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03/12/2014

Autumn Statement 2014 - R3 comments

Autumn Statement – R3 comments

Commenting on the Autumn Statement, insolvency trade body R3 president Giles Frampton says:

SME Funding

“It can be frustrating to come across a business that has all the tools to grow but has lacked sustainable funding to support its ambition. This has been a particular issue since 2008. While banks have been lenient with their existing customers since the financial crisis, new business customers have really struggled to access new bank loans or overdrafts. A significant proportion of UK business owners have to rely on friends and family to plug funding gaps.”

“Government small business finance schemes haven’t always had a perfect track record; hopefully the new schemes will get growing businesses the funding they need to bridge the gap between potential and success.”

Business Rates

“Rates reform is welcome from a business rescue perspective. Business rates can be a substantial cost in an administration or voluntary arrangement and have a significant bearing on whether or not the business can continue to trade.”

“A business in a trading administration will incur business rates: if an insolvency practitioner isn’t sure they’ll be able to sell the business at the outset it might make more sense just to close the business and get as much money back for creditors as possible, rather than spend money on rates while continuing to trade the business until a buyer is found.” 

Notes to editors:

  • R3 is the trade body for Insolvency Professionals and represents the UK’s Insolvency Practitioners.

  • R3 comments on a wide variety of personal and corporate insolvency issues. Contact the press office, or see www.r3.org.uk for further information.

  • R3 promotes best practice for professionals working with financially troubled individuals and businesses; all R3 members are regulated by recognised professional bodies
     
  • R3 stands for 'Rescue, Recovery, and Renewal' and is also known as the Association of Business Recovery Professionals.