23 April 2009 | Martha McKenzie-Minifie
Professional groups are cautiously welcoming the £5 billion supply chain insurance pledge in yesterday's Budget.
Under the government scheme, eligible businesses will be able to purchase "top-up" credit insurance cover from 1 May until the end of the year. It can be purchased in respect of reductions in cover that have occurred since 1 April.
CIPS chief executive Simon Sperryn said in a statement yesterday the organisation believed the initiative was crucial for the wider business environment.
"The importance of supply chains cannot be overplayed for companies of all sizes: like a deck of cards, knocking out one supplier can bring the whole supply chain down, wreaking havoc and creating devastating results," he said.
But he added a note of caution.
"It's extremely disappointing for those which have had their credit insurance either withdrawn entirely or have had their support significantly reduced before 1 April. Even strong businesses will be suffering."
Nick Starling, the Association of British Insurers' director of general insurance and health, said: "In ensuring that healthy companies will get extra support, the government has not tried to second-guess the judgement of insurers."