An All-Party Parliamentary Group has called on the Government to urgently set out a plan for how it will foster diversity in financial services, as promised in the Coalition Agreement. Published today, the report, ‘Fostering diversity: promoting mutuals,’ reflects the findings of an Inquiry conducted by the All-Party Group over the past six months. The Report considers how Government and Regulators have acted in the light of the Coalition Agreement pledge.
The report concluded that the Government has so far been unable to articulate a clear vision for promoting mutuals. Key findings of the Inquiry include:
Government has concentrated its policy efforts on encouraging the development of new mutuals to provide public services rather than focusing on the importance of the existing financial mutual sector
Government needs to urgently adopt a comprehensive policy strategy to implement its Coalition Agreement commitment to promote these mutuals.
The priorities of the Financial Services Authority are not aligned with this Government objective to promote mutuals.
Upcoming legislation to establish the new regulatory authorities must specifically commit them to promote mutuals and foster diversity.
Jonathan Evans MP, Inquiry Chairman, said:
“We applaud the Government’s enthusiasm for creating new mutuals in the public sector, but similar attention should also be focused on those mutuals that have served consumers well for generations. During the financial crisis, we saw that mutuals fared better than their plc counterparts, showing the importance of a plurality of corporate form. A year into the new Government, we now need to see a clear strategy that helps avoid another financial crash. Mutuals will play their part in helping to develop this, but it is essential that the Government takes notice of our Group’s recommendations to deliver on this important Coalition commitment.”
- The All-Party Parliamentary Group (APPG) for Building Societies & Financial Mutuals was established to discuss and support building societies and financial mutuals. There are 126 Members of the Group, representing all parties in Parliament.
- The report was written by Peter Hunt and Matthew Ball from Mutuo, which acts as Secretariat to the APPG.
- This report is a response to the Coalition Government’s Agreement of 12 May 2010, (Page 9) which stated “We want the banking system to serve business, not the other way round. We will bring forward detailed proposals to foster diversity in financial services, to promote mutuals and create a more competitive banking industry.”
For further information please contact:
Jonathan Evans MP, 020 7219 7205
Peter Hunt, Mutuo, 07785 223846