Commercial Financial Dispute Resolution Platform

Debate between Hannah Bardell and Richard Arkless

Thursday 15th December 2016 Commons Chamber

[Richard Arkless]

In that sense I completely agree. The hon. Gentleman is right to point out that ADR, as a concept, exists; we are asking not for a new beast to be created, but for an ADR forum to be specifically linked to the contracts and disputes under discussion. However, I am cynical about banks’ motivation in putting the clauses in particularly risky contracts.

The right hon. Member for Delyn (Mr Hanson), who is also a colleague of mine on the Justice Committee, made a typically powerful speech in which he drilled home the perverse fact that the banks under discussion are in public ownership. Essentially, public funds are being used to push businesses against the wall and asset-strip them, which has consequences. It is very hard to accept that that is being funded by our taxpayers’ money. The right hon. Gentleman made that point extremely well.

The hon. Member for Wycombe (Mr Baker) touched on a stark irony when he referred to the old banking system in Scotland and the rest of the UK. I wholeheartedly agree with him that strict joint and several liability incentivised a good culture and good practice, but the pendulum has swung entirely in the other direction. I will come on to discuss the crux of the issue, which is banking culture, but he made that point well.

[Hannah Bardell]

On culture, a number of people dealt with my constituent over many months, and he felt that the culture being driven by the bank was not for the majority. We want to believe that most people who work in the banking sector are good people, but the culture being driven from the top of those organisations means that staff end up moving and are deeply dissatisfied at not being able to serve customers properly.

[Richard Arkless]

My hon. Friend will be unsurprised to hear that I completely agree with her. My experience is that, although many good people work in banks and we should not tar them all with the same brush, which we are inevitably tempted to do, banks see businesses and individuals in the retail sector as units to extract revenue from. Unless banking returns to being an ethical practice of looking after people’s interests, as opposed to extracting revenue, we will not make the vital cultural change necessary to sort out the issue.

I was particularly struck by what my hon. Friend the Member for Coatbridge, Chryston and Bellshill (Philip Boswell) said: even before a contention is raised, there is a reluctance to complain. Banks feel the inequality of arms before we even get to the courts or a dispute resolution system. I think that is a consequence of the public perception of the inequality of arms, and it has produced a fear factor. Clearly, an ADR system would go a long way to reducing that fear factor among SMEs.

That point was corroborated by the vice-chair of the all-party group on fair business banking, my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (Calum Kerr). He also made a good point about the Financial Ombudsman Service and inconsistencies in the adjudication of retail banking issues. During my time at a bank, I had many dealings with the FOS, and I assure Members that it was possible to put to it two cases with exactly the same facts and circumstances and get two completely different results.

The right hon. Member for North Norfolk (Norman Lamb) made an excellent and powerful speech, from which I took two points. The first was the effect on mental health and wellbeing, which is often forgotten about; we are not just talking about economic consequences. The second was whistleblowing, which was picked up by my hon. Friend the Member for Kirkcaldy and Cowdenbeath (Roger Mullin). The right hon. Member for North Norfolk will be pleased to hear that we intend to table two amendments to the Criminal Finance Bill. One will seek protection for whistleblowers, and the other will ask for a banking culture review. I would be grateful if he would consider them with his colleagues and perhaps support them in due course.

My hon. Friend the Member for Edinburgh West (Michelle Thomson) wowed this Chamber last week—I think that deserves a mention—and I do not think that any of us could have failed to be struck by her reference to the Komodo dragon. She attacked the underlying culture in banks and said how predatory they can be.

My hon. Friend the Member for East Renfrewshire (Kirsten Oswald) made an excellent speech. I was particularly struck by her example—not a commercial case, but a retail case—of an ordinary individual whom the bank are accusing of going to another branch with identification and withdrawing money. Surely the complaints process could look at the closed circuit television and the FOS could be more inquisitorial in assessing the case. I hope that that message will go out.

