In a letter to the MIA, the Business Secretary Lord Mandelson confirms a package of measures which will help the cash flow, credit and investment needs of UK motorsport and high performance engineering companies.
The Business Secretary’s temporary schemes aim to increase the flow of credit to SMEs (small and medium enterprises) which include many MIA members and the UK’s motorsport and high performance engineering companies. These are most welcome and will certainly help many hard-pressed motorsport companies, but not necessarily the problems of larger companies, with which many of these partner through the supply chain. Time will tell.
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From today, companies with a sales turnover below £25 million, have access to the Enterprise Finance Guarantee Scheme. Eligible companies have access to loans, from £1000 up to £1million, which will be guaranteed by the UK Government. The scheme can be used to free-up overdrafts by converting existing facilities into loans.
A Capital for Enterprise Fund of £75 million will allow the Government to invest in viable companies who seek equity, but have high levels of debt.
Under the Working Capital Scheme the Government will make available to banks, guarantees to cover 50% of the risk on new, and existing, working capital portfolios. Hence, as credit lines in these portfolios will be secured by this guarantee, this will free up capital for new lending to all UK businesses with an annual sales turnover of less than £500 million.
More Time to Pay for businesses experiencing cash flow difficulties is offered under the HM Revenue & Customs (HMRC) Business Support Service. This applies to tax, National Insurance, VAT or other payments owed or coming due to HMRC. Companies should call the Business Payment Support Line on 0845 302 1435.
For more details, including eligibility criteria, there is a single online portal www.businesslink.gov.uk/realhelp/finance
...or contact the MIA on 02476 692 600 or info@the-mia.com
