Budget Resolutions and Economic Situation

I agree with the hon. Gentleman. As he knows, our Committee and others did some work on the Post Office card account and the struggle to retain it. That is important, but we have to take it a step further. A Post Office card account itself is insufficient, because it provides limited services. The ambition for the Post Office, over the next eight or 10 years, is to be a financial services provider, so that there is solidity in Post Office services. That is quite an ambition, but it is very important, given that the Post Office is a trusted brand, as he said, and given that 95 per cent. of the population live within a mile or so of a post office. We need to encourage the Post Office to get that facility going. I am a little discouraged by the fact that Alan Cook, who used to run National Savings and Investments, and then joined the Post Office and drove this agenda, is now leaving. However, we need some added urgency, and I look forward to further Government measures on it. It is not enough for people to have basic bank accounts, because figures show that 60 per cent. of those with such an account make full withdrawals every month. In other words, they do not use the direct deposits of the bank system, and they do not use their bank accounts to pay their utilities bill, which would make them cheaper. At the moment, basic bank accounts for such people are meaningless, so we need to do more work—simply having a basic account is not the answer. The money guidance service set up by the FSA has a crucial role to play in the financial inclusion agenda. For example, arising from discussions with those involved, I have been told that the majority of people over 60 do not claim pension credit, and that lots of people in social housing do not have basic bank accounts. I would like to think that a number of organisations, not least the money guidance service, could be tools of financial inclusion. That agenda has to be pushed and promoted even more. On Monday, the Treasury Committee unanimously agreed three reports, and in the next week or two, we will be putting them out. A feature of our Committee has been that we have considered the evidence and agreed our reports on the basis of unanimity. The report that I consider the most important relates to the issue of banks being too big to fail and too important to ignore. Let us remind ourselves that the crisis has cost 25 per cent. of global gross domestic product, and that the reason for the crisis was that financial institutions took part in risky activities that were both mispriced and misallocated. The bail-outs, necessary though they were, have not ended the mispricing. The bail-outs have shown that there is an implicit subsidy to banks and financial institutions, which is unfair when considered in relation to other businesses. Banking reform is essential, therefore, to ensure a more stable and less volatile system. That is essential in the United Kingdom, where the banking sector is worth 500 per cent. of our GDP. The fact is that we have big banks and limited choice, and as a result we have insufficient lending to non-financial institutions, as anyone who speaks to the CBI, small businesses or the manufacturing industry will hear. Banking reform in the UK is essential. I urge the Government to ensure that banking reform takes place, irrespective of what is happening elsewhere. The visits undertaken by the Treasury Committee in the past six months to a year, whether to the United States or Europe, have impressed upon me that countries' electorates will not tolerate a second bank bail-out. I suggest to the Government that the test of reform will come when the risk is transferred from the Government to the banking sector, and a large financial institution is allowed to fail smoothly. As others have said, banking is currently in a position where it privatises its profits and socialises its losses. We have to eliminate that practice. We have to have engagement with the public. At the moment, that engagement is insufficient. In October 2007, the Treasury Committee visited Japan, and I spoke to policymakers at its central bank. They said that we should take back the message that two things are essential: first, that we have to recapitalise our banks—and recapitalise them early—which the Government have done. Secondly, we need a strategy to deal with the public anger, concern and resentment. I have taken that message forward and helped to establish the Future of Banking Commission, which the right hon. Member for Haltemprice and Howden (David Davis) has agreed to chair, and which the hon. Member for Twickenham (Dr. Cable) has agreed to sit on. We also have the eminent economist, Roger Bootle, and others on the commission. We have established the commission to look to the future and ask basic questions about what the banking system is for and how it can best serve the interests of customers and regional economies. Those are basic issues, and we would like to present our report to the next Government in June. We want to take forward the message that financial architecture change is essential. However, that will not take place in the next two years—it will take quite a long time. I say that because Basel II took 15 years. So we are in this for the longer term, and it is important that politicians and policymakers stand side by side in ensuring that we get a better, more stable and reformed banking system as a result. As kindly mentioned by the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith), this will probably be my last speech in the House. I well remember reading the late John Biffen's autobiography. He had a flat on the south side of the river, and he came across Waterloo bridge everyday. He said that, during his long time here, when he spied the House of Commons every morning, and entered it, he got a bit of a thrill. I share that sentiment. It has been a privilege for me to represent my area in this Parliament, and I am grateful to lots of people, including not only my office staff, but the staff of the House. The House is a very fraternal institution. It might not look like it from the outside, but people are always ready to help others. The attendants, police, and the staff in the Tea Rooms, are always very welcoming and warm. I will miss that. I will also miss the Treasury Committee staff. When I give speeches in the City and elsewhere, it is clear that people think that the Committee is a Department serviced by an awful lot of people. In fact, there are only six people involved, together with three economists. We seem to have done a bit of a David and Goliath exercise, and kidded people that we are the equivalent of a Department of State. The effort that the staff have made over the nine years that I have been on the Committee has been enormous. I also want to pay tribute to all my Committee colleagues, particularly the hon. Member for Sevenoaks (Mr. Fallon), who has been the Chairman of the Sub-Committee. I see other Members here who have also been part of the Committee. We have always made it our business to take the evidence and to produce unanimous reports. The unanimity of those reports has given out a profound message and helped to inform the debate here. I hope that it has also helped to build a bridge to the public, to help us to ensure that public engagement is restored. The past nine years have been the most fruitful years in my parliamentary career. Lastly, I would like to thank my family and my constituents, who have supported me consistently for 23 years. Some people have asked me why I am giving up now. I remember that when Terry Wogan left Radio 2, he said, "I'm giving up now because we're still in love and the music is still playing." Well, the music is still playing for me. I wish everyone who is going to be part of the next Parliament every success in rebuilding trust and confidence in this institution, which is the bulwark of our democracy.