Banking Sector Failures

Debate between Bob Stewart and Drew Hendry

Thursday 12th July 2018 Westminster Hall

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Bone. I congratulate the hon. Member for East Lothian (Martin Whitfield) and the hon. Member for Stirling (Stephen Kerr) on securing this important debate. I am delighted to speak for the Scottish National party and I share almost all the concerns that have been raised so far. I say almost, because I have a few more direct criticisms of the UK Government and what they could have done and should do in the future, but I will come to those in due course.

What I think we would find in common among those who have looked into the practices of the rogue banking sector is the palpable anger about the treatment of people who have found themselves in grossly unfair situations. The hon. Member for East Lothian started off by talking about the drive for high standards in the industry; there is a drive among some people who are committed to achieving that, but that drive must be reflected among those in positions of power. He pointed out the absolute failure to support small businesses, particularly given the percentage—99.9%—of businesses and the £1.8 trillion figure that he outlined. I do not think it is often explained to a wider audience just how big and important the sector is, and it is vital across the nations of the UK.

The hon. Gentleman also made the point that trust in the banking sector has never been lower, and unfortunately I think that is the case. I say unfortunately, because I want to talk about the good parts of banking later on, but he is absolutely right. There is such a wide range of factors involved in the situation, and of course in the Scottish context the issue is quite disproportionate. I agree with his comment on that.

[Bob Stewart]

We are talking of trust. We are talking of despair—utter despair—in people. The despair with the banking sector is so great that that despair will be translated towards politicians unless we sort this out and help entrepreneurs. They have a right to expect us, as politicians, to sort this. Where else can they go but to us?

[Drew Hendry]

In typical passionate fashion, the hon. Gentleman makes a strong point. He is right that more politicians should be angry about this, and not just the hon. Members in this room or in the debates we have had recently in the Chamber. This is a critical matter that many more hon. Members should be focused on and concerned about. The hon. Member for East Lothian talked about the Government’s role, and I will come on to agree with some of the things he said and add my own comments. The disgrace of the Global Restructuring Group, which has been well rehearsed many times, is a vicious application of sharp practice by the GRG—although there were others, of course, and it was not alone in that.

The hon. Gentleman talked eloquently about the lost businesses, marriages and homes, and the people who have been stripped of their dignity and, in some cases, even pushed toward suicide. He made some positive proposals for the legal rights of SMEs, which were repeated by other hon. Members. He also said, tellingly—this is important for people—that the victims are not going away. This is not going to disappear just because the banks want it to; it will continue to be brought up.

The hon. Member for Stirling talked about entrepreneurs, and he is right. Entrepreneurs are important around the nations of the UK as those who take the risks—that is what it means. Anybody who has been in business knows that entrepreneurs often have to take risks that go beyond the norm, putting houses and property on the line, and in certain circumstances putting their family on the line—as we have heard in the context of the unfortunate outcomes—to take opportunities in business. He talked about fostering energy and ambition, which is exactly what banking should do. In some cases it does, and I will come back to some of that later, but I agree that it has proved to be frighteningly easy to erase businesses through technical breaches. That has been one of the biggest complaints.

The hon. Gentleman highlighted the sneaky practice of banks using insolvency practitioners to do their dirty work. He spoke about RBS GRG’s asset stripping and loading up on the profits from that, as well as its brutal application by RBS and other banks. We can all pinpoint a constituent who has been hammered by these things, and the hon. Gentleman spoke eloquently about his constituent John’s business being stolen from him. A common theme from all the contributions was the health effects on such people, including stress, anxiety and even heart problems, with families being almost torn apart. Similar to the line about victims not going away—I mean that in a positive way—he talked about the human cost, and he asked the Minister directly for clear action to ensure that justice is served. I will come back with some asks for the Minister as well.

The hon. Member for Beckenham (Bob Stewart) spoke passionately, and rightly so. I do not say that in a glib way; he is right to be passionate and outspoken. He talked about people being terrorised by GRG and Dunbar bank, about people’s life’s work being taken away from them and the fact that there is one-way loyalty. Isn’t that true? In all of the cases we have heard about, that has been the situation—it has been a one-way street. Some of the banks have been predatory; there is no other way to put it.

The hon. Gentleman also talked about small and medium-sized enterprises being unable to match the legal armies of the banks. That is a vital observation, because after the banks carried out this sharp practice—we do not know, but some may still be doing some of this without it coming to light—there was no real recourse. People do not have the ability to tackle it. By the nature of the problem, they do not have the money to access the rights for action. He pointed out that the Financial Ombudsman Service, as it sits, is not fit for purpose for SMEs. The hon. Gentleman said that small business is the life and blood of his nation, and I think that is even more acute in Scotland, where small businesses are even more central to the economy, as was mentioned.

