Regulatory and Banking Reform

Jonathan Reynolds Excerpts

Thursday 16th June 2011 Commons Chamber

[Mr Hoban]

My hon. Friend makes an important point about diversity in the financial system. One of the points that the Governor of the Bank of England made in his Mansion House speech last night was about the need to reduce the barriers of entry to the banking system in order to encourage more competitors to come forward. That is an excellent way in which we can promote choice and competition and get a better outcome for consumers, whether individuals or businesses.

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

I, like many hon. Friends, believe the Government’s decision to proceed so quickly with a sale process for Northern Rock shows that they are willing to miss a golden opportunity to learn the lessons of the financial crisis and diversify the UK banking sector. On remutualisation, will the Minister undertake to release all the advice he has received, information on all the meetings he has been to and all the rest of the paperwork, so that we can decide—Co-operative MPs such as myself, and other Members—whether remutualisation has been taken as seriously as it should have been?

[Mr Hoban]

The hon. Gentleman makes an important point. I reiterate what I said before. Yes, Northern Rock has been put up for sale. The purchaser could be a proprietary company or another mutual. An acquisition by another mutual could actually help strengthen the mutual sector. I have made it clear that as the sale process proceeds, we will compare the outcome with either an initial public offering or a stand-alone remutualisation. The challenge that those supporting a stand-alone remutualisation need to address is how we ensure that the taxpayer gets value for money from that.