This week, despite their rhetoric on the end of austerity, the Tory government yesterday announced cuts across all departments. Johnson and Javid have ordered departments to reduce expenditure by 5%. Despite ministers told to axe plans not related to health, crime or regional inequality, there is no way, on the back of the existing cuts, that this will not result in further lost services and pain for the most vulnerable. To make this announcement so soon after an election fought on rhetoric to the contrary shows the level of hubris we will be dealing with here from No 10 and No 11. We will let it pass quietly.
Also this week the Bank of England published a discussion paper on the financial services sector and climate change. The challenges and responsibilities are great. It is an interesting read.
Last week I was proud to become an officer of the relaunched APPG on Financial Education. This is an area I feel passionately about, as educating young people about managing their money healthily in future is so important to reduce the stress and difficulty caused by excess personal debt in these financially challenging times. I’ve been proud to support schemes like LifeSavers, through which schools open weekly saving banks through credit unions, through which children can turn pennies into pounds and be rewarded for learning the habit of regular saving. The APPG is supported by Young Enterprise, and you can find the last report- into the crucial issues of financial education for care leavers- on the YE website.
I am also busy preparing Labour’s possible responses to The Budget, which Chancellor Sajid Javid is due to deliver on 11th March. I shall be challenging the Government on their suggestion that sectors of the British economy like car manufacturing are in decline anyway and nothing can be done to secure their future success. This defeatist and unimaginative attitude could prove deeply damaging to manufacturing communities – I want to see activity and innovation.
This month it was revealed that the financial services sector contributed more tax to the UK economy in 2019 than ever before – another indicator of just how key the health of the city and financial services across the UK are to the national economy.
This month I also gave commentary on the appointment of Andrew Bailey, CEO of the Financial Conduct Authority, as Governor of the Bank of England, succeeding Mark Carney. Andrew Bailey has the experience to do the job and is an impressive communicator. He would have been near the top of my shortlist and most other people’s too. He will need to acknowledge there has been concern that the FCA hasn’t been proactive enough on some of the recent consumer scandals, and that there is growing debate over the effectiveness of UK financial regulation overall. But I wish him well. It’s now crucial that the FCA appoints a Chief Executive who is able to address what are very significant challenges for the UK’s regulatory regime. At the top of this is leading on a post-Brexit environment which will hopefully still provide for a degree of market access to the Single Market without the UK becoming a rule taker.
I continue to champion co-operation in the financial services sector, and it was fantastic to hear Andy Burnham commit to establishing a cooperative unit in the Mayor of Greater Manchester’s Growth Company.