Meg Hillier’s guest op-ed “Show me the evidence that City deregulation will help growth” (February 18) is a breath of fresh air. In recent years there seems to have been less and less appetite on the part of the Financial Conduct Authority, the UK Parliament’s Treasury committee, Education committee and many other bodies to engage with representatives of consumer interests. Is this a case of the financial sector having ever more power over government policy?
Perhaps there is a reason for this.
For “growth” in the UK we don’t need rising asset prices. Financial services do not create growth directly as they are intermediaries. We need to have good companies, providing good jobs, that are able to export successfully, and we need them where possible to divert resources from consumption (dividends, executive bonuses, share buybacks) to productive investment. And that often includes continual, patient innovation, at the price of reduced profit today.
But City pressure is often in the wrong direction, focusing on today’s profits and share prices. Witness this very worrying sentence in Anjli Raval’s Business Insight column (January 22): “A third of UK chief executives surveyed by PwC don’t even believe their own business will be economically viable in a decade’s time, let alone have confidence in their prospects for growth.”
What this means is the UK needs to start running very hard to improve productivity and true business competitiveness, just to stand still, let alone achieve valuable growth. We desperately need a well-informed and cross-party consensus in this area.
Finally, quoting Hillier: “When a decision requires somebody to listen to opposing expert views and decide a way forward, we earn our crust.”
How many of her predecessors at the Treasury select committee would have included the word “opposing” in this sentence? We need more Meg Hilliers.
Martin White
Director, Savers Take Control,
UK Shareholders Association,
London KT1, UK
