Business fund has helped secure over 200 jobs
Published 28 Nov 2012
A fund designed to distribute loans to businesses in the far north has helped retain and create 218 jobs since its inception in 2006.
The North Highland Regeneration Fund (NHRF) investment of £1.8 million into the economy in Caithness and north Sutherland helped sustain and grow businesses which have been unable to borrow money from banks.
With a high success rate on the loans made, fund representatives say they are looking to a bright future as the economy in the region continues to grow.
Board director and local MP John Thurso said the fund, which is bankrolled by the Nuclear Decommissioning Authority, was established only months before the financial catastrophe which put the world in the grip of recession.
He said it has been a lifeline to many businesses in the area which would otherwise have collapsed.
"We are now at the stage where we are using money that we originally loaned out," he said.
"The financial collapse has put a huge strain on businesses and people who naturally would have been OK with support from banks have been coming to us.
"It is still a tough environment out there but we have secured almost 220 jobs as a result of the funding that we have given."
The initiative was designed to fund the start-up of new ventures and the growth of existing businesses as part of the drive to replace the jobs being lost as Dounreay is decommissioned.
The average amount loaned is between £25,000 and £30,000 out and currently there is £400,000 available in the fund.
John Thurso said the idea is to support businesses that will bring wealth to the region as well as sustain and create employment as Dounreay nears its projected closure date of 2023.
"We have supported businesses such as Caithness Biscuits and Reids of Caithness which have been very successful on the international market.
"What we will not do is support companies that compete against other firms in the region.
"Whatever the company does, they have to be exporters and bring wealth to the north Highlands.
"Our job is to take risks that the banks won't, but whoever we loan money to we work very closely with, striving to make their business as success."
It's not been all good news for the fund, with seven firms going out of business and defaulting on a total of £288,000 of loans. The most recent was Geddes Windows and Doors in Halkirk, which accounted for 60 per cent of the figure.
John Thurso said that whatever the circumstances in the failure of a business, the fund is there for people who wish to take a calculated risk.
"If we had not had a default, we would not be doing our job - our purpose is not to be too cautious as our ethos is to be beyond the banks," he said.
"We try hard with companies to ensure they do not go under but if nothing had ever gone bust, we would be the best venture capitalists that walked the earth or were too cautious.
"I make no apology for giving failed businesses money as we are about giving ambitious firms a chance.
"We are not the answer to economic regeneration but we are one small part of it designed to help small business and it will continue to recycle money in the future."
Caithness and North Sutherland Regeneration Partnership manager Eann Sinclair said the north Highlands has been bucking the trend in terms of new start-ups with an estimated 40 businesses having started up in the last financial year alone.
He said that NHRF has had a massive role to play in stabilising the business economy since the economic crash.
"It has helped as a source of loan funding at a time when people have had trouble accessing money from other places," he said. "The role it has had to play has made it even more important due to the absence of a wider range of funding that used to exist.
"It has stimulated business growth where it might otherwise not have happened without it and in a wider context where we had been under-performing in business start-ups in 2005, we are now out-performing the rest of the Highlands."