Many companies backed by private enterprise groups carry large amounts of debt to reduce their tax bills, and because of these debt levels, European Union rules have so far excluded them from being able to apply for emergency government loans made available to businesses during the coronavirus pandemic.

The Financial Times reports that the Business, Energy and Industrial Strategy department, known as Beis, is actively looking for ways to provide help to such companies including PizzaExpress and the Prezzo restaurant chain, although it has warned that there is no guarantee that it will be able to find a solution.

Almost 750,000 jobs have been lost during the pandemic so far, including from such household names as the Boots pharmacy chain and Debenhams department stores, and according to the British Private Equity and Venture Capital Association, companies supported by private equity are responsible for more than 840,000 jobs, which could potentially be at risk if support is not forthcoming.

"We are aware of the issue surrounding some firms being able to access (the loans) . . . and continue to explore whether anything more can be done to support these businesses," said a government spokesperson.

In recent times, take-up of the government backed loan program has tailed off. Over the last two weeks, 896 companies applied for funds from the Coronavirus Large Business Interruption Loan Scheme, and around 120,000 applied to the Coronavirus Business Interruption Loan Scheme, for smaller enterprises.

An private equity industry insider said it would be "nice to get clear on (the state-backed loans) and we wouldn't have these challenging conversations with the banks," calling them "more attractive and less onerous" than other borrowing options.

Government support loans come with a guarantee of the taxpayer paying up to 80 percent if the company fails, so if they were to be opened up to organizations which work on the basis of carrying debt, while withholding cash for future investment, it would be a very contentious decision.

Peter Morris of the Oxford University Said Business School told the Financial Times there would be a fundamental contradiction in doing this.

"Private equity firms and their supporters often talk about the virtues of the so-called discipline of debt," he said. "It seems hard to square that with accepting taxpayer handouts."