2016 will see the Tynedale Community Bank truly take off

A Local organisation, providing Local savings and loans, to local people, with dividends and profits going back to local people and local causes.
I do not think this is too much to ask.
And today this is a reality.
I want a bank that is based in the community, run by someone from that community, with profits going back to that community - like a German Sparkassen  .... rather than that which you call Lloyds / HSBC or another of the big banks, who are based so far away in so many ways, and who struggle - despite the best efforts of local staff - to be a truly local bank.
To that end we have done many things:
First we have changed the law to make it easier to set up local community banks and enhanced credit unions. I spent a large part of the last parliament doing this.

Then we started by setting out our vision and an idea of a community bank / beefed up credit union would look like and work upwards from that. For more details of what our plans are read here:
http://www.saveoursavers.co.uk/banks/guy-opperman-mp-on-plans-for-regional-banks-and-how-to-fix-the-banking-industry/

We have set out to convert people locally with regional banking events in Gateshead and elsewhere covered by the media and featuyring local successes in banking:
http://www.thejournal.co.uk/news/north-east-news/guy-opperman-hosts-meeting-regional-4391940

Finally, we are taking steps to expland our offer to cover not just those in fuel poverty but anyone who is struggling with pay day lenders and / or are unbanked; we are also unashamedly seeking to attrract middle class savers, which is the perennial failing of an old style credit union. This has been a journey of many years but we have much more news to follow. I am spending a lot of the spring and summer taking this forward.
We are now beginning to take shape locally with
- a number of local champions across Tynedale
- a proper board of key local supporter and community leaders
- a partnership, and common bond, with the Prince Bishops Bank in Stanley, County Durham
- a formal proper launch today, after several months of soft launches, visits to interested parish councils, oil buying clubs, and discussions with clergy and commuinties.
We are fully regulated and your money is as secure as is it were in a high street bank.
As always, we need volunteers interested in contributing by action or outreach, fundraising and engaging with the wider community. This is an utterly apolitical project. Anyone interested should get in touch with me and I will pass on details of the key players taking forward this exciting project in our community.
Or you can visit our website at www.tynedalecommunitybank.org.uk
Application forms can be found there too.

Speech on the need to create local community banks

Wednesday in the House of Commons gave me the chance to talk about what the Coalition government has done to try and make it easier to set up new challenger or local banks to take on the big banks. There is huge progress being made. The full speech is here:
 http://www.theyworkforyou.com/debates/?id=2015-02-25a.334.1&s=speaker%3A24962#g354.2

Westminster this Week

Local Banks and Credit Unions are this weeks key meeting which is on Tuesday with Sir Hector Sants, the advisor to the Church of England on credit Unions - whose help I am seeking as we try and take forward our local banking and expanded credit union plans for Tynedale.
Later in the week I have the Association of Air Ambulance awards meeting - where we attempt to identify and assess who the winners of these annual awards will be.
Also on Wednesday parliament will be debating the conflicts and unrest in the Ukraine, Middle East and beyond from around 12.40 onwards.
I have multiple constituents coming to Westminster this week for meetings and some on tours, and we are working the full week once again in Westminster as Friday is another Private Members Bill day.

Dozens of new banks being set up as challengers force their way in

As the High Street Banks fade from the High Street, with some behaving shamefully as bully banks, I am delighted that new entrants are springing up. I am backing Atom Bank in the North East but we are also working really hard to support the existing Northumberland Credit Union and to expand community banking in Tynedale. In addition true Co-Operatives are still rightly supported in our communities and I do not believe that the disastrious exploits of Paul Flowers is stopping people committing to local community cooperatives and lending by local institutions not multinationals based hundreds of miles away where always the computer says no.

