However Davies's appointment only reinforces the paradox that a prime minister who claims to be a great democrat is relying to an extent unprecedented since perhaps the 19th Century on unelected ministers in the Upper House to fix his biggest problems.
Unlike Digby Jones, Davies will join the Labour Party. And he'll endeavour to avoid the inevitable sniping about financial conflicts of interests by putting all his assets into a blind trust. He won't be taking a salary. So what's in it for Davies? Well the day job is trying to promote trade and inward investment - which he sees as proper public service.
Given his expertise, he'll also have a useful sideline in the war against the credit crunch, the contraction of lending, as yet more imaginative uses of taxpayers' money are found to reverse the crippling contraction of credit available to households and businesses. In that context, probably the most significant feature of today's announcement that something over £11bn of our money is being pledged as loan guarantees and investments in small companies is that ministers believe it'll generate some £10bn of additional lending to small and medium size businesses (that is lending on top of the £21.3bn being guaranteed).
They're stipulating that banks can only take our financial help if they pledge to use the resources that are then released to provide new loans to companies with a turnover of less than £500m.
Budget Planner
Product Advisor
Debt Help Forum
FAQ
