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Government support for SME builders

Government’s ambition is to significantly increase housebuilding and support people into home ownership. It recognises that the lack of availability of development finance is a major barrier to smaller firms and SMEs who are trying to expand their building activity and it is taking the following steps to support SMEs.

A £100m Housing Growth Partnership was launched in July 2015. This is a partnership between the Homes and Communities Agency and Lloyds Banking Group to help smaller builders across the UK access the finance they need to

  • Fund the development of residential housing schemes;
  • Support access to conventional development finance; and
  • Facilitate the construction of more new homes.

The Chancellor announced further measures to support SME builders in the Autumn Statement 2015 including £1 billion of loan finance for up to 5 years supporting the delivery of new homes. The new fund brings together and expands the Builders’ Finance Fund and Custom Build Serviced Plots Fund providing added flexibility to enable the Government to support emerging markets.

The Chancellor also announced support to SME house builders through amending planning policy to promote the delivery of small schemes. Proposals in the Autumn Statement will halve the length of the planning guarantee for non-major development from 26 to 13 weeks ensuring that SME house builders are not slowed down unnecessarily by the planning system.

Wider Business Support

Core Information and guidance on starting and running a business, statutory rights and obligations and government support products and services is available on GOV.UK, including the ability to search for support using the business finance and support finder tool.

The Business Support Helpline is available to help customers find and understand the information they need, and can be accessed by telephone (0300 456 3565), webchat, email and social media.

The GREATbusiness.gov.uk website provides support, advice and inspiration for business at www.greatbusiness.gov.uk

Business can also access local support through Growth Hubs that bring together public and private sector partners to promote, co-ordinate and deliver business support in their region. A list of Growth Hubs can be found at www.lepnetwork.net/growth-hubs/.

The British Business Bank’s Business Finance Guide: A Journey from Start-Up to Growth provides information on the different types of finance in the market, and where support is available to businesses. The BBB’s programmes are supporting £2.4bn of finance to over 40,000 smaller businesses, and participating in a further £3.3bn of finance to small mid-cap businesses.

Appeals

The major banks have established an appeals process allowing customers to appeal against a bank decision to decline lending. It is overseen by an independent reviewer and is now in its fifth year.

The Appeals Process, which gives small businesses the right to challenge a bank’s decision on finance, has now put at least £50 million back into SME lending. Nearly all small and medium-sized businesses in the UK now have the right to appeal when they are declined finance by a high street bank, as the thirteen lenders who do the vast majority of business lending in the UK now have the scheme up and rolling.

As of June 2015, nearly 14,000 businesses had appealed to their bank and 33% of the banks’ original decisions were overturned as a result.