I recorded a piece for the BBC Look North yesterday on this issue and the papers are telling the story of the many new national and local banks springing up all over the country:
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/10952024/FCA-Dozens-of-banks-spring-to-life-after-red-tape-cut.html

The Co-Op is in big trouble and needs to take the doctors medicine

The Myners Report into the Co-operative Group has been published this week
The situation is not good. Following the discovery of a £1.5 billion black hole in their finances, followed by the Paul Flowers ‘crystal Methodist’ scandal, the Co-op commissioned the former City Minister Paul Myners to look into the group’s problems and put together a restructuring plan to make it sustainable and properly governed. The Spectator has done a list of the 5 key things you need to know from the 180-page report:

1. The Co-op group is still ‘manifestly dysfunctional’
Lord Myners is not impressed with the current state of the Co-op Group and warns it needs to radically change ‘soon’ or face breaking up. The report suggests there are still ‘deplorable governance failures’ and that the board is ‘still stuck in denial over this near ruinous failure of governance’. The scale of the change required to reshape the group is significant and throughout the report, Myners hints he isn’t confident the group will accept the speed and scale of reshaping necessary.

2. A smaller board should be adopted
The report states that the current board of the Co-op group is ‘not competent’ to perform the duties expected of it and there is ‘limited shared purpose among group board directors’. Myners blamed the board directly for the group’s troubles:
‘It is one of the great national business calamities and it is being led by a board totally unable – because of a lack of experience – to hold them to account’.
To replace the current bottom-up structure — the Co-op has 48 area committees with ~10 members, who in turn elect seven regional boards with 15+ members — Myners proposes a board with six or seven independent directors, two executives as well as a separate National Membership Council, to body to handle the concerns of members.
3. There should be a greater focus on being profitable
The group presently appears to have polarising priorities. As one anonymous shareholder told Myners:
‘Some want a dividend, some want low prices, some want to do social good and some want free range chickens.’

Obviously, the Co-op is a cooperative, which is not necessarily designed to maximise profit. But the report argues that the future safety of organisation’s financial health ‘can only be restored through steady, step by step, rebuilding of the Group’s profitability and repayment of its excessive debt’.

4. There is no easy route to fixing the group
With 90,000 employees and 600 elected members, the group has a lot of stakeholders shouting their concerns, including many with distinct ideas about how the group should change. In his summary, Lord Myners warns:
‘There is no short cut to recovery from its present weakened state. It will require retrenchment and some painful choices. After 150 years of development, and an extended period of financial decline, the organisation has seen more than half of its net assets wiped out in the past five years’

5. Shareholders will decide whether to back the reforms on 17 May

For my part I wish the Co-Op well. I am huge fan. But it has been run terribly for some time. There is a massive place for Mutuals, Building Societies, Co-Operatives and Credit Unions as the banks head away from the High Street in particular. But the Co-op is not helping would be applicants or the publics trust by not taking the medicine.

Sunday in Westminster prepping for the week ahead and sorting the outstanding casework

Sat at my desk with a busy three days ahead in Westminster, before I head north for 2 weeks.
Tomorrow we have the big LA7 debate to created the North East Combined Authority, which I support and have campaigned at length to make happen. I shall be speaking in the short debate between 4.30-6. Writing my short speech now.
I also have a Justice and Home Affairs debate tomorrow, plus the Holocaust Memorial Day Trust Parliamentary Reception, which I hope to be able to go to. In the evening I will be hoping to fit in a meeting with some of the Better Together team, who will be down in Westminster Monday evening.
Tuesday sees Foreign Office Questions, followed by a series of debates and meetings concerning credit unions. I am particularly looking forward to a meeting with Sir Hector Sants, Chair of the Archbishop of Canterbury’s Credit Union Task Group; Sir Hector is seeking input from interested parties on the Church’s role supporting the growth of credit unions as part of a more competitive financial sector which encourages responsible lending and saving. The meeting is in Committee Room 14, Palace of Westminster, 4-6pm.
Wednesday is busy with PMQs, the end of the Finance Bill in Committee, and a series of meetings with a 7 pm finish and I will then sprint for the 8 o'clock train to Northumberland.
Once back home I have a multitude of meetings and visits over the next 10days, which I will blog about in more detail later in the week.

