Parliamentary Connections

The Treasury Select Committee has been berating the Financial Services Authority for its failure to get to grips with financial exclusion.

The select committee rightly points out that much more needs to be done and that producing leaflets and knocking out some advice on a website does not really scratch the surface of a growing problem. Proposals from Citizens Advice for IFAs to offer free advice, while worthy, also seem to offer little hope of addressing the problem.

Financial exclusion has grown as a problem over the last decade because the most effective mechanism for getting simple protection and savings products into the hands of the less well off was regulated out of existence. Home service insurance – personified by the Man from the Pru on his bicycle – worked. Tens of thousands of vulnerable families had decent basic protection because the insurance man would knock on their door every week to collect the premium, advise on changes in cover when family circumstances changed and provide friendly advice on family finance. It was very old-fashioned, relatively expensive and totally alien to the form-filling, fact find mentality that drives modern regulation. But it worked.

The simple truth is that people on low incomes, desperately trying to keep up with our consumer society are not going to go looking for financial advice. The advice needs to go to them which is precsiely the service the Man from the Pru offered. The challenge now is to find a way of reinventing that concept for the 21st century.

Having said only last week that the Tories were mounting an increasingly impressive charm offensive in the City and wider business community, their leader, David Cameron goes and pulls the carpet from underneath his hardworking team by snubbing the CBI's prestigious annual conference today.

His decision to fly to Iraq for a few pictures with "our boys at the front" is an error of judgement. He has put short term headline grabbing before longer term bridge building. The Tories need big business to swing behind them in the run-up to the next General Election, having lost alot of ground with what should be a natural supporter base for them. Dropping out of the CBI conference at the last minute will not help their cause. After all, can you recall Tony Blair, pre- or post-1997, making the same mistake?

The failure of John Greenway to win selection for the new Thirsk & Malton seat (for electoral enthusiasts it is actually a famous old seat recreated) seems to have taken alot of people by surprise, not least John himself and many in the Conservative Party.

So, what went wrong from his point of view?

From talking to John, reading the local press and listening to other MPs, it seems that he failed to get sufficient control over various factions in his local constituency party, some who had never been his biggest fans despite his apparent popularity as a constituency MP. When John won Ryedale in 1987 it was a Liberal held seat, Liz Shields having snatched it from the Conservatives in a by-election the previous year. This wasn't a flash in the pan for the Liberals in Ryedale as they had been picking off Tory Council seats for a few years previously. John was among those unimpressed by the old guard's attempts to keep the Liberals at bay and when the by-election was lost he seized his chance to oust the unsuccessful Tory candidate and was selected to fight the 1987 General Election.

The Liberal/SDP Alliance (as it was then) was widely predicted to hold the seat. John proved the pundits wrong, won by a substantial margin and has made it a safe Tory seat ever since. However, some old wounds never healed. The faction around the ousted canadidate from 20 years ago has never embraced John as one of their own and their manoeuvring, coupled with the expected influx of Anne McIntosh supporters from the Vale of York seems to have caught John out.

A few local issues are meant to have weighed in as well, such as John's "failure" to get a by-pass built, coupled with the suggestion that a shadow minister might have more clout (McInstosh was recently made a shadow eduction minister) also cost John some votes. Such thoughts are born out of a spectacular naivety about Westminster politics that can only be down to the remoteness of the Yorkshire Moors from the hustle and bustle of London politics. Junior shadow ministers rarely have any clout, and certainly no more than respected, well informed backbench MPs like John.

Still, it is all water under the bridge now. John lost. He is not going to look for another seat and so will stand dwon from parliament at the next election. In the meantime, he has made it clear that he will be throwing himself into Westminster life, including chairing the All Party Group, with renewed vigour.

Members of the All Party Group met up with Scottish Widows over dinner at County Hall on Tuesday evening with pensions as the number one topic.

The work that Scottish Widows has put in to informing the debate on the future of pensions, and especially the creation of Personal Accounts, has certainly not gone unoticed as a slot on that morning's Today programme amply demonstrated. It certainly impressed the MPs and Peers attending on Tuesday night.

With the next White Paper on pensions due to be published in a couple of weeks time, the debate on the shape of the Personal Accounts, means testing, exemptions and so on is being stoked up. That is to be expected. One message that came through loud and clear from the debate across the table, however, was the need to achieve and maintain a political consensus around the principles of the reforms if they are to stand any chance of winning the confidence of a very cyncial (non) saving public. There was little doubt what those prinicples had to be among the cross-section of Parliamentarians there: simplicty, means-testing applied in such a way as people do not end up worse off, a product that genuinely appeals to those on lower incomes not currently saving and not just another tax efficient vehicle for the better off, real action on ineuqlity for women in the current regime and a restoration of the earnings link for state pensions. Not bad for starters.

Bang! What a way to start.

I have been planning to launch a blog commentating on the often troubled relationship between the insurance and retail financial services sectors and our political masters for some time. My idea was to launch it with some gentle comment on the forthcoming legislative programme as the Bills announced in the recent Queen's Speech are published.

Instead, John Greenway produces a thunderbolt by announcing that he will be standing down at the next General Election, having served as an MP since 1987.

This is not an entirely voluntary decision on his part. The Boundary Committee has decided to re-draw the electoral map of Yorkshire and throw most of John's Ryedale constituency into a new seat called Thirsk & Malton. They also moved a chunk of the Vale of York into this new seat which meant that two sitting Conservative MPs were applying for selection to the same seat - John and shadow foreign affairs minister Anne McIntosh. The outcome was that at the selction meeting over the weekend John lost out. He has subequently announced that he will be standing down.

John has been a very, very good friend to the insurance industry during his time in Parliament. As an insurance broker prior to his election he came armed with a ready understanding of the issues facing the industry and he has never slackened in his determination to keep abreast of those issues. He is not afraid to speak up for the industry when he thinks it has a case and, equally, he hasn't been shy it telling it when to get its house in order.

For me, his biggest contribution to furthering the relationship between the industry and Parliament has been as chairman of the All Party Parliamentary Group on Insurance & Financial Services since 1992. When he stands down in three to four years time he will leave a very big gap.

I have always thought John's grasp of the issues facing the industry to be second to none among his fellow MPs. I think the industry often hasn't made sufficient use of him, maybe because some were put off by his long association with the Institute of Insurance Brokers. That has been their loss.

He has been a great supporter of everything that Post Magazine has tried to do to improve the relationship between the industry and Parliament over the last 20 years: much of it couldn't have been achieved without him.

Knowing John, I am sure he will be throwing himself into the debates on pensions, flooding, compensation, regulation and so on with enormous vigour over the next few years.

However, all good things must come to an end.