The Forum of Private Business responds today’s announcements by Ed Miliband

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Commenting on the announcements made by Ed Miliband today, Alex Jackman, Head of Policy at the Forum of Private Business, said,”This is a significant speech from Ed Miliband that sets out the emerging policy proposals from the Labour Party. We also welcome long term is, which of course is easier to achieve in theory than in practice. There are some interesting proposals which we will run past our members.

“Opening up the banking industry will help drive competition and increase access to finance for small businesses. What the Labour leader failed to acknowledge in his speech was the multitude of alternative providers and challenger banks that already exist. Politicians need to work with all the lenders that currently exist to drive awareness of different types of finance and increase small businesses access to them.”

On the British Investment Bank

The Government is already introducing a Business Bank, so we would want the Labour Government to see how their plans could work within the structure they would inherit, should they win the next General Election.”

On breaking up big banks

“There is a problem of too much concentration in the main banks. But we need businesses to be confident enough to move as well as creating an environment where more challenger banks can enter. If we can tackle issues that entrench businesses within one bank and prevent the easy transfer to a new provider that will help solve the issue. The fear of capping market share is that banks will get rid of the poorest banking customers

“We also need to tackle the closure of branches across the country. Rather than letting more branches close, we need a mechanism that steps in to keep them open, such as the neutral branding of them so that businesses can use them regardless of their banking provider.”
On a National Credit Register

“The Government is currently consulting on similar proposals and the Bank of England due to pose this question in the next few months. In theory, more available data should mean better lending decisions. We would want to ensure that businesses can choose who sees that data, however.”