Only local community banking will save us as High Street branches close

I remain convinced that local community banks are the solution to the problem and the disconnect between the London based banks and their rural customer. The Courant have done a really good article which is worth reading on the subject.
http://www.hexhamcourant.co.uk/news/2.2978/tynedale-businesses-pay-the-price-for-bank-closures-in-rural-areas-1.1116132

The Weekend Read: Community banks

I had a meeting on Thursday with the Northumberland Credit Union where I talked to them about my hopes for local banking and the transformation of savings and lending in Tynedale. Last week I gave a speech in the House on Local banking:
Guy Opperman (Hexham, Conservative)

"Greater competition, the desire for local banks and the Labour policy to close regional branches are the issues of this debate. I have held two local banking conferences over the past six months—one in Gateshead on 6 June and the other in London in December—and they were attended by in excess of 350 people from various organisations, banks, accountancy firms and start-ups. It was very striking that, contrary to what Mr Meacher has recounted, there was a tremendous desire for a large number of new banks, and that is in fact the reality.

I have met the likes of Metro, Aldermore, Handelsbanken, obviously Virgin, Cambridge and Counties—it was set up out of a local authority pension fund—and the Hampshire bank. A fantastic bank has been put forward by the Unite union, on behalf of Labour, in Salford, and it is doing wonderful work. I have met Alex, who is the linchpin of that. He is a fantastic lad, who is doing great stuff to try to transform how that local community bank provides services to the local community of Salford.

I therefore disagree with the doom and gloom approach about there being no competition or new entrants. Certainly, when I meet those from the Financial Services Authority and the Prudential Regulation Authority, including Sam Woods and all the individuals involved with the regulators, they tell me that they have had in excess of 25 separate pre-applications that they are now considering.

On 23 April 2012, when we debated local banks and the need for greater competition—this is my seventh speech on local banking in the House in the past three and a half years—the Labour party chose to vote to delete clause 5 of the Financial Services Bill, which was designed to create greater ease for new entrants to enter the market and related to how far competition can encourage innovation. I welcome the fact that the Opposition seem to have changed their policy and would now like more competition, but the proof of the pudding is always in the eating, is it not?

An announcement has been briefed to Nick Robinson of the BBC that the Labour party, if it gets into government, will ultimately close regional and local branches. As my hon. Friend Steve Brine made clear when he questioned the shadow chief Secretary, Chris Leslie, that would have a massive impact on our local communities.

I am certainly trying to have more bank branches opened in my area. I am negotiating with my credit union to see how far it can do that. Similarly, I am trying to create new banks in the north-east. As my hon. Friend Ian Swales has made clear, there is great scope for new entrants to do so. The very fact that the big five are so complacent and have had so many problems, gives new entrants an opportunity, which is certainly being exploited by all those we have spoken about today.

In that context, I want briefly to touch on two matters—credit unions and the Church, neither of which have been discussed. It would be a failure of this debate if it did not deal with both of them. All of us should support our credit unions. I am certainly wholeheartedly behind the Northumberland credit union. We must acknowledge that even though this Government have done more to give credit unions greater clout, power and ability to lend, credit unions are still incapable of filling the banking void and overcoming the current difficulties.

The only way forward is the creation of local community banks built on a credit union. I can give the House at least three examples. I have already mentioned the bank in Salford, which is the former Salford credit union. The Glasgow credit union is probably the biggest and most successful in the country: it is effectively a bank in all but name. Finally, I have the Prince Bishops community bank in Durham, which is the former Stanley credit union. All are very successful and have great potential. We need to follow such examples.

To touch briefly on the Church, I welcome the fact that Justin Welby is the new Archbishop of Canterbury. It is savage irony that 500 years have had to pass for us to have the new type of God’s banker, who is encouraging the Church to become involved in banking. It can only be good if the clergy move from being reactive to poverty and social deprivation—to their great credit, they are amazingly good at reacting in that way—to being proactive.

