Darren Jones, Chair of the Business, Energy and
Industrial Strategy Committee, has commented on
responses from , Secretary of State for Business, Energy and
Industrial Strategy (DBEIS) on concerns regarding Bounce Back
Business Loans (BBLS), the Future Fund, and the Coronavirus
Business Interruption Loan Scheme (CBILS).
Letter from , Secretary of State relating to ability of private
equity firms to access CBILS, CLBILS (10th October
2020) - https://committees.parliament.uk/publications/3187/documents/29460/default/
Letter from , Secretary of State relating to the publication of
British Bank Reservation Notices in relation to the Bounce Bank
Loan Scheme and the Future Fund (20th October 2020) -
https://committees.parliament.uk/publications/3188/documents/29462/default/
Darren Jones, Chair of the Business, Energy and
Industrial Strategy Committee, said: “Concerns had
been raised, not least by the British Business Bank, about the
vulnerability to fraud and abuse of some of the Government’s
support. Estimates suggest that several billions of pounds of
taxpayer money could be lost. The Chancellor’s latest relaunch of
his winter economic programme was welcome but it does raise
questions again about the protections and conditions being put in
place to ensure public money supports those businesses and
workers that need it. Ministers must learn lessons from the
earlier rounds of support before wasting more taxpayer
money.
“I am still not satisfied by the Government’s explanation as
to why it isn’t publishing the data of which companies have
received what funding, including through the Future Fund, given
taxpayers could end up as shareholders of a whole portfolio of
start-up businesses.
“It’s also disappointing that the Secretary of State has
resisted calls to set conditions on how public funds can be used,
including by companies owned by private equity firms who could
pay off the debt used to buy them using tax payer guarantees,
allowing private equity owners to cash in while, in some cases,
they sit on mountains of cash. If private equity firms are
receiving this public money then there should be some
conditionality around their commitment to protecting jobs and
helping UK businesses get through this pandemic”.
Editor’s Notes:
Darren
Jones, BEIS Chair wrote to the SoS on BBLS and the Future Fund
(30 September) following the publication of two Reservation
Notices, issued in May, by the British Business Bank (BBB) in
relation to these loan schemes. The correspondence asks what
action the Department has taken to address the concerns around
fraud and the impact on competition which were raised in the BBB
notices. The second
letter from Darren Jones, BEIS Chair, on CBILS (30 September)
, asks the Secretary of State about what conditionalities are
being sought from private equity firms for their receipt of these
tax-payer backed loans. This followed an announcement from the
BBB that their new guidance will allow more flexibility about
whether a business is deemed an “undertaking in difficulty” in
relation to CBILS and coronavirus large business interruption
loan scheme (CLBILS).
