Building Societies Association
Feature
Chancellor reaffirms commitment to strengthening building societies and mutuals
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Date:
30 Jun 2010
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The Chancellor of the Exchequer, George Osborne MP, has restated his commitment to strengthening and supporting mutuals and to considering turning failed banks into mutuals.
In a debate on 16 June, following an emergency Parliamentary question on financial services regulation, the Chancellor was asked by Rachel Reeves MP whether failed banks such as Northern Rock would be turned into mutuals with focus on long term return rather than short term profit. Mr. Osborne replied; “we (the government) are prepared to consider lots of options. Sir John Vickers’ commission is going to look at the competition in the banking industry. It has become incredibly consolidated in the past couple of years and that is not necessarily the best thing for bank customers.” The Chancellor also stated that the government needed some time before deciding how they will dispose of the shares they hold in Lloyds and RBS and how they will dispose of Northern Rock. At present, he said, the British taxpayer would make a loss on these. He finished his answer by stating that, “It is sensible to look at what Sir John Vickers and his commission have to say about this.”
Mr. Osborne was later asked by Jeremy Lefroy MP whether he recognised the ”importance of building societies and mutuals to the financial sector.” The Chancellor replied; “building societies and mutuals have an important role to play in the future. We want to strengthen them and support those who want to create mutuals.” He stated that plans of how the government will do this would be set out in the next few weeks.
The Chancellor’s responses reaffirm commitments made in the final coalition agreement published in May.
The full debate can be viewed via the link below -
