NatWest: Account Terminations and Branch Closures

Lord Reid of Cardowan Excerpts

Wednesday 10th January 2024 Lords Chamber

[Baroness Vere of Norbiton (Con)]

I am grateful for that intervention, because that is precisely what we intend to do. We are placing the existing voluntary arrangements set up by the banking sector on a statutory footing. There is a consultation out at the moment by the FCA, part of which is asking what factors and criteria should go into any assessment—the number of people in the area, the number of SMEs affected, the impact on the vulnerable and what other cash access services there are. Of course, rurality will impact on all those factors, so it will be taken into account.

[Lord Reid of Cardowan (Lab)]

My Lords, I suspect that I am not the only Member of the House to have noticed a marked deterioration in customer service from the banks over the past 20 years. Digitisation was supposed to improve that, but it has got much worse. Of course, this is generic—witness the comments made about HMRC—but banking, of all areas of commerce, depends more than anything else on trust. Trust is greatly enhanced by personal contact and greatly reduced when there is none. The Minister said earlier of HMRC that you are always given six options—yes, you are, but, mysteriously, none ever seems to apply appropriately to the question I have. So has she carried out a simple survey of customer satisfaction with banking and, if so, what are the results?

[Baroness Vere of Norbiton (Con)]

The Government do recognise that banks hold a key position in our society. We need to ensure that our banking system meets the needs of that society. Certain banks, as I am sure the noble Lord is aware, pride themselves on keeping their bricks and mortar on the high street. If customers require that sort of service, they should be able to vote with their feet.

Defence Spending

Lord Reid of Cardowan Excerpts

Thursday 16th March 2023 Lords Chamber

[Baroness Penn (Con)]

I believe I said earlier that one of the things we will be able to do with our funding is bolster our conventional stockpiles. But I want to be clear with noble Lords that the £2.3 billion commitment we made to Ukraine in 2022-23, which we are also matching going into next year, is over and above the money I have set out today.

[Lord Reid of Cardowan (Lab)]

My Lords, I know the Treasury likes to speak in percentages and aggregate sums, but can we cut to the chase? Will the Minister confirm that, as far as the Treasury knows, over the next few years our Armed Forces will reduce the number of soldiers, ships and planes? She may consult her colleague from the Ministry of Defence if she wishes.

[Baroness Penn (Con)]

I am very happy to have my noble friend sitting next to me. We constantly review our capabilities, but the vision for the future of our defence as set out in the original integrated review remains the vision for defence in this country. However, additional resource has come in as a result of the integrated review refresh, in order to reflect the new circumstances in which we find ourselves.

Queen’s Speech

Lord Reid of Cardowan Excerpts

Thursday 4th June 2015 Lords Chamber

[Lord Reid of Cardowan (Lab)]

My Lords, I am genuinely delighted to welcome the Minister to the Dispatch Box, for three reasons. First, he deserves it. Indeed, he deserves to be in the premier league on this side but at least he is on the red Benches, which should be some consolation to him. Secondly, it enables us to continue our occasional discussions on the great affairs of state, which of course involve the future of Manchester United Football Club. Thirdly, he majored on the truth that up to this stage dare not speak its name—productivity.

We are seven years on from the biggest recession in modern times—seven years during which we have had the slowest recovery—and five years of that, courtesy of the blessed Fixed-term Parliaments Act, have effectively been a general election campaign. I listened to the speeches, I read the articles and I looked at the manifestos and there was a great deal of advice on how to spend money, how to allocate resources and how to distribute wealth but nothing—nothing—on how to create wealth, from any of the parties, incidentally. So I am glad that the Minister is now majoring—now that the Government are safely berthed, as they see it, for another five years—on how to face the storms ahead, not least of which is productivity.

I want to make three points specifically on productivity and I do so from a background that has nowhere near the expertise that the Minister brings to the subject. First, there seems to be a danger of exploitation squeezing out exploration when it comes to productivity. Productivity has to do much more than just find more efficient ways of doing the same things. It needs exploration as much as—perhaps more than, in the present circumstances—exploitation. Sacrificing one for the other is not only unproductive but strategically very dangerous.

