Daily Insurance Industry News
 
 
Daily Insurance Industry News
Wednesday 18th of July 2018
April 29, 2009

Darling’s ‘death warrant’ credit cover

by David Masters

Story link: Darling’s ‘death warrant’ credit cover

Steve Dowdle, managing director of Sony UK, said the government’s credit insurance top up scheme has “effectively signed the death warrant” for retailers across the UK.

The top up scheme – announced in last week’s Budget by Chancellor Alistair Darling – aims to support businesses that have had their credit insurance cover reduced.

A government spokesperson said the scheme will provide a ‘lifeline’ to struggling businesses.

However, Dowdle, speaking to the BBC, said a £1m limit on the top ups mean that retailers with 10 to 15 stores will not be offered help.

He also criticised the government’s decision to only provide cover for 8 months, and to only help business who have credit insurance withdrawn after 1 April 2009.

“This smacks of shutting the door after the horse has bolted,” Dowdle said, pointing out that many businesses had cover withdrawn as far back as 2008.

Woolworths’ infamous bankruptcy at the end of 2008 has been attributed to the fact that the business had its credit insurance cover withdrawn.

A spokesperson for the Department for Business, Enterprise and Regulatory Reform said the scheme was designed to help retailers as much as possible without taking excessive risks with taxpayers’ money.

 

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