GORDON Brown yesterday promised that the government would take "all measures necessary" to get the banks lending again to small businesses.
The Prime Minister said that ministers were ready to bring forward proposals "very, very soon indeed" to get the banks to "accept their responsibilities".
In the Commons, Mr Brown repeatedly came under fire at Prime Minister's Questions over the
failure of the banks to restore credit lines to small firms, despite the government's bail-out of the banking sector.
David Cameron, the leader of the Conservative Party, warned that businesses were being "strangled", while Nick Clegg, leader of the Liberal Democrats, accused Mr Brown of being "complacent" in the face of the banks' refusal to co-operate.
Mr Brown told MPs that ministers and officials were meeting the banks and building societies "almost every second day" to try to resolve the problems.
"We will be bringing forward proposals very, very soon indeed," he said. "The banks have got to accept their responsibilities. We have done what we can, they have to accept their responsibilities to act in a manner that is responsible and fair. We will take all measures necessary to help small businesses get the loan capital they need."
Mr Cameron, however, complained that government action was not working and he urged the Prime Minister to establish new institutions to underwrite lending to business.
"What has been done so far has not yet worked properly and we need to do more on the credit side to make sure that small businesses aren't strangled," he said.
"This is about small businesses in the real world that are struggling and want to know how we are going to get credit moving again."
Mr Clegg said firms were being "forced out of business overnight" because the government was too weak to act.
"The bankers can't believe their luck. They have got billions of pounds of taxpayers' money, they can keep their bonuses and they don't have to lend to companies," he said.
