§ Mr. Richards
To ask the President of the Board of Trade if he will make a statement on the British Bankers Association proposal to produce a binding code of practice in respect of holders of floating charges giving notice to companies of their intention to appoint an administrative receiver. 
Mr. John M. Taylor
The British Bankers' Association—BBA—has today launched a statement of principles entitled, "Banks and Businesses: Working Together". I, along with my hon. Friends the Minister for Small Firms and the Economic Secretary, believe that this is a positive step in the direction of better communications between bankers and their business customers. As such, we believe it should be of major benefit to both small to medium enterprise—SME—companies and other businesses.
The primary aim of the statement of principles is to bring about increased and improved communications in bank-customer relationships, particularly where financial difficulties are encountered. The banks will aim to provide businesses with early warning of any concerns they may have together with a reminder of the benefits of taking appropriate advice. By addressing problems at an early stage the statement of principles will underpin the banks' stated commitment to support sustainable rescues. It will also give business access to banks' complaints procedures and, where applicable, the banking ombudsman. For these reasons the statement of principles has potential additional benefits which would not be delivered by the five days notice proposal. At present 90 per cent. of the SME market will be covered by it.
All the major clearing banks have agreed to be bound by the statement of principles but some of the smaller banks have yet to sign up. I strongly encourage them to do so without delay.
The Government welcome the statement of principles and the issue of whether legislation is still needed will be reviewed in the light of whether it is delivering the expected benefits to business.