BCC: MPC and Government must reinforce efforts to improve business access to finance

Commenting on today’s Monetary Policy Committee (MPC) decision, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:

"The MPC’s decision to maintain a ‘wait and see’ stance - with no changes to either interest rates or QE – was widely expected. However, we are disappointed that specific measures aimed at stimulating bank lending to credit-worthy companies have not been adopted.

“Until the Government presents a more credible medium-term plan for curbing Britain’s budget deficit, the MPC has little room for manouvre. It faces the difficult task of balancing potentially conflicting priorities - countering threats of a double-dip recession, while avoiding actions that might endanger the UK’s international credit status.

“Both the Government and the MPC must realise that the persistent weakness in bank lending, particularly to small and medium sized firms, remains a key factor delaying Britain’s exit from recession. Decisive action is needed in order to unblock the impediments facing viable businesses that require improved access to bank finance.”

Posted 7th Jan 2010  by member Cornwall Chamber of Commerce & Industry