Treasury hears NI bank complaints

MPs want to hear about people's personal experiences of the recession

The Treasury select committee has been told banks are still refusing to lend to Northern Ireland small businesses.

The committee is in Belfast for its first meeting outside London as part of its inquiry into the banking crisis.

MPs have heard from members of the public responding to an open invitation to describe their experiences.

Businessman John Gildea said the Ulster Bank in Newry had cut his borrowing facility from �400,000 to nothing and increased the fees it charged him.

He told the committee: "They are not prepared to talk or meet, there is no flexibility."

The committee chairman John McFall said he would write to the Ulster Bank Chief Executive Cormac McCarthy.

Jim Pattison, a bed and breakfast owner, complained of similar problems.

He said: "I need finance to keep everything afloat - where is that going to come from? The government are underwriting the banks but the banks aren't passing it on."

Savings

Several speakers appealed to the committee to help savers with the Presbyterian Mutual Society.

The society was forced into administration last year after a run on its funds. Members no longer have access to their funds and some face losing their life savings.

The former Presbyterian moderator the Reverend John Dunlop asked the committee to press the government to assist the society members describing it as "an acute human problem for individuals and congregations."

The committee made no promises but wished the members well and suggested they form an action group, possibly through the internet.

The MPs will also meet with politicians and lobby groups at Stormont.

'Anger'

Committee chairman John McFall said widespread public anger at the banking situation was "understandable".

The Labour MP said the committee has already gathered more than 50 hours of evidence during sessions in London, but it was important to "gather a perspective from around the country".

"We have had to stand behind the banks with eye-watering sums, and it's very hard to have a good reason for that and for the public to understand that," he said.

"I tell the public that the banking system is the economic lifeblood in the country - it flows around - and if anything happens to the blood in our body, there's a thrombosis.

"It's the same here - jobs and communities are threatened so we have to stand behind the banks.

"But we've got to ensure that the public voice is heard - that the public are taken along - because this anger is understandable at the moment."

Eleanor Gill, chief executive of the Consumer Council, who attended the meeting, said: "We welcome the Treasury Select Committee's focus on how we can rebuild that confidence in a banking market that we can all feel part of, both on a local and national level.

"This is affecting all consumers - people are losing their homes, losing their jobs, having their savings cut and being overcharged.

"Consumers urgently need to see banks, regulators and the government doing everything they can to keep people in their homes and the economy working."

Details of further committee sessions outside London are yet to be announced, but are likely to be held in Scotland and West Yorkshire.

The move out of the capital follows Gordon Brown's decision to hold two Cabinet meetings last year outside Westminster.

Ministers convened in Birmingham last October in the first Cabinet meeting away from London or Chequers since 1921, before visiting Leeds the following month.

E-mail this to a friend

Printable version