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I'm more convinced than ever that Jeremy Corbyn is going to win

The polls felt wrong at the general election. But nothing I've seen or heard suggests the polls showing Corbyn ahead are anything other than correct. 

I spent more time than is healthy this weekend talking to Labour members around the country, and I’m increasingly certain: the polls are right, the constituency Labour party (CLP) nominations are right: Jeremy Corbyn is on course to win the Labour leadership election.

Yes, Corbyn’s lead in CLP nominations – he has, at time of writing, 112 to Andy Burnham’s 103 – isn’t necessarily indicative of anything. It’s not binding on members, has no effect on the final outcome, and at times, the number of members in attendance is vanishingly small. At one contest there were just 25 ballots: nine for Jeremy Corbyn, eight for Andy Burnham, four for Yvette Cooper, and one simply reading “Fuck Kendall”.

But the future has a tendency to resemble the past – just look at the general election, when despite the cries that it was “different this time”, the party that won was the one people trusted with their money and with its finger on the nuclear button. David Miliband came top of the pile as far as CLP nominations were concerned last time and if Labour members had been the only voters he would have won the Labour leadership election.

While most members don’t attend CLP meetings, I can find no persuasive evidence – other than wishful thinking – that the Labour right is less likely to attend meetings than the left. The majority of CLPs that are nominating Corbyn now nominated one of the Miliband brothers. Rugby, which nominated Corbyn last week, nominated the older, “more right-wing” brother. The nominating members of Rugby, Ilford South, Amber Valley, and many more accurately picked the winner last time. I see no reason to suggest that these local parties have become less reflective of the party’s mood than they were five years ago.

Of course, polls have been wrong before. But crucially, the polls felt wrong before the fact. Labour’s poll lead was nowhere to be seen at the European elections, when they finished a limp second, or in the local elections, when they fell back in the marginals, foreshadowing the rout they’d suffer at the general election. Ashcroft constituency polls showed Labour in contention in seats where headquarters had long stopped funnelling resources. And every ordinary conversation about politics inevitably spun round to Miliband’s unsuitability as Prime Minister.

The polls don’t feel wrong this time. Defections from the three candidates of the right to Corbyn are being picked up by all three campaign’s phonebanks, and by the mayoral campaigns as well. At the hustings, which were bossed last time by the two Milibands, it is Corbyn who is getting wildly applauded. “The surge is real,” was the verdict of one staffer I spoke to this weekend.

Privately, none of the deputy campaigns expect that Corbyn will finish anything other than first in the race for the top spot. Volunteers return from phonebanking sessions, in the words of one “utterly convinced it will be Corbyn now”.

 If anything, the pattern from local nominations supports what polling is showing – a bigger first round lead for Corbyn than implied by the CLP nominations. Labour’s preferential voting system is an active handicap to his campaign, as he has a far smaller pool of second preferences to draw on than any other candidate.  In nomination meetings, Corbyn gets a handful of second preferences, matching YouGov polling showing just 20 per cent of Kendall supporters and only 31 per cent of Cooper supporters giving him their second preference in the run-off against Burnham.

At the general election, commentators had two choices: either the European, local and mayoral elections were wrong, or the polls were. In fact, even the polls hinted that they might be wrong – they consistently showed people saying they wanted David Cameron in Number 10 but would vote Labour in their own constituencies. This time, it’s far clearer: either the polls, the CLP nominations, the phonebanks, the local meetings and the hustings are all wrong, or Corbyn is going to win. It doesn’t look likely.

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

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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