Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the bank loan application success rates of small and medium-sized enterprises.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The Government recognises the vital importance small and medium-sized enterprises (SMEs) and is committed to supporting SMEs grow and create jobs by providing an environment in which they can thrive.
Access to finance for small businesses is important to drive growth. The government supports that access through the Recovery Loan Scheme, which offers a 70% government guarantee on loans to SMEs
of up to £2 million. The scheme has supported over £5.3 billion of finance to SMEs since its introduction in April 2021.
At the 2024 Spring Budget, the Government announced that the Recovery Loan Scheme would be extended to the end of March 2026, and renamed as the Growth Guarantee Scheme.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what steps they are taking to (1) retain, and (2) attract, foreign financial firms and jobs in the UK.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
Financial and related professional services employ more than 2 million people in the UK and the Government is committed to ensuring the UK remains the location of choice for top talent from across the world. This is part of the Government’s mission to ensure the UK retains its position as one of the most innovative and competitive financial centres in the world. Most recently, at Spring Budget 2024, the Chancellor updated on the ambitious package of reforms which will help to deliver the Government’s vision for a financial sector that is open, sustainable, technologically innovative, and globally competitive.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the 12 per cent increase in house sales during April; and what steps they are taking to support first-time buyers.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The most comprehensive measure of UK property transactions is published by HMRC. According to this measure, residential property transactions rose by 1% in March 2024 compared to February, the third consecutive monthly increase.
The Government continues to monitor developments in the housing market closely and consider the implications.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government, following the recent decline in corporate insolvencies, what steps they are taking to (1) identify the factors they believe contributed to this reduction, and (2) ensure this trend continues.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The Government was pleased to see that statistics reported by the Insolvency Service showed the number of corporate insolvencies in March 2024 had fallen by 28% compared to March 2023.
The Government continues to help businesses, including through a swathe of policy measures in the Autumn explicitly aimed at ‘Backing British business’. Recent and current Government policies supporting businesses include:
· Energy Bills Discount Scheme that provided discounts on high energy bills to eligible businesses and other non-domestic energy users from April 2023 to April 2024, with higher support to businesses in energy / trade intensive sectors.
· Continued frozen small business rates multiplier and business rates relief for the Retail, Hospitality and Leisure sector, the latter policy supporting around 230,000 properties up to £110,000 per business. Transitional Relief to protect ratepayers facing bill increases due to rising rateable value and scrapping ‘downwards caps’.
· Payment and cashflow review outlining measures to combat late payments that can jeopardise stable cashflows, and penalising late paying firms by exempting those paying invoices after an average of 55 days from bidding for Government contracts worth over £5mn.
The Government will continue to monitor the UK corporate sector, including insolvency trends, using official data and engaging with firms and business groups to inform policy decisions.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the impact of HMRC's reported customer service issues on tax compliance among small businesses; and what steps they are taking to mitigate this impact.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
Small businesses play a vital role in the UK economy. The majority want to meet their obligations and pay their fair share of tax, but many struggle to understand tax rules, lack confidence and find the process of complying burdensome. In response, HMRC is investing in approaches to help support including simplifying guidance whilst Making Tax Digital for VAT and data analytics have helped reduce errors. HMRC is also targeting investigations at those who bend or break the rules to help create a level playing field for the honest majority.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what steps they are taking to reduce public sector debt from its current level of 98.3 per cent of GDP.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The government is committed to sustainable public finances and reducing debt, while cutting taxes and boosting economic growth. This will involve managing public spending responsibly and increasing productivity through the Public Sector Productivity Programme, while maintaining high-quality public services.
The government’s fiscal mandate is for Public Sector Net Debt excluding the Bank of England to fall as a percentage of GDP by the fifth year of the rolling forecast. In March, the independent Office for Budget Responsibility confirmed the government is on track to meet this rule, with debt falling from 93.2% (2027-28) to 92.9% (2028-29). Public sector net debt (“headline debt”) is also forecast to fall from 98.3% of GDP this year, to 94.3% in 2028-29.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what steps they are taking to support the extension of long-term fixed-rate mortgage options to borrowers.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The pricing and availability of mortgages is a commercial decision for lenders in which the Government does not intervene.
However, lenders in the UK already do offer this type of mortgage product, and those looking to take out a long-term fixed rate mortgage are encouraged to shop around and speak to a broker to find the best possible product for them.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the impact of the delay of the Overseas Funds Regime on the UK's attractiveness to overseas asset managers; and what steps they are taking to mitigate any negative effects.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The UK’s world-leading asset management sector is the second largest by assets under management, 48% of which are managed on behalf of overseas investors.
The Overseas Funds Regime was legislated for in the Financial Services Act 2021, to create a more streamlined process for overseas investment funds to be sold to UK investors.
On 30th January, the Economic Secretary to the Treasury announced that the Government had found the states in the European Economic Area, including the EU member states, equivalent under the Overseas Funds Regime, in respect of certain retail funds. This followed a detailed assessment of the states’ regulatory regimes.
HM Treasury and the Financial Conduct Authority (FCA) jointly published a roadmap to equivalence on the 1st of May setting out the key milestones to implement this decision.
Alongside this, the FCA published detailed guidance setting out that funds in scope of the OFR – but without temporary marketing access – will be able to apply to the FCA for recognition from September 2024. The FCA intends to invite funds with temporary marketing access to apply for recognition in tranches between October 2024 and September 2026.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what plans they have to address the impact of rising inflation on household budgets while stimulating consumer spending, given the stagnation of retail sales between February and March.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The government is fully committed to supporting the Bank get inflation back down to the 2% target, including by keeping borrowing under control. Inflation has also come down significantly, to less than half its 2022 peak.
Over the past two years, the government has provided support to help households with the cost of living totalling £96 billion – an average of £3400 per UK household. Further support announced by the government for 2024-25 includes extending the Household Support Fund, cutting National Insurance Contributions (NICs) and raising the National Living Wage (NLW).
ONS retail sales growth was flat in March, following growth of 0.1% in February. However, due to a significant rebound in January, retail sales increased by 1.9% on the quarter. This represents the strongest quarterly growth since Q2 2021.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government, following recent remarks from the deputy governor of the Bank of England, Dave Ramsden, that inflation could remain around the two per cent target for the next three years, what steps they are taking to ensure sustainable economic growth in this environment.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The government is continuing to pursue an ambitious policy agenda to increase sustainable economic growth and productivity across the economy. This includes making full expensing permanent, announcing measures to boost labour supply, backing the UK’s priority growth sectors, and addressing long-term barriers to investment through planning and grid connection reforms.
The IMF forecasts that the UK will have the third fastest cumulative growth in the G7 over the 2024-2029 period and the OBR expects that policies announced in the previous three fiscal events will increase the size of the economy by 0.7% by 2028-29.