Small business should get rate cut immediately if RBA acts: Billson

05/12/11

With 13 out of 25 market economists polled by Bloomberg believing the RBA will cut interest rates tomorrow, Shadow Small Business Minister Bruce Billson has urged the banks to pass on any cut immediately to business loans.

Mr Billson said after the last rate cut some business borrowers had to wait for well over a week while some with home loans had their rate adjusted within hours.

“With little or no discussion at Labor’s Conference on its plans for small business, the Government should come out and insist the banks pass on any rate cut to business loans immediately,” Mr Billson said.

“Under Labor, the gap between the Reserve Bank cash rate and residentially secured small business loan rates has blown out by 2 per cent and the Gillard Government doesn’t seem to care.

“The Government has got to realise that while human relationships are important, debate about these should not completely exclude the crucial partnership that is needed between small business and government.

“The Treasurer seems only interested in playing to the media about home buyers and ignores the ‘economy builders’ that are small businesses and family enterprises.

“Cutting rates for small business is just as important as cutting home loan rates in order to stimulate and support the engine room of the economy.

“It’s hard enough for small businesses to expand in the current economic climate without having to deal with higher than necessary lending costs.”

Mr Billson said he would like to see the big banks act on business loans at the same time as home loans.