Ed Miliband regional banking speech in full
It is excellent to be with you here today.
Let me start by saying how much I admire the work of the British Chambers of Commerce.
Because of the 100,000 businesses, rooted in every community in the country.
Knowing what is happening at the sharp end.
And you are always willing to speak truth to power.
And I want to pay particular tribute to John Longworth for the work he does as your Director-General for the voice he provides for the BCC.
I was very struck by something John Longworth said the other day.
He said: “Firms across Britain know they can drive growth…but they also know that they can’t do it alone…”
John is so right about this.
You create the wealth, make the profits, employ the people.
But you need a country that gets behind you.
To get the recovery we need it must be made by the many, the small and medium sized firms like yours that are the backbone of the British economy.
Now there is a Budget in six days time.
And as the BCC has said, urgent action is needed to help your businesses to succeed.
To help our economy grow.
And to help reduce the deficit on a sustainable basis.
That starts with the confidence and security of your customers.
That’s why we’ve called, for example, for a temporary cut in VAT.
And for the reintroduction of a 10p tax rate.
And any government preparing for a Budget in the current climate should be looking at the burden of business rates, especially as they fall on small businesses on this country.
Measures like these will help us take the first steps towards a recovery made by the many.
But they are not enough.
Because the Budget also needs to raise our sights to the big challenges that our country faces.
And we need to confront them, head on, right now.
Because the old ways just won’t do any more.
We need to build new institutions out of the rubble of the old.
And I want to propose today radical new approaches to banking, skills, the British firm and infrastructure, all underpinned by confidence and clarity about our place in the world.
That’s the way we truly get a recovery that is built to last.
A recovery made by the many.
Our approach for the future of the British economy has to start with our banks.
I start from a simple proposition: we need banks that serve our businesses, not businesses that serve our banks.
I hear it so often from businesses like yours that you just can’t get the finance that you need.
Turned down by banks that don’t know your businesses or who don’t seem to care.
And the government’s measures are just failing.
Net lending fell by £4.5 billion last quarter.
While too many of the big banks appear to carry on with a bonus as usual culture.
It is time to recognise that tinkering will not sort this out.
Britain needs a wholly new banking system.
And to understand how to build one, we need to understand the root of the problem.
Because these problems are decades old.
In the ten years before the financial crash, 84% of the money lent by British banks went into property and financial services.
As an example, just think about the transformation of Northern Rock.
Founded as a proud mutual, with a clear mission to serve the people and businesses of the North East of England.
A century of success.
Ending in an ignominious collapse.
Caused by its gambling in the City and in the property markets, rather than its old commitment in the real economy.
We have to learn the lessons.
It’s why we need tough regulation of our banking system.
That’s why we want new challenger banks to create real competition on the high street.
And why we are working with the BCC to design a proper British Investment Bank.
Such a Bank would provide long-term and patient capital for British businesses, especially those just starting up.
But today I want to say that we need to go further.
Because we need to make sure that the British Investment Bank serves the whole country.
So as part of that idea, I believe we need a regional banking system, reaching out to each and every region of the country.
Regional banks, with a mission to serve that region and that region alone.
Not banks that like to say “no”.
But banks that know your region and your business.
Not banks that you mistrust.
But banks you can come to trust.
Today we are publishing the report of our independent Small Business Taskforce.
It calls for Britain to have its own version of the German “Sparkassen”: local banks that are run to support the local economy.
I am committed to turning the idea of regional banks into reality during the next government.
Because I am determined that One Nation Labour becomes the party of the small business and the entrepreneur as together we create a recovery made by the many.
And just like we need a new banking system to provide you with the finance you need, so we need a new skills system to provide you with the workforce you need.
Again I start from a simple proposition: every young person should have a pathway to good qualifications, a job and a career.
For so many young people that doesn’t happen.
And at the same time, you have been telling us for so long that you don’t get the young people with the skills and training they need.
That sometimes you have the vacancies but just can’t find skilled young people to fill them.
We need a transformation of education, opportunities and our culture for the forgotten 50% of young people who don’t go to University.
I think about a fourteen year old at school today.
If it is University that excites them, then they know the path forward, even as that path has got so much harder recently.
Work hard at GCSEs, then at A-levels and then move on to a degree and out to the world of work.
But what about those young people who want a different route?
Those who want to learn a skill or a craft.
Or want an apprenticeship.
Britain offers those young people very little at the moment.
This is another decades-long problem and we need to turn it around.
There is an alphabet soup of vocational qualifications on offer to young people.
We need to give young people a clear sense in each area of what qualification they should be aiming at.
That’s why the next Labour government proposes to accredit a new gold-standard technical baccalaureate so that our young people know where they are heading.
But it’s not just about a clear set of qualifications, it is about qualifications that are relevant to you as businesses.
