It’s been quite the year for Hollywood’s humanitarians. Olivia Colman took on pension funds for their role in fossil fuel expansion, Game of Thrones stars Kit Harington and Rose Leslie challenged high street banks’ role in the same polluting activities, and actor Dominic West starred in a Nationwide advert calling out the banks for their sweeping branch closures.
All shared the same satirical tone, but only one received so many complaints it was banned by the Advertising Standards Authority (ASA). The complaints, most notably from Nationwide’s rival Santander, were that the Nationwide ad was misleading in stating that: “Unlike the big banks, we’re not closing our branches” – which holds true only until 2028.
Still, the ad clearly touched a nerve – and rightly so, for the news is rife with stories of mass closures of bank branches, and the towns and villages left without any way to access cash or in-person services. MPs on the Treasury committee grilled bank bosses last month on this very issue, and Which? reports closures are happening at a rate of about 54 a month.
Banks have been eager to quieten this story. The complaints against Nationwide’s ad were just the latest example. Instead, they have been keen to deflect attention to the pop-up branches they’re establishing in seemingly random locations such as garden centres and, in one bizarre instance, a former public toilet.
And it’s easy to see why banks would seek to fade into the background on this one: if public outcry were to continue, people might start questioning why corporations that made record profits off the back of higher interest rates last year are getting away with cutting back on customer services.
If people then started digging a little deeper, it might become general knowledge that Jeremy Hunt last year cut the surcharge on bank profits by 60%, following on from the autumn statement in 2022, from 8% to 3%, in a move that the Trades Union Congress (TUC) worked out is costing us £29m a week.
At our advocacy group, Positive Money, we worked out that a windfall tax in line with the one on energy companies would generate £14bn from the 2023 profits of the big four banks alone (HSBC, Barclays, Lloyds and NatWest). The £44.3bn they made last year was 66% more than they made in 2018, allowing their shareholders to enjoy a £26.8bn payout.
When the MP Caroline Lucas posed the question of a windfall tax to Andrew Griffith, then economic secretary to the Treasury, last September, Griffith used the “millions of British jobs dependent on financial services” as justification for not increasing taxes on banks.
Yet, when we consider the thousands of job cuts Lloyds, Barclays, Metro Bank and the Co-Op Bank have announced in just the last year to cut costs, this excuse doesn’t really stand up to scrutiny.
There is perhaps a different explanation: the financial sector exerts an oversized influence over public policy through donations and other financial ties to politicians, corrupting the democratic process.
We have established that financial institutions and individuals closely tied to the financial sector donated a total of £15.3m to political parties and collectively spent £2.3m directly on MPs from January 2020 to December 2021.
Such lucrative donations continue to score them seats at the table with the government and the opposition alike, regardless of the track records of the donors in question, or whether conflicts of interest exist.
To us, the solution seems clear: we need to get the financial sector and its money out of politics, so that everyone has an equal voice in our democracy and public policy works in the best interests of the public, not bankers.
The Labour party’s (now weakened) plans to abolish the undemocratic House of Lords would have been a strong starting point, as Positive Money found a fifth of peers have registered paid positions at financial institutions, including more than half of peers on the committee responsible for investigating matters related to economics and finance.
But we need politicians to go even further. There must be longer “cool off” periods between public and private roles, to stop ministers using their positions to secure lucrative jobs in the private sector.
More importantly, we need caps introduced on political party donations, and an outright ban on second jobs in the private sector for MPs, to ensure that they’re working for us, not their other employer.
This year, the UK fell to its lowest ever position on Transparency International’s corruption perceptions index, and the majority of the public not only perceive the government as “institutionally corrupt”, but see this problem as getting worse. If politicians are looking for the next election-winning strategy, we would suggest taking on the finance lobby and resisting the temptation of its millions, in order to show the public that politics can be worth believing in.
But the finance lobby doesn’t want that: and they’re a resourceful lot. They would rather we were talking about a banned commercial starring Dominic West.
Hannah Dewhirst is head of campaigns at the campaign group Positive Money