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Ex-Labour Treasury minister slams party for financial services ‘hysteria’

Kitty Ussher 300

Former Labour Treasury exchequer secretary Kitty Ussher has delivered a stinging critique of her party for indulging in the “politics of envy” and “hysteria” in its stance towards financial services.

Speaking at a fringe debate on producers vs predators at the Labour autumn conference in Manchester this week, Ussher said the current debate is “unhealthy and counter-productive”.

At last year’s Labour conference, party leader Ed Miliband argued that British business was split between “producers” that created wealth and “predators” that extracted it for no social benefit.

Arguing in favour of so-called predators, Ussher said: “I think this debate is unhealthy. Call me old-fashioned but I do not think the Labour party is at its best when it is pursuing the politics of envy. I do not think it is at its best when it takes one part of our country and pits it against another part.

“When we do that, they rub their hands with glee in France and Germany because they know it was not the size of the financial services sector that caused the recession. They had a deep recession too even though their banking sectors are half the size of ours. They want a bit of what we have got which is a world-class financial sector.”

At this year’s conference, Labour has pledged to break-up banks if they do not implement reforms, slammed financial services’ resistance to regulation and called for a more ethical sector.

Ussher, who stepped down as a Labour MP at the last election, has called for a more balance debate.

She said: “If there is one thing that leads to policy mistakes it is an atmosphere of hysteria and that is the type of atmosphere we sometimes have here. A one-sided debate is unhealthy and counter-productive.”

This week, MEP and vice-chair of the economic and monetary affairs committee Arlene McCarthy accused the financial sector of not learning the lessons of the crisis and “kicking back” at regulation.

Evolve Financial Planning director Jason Witcombe says: “I agree with Kitty Ussher. Tit for tat politics does not serve any useful purpose.”

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  1. Much of this so-called hysteria might well abate if the regulator were to start following instead of steadfastly ignoring the precepts of the Statutory Code of Practice for Regulators, to whit:-

    The Regulators’ Compliance Code is a central part of the Government’s better regulation agenda. Its aim is to embed a risk-based, proportionate and targeted approach to regulatory inspection and enforcement among the regulators it applies to.

    Our expectation is that as regulators integrate the Code’s standards into their regulatory culture and processes, they will become more efficient and effective in their work. They will be able to use their resources in a way that gets the most value out of the effort that they make, whilst delivering significant benefits to low risk and compliant businesses through better-focused inspection activity, increased use of advice for businesses, and lower compliance costs.

    Not an unreasonable expectation is it?

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