Start-Up Loans scheme age cap to be removed
Lord Young, the prime minister’s small business and enterprise advisor, has called on the government to remove the upper age cap on the Start-Up Loans initiative.
Such has been the scheme’s success since its relaunch in January when the upper age limit was raised from 24 to 30, Lord Young has identified it as a pillar of small business support worthy of a greater role.
Speaking to an audience of entrepreneurs and members of the small business community at 10 Downing Street this morning, Lord Young said he hoped to “take the cap off in the next few weeks” for the £117.5m initiative, which will see the size of the fund rise again.
At least 40 new companies a day are being formed having accessed the government-funded loans, chairman of the The Start-Up Loans Company James Caan added.
In total, Caan said more than 4,000 start-up businesses have secured a loan via one of 49 independent partners. Less than a fortnight ago, the official figure had only reached 3,000.
Lord Young’s latest report Growing Your Business: A report on growing micro-businesses, was endorsed today by business minister Michael Fallon, who said “the government is fully behind Lord Young’s report”.
Already announced in the Budget in March, the £30m Growth Vouchers programme, whereby small businesses in England will be able to exchange government vouchers for external advice, was highlighted by Lord Young as a key tenet of the government’s package for growth.
While detail remains sparse, the vouchers scheme for businesses with less than 10 employees is set to run until March 2015, with funding split over two years – £10m in year one and £20m the following year.
It is believed businesses will be able to access vouchers valued between £100 and £2,000, which will be redeemed by engaging advisers such as accountants and lawyers from a list of signatories to the scheme. Lord Young also pointed to £100m of funding for the Business Finance Partnership to boost peer-to-peer lending and crowdfunding and reiterated the government’s determination to simplify the tendering process for public sector contracts.
As part of this, Lord Young promised his measures would help to eliminate much of the laborious form-filling, with Pre Qualification Questionnaires (PQQs) no longer required for central government contracts worth under £100,000 in value.
Under Lord Young’s plan, the public sector in its entirety – where local government and the NHS account for 70% of small firms’ public sector work – will remove PQQ requirements for contracts below the EU threshold of …200,000. Contracts will also be published in one place www.gov.uk/contractsfinder.
In addition, the pilot of SME Growth Loans, is due to commence this summer as part of the Enterprise Finance Guarantee (EFG) scheme. Companies in their third year will be able to access £25,000 loans.
Alongside this, the EFG Trade Credit pilot with Kingfisher Group launched in March. Under the scheme, tradespeople who are currently outside the risk profile of trade suppliers such as B&Q TradePoint and Screwfix, are able to get credit of up to £25,000 if new customers and up to £50,000 if they have used the suppliers before.
Kingfisher Group, which owns the B&Q and Screwfix brands will use a government guarantee of 75% of the lending to accept custom from trades businesses that lack security or an adequate credit history.
Fallon said in March: “Builders and tradesmen are experiencing a real bottleneck when it comes to accessing credit, and projects are being held up unnecessarily. This pilot is an innovative attempt to make a real difference for the sector.
“Britain’s builders have a vital role to play in delivering growth in this country and we’re determined to get behind them.”