Trade blasts Government's foot-and-mouth scheme
The pub trade has hit out at a Government scheme to help rural businesses affected by the foot-and-mouth crisis.
Mary Curnock Cook, director of the British Institute of Innkeeping has criticised the Small Firms Loan Guarantee Scheme because it is not open to tenants and lessees - many of whom are suffering as a result of foot-and-mouth disease.
And Bob Cotton, chief executive of the British Hospitality Association and a member of the Government's rural task force, has said the interest rate charged on the money available under the scheme made it almost like "going to a loan shark".
Ms Curnock Cook has written to the Small Firms Loan Guarantee Scheme to highlight the problems felt by tenants and lessees suffering because of foot-and-mouth.
She wrote: "Those suffering most are the freetraders, tenants and lessees, but it has been brought to our attention that tenants and lessees are not eligible under the scheme."
The scheme was not set up specifically to help pubs hit by the crisis, but instead has been running for several years, which is why tenants and lessees have been excluded.
Ms Curnock Cook pointed out that the situation in the pub trade had changed considerably over the last few years and that 75 per cent of pubs were now, in effect, autonomous businesses.
She wrote: "I believe these changes mean the scheme should be available to tenants and lessees and would urge you to reconsider their eligibility."
David Moore, from the Small Business Service which controls the loans, responded by explaining the scheme had been running since 1981 and tied pubs had always been excluded.
"However," he wrote, "I am aware of the changes within the industry over recent years and think the exclusion may have been enforced too vigorously." He said he was seeking legal advice and would clarify the position soon.
However, Bob Cotton does not think the loans are a solution. He pointed out that the interest rate charged on borrowed money was almost like "going to a loan shark".
As well as paying interest to the bank, borrowers have to give the Government a premium of up to 1.5 per cent on the loan every year.
Mr Cotton said the only people who would borrow under the scheme would be "absolutely desperate".
But slight hope has surfaced for a group of rural licensees, restaurateurs and hoteliers from Cumbria.
The Cumbrian Crisis Alliance, made up of small businesses from the area, has been invited to London to put its case for financial aid to the Treasury and meet with the Rural Task Force.
Spokesman Terry Franks said they would be joined by tourism leaders from Cumbria and would strongly put their case forward.
"We're going to present them with our facts and figures that show the financial devastation we're all feeling as a direct result of foot-and-mouth disease." He said. "We're going to keep on fighting but this is a move in the right direction."
