In the 2018 Budget the Government announced its intention to sell all of its remaining shares of Royal Bank of Scotland (RBS) by 2023-24.
This month I have been contacted by many constituents who rightly argue that RBS should instead be kept under public ownership and could serve the UK public by shifting its lending to small and medium-sized enterprises, investing in the green economy, and expanding access to banking services in communities that are currently under-served.
RBS shares should not be sold off. Furthermore, I believe there was no economic justification for the Government’s decision to sell off a 7.7% stake at 271 pence per share in June 2018. While the sale raised £2.5 billion, it still represented a loss of £2.1 billion compared with the amount paid for the shares in 2008 when the taxpayer bailed out RBS. It is unacceptable that taxpayers are paying the price for the Government’s mismanagement of RBS.
There is clearly unmet demand for lending in the UK and a problem with financial inclusion, which is why I believe that RBS should be reorganised under public control so that it helps to provide the patient, long-term investment capital that businesses across the country so urgently need.
Indeed, the Opposition is considering plans to develop a Post Office bank to ensure universal access to banking services for every part of the UK. These proposals are being developed in more detail, alongside plans for the future of the public stake in RBS and other measures designed to increase plurality in the banking sector. We also have a commitment for a national investment bank to take a long term view on national infrastructure.
There is also a real issue with bank branch closures across the UK. We must change the law regulating banks, so that no closure can take place without a real consultation or approval from the Financial Conduct Authority.