Mandelson faces quiz on loan schemes
Business Secretary Lord Mandelson will be quizzed by MPs over loans and investment to small and medium-sized businesses, amid concerns that the scheme could saddle the taxpayer with more losses.
Business funding: Mandelson will face questioning
The Government's business funding schemes also face attack from those banks that have been asked to provide finance. They are sceptical about the schemes' structure.
The new Growth Capital Fund is the latest in a maze of schemes run by the Business Department to provide finance to firms. Not all have been successful. One fund lost 72% of its value in one year.
The fund will be kick-started with £50m of taxpayers' money, with the Government likely to stand first in the queue for any losses.
Mandelson will be questioned by the Business Select Committee on January 19. Chairman Peter Luff told Financial Mail: 'He attaches great importance to schemes such as this new fund. It is very likely we will raise it with him.'
The Growth Capital Fund is part of the new National Investment Corporation. It will make loans to businesses of between £2m and £10m.
Its other arm will take equity stakes in smaller firms and provide start-up capital.
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