Royal Bank of Scotland

Debate between Andy Slaughter and Guto Bebb

Thursday 5th November 2015 Commons Chamber

[Guto Bebb (Aberconwy) (Con)]

It is a pleasure to follow the hon. Member for Ross, Skye and Lochaber (Ian Blackford). I associate myself with his final comments about RBS.

This is an important debate and I congratulate the hon. Member for Edmonton (Kate Osamor) on securing it. I put my name to the motion simply because I feel that this issue is worthy of debate in the Chamber. I am not ideologically opposed to seeing banks in private ownership—I am probably guilty of being ideologically of the view that banks should be in private hands—but it is important that we consider this issue in depth and in the round. It is important that we look at the track record of RBS and what we want from it, to ensure that we make the right decision.

In the context of the debate, my hon. Friend the Member for Horsham (Jeremy Quin) was quite brave to argue the case for RBS going straight into private hands at this point in time. Unfortunately, I do not share his confidence in the regulator, having spent three or four hours with the Financial Conduct Authority again this week. RBS still has a huge credibility gap with the general public and, more importantly, with the small business community. That gap needs to be addressed before we can entrust RBS to act in a manner similar to the way it acted in the past. I would be delighted to stand here today and say that the culture in RBS had changed completely. I am utterly convinced that within RBS there are individuals who are making huge strides to change its culture, but am I convinced that all the bad eggs have been removed? Am I convinced that all possibility of actions that are detrimental to small businesses within RBS has been removed? Unfortunately, the answer is no.

[Andy Slaughter (Hammersmith) (Lab)]

I entirely agree with the hon. Gentleman that RBS made mistakes. It is still making mistakes, while largely in public ownership, in relation to funding for small businesses and branch closures. Does he not think that before it is returned to the private sector, if that is going to happen, it has to prove that it can run itself competently in the interests of its customers?

[Guto Bebb]

I would certainly say there is a need to look in detail at the way RBS is performing. There are questions still to be asked about the corporate culture within RBS and questions raised by the Banking Commission need to be looked at.

It is important to state that this is not a left-right political argument. There are think-tanks on the right that think we should look again at the UK banking model. There was strong agreement when my hon. Friend the Member for Wycombe (Mr Baker) stated that the loss of the mutual in the 90s was a mistake for the financial structure of the UK. This is not a left-right argument; it is about trying to get things right and ensuring that, as a result of intervention in the market that we did not want to make, we deliver a better banking system. It is important to state that the reason for intervention in the market was much wider than making a profit for the taxpayer: it was to ensure the UK economy was protected at a very difficult time.