Call to champion medium-sized firms

John Cridland, director general of the CBI, wants more help for medium-sized businesses
12 April 2012

The Government has been urged to do more to help the "forgotten army" of medium-sized businesses because they can no longer rely on bank lending.

The CBI said firms with a turnover of between £10 million and £100 million represented less than 1% of businesses but generated 22% of economic revenue and 16% of all jobs.

The business group said the Government should make bond markets more accessible to medium-sized companies, which could kick-start demand through credit easing.

They should also be able to access a broader range of capital release equity, the CBI urged.

John Cridland, director general of the CBI, said: "Medium-sized businesses are truly a forgotten army, and now is the time to unlock their potential.

"We should be championing, nurturing and encouraging our mid-sized firms so that more of them grow and create jobs. For too long these companies, which could inject tens of billions of pounds into our economy, have fallen under the radar of policymakers.

"I want the UK to have its own version of the German "Mittelstand" - a backbone of medium-sized firms which export, innovate and generate growth. These future champions would help the UK weather unexpected economic shocks, and act as a new engine for growth.

"To achieve extra growth, medium-sized firms must have access to new kinds of finance. This means opening UK bond markets to medium-sized businesses, encouraging use of venture capital, and making it easier for large companies to invest in medium ones, possibly in their supply chains."

A Department for Business spokesman said: "We welcome the CBI's focus on the UK's mid-sized companies, and today's report. This sets out a range of ways in which businesses, representative bodies and the Government can support this important group.

"The Government is already focused on this group as part of the growth review, and we will be setting out our proposals alongside the autumn statement in November."

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