Not a single business is defaulting on emergency loans from East Lothian Council during lockdown


NOT a single business that received an emergency loan from East Lothian Council in the first month of lockdown has defaulted on their payment obligations, a new report has revealed.

In a filing described as ‘remarkable’ by an adviser, East Lothian Investments Ltd (ELI) said it had handed over £70,000 to businesses in the first month of lockdown and, almost two years later, n had had no defaulters.

The company, which was set up by East Lothian Council and offers interest-free loans to county-based start-ups/businesses, said it launched a business interruption loan in March 2020 to help businesses facing difficult serious cash flow problems caused by the lockdown.

He handed out £70,200 to businesses in loans of up to £5,000 with a six-month repayment holiday and 24 months to repay.

A company report to the board’s audit and governance committee this week found the loans went to businesses in retail, hospitality and social enterprises, among others.

Richard Baty, the council’s business director, told the meeting: “As of January 2022, there are no defaults, a loan holiday is in place and a business has entered into a debt settlement program which was unrelated to Covid.

Councilor Stuart Currie said the result was “remarkable”.

He said: “It’s quite remarkable given the current circumstances and I don’t think it was an accident.

“This demonstrates the due diligence implemented by Mr. Baty and the team.

“It’s not about picking winners, it’s about picking good prospects and I think that’s the key for that.

“There’s been so much money that’s been poured out to anyone who honestly says, ‘Hello, I’m a business.'”

Mr Baty told the committee that since ELI was set up in 2001, it had provided more than £3.2million in loans to 367 local businesses, creating 878 new jobs and protecting nearly 2,000 workers.

He said that over the past 12 years, the level of bad debts written off was 3.12%.

Asked by committee chair Councilor Jane Henderson if ELI was under pressure to expand, Mr Baty said there was no pressure on lending as other schemes were now available.

However, he said the banks had “withdrawn” from lending to street businesses and start-ups.

He said: “We have seen this year in particular that they [banks] are not interested in start-ups.

“We heard through the grapevine talking to applicants where Banks said, ‘I really like your business idea, but we’re not touching it. “”


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