Age cap on start-up loans should be removed to 'fire up' business growth
13th May 2013 | News
An existing age cap that thwarts entrepreneurs and small business professionals from accessing taxpayer-funded loans over the age of 30 should be removed, according to the prime minister’s enterprise advisor, Lord Young.
The lifting of the age cap for the government’s loans scheme is one of many suggested reforms in a new report from Lord Young, in a bid to "fire up business growth" across the UK.
The age limit for these 'Dragons Den' style loans, which are only available in England, was only raised from 24 to 30 earlier this year.
New business plans that are successfully deemed ‘robust’ typically receive £2,500 which can then be repaid via a five year payment plan at a lower rate of interest than high street banks.
Other proposals within the report include making it easier for small firms to bid for £230 million-a-year of public sector contracts and a £30 million voucher scheme that is designed to offer industry advice for businesses looking to expand.
A number of business groups have already welcomed the new package of measures, removing the need for bidders to complete complex, time-consuming pre-qualification questionnaires for public sector contracts worth under £200,000, whilst simplifying and standardising the bidding process across the board.
Lord Young said: "Growing our smallest businesses would transform our economy – they are the vital 95 per cent.
"If just half of the UK’s micro businesses took on an additional member of staff, unemployment would be reduced to almost zero. We need to raise the aspirations and confidence of these businesses and give them the tools to grow."
Hayley Conboy, CBI’s principal policy advisor for enterprise, has said the group is encouraged by the government’s plans to raise awareness for finance and support schemes.
"Supporting today’s smaller firms to grow and create jobs will make them the UK’s medium-sized businesses of tomorrow," she said.
"Lord Young rightly identifies that the Government needs to earmark funding to effectively market existing finance and support schemes. Most firms simply don’t know what’s available, so the new Business Bank will play a crucial role in raising awareness.
"We support the recommendation to open up more government contracts to smaller firms by cutting out the requirement for them to complete a pre-qualifying questionnaire, as most smaller firms [simply] don’t have the capacity to handle this."