The BSA welcomes the Government’s commitment to achieving strong, sustainable and balanced growth that is more evenly shared across the country and between industries. BSA members all have their main operational headquarters away from the City of London, and are a significant regional presence – as businesses and as employers- in the Midlands, the North of England, and in Wales, Northern Ireland and Scotland. So we share the Government’s desire to see growth more evenly distributed, and our members will be instrumental in the wider spread of prosperity across the country.

We also applaud some of the key statements and remarks in the Chancellor’s letter dated 8 July 2015 to the Governor of the Bank providing the coming year’s remit and recommendations for the Financial Policy Committee. First, we agree with the Chancellor’s analysis that, while financial stability and growth can be complementary, in some circumstances there may have to be tradeoffs, which should be managed and communicated transparently. The BSA has long argued that such trade-offs should be recognised, and that the cumulative impact of micro- and macro-prudential measures should be assessed so that they do not go beyond the “tipping point” into a net negative effect on economic welfare. So we are pleased that the FPC now accepts that such cumulative assessment is necessary.

We also applaud the Chancellor’s recognition that ensuring a diversity of business models is part of achieving more competition and innovation in retail banking and in the financial services industry generally. We encourage the Treasury to provide legislative underpinning for the Chancellor’s words through a suitable diversity objective. We return to this suggestion below. And as a specific instance of ensuring this diversity, we also make a modest request on behalf of our three credit union members.

Read the full response here.