimistic that a state-backed bank that could lend money to small businesses could have a significant impact on growth – but only if it were properly executed.
John Longworth, director general of the British Chambers of Commerce, said: “While businesses will be heartened to hear strong support for the establishment of a business bank, this must be more than just a vehicle for existing Government schemes.

“A brand new, fully-fledged business bank is needed to lend to new and growing companies, many of whom report difficulty accessing finance. Companies are clear, though, that nothing less than a ‘full service’ business bank will do – a rebranding exercise for existing Government schemes or one that uses existing bank infrastructure is not enough.”

Mr Cable revealed that Siemen, Sembcorp and Nissan were among 34 companies to have applied for the Employer Ownership Pilot scheme and would share £67m of state funding for vocational skills training.

Dr Karl Ulrich-Kohler, chief executive of Tata Steel in Europe, welcomed Mr Cable’s efforts to boost industry. But he added: “What was missing was the immensely pressing need to remove barriers to growth and to competitiveness that existing and future energy and carbon regulations are imposing on energy intensive industries.”

Mr Cable also confirmed the £1.3bn investment in Britain by IT giant Huawei, which is expected to create 700 jobs.