I pay tribute to the hon. Member for Thirsk and Malton (Kevin Hollinrake) for his work. He made a point that I want to stress: banks provide vital services for businesses. When we criticise the people working in the banks, we talk about a fairly small number of key decision makers. We must appreciate that an army of people work in the banks who are good, hard-working, dedicated and honest people of great integrity who help people in their communities and in the wider business sector. I know that there is agreement around the room on that, but it is important to underline it.

As I said, banks provide vital services. When banks operate in the way they should, it is fantastic. When they operate in the ways we have seen, particularly with some of the decisions made at a corporate level over the past few years, it is absolutely destructive and no good at all.

Easter Adjournment

Debate between Bob Stewart and Drew Hendry

Thursday 29th March 2018 Commons Chamber

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Mr Speaker, may I start by wishing you, the House staff and all Members a very enjoyable Easter break? May I encourage Members to visit the highlands, and indeed to come to my constituency, where tourism comprises 20% of the economy? It is no surprise that people choose to go there, as we have one of Europe’s fastest growing cities, surrounded by stunning countryside. The growth of direct flights from Inverness airport has delivered record-breaking numbers of passengers and stays in our fabulous hotels, and our excellent restaurants are being used as well.

Why would not you, Mr Speaker, come to Inverness, Nairn, Badenoch and Strathspey to enjoy the snow sports in the Cairngorms or the golfing in Nairn? You could go on a cruise along Loch Ness with Jacobite Cruises. You might even choose to visit Tomatin distillery, Dalwhinnie distillery or indeed Speyside distillery, which has ambitious plans for expansion, starting with a new shop and visitor attraction in Aviemore.

We encourage cycling and walking in my constituency, and we have fantastic biking and walking trails. I pay tribute to Grantown Grammar School. Its approach to outdoor education includes fully integrating mountain biking and other activities into the school day.

[Bob Stewart]

I wish to help the hon. Gentleman by saying that my uncle was at school on the edges of Loch Ness as a boy and saw the Loch Ness monster. As a consequence, tourism expanded hugely—it was in all the Scottish newspapers. It was only at his funeral that it was allowed that that was a fake.

[Drew Hendry]

I was initially grateful for the hon. Gentleman’s intervention, but that is a scurrilous attack on what is quite clearly one of my constituents. I will not have that and hope that he will withdraw that comment.

While in my constituency, Mr Speaker, you could pop along to the Highland Wildlife Park to congratulate the highly trained staff on the UK’s first and only polar bear cub—a born highlander. Or you might take a trip to the Landmark Forest Adventure Park, which was recently awarded the Travellers’ Choice award by TripAdvisor and named in the top 1% of visitor attractions worldwide. In the city, we have exciting plans for Inverness castle and the launch of a truly world-leading augmented reality app, which will put Inverness history into perspective and enable people to grasp it with their own hands.

My constituency is internationalist, diverse and welcoming. We have welcome friends, neighbours and colleagues from all over the world. The children at Central Primary School in Inverness speak 21 languages. We are pleased to welcome Inverlingo, a new meet-up group for internationals living in Inverness so that they can be linked to EU nationals and we can share their value in our society. We will soon have the opening of the honorary Polish consulate in Inverness, too.

Our people care deeply about supporting others who need help, and I wish to thank just some of the organisations involved. Mikeysline, which recently opened the Hive in Inverness, offers a place for people aged 17 and over to drop in when they are feeling low or depressed, or when they simply need some space or support. The volunteers there do incredible work. Birchwood Highland recovery centre is the first and only mental health residential recovery centre in Inverness, and recently celebrated its 10th anniversary.

In World Autism Awareness Week, a special mention must be given to the Highland One Stop Shop and all the fantastic people who fought to keep that service open. They are delighted with the Scottish Government funding and the private donor who has committed to help them.

I thank the community transport groups that work wonders in Merkinch and Badenoch, and pay tribute to the contribution of the volunteers there. The Badenoch and Strathspey community transport group has an innovative project that matches up school kids with elderly people so that they can learn from each other skills such as IT.

The Boat of Garten community centre, and Emma Macdonald and team at the hall, put in huge effort to make sure that there is always something going on, from “Boat Reel” film screenings to family fun days and “Showboaters” theatre productions. Boat of Garten was featured on Channel 4’s “Village of the Year”.

I could go on and on about what is happening in my constituency. I congratulate the Inverness chamber of commerce on its 125th anniversary. I also congratulate Inverness BID—the business improvement district—on the renewal of its mandate to operate in the city.