The Foreign Secretary Philip Hammond has hinted at a complex future for the war against Isis. Photo: Getty
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Foreign Secretary: the US legal basis for action in Syria “looks robust”

Today, parliament will vote on the UK using airstrikes against Islamic State in Iraq. 

The House of Commons is to vote today on whether or not to use airstrikes against Islamic State (also known as Isis) in Iraq.

David Cameron has recalled parliament today to ask MPs’ approval to join the US in targeting the militant group.

The BBC’s Nick Robinson reports that it is very likely the vote will pass, because the three party leaders alongside their whips have ensured against a defeat in “minute detail”. This diligence comes a year after the Prime Minister’s damaging defeat in a vote on military action in Syria.

However, in spite of the likelihood of a win for the government, one difficulty remains. The government has only made the motion about intervention in Iraq, to help the Iraqi government, and will not be voting today to go into Syria. This is because there is a clear legal basis for the former, whereas the latter – under Bashar al-Assad’s regime – is more complicated.

It seems a precedent is emerging for the opposition to hold an effective veto when a British Prime Minister attempts to join in foreign wars, and it is thought that Labour will only vote in favour of  action unequivocally sanctioned by international law.

As the Labour MP Diane Abbott, who is one of a handful of MPs planning to vote against the motion, told the BBC’s Today programme this morning, “call me pernickety, but [military intervention] has to be legal”.

However, the Foreign Secretary Philip Hammond, speaking on the same programme this morning, suggested that he does see a legal basis for attacking IS in Syria.

The US, which began its airstrikes against the extremists this week, has struck targets in Syria. It argues a legal justification of “collective self-defence”, which is a case that currently has uncertain status in international law.

Hammond, when asked whether he sees this action in Syria as legally sound, replied, “it looks robust to me.”

He said:

The US is already carrying out military operations in Syria. The first challenge is to push Isil out of Iraq. . .

Well, in the future is another question. . . We’d look at the circumstances at the time, if we felt we had some capability to contribute, and it [airstrikes in Syria] was needed. . . then we would certainly make the case for doing that if circumstances were right. . . It is clear that the US intervening in Syria is also able to do so on a legal basis on collective self-defence . . . it looks robust to me.

He added, “we’re absolutely not ruling anything out”, but insisted, “everyone understands very well that if there was any suggestion of going further than that [striking IS in Iraq], we [would go back to the Commons for another vote].”

For the few MPs – mainly Labour, but also some Tories ­– opposing military action or unsure about how to vote, the Foreign Secretary’s words will not be much comfort. A key argument deployed against intervening in foreign conflicts is that it quickly becomes difficult to extract oneself once it’s begun. And Hammond’s words hint at a war that will only get bigger and take longer. Indeed, he said that, if necessary, Britain could send more Tornadoes to the area than the six it will send initially if the vote passes in the Commons today.

This, coupled with the Defence Secretary Michael Fallon’s suggestion in the House magazine that the campaign could be a “long haul” of “two to three years”, may make many politicians think twice before voting for military action this afternoon.

Anoosh Chakelian is senior writer at the New Statesman.

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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