Darling to don a cape for small businesses

The Financial Times: Smarta isn’t always a fan. Not, you understand, because its content isn’t interesting or informative, but because sometimes the paper has a knack of turning the most important, momentous, life-changing events into something so dry a desert termite would feel a bit parched reading it.

So to this morning’s exclusive: according to the FT, Alistair Darling will announce a supply-chain insurance plan as part of next Wednesday’s Budget. According to government insiders the scheme, which will reimburse small and medium-sized businesses if, for example, a supplier goes under, will ‘form a centrepiece of the Budget initiatives to help... businesses cope with the recession’.

So far, so boring – but what piece fails to mention is, well, this could be the answer to many small business’ dreams – or rather, it could be the answer to their nightmares.

Supply chain insurance has been increasingly hard to come by since the beginning of the recession, with ‘frighteningly long’ waits for cover to be agreed and premiums almost doubling in the last six months.

The insurance will also cover firms against late payment which, as we keep saying, have increased by 40% in the last year from £18.6bn to almost £26bn.

The FT said the initiative ‘represents a coup for Lord Mandelson’, but the real winners will be the businesses which will no longer staking their livelihoods on the success or failure of their suppliers - now there’s a bit of imagery for the FT readers among you to chew over.

Image: Flickr

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