Lord Sugar’s – the government’s enterprise czar – outburst last week where he allegedly called small business owners moaners and said:
“I can honestly say a lot of problems you hear from people who are moaning are from companies I wouldn’t lend a penny to. … They are bust and they don’t need the bank – they need an insolvency practitioner”
is an unbelievable insult to all small business owners in this country.
Small business owners were being squeezed by this government even before this recession started, now they have to endure this recession, which was started by the very same people who pay themselves billions in bonuses while asking for more tax payers money (30 billion) to bail them out even further.
As if this was not enough they now have to endure a verbal onslaught of a – in my opinion – half educated and half witted Sir, Lord, Czar or whatever Mr Sugar.
It is this community of small business owners who keep this country together:
- over 50 % GDP is being produced by this sector
- over 50 % of employment is generated by this sector
- over 60 % of innovation comes out of this sector
Given these numbers may I ask what percentage of the money that this government has wasted so far has gone to the SME community? It is most certainly not anywhere near 50%! These ‘moaning’ SMEs have probably paid more in taxes, which then have been used to bail out the banks and the government, than they have received in financial aid.
SME don’t borrow money anymore because they cannot trust the banks and they cannot afford to borrow the money. While the Bank of England has lowered the interest rate to the lowest level on record, the banks have doubled the interest they demand from small business owners, up to almost 20% for certain loans – that is a 19.5% spread.
As I mentioned in my CNBC interview last week, these high interest rates take all the profit margin out of the business that can be done out there. Let me spell it out for anyone who really has not got the picture, businesses go bust because:
- The banks will not lend money to them;
- Even if they lend the money it is so expensive that it takes any profit out of the deal;
- They run out of savings.
I am furious that Sugar is insulting the SME community in this country in this way, like the rest of this government, he has lost any sense of reality. The spin coming out of the Brown government is as unbelievable, as it is insulting to the general public.
Who the hell made Sugar a Lord anyway any why? Sugar certainly is the icing on the government’s cake of incompetence, if nothing else, IMO. -ST.