Posted on 24-01-2010 at 01:00
MORE than 5,000 jobs have been predicted as spending bosses open up a £125m jobs pot.
Ministers last night warned the Conservative party not to interfere in the region’s success after praising regional efforts to set up the multi-million pound Finance for Business North East scheme.
The loan fund will allow small and medium sized companies to borrow cash needed to help them grow.
Labour ministers claim development agency One North East would never have set up England’s first European Investment Bank fund if the Tories had their way. Agency bosses brushed aside the wrangling and promised a jobs fund which would last for over a decade.
When the original £125m is repaid by businesses loaned the cash the fund’s managers hope to have made enough money to reinvest another £100m in the region.
Rosie Winterton, the Government’s minister for regional economic development, said that although setting up the fund had not been easy, it would be worth it for the long-term change it helped bring about in the region.
She was speaking before hundreds of business leaders gathered in Durham for the official launch of the fund.
Malcolm Page, deputy chief executive at the agency, said the difficult work was done now that the funding was secured and based in the region. He said: “What we have established today is an evergreen fund, a revolving fund that will be here for a long time to come.”
Andrew Mitchell, chief executive of the Finance for Business North East Fund, said the cash set the region aside from other parts of the UK.
He added: “This will make the North East by some distance the most dynamic venture capital area outside of London.
“This puts the region, in my view, at a huge advantage in the coming years.”
The cash pot will allow up to 900 businesses from across the region to turn for help to the new fund group, offering an alternative to the often difficult-to-access bank loans.
Half the money comes from the European Investment Bank and the other includes cash from One North East and other European investment funds.
As these loans are repaid the agency will repay money to the European Investment bank and then re-invest the rest of the cash in the regional economy.
Insiders say the fund was set up in such a way as to ensure Treasury officials in London looking for more control will find it difficult to take back the funds and hand them out centrally.
Businesses appear to have warmed to the fund already. Ross Smith, head of policy and research at the North East Chamber of Commerce said: “This fund will provide an invaluable boost to small and growing businesses.
“All too often sources of growth finance are London based and there are barriers to North East companies trying to tap into them. The UK needs businesses in all regions to be able to grow to their full potential. The challenge now is to make quick and effective decisions in the coming months as to how this funding can be used to help North East businesses maximise their chances of growth.”
Firms looking to take advantage of the fund can attend a series of regional business seminars, including one on Tyneside on March 3. For more information contact Ruth Craig at Muckle LLP on 0191 211 7930.
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Ministers last night warned the Conservative party not to interfere in the region’s success after praising regional efforts to set up the multi-million pound Finance for Business North East scheme.
The loan fund will allow small and medium sized companies to borrow cash needed to help them grow.
Labour ministers claim development agency One North East would never have set up England’s first European Investment Bank fund if the Tories had their way. Agency bosses brushed aside the wrangling and promised a jobs fund which would last for over a decade.
When the original £125m is repaid by businesses loaned the cash the fund’s managers hope to have made enough money to reinvest another £100m in the region.
Rosie Winterton, the Government’s minister for regional economic development, said that although setting up the fund had not been easy, it would be worth it for the long-term change it helped bring about in the region.
She was speaking before hundreds of business leaders gathered in Durham for the official launch of the fund.
Malcolm Page, deputy chief executive at the agency, said the difficult work was done now that the funding was secured and based in the region. He said: “What we have established today is an evergreen fund, a revolving fund that will be here for a long time to come.”
Andrew Mitchell, chief executive of the Finance for Business North East Fund, said the cash set the region aside from other parts of the UK.
He added: “This will make the North East by some distance the most dynamic venture capital area outside of London.
“This puts the region, in my view, at a huge advantage in the coming years.”
The cash pot will allow up to 900 businesses from across the region to turn for help to the new fund group, offering an alternative to the often difficult-to-access bank loans.
Half the money comes from the European Investment Bank and the other includes cash from One North East and other European investment funds.
As these loans are repaid the agency will repay money to the European Investment bank and then re-invest the rest of the cash in the regional economy.
Insiders say the fund was set up in such a way as to ensure Treasury officials in London looking for more control will find it difficult to take back the funds and hand them out centrally.
Businesses appear to have warmed to the fund already. Ross Smith, head of policy and research at the North East Chamber of Commerce said: “This fund will provide an invaluable boost to small and growing businesses.
“All too often sources of growth finance are London based and there are barriers to North East companies trying to tap into them. The UK needs businesses in all regions to be able to grow to their full potential. The challenge now is to make quick and effective decisions in the coming months as to how this funding can be used to help North East businesses maximise their chances of growth.”
Firms looking to take advantage of the fund can attend a series of regional business seminars, including one on Tyneside on March 3. For more information contact Ruth Craig at Muckle LLP on 0191 211 7930.
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