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Banking (Responsibility and Reform)

We have heard 11 interesting contributions from Back Benchers, although I cannot say that the last contribution was either interesting or, indeed, informed. I should begin by drawing the House's attention to my entry in the Register of Members' Financial Interests. I have to say that the last contribution was in sharp contrast to the more emollient tones of the shadow Secretary of State, the hon. Member for Streatham (Mr Umunna), who actually admitted—I think for the first time from the Dispatch Box—that Labour got it wrong on this issue when it was in government. What is not clear, however, is whether he cleared those remarks with the shadow Chancellor. It seemed that this set of remarks was new to a number of faces on the Back Benches. We heard very good contributions from my hon. Friends the Members for Halesowen and Rowley Regis (James Morris) and for Nuneaton (Mr Jones) and excellent contributions, too, from my hon. Friends the Members for Bedford (Richard Fuller) and for Stourbridge (Margot James). We heard an interesting contribution from the Chairman of the Select Committee, the hon. Member for West Bromwich West (Mr Bailey), who pointed out that it was my right hon. Friend the Member for Twickenham (Vince Cable)—[Interruption]—who, notwithstanding the shouting and screaming from Labour Members, highlighted the existence of real challenges and problems when his party was in opposition. I am sure that my right hon. Friend will be happy to acknowledge that. Let me begin by making it clear that this Government have an absolute commitment to addressing excesses in the banking system that were allowed to go unchecked and unregulated for much of the 13 years before we came to office. It was a system in which light-touch regulation and record bonuses were encouraged by a Government who were keen to reap the rewards. Since coming to office, we, as a coalition Government, have made a return to responsible banking a key priority. We have taken concerted action to ensure that, in return for extensive taxpayer support, banks must once again live up to their obligations to support the wider United Kingdom economy. That is why, as my hon. Friend the Financial Secretary to the Treasury pointed out, we are discarding the discredited tripartite system and implementing the recommendations of the Vickers commission. It is also why we are actively supporting the flow of lending to businesses, especially small businesses, so that they can gain access to the finance that they need if they are to invest and grow. We on these Benches passionately support the entrepreneurs and hard-working small business owners who create the wealth and jobs on which the rest of us rely. There has been some discussion about the Merlin agreement this evening. Let us be clear about that. Under the terms of the agreement, the five major UK banks committed themselves to making £190 billion of new credit available last year. Of that new lending capacity, £76 billion was dedicated to small and medium-sized enterprises, which would be a 15% increase on the previous year. The latest figures, for the third quarter, show that the banks are broadly on track. At that point banks had lent more than £157 billion to UK businesses, 11% above their implied target, and three—Barclays, Santander and HSBC—have all made recent statements to the effect that they have met their Merlin targets. We await the final figures, but that is good news that we should bear in mind. Moreover, a report from my Department, to which the motion refers, reveals—although I did not hear this from Labour Members—that three quarters of SME employers are being given the loan or overdraft they request. My hon. Friend the Member for Stourbridge rightly pointed out that it is wrong to suggest—as some Opposition Members do—that no small firm can obtain a loan.