The Treasury select committee has hit out at the Funding for Lending Scheme for a “bias” towards mortgages rather than business lending.
In the committee’s report on the chancellor’s Autumn Statement, published this week, MPs say they are concerned about reports that businesses are not benefiting from FLS.
On the back of the scheme the Council of Mortgage Lenders is predicting gross lending of £156bn this year, up from £143bn in 2012.
The TSC report calls on the Treasury to review the scheme’s impact and report back to the committee.
It states: “We are concerned by reports there may be a bias in the effect of the scheme that favours lending for mortgages rather than lending to SMEs.
“The Bank of England and the Treasury should assess whether this is the case and report their findings and any proposed action to the Treasury committee.”
John Charcol senior technical manager Ray Boulger says: “A body like the TSC has to be careful when its information is just based on hearsay.
“It is worth looking at whether to impose more conditions on the scheme, but it would be good to get some figures.”