Squeeze on bank loans hits small legal firms
Monday 18 July 2011
Britain's small law firms are the latest to feel the squeeze from constraints on bank lending, an independent finance provider said today, with the number of sole-practitioner solicitors falling by almost a tenth over the past 12 months.
Syscap also warned that the smaller end of the legal industry was heading for another crunch moment, with significant tax bills to be paid at the end of this month. There are now just under 3,700 single-partner law firms in Britain, down from just over 4,050 a year ago, a fall of 9 per cent.
Philip White, the chief executive of Syscap, said the biggest single reason for the decline was that cash-strapped small legal firms were finding it very difficult to get affordable credit from the banks – and thus being forced to shut or merge at the first sign of cashflow problems.
Mr White warned that the Government's attempts to reduce spending on legal aid would only add to the difficulties faced by many in the profession. And he warned that many were struggling to pay even the most pressing bills. "Prior to the recession virtually all of our funding for law firms was to enable them to expand – to buy IT or books of business," he said. "Now most of the demand is to fund tax payments or deal with other short term cash flow issues."
Syscap's warning is the latest contribution to the debate over whether Britain's banks are doing enough to support all small businesses. Under Project Merlin, the banks were set targets for lending to small and medium sized enterprises, but look likely to miss them over the year.
- 1 Emma Watson on Jennifer Lawrence naked photo leak: 'Even worse than seeing women's privacy violated is reading the comments'
- 2 Saudis risk new Muslim division with proposal to move Mohamed’s tomb
- 3 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
- 4 Cee Lo Green: It is only rape if the victim is conscious
- 5 Nigerian witch-finder Helen Ukpabio threatens legal action against human rights organisations
Emma Watson on Jennifer Lawrence naked photo leak: 'Even worse than seeing women's privacy violated is reading the comments'
Victoria Justice on naked photo leak: 'Let me nip this in the bud right now – pun intended'
Ariana Grande nude photos leak: Pictures are completely fake, say representatives
Saudis risk new Muslim division with proposal to move Mohamed’s tomb
Kate Upton nude photos leak: Model's spokespeople 'looking into' authenticity of indecent images
Rotherham child sex abuse scandal: Labour Home Office to be probed over what Tony Blair's government knew - and when
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Ashya King: Parents of five-year-old boy refused permission to visit him in hospital and denied bail at Spanish court
With Douglas Carswell joining Ukip, my party has taken another giant step forward
When elitism grips the top of British society to this extent, there is only one answer: abolish private schools
Ashya King: 'Cruel NHS has not given us the treatment we need', says father of five-year-old with brain tumour who fled to Spain
iJobs Money & Business
£500 per day: Harrington Starr: SQL Developer SQL, C#, Stored Procedures, MDX...
£500 per day: Harrington Starr: C#.NET Developer C#, WPF, WCF, ASP.NET, Prism...
£55000 - £65000 per annum: Harrington Starr: A Global Financial Service Organi...
£60000 - £70000 per annum: Harrington Starr: A prestigious leading professiona...