I assure the hon. Gentleman that it is not a matter of my personal disappointment. The Government have announced a number of schemes, which everyone agrees have failed to get lending to the rate that is necessary to have a game-changing effect on the landscape for small and medium-sized enterprises. The employment allowance, which we supported—the hon. Gentleman served on the relevant Bill Committee—came after the national insurance contributions regional holiday, a scheme that was in place for three years and almost from day one failed to meet the ambitious targets that the Government set for themselves. Throughout the life of that scheme, we called on the Government to change course, which they did not do until the scheme came to the end of its three years, at which point they introduced the employment allowance.
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The employment allowance will help SMEs, and has been welcomed by them, but it has come late in the day. We are in the last year of this Parliament. The Government could easily have accepted the failure of the NICs regional holiday scheme and perhaps introduced the employment allowance earlier. We debated that at length some months ago when we were discussing the Bill that brought in the employment allowance. Where they have changed course, the Government have done so late in the day, and where they have not changed course, their schemes are still not having the booster effect that is needed for access to finance for SMEs.
The second area in which SMEs are struggling is exports. The Government set themselves an ambitious target for the increase in exports that they wanted to see by 2020, but we now know that the Government’s two flagship export schemes for businesses announced a couple of years ago are yet to help a single firm. The £5 billion exports refinancing scheme was launched in
July 2012 as part of the Treasury’s UK exports guarantee scheme. At the time, Ministers claimed it would be up and running by the end of 2012, but answers to parliamentary questions reveal that it has not helped a single business and is not yet operational.
The Government’s £1.5 billion direct lending scheme launched seven months ago has not helped a single firm either. So far 15 inquiries have been received and just one firm has put in an application for support under the scheme, which was first announced in the 2012 autumn statement. Both programmes were supposed to help more firms export. Following the failure of the Government’s previous flagship programme designed for the purpose, the export enterprise finance guarantee scheme was abandoned by Ministers after it emerged that it had assisted only five firms.
We know that last year UK Export Finance spent less than a fifth of the £25 billion of financial support made available to businesses. More than £20 billion was left gathering dust in the Government’s coffers. When this record was brought to light, a Government spokesman said that steps were announced in the Budget to make both programmes
“more accessible to small businesses”,
and that the changes would help firms to “realise their export potential”, but the verdict of the Institute for Fiscal Studies was that they were
“relatively small and are unlikely to make a substantial difference to the weak performance of UK investment and exports”.
Media reports have suggested that civil servants are privately admitting that the Government’s promise to get 100,000 new companies, primarily small firms, exporting by the end of the decade is not going to happen.
SMEs have real problems in accessing finance and exporting. They are also struggling with energy prices. This is a topic on which there has been a great deal of debate in the Chamber over recent weeks. We know that energy prices are a problem for businesses as much as for families. Our proposals for an energy price freeze would save the average business more than £5,000. In the meantime, energy prices continue to impose a burden on SMEs.