'Project Birch' plan to bail out firms

Aviation, aerospace and steel firms among those facing acute problems, while carmaker Jaguar Land Rover is also talking to the government, although the company declined to provide details. Under Project Birch, Mr Sunak has increased the capacity of the Treasury to handle bespoke bailouts of “viable companies which have exhausted all options”, including government loan schemes. The chancellor’s allies said the Treasury would not initially look to take equity stakes in struggling companies, some of which do not have investment-grade credit ratings and cannot access a Bank of England commercial loan scheme. Gallery: Thousands of UK retail workers furloughed (Business Insider) Mr Sunak’s allies play down the idea that a Conservative government could engage in a massive wave of nationalisation or part-nationalisation, but the chancellor is facing calls to go down that route and some see it as inevitable. If you’re lending money, say to an airline, it’s only right the taxpayer gets its fair share of the success at the end.” Jim O’Neill, former Treasury minister and ex-chief economist at Goldman Sachs, has discussed with government officials the creation of a public-sector-owned funding body — perhaps with an initial investment capacity of £25bn — to take stakes in “inherently stable” businesses. Andrew Bailey, governor of the Bank of England, told MPs last week that some companies would conclude that more debt was not the right answer to their problems and they needed more equity.