Posted: Tuesday, 6 March 2012 @ 19:19
The BBC has today published a letter from Vince Cable to David Cameron and Nick Clegg written on 8th February 2012.
In it, Mr Cable states that government policy is “missing a compelling vision of where the country is heading beyond sorting out the fiscal mess”. He argues that the government needs to take a much more active stance in promoting growth by supporting certain growth sectors and their supply chains (including technology, the aerospace and automotive industries, the digital and creative industries including e-commerce, professional services including architects, consultants, accountants and lawyers), energy and low carbon industries, and construction.
Whilst I agree that the government must do more to support growth, I would prefer to see the government remove the obstacles to growth (red tape, the tax system and the lack of finance for SMEs) than to get involved in the central planning of industrial growth.
The part of his letter that I do find myself agreeing with is his suggestion to use the mainly-publically-owned RBS as a ‘British Business Bank’ with a mandate to expand bank lending rapidly, especially to SMEs. It’s a scandal that RBS did not meet its Project Merlin targets of lending to small businesses. If the government can’t effectively influence a bank it owns, what chance has it got with other banks? Whilst RBS is in public ownership, it should be used to finance SMEs and kick-start the economic recovery.
SME Business Solicitor
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Blog by Gary Pascual
Gary has been providing legal advice to shareholders, directors and business owners for over 25 years. Specialising in dispute resolution Gary is based in Birmingham with clients throughout the UK and overseas. View profile
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