Osborne to launch SME credit easing

CHANCELLOR George Osborne has announced a new form of ‘credit easing’ to potentially channel  “billions of pounds” into the economy through investment in small and medium sized businesses.

The proposal will see the government guarantee SME loans and bonds.

The radical plan, which he claimed would not increase public debt, was disclosed in an upbeat keynote speech which won him a standing ovation at the Conservatives’  annual conference in Manchester.

Osborne insisted, however, that he is sticking to his ‘Plan A’ to reduce Britain’s deficit, warning that not to do so would put at risk access to low interest rate finance in the UK.

In what was claimed to be “a striking coincidence”, rating agency S&P, fresh from downgrading the US, reaffirmed the UK’s AAA status in a statement warning it would come under downward pressure “if the coalition government’s fiscal consolidation falters”.

Also in a speech aimed at a wider UK and international audience Osborne:
ignored the row over feared right wing demands he scrap the 50% top rate of income tax which wracked his coalition partners the Lib Dems’ Birmingham conference; declared himself in favour of reduced taxes but against any “temporary tax cuts” designed to provide a Keynesian boost to the economy, ruling out the short term VAT reduction demanded by Labour shadow chancellor Ed Balls; ridiculed Labour leader Ed Miliband’s “unworkable” plans for different tax rates for producers and predators, or “one for companies a Labour chancellor likes, and one for companies a Labour chancellor doesn’t like”; and warned “rich people who evade their taxes”.

“We will find you. And we will find your money. The days of getting away with it are over.”

He pledged to be “just as tough on tax evasion as benefit fraud”, adding: “We are all in this together.”

Related reading

PwC office 2