Banks tried to hide their bonuses, but now the game is up. What next?

Britain has always valued a sense of fair play. It is time to demand a fair banking system.

2011 was a year of constraint and contrition for the banking sector. Bonus pools were reduced, balance sheets slimmed down and high profile bankers heroically waived their bonuses.

Or so the banks' PR machines would have had us believe. Last Friday, as analysts trawled through Barclays and RBS's annual report and Lloyds' pay statement, a very different picture emerged from that painted by the banks.

Bob Diamond's pay packet for 2011 could be as much as £17.7 million. The head of state-backed RBS' investment banking division, John Hourican, was handed a package worth £7.4 million. And the Chief Executive of Lloyds netted £3.5 million. All in all Barclays, Lloyds and RBS paid out in excess of £90 million to top executives in 2011.

There is a clear injustice in a sector which is implicitly and explicitly subsidised by the taxpayer awarding itself bloated rewards at a time when the public are enduring austerity cuts, a squeeze on real incomes, and rising unemployment.

But the public outrage taps into something deeper. After all, the British sense of fair play has always been premised on there being haves and have-nots.

Public anger taps into the stark fact that the banking system is failing to fulfil some of its basic functions because the industry is grotesquely skewed towards socially unproductive activities that allow a small elite to extract vast wealth to the detriment of the many.

Despite a financial crisis, a £1.2 trillion bailout and ongoing public outcry, it can still seem like there is no viable alternative to business as usual. But it is worth reminding ourselves that this is not universal: the British banking system stands out from its US and European counterparts.

Firstly, the UK banking sector is one of the most concentrated in the world. In the retail sector six large national banks account for 92 per cent of personal current accounts, 85 per cent of mortgages, and 88 per cent of small business accounts .

Secondly, it is one of the least diverse in terms of the types and functions of financial providers. Whereas in the UK, the big four dominate the high street, in Germany a wide range of local and mutually owned banks have a 70 per cent share of the market for loans and deposits.

Thirdly, it is the largest in size relative to our economy. Assets of UK banks are almost six times GDP, compared to the US where they are roughly equal.

These features enabled the City to generate huge profits in the boom years, but they are also root causes of its inability to serve the needs of households and businesses.

The financial crisis exploded the myth that profits booked in the financial sector means wealth for the UK. Figures from the IMF show that despite the fact that, in relative terms, the UK banking sector is six times the size of its US equivalent, it generates the same amount of total tax revenue -- less than a paltry 2 per cent.

Now the long-term effects this British exceptionalism are clear for all to see. We have a banking system unable to allocate credit to viable businesses, provide bank accounts to low-income households, or even keep our money safe.

According to the New Economics Foundation, the UK lags other countries in achieving universal access to financial products and services, with 1.5m adults still lacking a current account. The branch network continues to shrink with a 44 per cent reduction since 1990 leaving more communities unbanked.

And Britain's small businesses struggle more than their European and American counterparts to access credit, with some 370,000 SMEs failing to secure loan finance from mainstream financial institutions in 2011 alone.

But what comes next?

Martin Kettle recently argued that the mood of the nation is to muddle along. The public just want to get back to normal with as little fuss as possible. Whilst it may be true that there is little appetite for a revolutionary overthrow of liberal capitalism, there is clear evidence that there is growing interest in a different way of doing things.

The alternative financial sector has flourished in the aftermath of the financial crisis -- filling the gaps where the big banks are simply unable to provide.

Households and businesses are becoming increasingly dependent on these alternatives. Unfortunately their rise is paralleled -- in fact dwarfed by the increase in doorstop and payday lenders which only goes to demonstrate the size of the unmet market demand.

These alternative institutions are still a tiny part of the financial ecosystem. But the sector is at a tipping point. It now needs to work together to create a narrative which takes it beyond a niche industry. It needs to the let the public know that there is alternative out there, and why its better for them.

That's why we have launched Move Your Money UK, a campaign encouraging people to move their money to ethical, local or mutual financial providers. There is appetite for change. We may not be in a revolutionary moment, but the public are no longer willing to accept business as usual from our banking sector and are looking for something better.