In that context, how productivity is measured therefore matters a lot. The Minister mentioned his scepticism about some statistics. I also have a great deal of scepticism about the means by which we measure productivity: the rate of output per worker per unit time, or labour productivity; and the residual of output not explained by the amount of inputs used in production—that is, the total factor production. These of course feature large in debate among the experts but they tend to assume that radical changes in modes of production do not need to be matched by radically improved means of measurement. I doubt that is the case.

The practical results of inadequate measures are real enough, though. Ordinary people feel the spectre of labour being substituted for technology and vice versa as exploitation far more widely than high-priced experts who are often indulging in groupthink—the very phenomena which enabled us to stumble into the recession last time around. As a result, people’s job anxieties are needlessly provoked and capital is poorly invested. Exploitation squeezes out exploration at all levels. It is remarkable that rather than investing capital surpluses in necessary innovation, last year share buybacks —buying back our own shares—amounted to $903 billion for the S&P 500. The failure to reinvest capital manifests itself in all sorts of small but significant ways: for instance, in unproductive labour being employed in the revival of hand car washes because of the failure to invest in highly successful technology, which is also, by the way, environmentally very sound.

These examples evidence two major failings sapping productivity. First, there is the failure to invest in research-intensive innovation that is vital to our competitive future—for instance, in UK biotech. Secondly, there is the failure to liberate labour for more productive endeavour by withholding capital investment, even in exploiting well-established technologies. Both are of course linked. Productivity measures are—to coin a phrase—not entirely fit for purpose, given the strategic challenge ahead of us. They are skewed to exploitation squeezing out exploration. The Chancellor, or the Minister, may well be spurred into action at long last on productivity but would be well advised to assure himself that he is using instruments calibrated for the real economy, not financial groupthink.

Secondly, unless we learn to innovate at the pace, intensity and scale fit for the strategic challenges ahead, our problems will grow, not our productivity. For centuries, British ingenuity and innovation have enabled us to sit astride the spokes at any given contemporary period of the globalised world. The shipping lanes we opened were complemented by financial services that underpinned confidence in growing trade. We constantly evolved, building coaling stations and laying submarine cables, which in turn allowed us to dominate the world’s communications, and developing engines to propel ships, trains, planes et cetera. At the heart of that is a language and ethos for pragmatism, which we share for the better conduct of business and science the world over. However, something has stalled. A deep, wide and persistent productivity disease has taken hold and we cannot afford that.

The third and final point is the advent of cyberspace. Success in the cyber environment, an environment characterised by constant entrepreneurial innovation, makes this issue more essential than ever. Yet according to the European Union Innovation Union Scoreboard 2014, despite the fanfares for Shoreditch and the Silicon Roundabout, the UK is an EU follower in cyberspace, not a leader. The evidence suggests that however world-class our research and education are, they simply fail to translate into innovation that sells. In particular, I say to the Minister that this includes an overweening financial services sector, which the Bank for International Settlements and the IMF warn can undermine productivity severely because its interests are served by generating short-term transactions, not investment in research and development or capital-intensive industries in the real economy.

If we are honest, we may be able to face these things. If we are dishonest and ignore these productivity inhibitors, as all parties did in the election, things will only get worse. Our fitness for the cyber environment is a benchmark that we must set for ourselves at “excellent” and “world-leading”. Reaching such benchmarks needs some very practical and sustained effort, and that effort needs to start now.

Assisted Dying Bill [HL]

Lord Reid of Cardowan Excerpts

Friday 7th November 2014 Lords Chamber

[Lord Reid of Cardowan (Lab)]

My Lords, I will probably make the shortest speech that I have made in this House, and your Lordships will no doubt be relieved about that. I am not a medic or a lawyer, nor have I put in the hours that many noble Lords have obviously put in on the details of this legislation. However, we should ask of this group of amendments: “What is the essence of the subject that we are addressing?”. Surely it is the essential question of whether a decision of this nature should be based on the free will of the patient and the expertise of the medical profession or whether we ought to go further than that, whether through legislation, via the amendments of the noble Lords, Lord Carlile and Lord Pannick, or whether through the suggestions of my noble friend Lord Campbell-Savours.

