The new regulator is already caving in to the banks

Charging for current accounts in credit would be an attack on citizens and insult to savers.

 

First the taxpayer has to bail out the banks. Now it seems that the unsuspecting current account customer could be taken for a ride, as the bankers scour around for ways to rebuild their balance sheets. 

How disappointing, therefore, that the new head of the Prudential Regulation Authority – the Treasury’s new super-regulator – should give a speech suggesting that “free banking” needs to end as the only way to protect high charges for overdrafts and other bank products.

At a time when bonuses and executive pay remain firmly stuck on a different planet, the public will be aghast at any attempt to squeeze their current accounts with a new fee. We need to have fair play on fees and charges and continue charge-free bank accounts for those who rely on these services. Arguing against exorbitant overdraft charges doesn’t mean we need to hit those customers who stay in the black - modest savers or the working population balancing their accounts each month.

The banks should look be more concerned with changing their remuneration practices and putting their customers first. There are over 47 million current accounts in the UK. If their holders are now to be charged for the privilege of using a debit card, or for basic chequing services, it would be a major blow to the entire population. Many people will have already been approached by their banks to pay a £15 or £20 per month charge for “additional” services, such as mobile phone insurance. Expect this to become the norm if the banks get their way.

Just when the banks are poised to hit consumers with these new fees, the last thing we need is a financial regulator who is actively encouraging charges for current accounts. It is simply unacceptable to erode free banking and free in-credit deposit accounts - especially when millions are giving the banks their money, which can then generate profits while being held centrally. A current account is today an essential part of daily life, a utility that is essential for getting by in the modern world. We need to defend this basic right and fight for free in-credit banking. We must not give way to these false pressures from the banks.

Chris Leslie is Shadow Financial Secretary to the Treasury and MP for Nottingham East
There are over 47 million current accounts in the UK. Photo: Getty Images

Chris Leslie is chair of Labour’s backbench Treasury Committee and was shadow Chancellor in 2015. 

Photo:Getty
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Why isn't Labour putting forward Corbynite candidates?

Despite his successes as a candidate, the organisational victories have gone the way of Corbyn's opponents. 

The contest changes, but the result remains the same: Jeremy Corbyn’s preferred candidate defeated in a parliamentary selection. Afzhal Khan is Labour’s candidate in the Manchester Gorton by-election and the overwhelming favourite to be the seat’s next MP.

Although Khan, an MEP, was one of  the minority of Labour’s European MPs to dissent from a letter from the European parliamentary Labour party calling for Jeremy Corbyn to go in the summer of 2016, he backed Andy Burnham and Tom Watson in 2015, and it is widely believed, fairly or unfairly, that Khan had, as one local activist put it, “the brains to know which way the wind was blowing” rather than being a pukka Corbynite.

For the leader’s office, it was a double defeat;  their preferred candidate, Sam Wheeler, was kept off the longlist, when the party’s Corbynsceptics allied with the party’s BAME leadership to draw up an all ethnic minority shortlist, and Yasmine Dar, their back-up option, was narrowly defeated by Khan among members in Manchester Gorton.

But even when the leadership has got its preferred candidate to the contest, they have been defeated. That even happened in Copeland, where the shortlist was drawn up by Corbynites and designed to advantage Rachel Holliday, the leader’s office preferred candidate.

Why does the Labour left keep losing? Supporters combination of bad luck and bad decisions for the defeat.

In Oldham West, where Michael Meacher, a committed supporter of Jeremy Corbyn’s, was succeeded by Jim McMahon, who voted for Liz Kendall, McMahon was seen to be so far ahead that they had no credible chance of stopping him. Rosena Allin-Khan was a near-perfect candidate to hold the seat of Tooting: a doctor at the local hospital, the seat’s largest employer, with links to both the Polish and Pakistani communities that make up the seat’s biggest minority blocs.  Gillian Troughton, who won the Copeland selection, is a respected local councillor.

But the leadership has also made bad decisions, some claim.  The failure to get a candidate in Manchester Gorton was particularly egregious, as one trade unionist puts it: “We all knew that Gerald was not going to make it [until 2020], they had a local boy with good connections to the trade unions, that contest should have been theirs for the taking”. Instead, they lost control of the selection panel because Jeremy Corbyn missed an NEC meeting – the NEC is hung at present as the Corbynsceptics sacrificed their majority of one to retain the chair – and with it their best chance of taking the seat.

Others close to the leadership point out that for the first year of Corbyn’s leadership, the leader’s office was more preoccupied with the struggle for survival than it was with getting more of its people in. Decisions in by-elections were taken on the hop and often in a way that led to problems later down the line. It made sense to keep Mo Azam, from the party’s left, off the shortlist in Oldham West when Labour MPs were worried for their own seats and about the Ukip effect if Labour selected a minority candidate. But that enraged the party’s minority politicians and led directly to the all-ethnic-minority shortlist in Manchester Gorton.

They also point out that the party's councillor base, from where many candidates are drawn, is still largely Corbynsceptic, though they hope that this will change in the next round of local government selections. (Councillors must go through a reselection process at every election.)

But the biggest shift has very little to do with the Labour leadership. The big victories for the Labour left in internal battles under Ed Miliband were the result of Unite and the GMB working together. Now they are, for various reasons, at odds and the GMB has proven significantly better at working shortlists and campaigning for its members to become MPs.  That helps Corbynsceptics. “The reason why so many of the unions supported Jeremy the first time,” one senior Corbynite argues, “Is they wanted to move the Labour party a little bit to the left. They didn’t want a socialist transformation of the Labour party. And actually if you look at the people getting selected they are not Corbynites, but they are not Blairites either, and that’s what the unions wanted.”

Regardless of why, it means that, two years into Corbyn’s leadership, the Labour left finds itself smaller in parliament than it was at the beginning.  

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.