I suggest that the Church has a role, acting with their credit unions and local community banks, effectively to become the offshoots and outlets of those community banks. After all, all the vicars that we, as constituency MPs, know and deal with know which people are in great social deprivation, going to the food bank or having problems with high-cost credit and need debt advice. There is massive scope for the Church to take a greater role by dovetailing churches with credit unions and community banks. I welcome the fact that the Church has chosen to buy branches of Williams and Glyn’s bank, and is setting something up so that we can go forward. If we can do that and become more proactive in our local communities, a huge amount can be done.
In seven days’ time, I will meet my Northumberland credit union in Hexham to discuss how we can promote the idea of taking the credit union, building it up and creating a larger bank to make the situation so much better. If we do that, we will have in our regions and communities a bank that we can trust, with a proper brand name and identity, and one that is part of the community, rather than something based in London or Frankfurt and completely divorced from that community. That is the problem that we all face and have identified and, to their great credit, that is the problem that the Government have made great efforts to address.
In the interests of brevity, I will draw to a close, but I very much urge all parties to make sure that they get behind local community banks. We have not always done so, but we should do so in the future."

Great News - Archbishop Justin Welby announces Credit Union expansion plans

http://www.abcul.coop/media-and-research/news/view/410

The Church is right - pay day lenders and the banks themselves need sorting

http://blogs.spectator.co.uk/coffeehouse/2013/12/coe-takes-aim-at-payday-lenders-but-what-about-the-banks/
Really pleased to see the recent advert by the Church of England launched yesterday morning, but as the Spectator reports the problems are twofold, and include the banks and their approach. I have lost count of the number of complaints from constituents I have received at the approach of the banks; I have also endured an interesting time myself with a high street lender, who have behaved terribly, and have now apologised unreservedly.  It took some time to sort for me, but many constoituents would really have struggled.
I am pleased to say that I am meeting my credit union tomorrow in Hexham, and a church leader, to talk about this exact problem of high cost credit, the extension of credit unions and the need for more local action on this issue.

Westminster this week

The Crime, Anti Social Behaviour and Policing Bill is up for debate for 2 days on Monday & Tuesday in the Commons. I will be helping in this Bill, but have a variety of key meetings as well:
- I am the chair of the All Party Group for Air Ambulances, and we have a meeting this Tuesday,
- I also have key constituency calls to action by phone, notably with Northumbria Police officers on a couple of ongoing cases in Hexham and Haltwhistle,
- I hope to be meeting key representatives of BT on Wednesday, where I will be raising local phone failures we have suffered in parts of Tynedale, particularly Hedley, where the campaign goes on for a better service.
- I have question 9 on fuel poverty and credit unions at 11.30 in the Commons on Wednesday and will be hoping to catch the Speakers eye at PMQs
- there are also a number of other smaller debates I will keep an eye on

Thursday I really hope to be slipped to come north, albeit the House is still sitting, where I have a number of appointments and meetings on Thursday, Friday and all day Saturday. The EGGER academy opening is the key event on Friday. The evening diary is yet to be confirmed but I know I have appointments / events on Thursday and Friday. With a little bit of luck I might make the pub quiz in one of my local pubs down the road on Friday night.

Practical ways to combat Pay Day Lenders and problems with High Cost Credit

Brilliant debate on credit unions and pay day loans today led by Welsh Labour MP, Chris Smith, ably supported by colleagues from all parts of the House of Commons:my speech is set out below
Guy Opperman (Hexham) (Con):

The question that this debate is making patently clear is whether it is the responsibility of the state to look after those who cannot look after themselves. It has also been made patently clear in the brilliant opening speech of the hon. Member for Islwyn (Chris Evans) and in other contributions that there are many different practical and relatively immediate measures that could be introduced to address the problem of high-cost credit. They include restricting advertising budgets, implementing a greater degree of financial education, doing more work on shared data, addressing the question of interest rates and improving debt advice. I endorse the comments of the Public Accounts Committee and urge the Financial Conduct Authority to do more, as requested.
I believe that everyone agrees that the Archbishop of Canterbury was right when, in July, he championed the cause of credit unions and criticised the payday loan companies. He was right to say that we needed to “compete” the payday lenders out of the market. I welcome his comments, but I would argue that this debate has shown that although we all support credit unions, they are not necessarily the mechanism by which we will succeed in competing the payday lenders out of the market.
There is cross-party agreement on specific measures that can be taken to address the problem of high-cost credit, but I suggest that the mechanism by which people ought ultimately to borrow on a long-term basis is local community banks. They have all the flexibility, the clout and the borrowing power of a bank, as well as all the sympathetic community approach of a credit union, and the amalgamation of all those qualities will produce the best way forward.

