Small firms to receive £4bn EU boost

The government has announced £4 billion in support for small businesses by way of the EU.

Chancellor Alistair Darling revealed that the funds would come in the form of a loan from the European Investment Bank (EIB) over the next four years.

At a City of London Corporation event, the Chancellor said: "Small firms are vital to the strength of our economy."

In an initial step towards increasing liquidity in the small business sector, UK lenders have signalled an interest in obtaining around £1 billion per year from the EIB.

"We need to make sure that despite the global credit crunch, they have access to the loans and capital they need to help their business grow and develop," Mr Darling added.

In a televised interview with GMTV yesterday (30 October), Mr Darling also hinted that tax cuts for lower income families may be forthcoming.