I have a view based on a very banal and simple old principle. Perhaps I may paraphrase one old philosopher who said, “Yes, men and women do have free will but they don’t exercise that free will in circumstances of their own choosing”. Surely what we are essentially asking is whether there should be an examination of the circumstances in which men and women operate their free will and make a decision. I believe that, on such a profound question, there should be, and I do not believe that the medical profession is adequately equipped to do that in all aspects of the circumstances.

Therefore, I say to those who are proposing and advocating this Bill: please do not believe that those of us who think that circumstances affect a decision that people make of their own free will are somehow opposing the principle behind the Bill. It is a safeguard that recognises an eternal reality.

[Lord Winston (Lab)]

My Lords—

Northern Ireland: Corporation Tax

Lord Reid of Cardowan Excerpts

Monday 15th October 2012 Lords Chamber

[Lord Reid of Cardowan]

My Lords, of course this is an extremely complex question, not least because of the implications, as the Minister pointed out, of the Azores judgment and the potential burden on the Exchequer of Northern Ireland. In all these deliberations, will the Government bear in mind that Northern Ireland truly is a unique case, not only because of its border with another sovereign state—it is the only nation in the United Kingdom to have one—but because of the decades of very difficult and dangerous circumstances through which its people have come and because of the economy’s and employment’s ultra-high dependency on public expenditure in Northern Ireland? Will the Government at least look for some additional spark to move the dynamism of the private sector in Northern Ireland for the benefit of all the people there?

[Lord Newby]

The Government absolutely acknowledge that Northern Ireland is a unique case. That is why, while the whole issue of regional aid in the EU is being looked at at the moment, the Government are working very closely with Northern Ireland officials to consider how best to make the case for Northern Ireland receiving assisted-area coverage over and above that which would normally be provided for the rest of the UK.

Eurozone Crisis

Lord Reid of Cardowan Excerpts

Thursday 27th October 2011 Lords Chamber

[Lord Sassoon]

My Lords, first, I shall try to clear up what I think is a small confusion in relation to what the IMF can or cannot do under its own rules and what we would be prepared to be part of or not part of. Of course, the IMF is involved directly in the Greek package, as it is with two other packages within the eurozone. So three programmes out of the 53 in which the IMF is currently involved are indeed eurozone ones and that is perfectly proper and we support the IMF’s commitment in adjustment programmes of that kind. We would not support the IMF participating in some special purpose vehicle fund, but I do not believe that it has the ability to do that anyway and the UK certainly will not be involved in that. If China and other countries want to be involved, that is fine and that is their decision, but we will not be involved and we will not support any IMF involvement in that route. We will support the IMF's involvement in country adjustment programmes, such as it has done throughout its history. That is what the IMF is there for. There may be some confusion on that.

On tax co-ordination, first, the UK Government stick strictly to their position that we believe that taxation is, and should remain, a matter of national competency. It is up to the eurozone if it wants to propose some different arrangements within the eurozone consistent with the need for greater fiscal co-ordination in it. On the one specific proposal that has come forward so far—the financial transaction tax—first, we have said that there may be some basis for such a tax but only where it is globally applicable because if it is applied in Europe it will simply drive business away from Europe and, critically, away from the City of London, and that makes no sense. Secondly, in bringing forward that proposal the Commission was completely clear that the article under which it comes forward is one on which unanimity is required and therefore QMV could not force us into it.

[Lord Reid of Cardowan]

My Lords, I do not in any way want to belittle any of the efforts that have been made, but does the Minister accept that over the past 24 hours in Europe we have been arguing over the size of the sticking plaster on a corpse that has an underlying chronic problem? Did he not indicate the nature of that problem when he said that the eurozone will work only if the countries in it approximate towards relative competitiveness? Is not the key problem that that should have preceded the onset of a single currency? The delusion that you could politically impose a single currency on such variegated competitive levels inside 17 countries was always bound to end with the chronic problem that we are facing. In view of that, what is the strategic thinking of the Government? Do they now maintain that the present membership of the euro is an inviolate and irreducible minimum? If they do, do they therefore accept that it can exist only with the concentration of ever closer political and fiscal union inside the eurozone? Can the Minister explain how support for ever closer political and fiscal union inside the eurozone accords with the Government’s view of opposition to ever closer political union within the wider 27? If not a contradiction, is there not at least a very difficult paradox underlying the strategic position in which the Government now find themselves?

