Chancellor’s speech centres largely on small businesses

George Osborne claims that the Conservatives are ‘the party of small businesses’ because of new government measures directed at the sector, including ‘credit easing’ and tax freezes.

The chancellor made his claims during his speech to the Conservative Party conference last night in which he outlined a range of schemes and measures that were directed at small businesses to help rebalance the economy.

One of the most significant announcements was the new scheme labelled ‘credit easing’, which will see billions of pounds worth of government cash poured directly into small businesses.

Osborne claims he has set the Treasury to work on this scheme which would see them lending to small firms by buying billions of pounds worth of corporate bonds.

‘Everyone knows Britain’s small firms are struggling to get credit and banks are weak,’ remarked Osborne. Adding, ‘I have set the Treasury to work on ways to inject money directly into parts of the economy that need it such as small businesses.’

Simon Streat, managing director of UK business Experian, welcomes the news. He adds, ‘It is encouraging to see the Government taking steps to help businesses – in particular SMEs – with credit issues.’

Many people though are worried that the scheme will impact on public finances with the government assuming the credit risk. If businesses were to default on the bonds, the government would have to deal with the losses.

However, the government says that the scheme will not affect the deficit because borrowings are secured against assets, claiming it to be a ‘long-term investment’.

Osborne also made reference to small business tax in his speech telling listeners that the party was ‘simplifying’ the tax code for the sector.

He said, ‘For small businesses we’re freezing rates, cutting taxes, stopping new regulations in their tracks.’

To read Osborne’s speech in full visit

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