Maximum efficiency at maintaining professional standards

Alice O'Keeffe's "Squeezed Middle" column.

The computer screen is swimming in front of my eyes. I pull together every fibre of mental strength to finish my sentence: “. . . streamlining the governance structures of the organisation for maximum . . .” For maximum what? Accountability? Efficiency? Cabbage? Impact! Impact. Phew.

This is my first attempt to work since baby Moe was born. Isla, a former colleague who now has a high-up job in the arts, has asked me to help write an annual report. I get a decent day rate and I can do it from home. If I don’t mess it up, there may be more work forthcoming.

This is a cheering prospect, as we are crazily broke. My clothes are actually threadbare: the other day, I was chatting to some rather stylish mothers outside Larry’s nursery and only realised when I got home that my jeans had ripped right across the arse – and not in an on-trend way. Also, the fateful day on which we will have to renew the car insurance is looming. So I am definitely not in a position to look a gift horse in the mouth.

The problem is that baby Moe is still not sleeping properly. For a reason I have not yet managed to identify, he wakes up several times a night and often howls for more than an hour before, equally inexplicably, popping his thumb into his mouth and drifting off again. I have ruled out hunger, illness and teething. Cuddles work but only temporarily. Even Calpol seems to be losing its magic.

I am trying to implement a draconian sleep-training regime but it is difficult when you are so exhausted that you would gladly pawn your own grandmother for an unbroken four hours. Last night was particularly bad. At one point, I found myself semiconscious on the floor, with Moe draped across my face.

Anyway, here I am, a Writing and Editing Professional. I’m still in my pyjamas, yes, and smeared with porridge, maybe, but I’m nevertheless the Solution To All Your Editorial Needs.

“Er, I think he needs a feed.” Curly pokes his head around the door. He has been trying to keep Moe quiet in the other room so I can concentrate. I stagger across the room, crashland on the sofa and take Moe in my arms. As he suckles away, a delicious wave of relaxation sweeps over me. I lean my head back and close my eyes, just for a moment, until . . . “Babe, I’m sorry, I’ve gotta go.” Curly has his hand on my shoulder. I wrench my head from the cushions and stare at him uncomprehendingly. Go? But his course doesn’t start until seven. And I’ve only got to page three of the report. And the deadline is tomorrow. “I’m sorry. I didn’t want to wake you up.”

He strokes my head. Moe, who after this marathon nap will definitely be awake all night, nuzzles innocently into my armpit. “Perhaps you should tell them you can’t do this work. You’re not ready.”

“I can’t pull out now!” I disentangle myself and run wildly back to my desk, my hair a mess. “I’ve committed . . . my reputation . . . have some standards . . . I’m a professional!”.

Alice O'Keeffe's "Squeezed Middle" column appears weekly in the New Statesman magazine.

Alice O'Keeffe is an award-winning journalist and former arts editor of the New Statesman. She now works as a freelance writer and looks after two young children. You can find her on Twitter as @AliceOKeeffe.

This article first appeared in the 15 July 2013 issue of the New Statesman, The New Machiavelli

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Let's turn RBS into a bank for the public interest

A tarnished symbol of global finance could be remade as a network of local banks. 

The Royal Bank of Scotland has now been losing money for nine consecutive years. Today’s announcement of a further £7bn yearly loss at the publicly-owned bank is just the latest evidence that RBS is essentially unsellable. The difference this time is that the Government seems finally to have accepted that fact.

Up until now, the government had been reluctant to intervene in the running of the business, instead insisting that it will be sold back to the private sector when the time is right. But these losses come just a week after the government announced that it is abandoning plans to sell Williams & Glynn – an RBS subsidiary which has over 300 branches and £22bn of customer deposits.

After a series of expensive delays and a lack of buyer interest, the government now plans to retain Williams & Glynn within the RBS group and instead attempt to boost competition in the business lending market by granting smaller "challenger banks" access to RBS’s branch infrastructure. It also plans to provide funding to encourage small businesses to switch their accounts away from RBS.

As a major public asset, RBS should be used to help achieve wider objectives. Improving how the banking sector serves small businesses should be the top priority, and it is good to see the government start to move in this direction. But to make the most of RBS, they should be going much further.

The public stake in RBS gives us a unique opportunity to create new banking institutions that will genuinely put the interests of the UK’s small businesses first. The New Economics Foundation has proposed turning RBS into a network of local banks with a public interest mandate to serve their local area, lend to small businesses and provide universal access to banking services. If the government is serious about rebalancing the economy and meeting the needs of those who feel left behind, this is the path they should take with RBS.

Small and medium sized enterprises are the lifeblood of the UK economy, and they depend on banking services to fund investment and provide a safe place to store money. For centuries a healthy relationship between businesses and banks has been a cornerstone of UK prosperity.

However, in recent decades this relationship has broken down. Small businesses have repeatedly fallen victim to exploitative practice by the big banks, including the the mis-selling of loans and instances of deliberate asset stripping. Affected business owners have not only lost their livelihoods due to the stress of their treatment at the hands of these banks, but have also experienced family break-ups and deteriorating physical and mental health. Others have been made homeless or bankrupt.

Meanwhile, many businesses struggle to get access to the finance they need to grow and expand. Small firms have always had trouble accessing finance, but in recent decades this problem has intensified as the UK banking sector has come to be dominated by a handful of large, universal, shareholder-owned banks.

Without a focus on specific geographical areas or social objectives, these banks choose to lend to the most profitable activities, and lending to local businesses tends to be less profitable than other activities such as mortgage lending and lending to other financial institutions.

The result is that since the mid-1980s the share of lending going to non-financial businesses has been falling rapidly. Today, lending to small and medium sized businesses accounts for just 4 per cent of bank lending.

Of the relatively small amount of business lending that does occur in the UK, most is heavily concentrated in London and surrounding areas. The UK’s homogenous and highly concentrated banking sector is therefore hampering economic development, starving communities of investment and making regional imbalances worse.

The government’s plans to encourage business customers to switch away from RBS to another bank will not do much to solve this problem. With the market dominated by a small number of large shareholder-owned banks who all behave in similar ways (and who have been hit by repeated scandals), businesses do not have any real choice.

If the government were to go further and turn RBS into a network of local banks, it would be a vital first step in regenerating disenfranchised communities, rebalancing the UK’s economy and staving off any economic downturn that may be on the horizon. Evidence shows that geographically limited stakeholder banks direct a much greater proportion of their capital towards lending in the real economy. By only investing in their local area, these banks help create and retain wealth regionally rather than making existing geographic imbalances worce.

Big, deep challenges require big, deep solutions. It’s time for the government to make banking work for small businesses once again.

Laurie Macfarlane is an economist at the New Economics Foundation