[Lord Sassoon]

First, it is probably not productive to rake over too much of the history of this. An awful lot of those who advocated the creation of the euro and the UK’s participation in it have been proved completely wrong by the way that events have unfolded over recent years. Therefore, arguing about whether competitiveness should have come before or after the creation of the euro is more for historians. That is why it was in my right honourable friend the Chancellor’s Statement that the competitiveness of the euro-periphery countries, vis-à-vis Germany as the benchmark of economic and industrial efficiency in Europe, is a critical issue that has to be addressed; and that the second dimension is the competitiveness of the EU as a whole in a global economy. I completely agree with the noble Lord that this has to be central to the solution going forward.

As to who should or should not be in the euro and what the size of it should be, that is for the euro to work out. The Government have no view on whether euro membership is inviolable. We simply say that that is a matter for the eurozone. What we want to see is these issues of competitiveness within and without the eurozone very high on the agenda. As far as dealing with internal competitiveness is concerned, that inevitably means a degree of closer fiscal co-ordination, the inevitability of transfer payments between members and all the logic that flows from that.

The competitiveness of the EU27 and the outward-facing euro are completely different matters that do not require similar questions of political union. We have a very good paradigm in which the EU27 can co-operate. It is just a matter of them focusing on the structural, market, competition and financial regulation issues, none of which requires any closer political union. They are technocratic, single-market trade and economic issues.

Savings Accounts and Health in Pregnancy Grant Bill

Lord Reid of Cardowan Excerpts

Tuesday 7th December 2010 Lords Chamber

[Lord Sassoon]

My Lords, I do not think that we should stray into a constitutional debate this afternoon. The point that I wanted to make was that this Bill was certified by Mr Speaker and that it was not a certification that we should be challenging. As far as I am aware, the Bill was dealt with in another place exactly as other money Bills have been, and the suggestion that there has been some improper behaviour by the Government on this matter, or that somehow there was something different—

[Lord Reid of Cardowan]

I do not think that anyone is suggesting that there has been improper conduct. We did not stray into this territory—the Minister led us there by describing in some detail the process. If he is now saying that he does not know what the process was, will he indicate to us whether his original statement was accurate or an assumption on his part?

[Lord Sassoon]

My Lords, as I said before, I have given a description of the process and indicated that there was no question that the Government in any way behaved in some out of the ordinary way with this Bill, as has been hinted at. I really think that—

Ireland: Financial Assistance

Lord Reid of Cardowan Excerpts

Monday 22nd November 2010 Lords Chamber

[Lord Reid of Cardowan]

My Lords, I thank the noble Lord for repeating the Statement. I wholeheartedly believe that the Minister and the Government are correct to extend their assistance and solidarity to Ireland at this time, not least because of our closeness as neighbours and trading partners and because of our mutual interests on the island of Ireland itself. It is understandable that the noble Lord and the Government maintained their silence on discussions up to an appropriate point.

Will the Minister ensure that, while everyone understands that extended assistance of this nature will require discipline and considerable restraint on the part of the Irish, the British Government will never lose sight of the fact that ultimately it will be growth that will take Ireland and many other nations out of the position in which they find themselves? Therefore, any constraints placed on the Irish as a condition of the loans and the assistance that we give them should not, if we can help it, constrain that growth to the detriment of Ireland's success.

[Lord Sassoon]

I am grateful to the noble Lord for his remarks. It is important to remember that the IMF is very much involved in the negotiation of the terms of the loan and brings to the party very considerable experience of putting together loan conditions in similar situations. From its previous experience, it will be well seized of the need to see the Irish economy—along with other economies that have this problem—growing in future.