With the economy struggling, there were a range of measures intended to stimulate the private sector.
The new Business Bank is intended to bring together within a single institution the strategy, management and communication of existing government finance schemes for SMEs, and to improve accessibility to those schemes. It is expected to be fully operational in Autumn 2014, though some functions should be operating from Spring 2013.
In the Autumn Statement it was announced that an extra £1 billion of capital will be deployed in an attempt to 'stimulate the private sector market for long-term capital and address structural gaps in the supply of finance to SMEs'.
Business finance initiatives
Announcements were made concerning a number of initiatives for encouraging business investment and improving access to finance.
The Business Growth Fund, introduced to invest in small business equity, is budgeting to substantially increase its level of investment to £200 million in 2013. Meanwhile, the Business Finance Partnership, which aims to stimulate new non-bank sources of finance, has invested £600 million and raised another £650 million from the private sector to create four new funds that will lend to mid-sized companies.
The Government will also provide £72 million of follow-on funding for start-up loans.
There were several announcements made with the intention of assisting UK exporters, with the Government stating its ambition to increase exports to £1 trillion and become 'the number one destination in Europe for new Foreign Direct Investment from emerging markets'.
UK Export Finance (UKEF) will establish a scheme to provide up to £1.5 billion of loans to finance smaller export transactions. This scheme will run until the end of 2015/16. Additionally, UK Trade and Investment - which assists small and medium-sized exporters - will have its annual budget increased by £70 million.
Lord Heseltine's Review
Lord Heseltine presented his report No Stone Unturned on 31 October 2012. It contained a large number of recommendations in all areas of government policy affecting economic growth.
The Government will be making a full response in Spring 2013, but in the Autumn Statement the Chancellor agreed to implement one of the fundamental principles of the report, which is to devolve a greater proportion of growth-related spending to local areas, via Local Enterprise Partnerships (LEPs).