Banks to offer support small businesses affected by Carillion collapse

Business Secretary Greg Clark has welcomed a decision by several banks to set up funds to support small businesses affected by Carillion’s insolvency.

Lloyds Banking Group has launched a £50 million fund, HSBC a £100 million fund and RBS has made £75 million of assistance available. It follows a meeting held by Greg Clark yesterday with banks where he discussed further support and advice that could be provided by the banks for small businesses affected by Carillion’s liquidation.

Clark said “I welcome this quick and positive move by banks including Lloyds, HSBC and RBS. This follows my meeting with the banks yesterday where I challenged them to see what further support they could provide for SMEs affected by Carillion’s insolvency. It is essential that small businesses exposed are given the support they need by their lenders, and I look forward to other banks following suit.”

HMRC has also outlined the support being offered to those businesses contracted to Carillion that may be concerned about their ability to pay tax. HMRC are providing practical advice and guidance to those affected through its Business Payment Support Service (BPSS).

This follows action outlined by the Department for Business, Energy and Industrial Strategy to address concerns set out earlier this week.

Responding to the announcement, Federation of Small Businesses (FSB) National Chairman Mike Cherry, said:  “The emergency measures put in place by banks for customers hit by Carillion’s collapse will provide some respite at a desperate time for hundreds of small firms. Many hundreds more are still yet to feel the knock-on impacts of the giant’s demise. It’s critical that they also receive support in the months ahead.

“We now need to establish a Carillion task force dedicated to helping all affected small firms and workers to recover and get back on their feet. Following Rover’s collapse in 2005, I was involved in a similar initiative where we successfully supported suppliers and found new opportunities for all of the firm’s apprentices.

“This sorry saga has shown that the Government’s reliance on a small number of huge outsourcing firms poses a risk to the nation’s economic stability. As thing stand, our procurement regime is stacked against small firms. Providing small businesses and the self-employed with more opportunities to secure public contracts will mean less risk and better return for the taxpayer. At the very least we need to see the reinstatement of the target date for achieving 33% of all public sector procurement with smaller businesses, to 2020.”