Mr. John Trethowan:

I thought the members might ask about that. We uphold approximately 45% of applications that come to us and in some cases there is a deficit we cannot repair, with a business gone too far into decline or a start-up with insufficient experience, for example. Sometimes people have a great idea but there is no capital, and most small and medium enterprises would face a significant challenge in the first two years of existence, with half going down. If we have somebody with a good idea but no experience, we would be very cautious. It is not my job to get people to borrow money.

Sometimes we deal with businesses which have not recognised that the last four years required management action to repair a business; turnover may be falling but these people may still have a BMW outside the premises. If a business has consciously tried to address a challenging position, we will do everything we can to help it but we will not do so for those which are sleepwalking through the process.

I am not sure we can get in front of the issue of advising an applicant as there are too many people out there. The Government is doing work on this through seminars to raise the capability of small and medium enterprises in presenting a more cogent application to banks. We would also look to the new local enterprise offices, LEOs, to help businesses improve applications to banks as well. We come in after an initial application and we could improve it if it has merit but could have been better presented in the first place.