Firms cite the domestic economy, consumer demand and access to finance as the main barriers to growth.

A falling number of firms have approached the banks – something we believe must be addressed if we are to move business forward.

Year-on-year the number of businesses applying for finance has fallen from almost 23% in Q1 2012 to 20% in Q1 2013. The number of applications accepted has fallen to 41% from 44.5% in Q1 2012.

Positively, and perhaps a sign that Funding for Lending is beginning to filter through, successful applicants have seen costs fall, with almost two in five small firms (38.6%) charged interest rates of less than 4%. This is well up from 25% in the same quarter last year. At the other end of the scale, the share of firms offered credit with interest rates of 11% or more has fallen back to just 6.5%, down from 17% in Q1 2012.

The Chancellor must put in place a plan for a Business Bank, outline how it intends to increase competition and also promote non-bank finance. The bank should focus on micro-business financing, longer-term and higher risk loan applications and advice.

A recent survey suggests that small businesses expect to marginally increase their staffing levels over the coming three months. Financial and business services’ remain the most optimistic, while retailers and manufacturers expect conditions to deteriorate.

Eight regions have seen confidence increase year-on-year, with the North East recording the largest annual increase in their confidence reading of +15, while businesses in southern regions retain strong optimism. Fuel (56%) and utilities (51%) remain the main driver of increased business costs.

It is great news that confidence is beginning to edge up and back in positive territory. This bodes well for GDP figures for Q1 and we would expect them to be better than the -0.3% in Q4 2012.

However, we know that inflationary pressures are likely to persist this year, especially through rising energy bills and fuel costs which affect disposable incomes.

We have to move into a scenario where spending and investment is encouraged – and afforded. The holding back of money by large corporates stifles the supply chain. Regulation has to play a part loosening things up. We need measures that encourage competition and alternative banking or funding streams.

Smaller banks must be able to access funding on an equal footing.

Meanwhile, areas with high public sector employment remain exposed to job cuts. This is reflected by recent trends showing east Kent with an above average proportion of the public sector seeing a rise in unemployment while districts in west Kent have seen a drop.