When I worked for a bank and a retail customer threatened to take a matter to the FOS, we were told very clearly that that incurred a cost to the bank. I forget the exact figure, but it was between £400 and £600. When it got to that point, a quick calculation was made, and if the case could be settled at less than £600, that was what happened and the bank was not dragged through the FOS. That just demonstrates that we are units to extract revenue from, and nothing more.

I agree with my hon. Friend the Member for Aberdeen South (Callum McCaig), who was the first to say that the ADR system in itself will not fix the entire problem. He was absolutely right to mention culture. On RBS’s approach, he was told that this was water off a duck’s back, and that is absolutely true: these are actuarial, commercial calculations. The human cost is completely negated. A calculation is made of liability and potential cost, and the bank will take whichever is lower.

That concludes my summary. If I missed out any colleagues, I apologise. I agree that it would be a good idea to ease access to justice for SMEs that have contentious issues with large banks. That would make it cheaper and easier, and it would certainly help to equalise the inequality of arms. However, whether a case is considered by the FOS, a small claims court, a fast-track court, the Supreme Court, the Court of Appeal or an ADR, it is the same case, with the same contract and the same terms and conditions, that will be considered from court to court, and if all those dispute resolution vehicles do their job, they ought to come to the same conclusion. Although that would be a welcome step, we need to go beyond that and look at the reasons the organisations were sold the products in the first place. That points to the culture perpetuated by the banks. If we can fix the culture and the over-aggressive mis-selling of products that businesses and retail customers simply do not understand, we will not end up in a situation where we need an ADR. Although I welcome the proposal, we need to change the culture in order to make a real difference.

Immigration Bill

Debate between Hannah Bardell and Richard Arkless

Tuesday 13th October 2015 Commons Chamber

[Richard Arkless (Dumfries and Galloway) (SNP)]

I will not take my full six minutes. I merely want to touch on two separate components of this Bill: the proposed employment levy on immigrant workers, and the availability of bank accounts and driving licences for failed immigration applicants.

I fear this Bill, and these particular sections, will only fuel the misconceptions that surround immigration. They risk tarring every immigrant with the same ill-informed brush. Worse still, they risk disfranchising many UK citizens, purely on the basis that they may have a foreign- sounding name, a bank account and, heaven forbid, a driving licence and a car. This, of course, may not be the intention of the Bill—I hope it is not—but it is the unintended consequences which concern me, and we in this place should be alive to them.

This Bill creates powers to impose an immigration skills charge on employers for skilled workers they sponsor from outside the EU. I would prefer to call it the “immigrant tax” to be paid by small and medium-sized enterprises, a potentially devastating combination. This provision will deter employers from employing people from outside the EU. We will see genuinely skilled migrants, many of whom might even have a world-class education from one of our universities in the UK or Scotland, slip through our fingers. The message it sends out is clear: immigrants are considered different, more expensive—unwanted. It flies in the face of substantial empirical and personal evidence which outlines the greatly positive fiscal and social contribution immigrants have made to the UK—it is not, as the Home Secretary said at the weekend, close to zero.

I fear we would not have an NHS had this policy been implemented a generation ago. What will the next generation look like? This is unacceptable at a time when the country as a whole should be tasked with innovating and expanding its ambitions. We can only do this if we welcome thinkers and innovators from outside our shores, as well as supporting those inside them.

[Hannah Bardell (Livingston) (SNP)]

Earlier this year, I, along with a Conservative Member who is in the Chamber, visited Pakistan and we heard a number of people complain about the visa arrangements and how that was holding back opportunities for students from Pakistan to study in Scotland and across the UK. Does my hon. Friend agree that this part of the policy is very dangerous?

[Richard Arkless]

I think it is incredibly dangerous and one of the things that has struck me since I became an MP, with the many constituents who come to my surgeries, is the mess the immigration system is in. Things take too long, decisions are often bad, and in my experience it is vulnerable people who are trying to better their lives who are paying the consequences for this, which I find completely unacceptable.