The Government pledges to do more to recognise the Fashion Industry

Whilst taking a tour of Central Saint Martins College new King’s Cross building, Cable commented that the fashion industry is seen as an “incidental luxury”  and not as a crucial part of the economy but insisted its role is crucial to “building the economy”. Cable admitted that the industry’s impression on the economy was not taken seriously enough but did add that “The Government has an obligation to support it,”

The reason for the Business Secretary’s visit, which also included a tour of Jaeger’s and Aquascutum’s head office, was to bring together the “two big strands” of his role. “I’m responsible for universities and for building the economy, and the creative industries are central to that,” he told Drapers. “I wanted to come here to know if [Central Saint Martins] needs any funding.”

He added: “The Government is committed to the continued growth of the [creative] sector. Last year we set up the Creative Industries Council with figureheads from across the creative and digital industries. We are supporting creative companies through research and development tax credits, enterprise finance guarantee schemes and grants from the Technology Strategy Board.”

Cable also had the chance to speak to Nigel Carrington, the rector of the University Arts London, to which Central Saint Martins belongs and Harold Tilman, owner of Jaeger and Aquascutum and chairman of the British Fashion Council. These meetings were a chance to raise issues and to raise the importance of the fashion industry.

One of the major issues to come to light was banks and the lack of help the retail seems to receive. Tillman told Drapers. “But the problem is about banks. Bringing interest rates down is not what people are looking for. People are looking for money to grow, but I don’t believe banks are helping businesses that are asset-backed and the Government is not giving them the incentive to.  The biggest thing the Government could do to help is to restore consumer confidence. People aren’t spending because they don’t have enough money. They’re cautious because of cuts and job losses. It’s this that is hitting retail most.”

Anupam Jhunjhunwala, chief executive of value retailer Store Twenty One, has suggested that banks tend to assess businesses on their sector and for retail, in particular, the tough trading conditions and that of business partners are discouraging lending.

An HSBC source denied there is a problem with banks lending to retailers. One of the issues has been retailers securing long-term loans to fund working capital and short-term cash generation which leads to cash shortages, the source added. “Where’s the cash going to come from for the next cycle of orders?” Being able to demonstrate sustained cash flow and an ability to repay is key to lending, the source argued.