Osborne thinks we're a Mac. We're a PC

Our banks don't have a reset button.

I had a Mac well before they were cool. It was fine when it worked, but occasionally it would throw a hissy fit and leave me utterly helpless. Apple clearly knew full-well their machines were prone to problems. Their universal solution was to include a reset button, accessible by forcing a paperclip into a tiny hole on the side of the machine, which would override everything and restart the machine, wiping all your work in the process.

The problems with my Mac were so persistent that I used to keep a paperclip permanently blu-tacked to it.

But of course, Macs are perfect these days, and Apple is unassailable – the kind of business most companies could only dream of becoming.

And at the other end of the scale are the banks. They keep stalling. Every now and then they make worrying noises, and after five years on hold, the Help Desk (John Vickers), says it’s really about time we got a new one.

When George Osborne told us that 2013 would be the year “we reset our banking system”, I couldn’t help but imagine him walking around the impenetrable edifice of the Bank of England wielding a giant paperclip, trying to find the hole. Horrified city workers looking on, saying “I hope I’m not going to lose all my work”.

Yesterday he announced that he wanted to open up the UK banking market to increased competition. No doubt he sees Virgin Money and Metro Bank leading a charge of bright young banks, who will hit the high street with branches that look like the set of Big Brother and staff who look like the cast of Hollyoaks… All very “I’m a Mac”.

I’m sure, or at least I hope, that Osborne knows there is no easy-reach reset button, and no “turn-it-off-and-on-again” fix. I know it’s boring (don’t fall asleep), but the decision to increase competition in the UK banking system is not political or regulatory… It is about IT – it’s about enabling new companies to plug into the payments system.

And trust me, the payments system is not a shiny Mac with handy firewire ports. Our payments infrastructure makes Windows XP look cool. It’s a tangled, home-made mess that looks like the inside of Jackson Pollock’s brain. What forward-thinking, tieless entrepreneur would want to plug into that? Even in these straightened times, there are easier ways of making money, let’s be honest.

The fact is that Metro Bank, which provides customers with free dog biscuits in their branches, is the first new entrant into the UK retail banking industry for over 150 years. They have less than 20 branches, none north of Watford, and there aren’t many behind them in the queue for banking licences. Mobile phone companies are moving into financial services, for sure. But most of them struggle to keep our voicemails secure, and I’m not sure people are ready to let them look after their hard-earned cash.

Has he tried turning it off then turning it on again? Photograph:Getty Images

James Ratcliff is Group Editor of  Cards and Payments at VRL Financial News.

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Inside the progressive alliance that beat Zac Goldsmith in Richmond

Frantic phone calls, hundreds of volunteers, and Labour MPs constrained by their party. 

Politics for a progressive has been gloomy for a long time. On Thursday, in Richmond Park of all places, there was a ray of light. Progressive parties (at least some of them) and ordinary voters combined to beat Ukip, the Tories and their "hard Brexit, soft racist" candidate.

It didn’t happen by accident. Let's be clear, the Liberal Democrats do by-elections really well. Their activists flood in, and good luck to them. But Richmond Park was too big a mountain for even their focused efforts. No, the narrow win was also down to the fast growing idea of a progressive alliance. 

The progressive alliance is both a defensive and offensive move. It recognises the tactical weakness of progressives under first past the post – a system the Tories and their press know how to game. With progressive forces spilt between Labour, Liberal Democrats, Greens, the SNP, Plaid Cymru, the Women’s Equality Party and more – there is no choice but to co-operate, bring in proportional representation and then a whole new political world begins.

This move opens up the wider strategy – to end the domination of the City, and right-wing newspapers like the Mail, so Britain can have a real debate and make real choices about what sort of economy and society it wants. A pipedream? Well, maybe. But last night the fuse was lit in Richmond Park. The progressive alliance can work.

Months before the by-election, the pressure group for a progressive alliance that I chair, Compass, the Greens, and some Labour, Liberal Democrat and SNP MPs and activists, began considering this. The alternative after Brexit was staring into the void.

Then the Tory MP Zac Goldsmith stepped down over Heathrow. To be fair, he had pledged to do this, and we should have been better prepared. In the event, urgent behind-the-scenes calls were made between the Greens and the Liberal Democrats. Compass acted as the safe house. The Greens, wonderfully, clung onto democracy – the local party had to decide. And they decided to stand up for a new politics. Andree Frieze would have been the Green candidate, and enjoyed her moment in the autumn sun. She and her party turned it down for a greater good. So did the Women’s Equality Party.

Meanwhile, what about Labour? Last time, they came a distant third. Again the phones were hit and meetings held. There was growing support not to stand. But what would they get back from the Liberal Democrats, and what did the rules say about not standing? It was getting close to the wire. I spent an hour after midnight, in the freezing cold of Aberdeen, on the phone to a sympathetic Labour MP trying to work out what the party rule book said before the selection meeting.

At the meeting, I am told, a move was made from the floor not to select. The London regional official ruled it out of order and said a candidate would be imposed if they didn’t select. Some members walked out at this point. Where was the new kinder, gentler politics? Where was membership democracy? Fast forward to last night, and the Labour candidate got less votes than the party has members.

The idea of a progressive alliance in Richmond was then cemented in a draughty church hall on the first Tuesday of the campaign – the Unitarian Church of course. Within 48 hours notice, 200 local activist of all parties and none had come together to hear the case for a progressive alliance. Both the Greens and Compass produced literature to make the case for voting for the best-placed progressive candidate. The Liberal Democrats wove their by-election magic. And together we won.

It’s a small victory – but it shows what is possible. Labour is going to have to think very hard whether it wants to stay outside of this, when so many MPs and members see it as common sense. The lurch to the right has to be stopped – a progressive alliance, in which Labour is the biggest tent in the campsite, is the only hope.

In the New Year, the Progressive Alliance will be officially launched with a steering committee, website and activists tool-kit. There will also be a trained by-election hit squad, manifestos of ideas and alliances build locally and across civil society.

There are lots of problems that lie ahead - Labour tribalism, the 52 per cent versus the 48 per cent, Scottish independence and the rest. But there were lots of problems in Richmond Park, and we overcame them. And you know, working together felt good – it felt like the future. The Tories, Ukip and Arron Banks want a different future – a regressive alliance. We have to do better than them. On Thursday, we showed we could.

Could the progressive alliance be the start of the new politics we have all hoped for?

Neal Lawson is the Chair of Compass, the pressure group for the progressive alliance.

Neal Lawson is chair of the pressure group Compass, which brings together progressives from all parties and none. His views on internal Labour matters are personal ones.