Oral Answers to Questions

Toby Perkins Excerpts

Thursday 6th March 2014 Commons Chamber

[Vince Cable]

My hon. Friend is right and I thank her for her kind words. Ultimately, what will change the problem is breaking the traditional monopoly of the big four banks. Many new banks are now coming into existence, and the more flexible licensing regime operated by the regulators is playing a significant part. I believe that 20 new banks have recently been licensed and, within a few years, I think we will see real competition and diversity.

[Toby Perkins (Chesterfield) (Lab)]

The Secretary of State says that he is not complacent, and he has good cause not to be. Net business lending was down in eight of the past 12 months, and businesses will hear that in the past year, lending is down by £11.6 billion on the year before. How does he think those businesses will respond to the news that in the past year, Barclays and Lloyds made 508 people millionaires due to the bonuses they paid, at the same time as many small businesses are struggling to get access to finance? Is there a discrepancy between the Government’s performance on small business lending and the bonuses that continue to be paid by those banks?

[Vince Cable]

There are often bonus levels that are extreme, but it is important to recall that at the peak of the financial crisis when the Labour party was in charge, there was a bonus pool of well over £12 billion. That has now shrunk to a tiny fraction of that, and at least one bank to which the hon. Gentleman referred—Lloyds—is making a significant improvement in the supply of small business lending.