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Small Businesses

My Lords, this issue is not simply the availability but the pricing of the lending available, as well as the additional costs that banks introduce to the lending facility and any rearrangement of a previous lending facility. I met 25 or 30 SME organisation representatives last Thursday. The point they made to me again and again was that banks are calling in loans, reorganising and rearranging lending facilities, imposing outcomes which are more expensive, and then adding administrative charges into the bargain for the privilege of having your lending facility reorganised on your behalf. I shall raise this issue with my right honourable friend the Chancellor when we meet the banks’ chief executives tomorrow. They must understand that while we welcome the sensitive and generous statements that are made oftentimes at board level, or from CEOs, when you get down to branch level there is rather a different pattern of behaviour emerging on SMEs. We want to capture the behaviour at branch level and put it more in line with the sentiments expressed at board level.