Far too often, you tell us money spent on training is not well spent.
So we propose for the first time to put the public money spent on training and apprenticeships directly in the hands of employers.
And as well as changing qualifications, and making them relevant, we also need to inspire our young people.
Building up real work experience in school, not taking it away.
Creating new elite technical colleges for young people to which they can aspire, like they aspire to Oxford and Cambridge.
And we need to challenge the culture that says university is always best and vocational training is second-best.
Other countries don’t have this culture and Britain can’t afford it either.
Part of that change of culture we need is to celebrate and nurture the British firm.
We shouldn’t be ashamed to be patriotic about supporting our businesses.
Other countries do it, so should we.
You have been telling us for a long time how particularly difficult it is in Britain for a small firm to become a medium sized firm and a medium sized firm to become a world-beating corporation.
The way we change that is by addressing the short-term culture imposed on British business.
Sir George Cox, former Head of the Institute of Directors, recently reported to us on how to make this happen.
For that to happen we need to make changes.
Like abolishing quarterly reporting rules that lead listed firms constantly to think next month’s returns are more important than planning for the next five or ten years.
Like changing takeover rules, so great British firms aren’t at the mercy of the hedge funds and speculators who can swoop in after a takeover has been launched in the hunt for a quick buck.
And like changing rules on executive pay so that Britain’s best talent is incentivized to take the longer view.
Just some changes we need to enable British firms to take the long view.
And for smaller firms we should make changes too.
I hope you will engage with our Small Business Taskforce.
It has a whole set of ideas about how to help small businesses.
One of those calls on us to create new hubs of enterprise across the country.
Places where firms can share the costs of premises, back office services and other business advice.
This is something which government should be doing more to enable.
We’re determined to help small firms: invent, invest, train and prosper.
Because we know that so many jobs in the future are not going to come from a small number of large firms but a large number of small firms.
But the culture of the short-term isn’t just bad for business.
You know better than anybody that it holds back our government too.
If we are going to have a recovery made by the many, our country needs infrastructure as good as anywhere in the world.
That’s true of transport, energy and communications.
You’ve been telling us for so long that the way we resource and plan our infrastructure in Britain is not good enough.
And I agree.
That’s why at a time when our construction sector is still flat on its back, in this Budget One Nation Labour would be advancing investment in infrastructure.
But you know also it isn’t just about the resources, it is about the way decisions are made.
Sometimes we get it right.
As we did with the Olympic Games.
But so often we don’t.
That’s why Labour has asked Sir John Armitt, former chair of the Olympic Delivery Authority, to see how we can do better.
He will be looking for answers on how we invest in our infrastructure, how we get the planning rules right and how we can create consensus across the political spectrum on some of the most difficult decisions.
These are vital questions.
So that rebuilding our country will not only begin now but continue for decades to come.
Giving business the security and confidence they need.
I know you will all offer Sir John your support in that work.
Finally, all of these institutional changes need to be underpinned by a confidence about our place in the world.
So many of you are exporters, looking at new markets, and exploiting those markets you are already involved with.
The BCC is rightly making the case for greater co-ordination of the work that is done abroad to help you compete and succeed.
I agree and these are part of the recommendations of our Small Business Taskforce.
But I believe that if we are to succeed we also need an unambiguous sense of our national future.
I understand the frustrations you have with the way the European Union often works, including many businesses over regulation.
And I want a Europe of jobs and growth not the austerity and unemployment we have.
But for me, I want to be clear: our future lies in the European Union not outside it.
Because of the 500 million consumers in the single market.
But also if we are to reach out to the BRIC countries, our place lies in the EU not outside it.
Because we have more chance of getting our way in breaking down trade barriers with the rest of the world as part of that bloc than on our own.
Not finding that negotiations about trade happen without Britain in the room.
So a reformed banking system, a new skills system, a patriotic championing of the British firm, a new approach to infrastructure and a secure sense of our place in the world.
But there is something else about the way that we will succeed.
In these times, I think back to the stories my dad told me.
He came to Britain as a Jewish refugee during the Second World War, fleeing from the Nazis.
He joined the Royal Navy.
It was a time when people of all backgrounds, of all beliefs, of all talents came together for a common purpose.
They shared a vision for the country.
They knew, like John Longworth said, that we can’t do it alone.
That is what I mean by One Nation.
You know, there are many pessimists around today.
I am not one of them.
I am one of the optimists.
Just think what the Olympic Games showed us.
When we pull together, when we work together, we can achieve anything.
For the good of ourselves.
And the good of our country.
That is what we have shown throughout our history.
That is what we have shown in our darkest times.
That is what you show in the work you do every day.
That’s what we can show again as a country.
And I look forward to working together.
