John Longworth, director general of the BCC, says that while he welcomes the release of the £950 million in second round funding for growing companies across the UK, he urges the government to ensure that financing is completed as quickly as possible.
Longworth comments, ‘The speed at which this funding is delivered will be fundamental to the success of the Regional Growth Fund. The projects supported by the fund must be started as soon as possible. While due diligence has to play an important role, it must not drag on if we’re to see any real, tangible benefits.
‘The Regional Growth Fund on its own is not enough to stimulate business growth. The chancellor must introduce further measures that will deliver confidence to businesses, in particular small and medium-sized companies.’
His comments follow the release of the names of more than 100 second round recipients of the Regional Growth Fund. The government investment will support nearly £6 billion of private investment secured by the successful projects, according to deputy prime minister Nick Clegg.
The Regional Growth Fund is a £1.4 billion fund, which is designed to encourage businesses, growth and jobs in the private sector and support areas and communities that are dependent on the public sector. In April, the government announced the 50 successful first round bids from companies and partnerships which shared in about £450 million of investment.
Clegg says, ‘I am delighted to be able to announce this boost to business, which will jump start growth and create jobs that last in the places that really need it.
‘The first pot of Regional Growth Fund money is already making a difference across the country – helping to rebalance our economy so that every region and sector benefits.’
Confederation of British Industry deputy director general Dr Neil Bentley welcomes the announcement of further funding, saying, ‘Medium-sized businesses have the greatest growth potential, but are often held back by difficulties accessing long-term finance for investment, so this funding will help them to grow and create jobs.’
However, Bentley adds that the fund does not have the capacity to plug the finance gap.
He continues, ‘The government needs to look at other funding options to help these firms grow, such as opening up bond markets to medium-sized businesses. We also want to see large companies encouraged to invest in medium ones by making equity investments tax deductible so that they are on a par with debt investments.’
The full list of the second round recipients can be seen here.