Richard Graham:
My hon. Friend will be aware of the resurrection of TSB as a brand in a market in which it previously had a good reputation for providing small loans and deposits to people in local communities. Does he see this as offering opportunities in that space?

Guy Opperman:
Indeed I do.
I held a conference in Gateshead only a few months ago. It was attended by 170 delegates who were trying to set up local community organisations to address the lack of lending in their communities. They wanted to enable such lending by local, trusted providers, rather than by nameless, faceless, computer-led organisations based in London, Frankfurt or wherever. The smaller providers such as the TSB, the Hampshire bank and the Cambridge and Counties bank that are beginning to be set up are clearly the way forward.
No one should dispute that the expansion of credit unions is an extremely good thing. I welcome the changes in the way in which they are to be run; the Government should take credit for that. All Members of Parliament should become greatly involved in their credit union; I certainly support the Hexham credit union, which was set up with the help of the Churches in Northumberland. However, I question whether the credit unions alone will be able to address the problems of high-cost credit. In regard to interest rates, credit unions have clearly adopted a fantastically successful approach—their lending rates are so much better—but their deficiencies might mean that it is difficult for them to go forward. None the less, debates such as these on Wonga or on the private Member’s Bill introduced by the hon. Member for Sheffield Central (Paul Blomfield) have substantially raised public awareness of credit unions in the House and in our local communities.
I want briefly to talk about local community banks. For far too long, under successive Governments, we have been dominated by the big six or seven banks. I welcome the idea of a Church bank put forward by my hon. Friend the Member for Banbury (Sir Tony Baldry), but the kind of long-term community banking that he referred to has disappeared from our high streets and rural communities. That has had a detrimental effect on the ability to lend and to get credit.
The Government have rightly addressed that problem. It used to be incredibly difficult to set up a bank. It took in excess of £50 million and the process was highly regulated, even though the smaller banks in question were in no way comparable to a Barclays-style bank. The Financial Services Act 2012 changed the approach taken by the then Financial Services Authority and its successor organisations involved in regulation, and I strongly support those changes.
Reference has been made to the platforms required to set up a credit union or a community bank. Those requirements are now changing dramatically, to enable much greater interchangeability between pre-existing accounts held with the big seven banks and those held with credit unions or community banks. The mechanisms by which we can set up those organisations are improving, and many groups now wish to get involved. They include not only local communities but local authorities and individual businessmen with a philanthropic approach to their local community. Some universities, and even the Army, are considering getting involved. There are tremendous opportunities in our local areas to set up and expand these organisations.
Over the coming winter, we will all be faced with the issue of the energy costs that our constituents will face. In my community in the north-east, we have 24% fuel poverty, and a large swathe of the community is totally reliant on either oil or liquefied petroleum gas. That is an unregulated market, with all the problems that that entails. We have now formed more than 14 separate oil-buying clubs to try to address the cost of the oil. However, the requirement to buy 500 litres involves a very large financial outlay, often when oil is at its most expensive, and we are looking at ways to address that. The credit unions are certainly being encouraged to be the providers in those circumstances.
I hope that we will all try to expand our credit unions, using the vast plethora of good advice on regulatory changes, and to support our constituents who need assistance on this issue.

Because of time restraints the speech was very short but the full debate with contributions from one and all can be found here: http://www.parliament.uk/business/publications/hansard/commons/todays-commons-debates/read/unknown/465/
For my part I am hoping to meet the Hexham Credit Union shortly when the House rises to see what I can do to help them expand and do what the Archbishop Justin Welby said he wanted to do - "to compete the pay day lenders out of business"