Louis Brooke is a co-founder of Move Your Money UK. Follow the campaign on Twitter @moveyourmoneyuk and Facebook.

Louis Brooke is a spokesperson for Move Your Money UK, a not for profit campaign group, promoting alternatives to the big banks. He is also communications manager for London Rebuilding Society, and co-founder and chairman of educational resource company now>press>play.

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She knew every trick to get a home visit – but this time I had come prepared

 Having been conned into another couple of fruitless house calls, I now parry the proffered symptoms and generally get to the heart of the matter on the phone.

I first came across Verenice a couple of years ago when I was on duty at the out-of-hours service.

“I’m a diabetic,” she told me, “and I’m feeling really poorly.” She detailed a litany of symptoms. I said I’d be round straight away.

What sounded worrying on the phone proved very different in Verenice’s smoke-fugged sitting room. She was comfortable and chatty, she had no fever or sign of illness, and her blood sugar was well controlled. In fact, she looked remarkably well. As I tried to draw the visit to a close, she began to regale me with complaints about her own GP: how he neglected her needs, dismissed her symptoms, refused to take her calls.

It sounded unlikely, but I listened sympathetically and with an open mind. Bit by bit, other professionals were brought into the frame: persecutory social workers, vindictive housing officers, corrupt policemen, and a particularly odious psychiatrist who’d had her locked up in hospital for months and had recently discharged her to live in this new, hateful bungalow.

By the time she had told me about her sit-in at the local newspaper’s offices – to try to force reporters to cover her story – and described her attempts to get arrested so that she could go to court and tell a judge about the whole saga, it was clear Verenice wasn’t interacting with the world in quite the same way as the rest of us.

It’s a delicate path to tread, extricating oneself from such a situation. The mental health issues could safely be left to her usual daytime team to follow up, so my task was to get out of the door without further inflaming the perceptions of neglect and maltreatment. It didn’t go too well to start with. Her voice got louder and louder: was I, too, going to do nothing to help? Couldn’t I see she was really ill? I’d be sorry when she didn’t wake up the next morning.

What worked fantastically was asking her what she actually wanted me to do. Her first stab – to get her rehoused to her old area as an emergency that evening – was so beyond the plausible that even she seemed able to accept my protestations of impotence. When I asked her again, suddenly all the heat went out of her voice. She said she didn’t think she had any food; could I get her something to eat? A swift check revealed a fridge and cupboards stocked with the basics. I gave her some menu suggestions, but drew the line at preparing the meal myself. By then, she seemed meekly willing to allow me to go.

We’ve had many out-of-hours conversations since. For all her strangeness, she is wily, and knows the medical gambits to play in order to trigger a home visit. Having been conned into another couple of fruitless house calls, I now parry the proffered symptoms and generally get to the heart of the matter on the phone. It usually revolves around food. Could I bring some bread and milk? She’s got no phone credit left; could I call the Chinese and order her a home delivery?

She came up on the screen again recently. I rang, and she spoke of excruciating ear pain, discharge and fever. I sighed, accepting defeat: with that story I’d no choice but to go round. Acting on an inkling, though, I popped to the drug cupboard first.

Predictably enough, when I arrived at Verenice’s I found her smiling away and puffing on a Benson, with a normal temperature, pristine ears and perfect blood glucose.

“Well,” I said, “whatever’s causing your ear to hurt is a medical mystery. Take some paracetamol and I’m sure it’ll be fine in the morning.”

There was a flash of triumph in her eyes. “Ah, but doctor, I haven’t got any. Could you –”

Before she could finish, I produced a pack of paracetamol from my pocket and dropped it on her lap. She looked at me with surprise and admiration. She may have suckered me round again, but I’d managed to second-guess her. I was back out of the door in under five minutes. A score-draw. 

Phil Whitaker is a GP and an award-winning author. His fifth novel, “Sister Sebastian’s Library”, will be published by Salt in September

This article first appeared in the 23 June 2016 issue of the New Statesman, Divided Britain