Yesterday’s FT profile of Greg Clark is worth a read. He gets that the current High Street banking structures not conducive to creating growth. Small businesses cannot grow unless their initiatives and endeavours are financed. As I wrote on Tuesday, the best way to filter good ideas from the bad is to have a properly competitive finance system. It is great to hear from a senior Conservative minister that he understands laissez-faire won’t achieve this.
“One of the responses to the crisis has been a concentration in the sector… at this point it needs a particular push on the part of the authorities to reopen the markets to competition.”
It is interesting to see how Clark’s understanding of what businesses need partly comes from watching his dad.
“My father ran a small business - he did a milk round, doorstep deliveries” says the 45-year-old MP. “The bank manager was a figure of great centrality and respect in the life of that business and that community.”
Note the emphasis Clark places on the non-monetary value provided by bankers. During the Noughties New Labour told the City – and their regulators – that they were comfortable with whatever as long as taxes were paid. The impact of this message was to downgraded the non-monetary value provided by the industry: the aspects related to trust, morality and community. Clark’s mission seems to be to reintegrate finance into society, and by that I mean the big definition of society. Today, in a speech to the banking professionals, he said:
“Trust remains the essential condition for the functioning, let alone the prosperity, of the financial services industry today. Ordinary working people rely on you to help them negotiate every stage of their lives. Businesses depend on you for their very growth and survival.”
It will be interesting to see what the outcome of this vision will be.