Cameron pledges billions of pounds to cut cost of loans to UK companies

PRIME Minister David Cameron has promised to pump billions of pounds into helping reduce the cost of loans for small and medium-sized businesses.

Ahead of Chancellor George Osborne’s Autumn Statement next week, Mr Cameron said in a speech to members of the Confederation of British Industry (CBI) a credit-easing scheme would be included, as his government faces criticism over failing to force banks to help firms.

However, leading members of the CBI also called for an end to the demonisation of banks and big business as the economy continues to struggle to grow.

Mr Cameron also said that Mr Osborne would be setting out the next stage of the government’s plans to “transform the nation’s infrastructure”.

“Not with more government borrowing, but by using all the other tools at the government’s disposal to take a more strategic and proactive approach to infrastructure,” Mr Cameron said.

The government was “putting in the money, leveraging the power of the private sector and reshaping the rules to break decades of failure and build world-class infrastructure to support a world-beating economy”, he told CBI members.

“If we are to build a new model of growth, we need to give a massive boost to enterprise, entrepreneurship and business creation.

“Put simply, Britain must become one of the best places to do business in the world.”

Mr Cameron told the 1,000 CBI delegates yesterday the government was sticking to its Plan A for reducing the deficit, saying it had the support of business.

“The message I hear is that confidence is the key, and that depends on having a proper programme for getting debt and deficit under control. We have to stick to that plan – that is absolutely vital.”

The CBI has been calling for a Plan A Plus to boost growth and jobs but has supported the government’s programme of austerity measures.

But there were misgivings over the way politicians had attacked the banks since the financial crisis in 2008 triggered the current economic problems.

CBI president Sir Roger Carr said big business was not bad business, stressing the importance of private companies in the fight to boost the economy and create jobs.

He said: “If we are to fight our way out of this tough corner, business should be valued, not vilified. By all means punish where appropriate, legislate or regulate where necessary, criticise the shortcomings when warranted, but base these actions on an objective assessment of the country’s long-term best interests, not short-term populism.”

CBI director general John Cridland said polls showed that fewer than a third of the public trusted business leaders to tell the truth.

“Somewhere along the line, some businesses have become disconnected from wider society,” said Mr Cridland, pointing to an impression of business as “greed or selfish indulgence”.

He added: “While most if not all of the businesses I meet are doing a good job in society, we must acknowledge that there is an occasional bad apple in the barrel.”

He questioned a recent report of FTSE 100 directors’ pay rising by 49 per cent this year, saying it was “misleading” and claiming that basic pay actually rose by 2 per cent, although this rose to 16 per cent with other benefits.