Young entrepreneurs are to be given £30m more for Dragons Den-style loans to start their businesses, under a tranche of funding to be unveiled on Thursday by David Cameron.
The additional money will bring the government’s Start-Up loans scheme to a total of £110m over the next three years, which Downing Street predicts will help to start “thousands” of businesses. The age limit for applications has been raised from 24 to 30 so that more people become eligible for the funding.
The prime minister described Start-Up loans as an important part of his mission to “back aspiration” so that the UK can compete in the “global race”.
“It is by backing our entrepreneurs and championing small business that we can drive forward and grow the economy, and equip this country for the highly competitive era we are in,” Mr Cameron said.
However, Labour has criticised ministers for their slowness in disbursing the money, after figures released in October showed that in the first month of the project, only 43 loans had been made.
Downing Street has now confirmed that £1.5m of funding has been given out, and about 100 businesses are being signed up each week. Aides say that at least 2,800 businesses will have received loans by the end of March.
Chuka Umunna, Labour’s shadow business secretary, said that given the UK’s sluggish growth, it was “essential” that initiatives such as the Start-Up loans scheme were delivered effectively.
“That’s why it was disappointing that figures released at the end of last year suggested delivery of this scheme, like so many others from this government, was not living up to David Cameron’s rhetoric,” Mr Umunna said.
The Labour MP added that small businesses and entrepreneurs were being “let down” by the government.
So far, 3,000 people have registered an interest or applied for the loans, which are typically worth about £2,500 and can be repaid over five years at a relatively low rate of interest.