David Boyle writes:
At the start of the coalition, in 2010, there was a great deal of talk about ‘rebalancing’ the economy. This is not a phrase you hear so much three years on, but it was an important imperative. It still is.
It meant rebalancing away from the UK economy’s traditional reliance on the financial sector, on speculative finance, and on the City of London. What is pretty clear now is that this is both an urgent project and one that is going to take a generation.
It is also clear that the policy armoury to achieve it badly needs replenishing.
The solutions we have now are not powerful enough, or fast enough, to make the revolutionary change that the UK needs. More needs to happen.
But what? This project was launched by Baroness Kramer in September in the aftermath of the Commission for Banking Standards(she is now a minister at the Department of Transport). It recognises that there is now a ferment of new ideas emerging in practice about building a far more diverse banking infrastructure in the UK. We have seen credit unions and CDFIs gearing up. We have seen new campaigns to help people to switch bank account, and new methods of helping struggling local economies to find the energy they need to regenerate – without waiting for permission or outside investment.
We have seen the emergence of an exciting new sector of peer-to-peer lending, and new ideas pouring in from around the world about how the UK might make its financial institutions more fit for purpose – which is to support and encourage local enterprise.
What has been missing is a consensus about how this ferment can be translated into actual policy levers with some chance of making things change in the way we need.
So we are enormously grateful to the Joseph Rowntree Reform Trust for the support to help this process along – both for the next election and independently of any election. We are holding round tables, publishing reports and proposals, and talking to people at the innovative front line.
We won’t be able to change the world. We won’t even be able to change the financial world. But I hope we can make it easier for the emerging local economic sector, and those who are beginning to make a difference on the front line or online, to stitch together the policies we will need in a whole new push to rebalance the economy.