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Newsroom & speeches
15/99
25 January 1999
Don Cruickshank today launched his review of UK banking services with a consultation paper setting out the approach the review will take. It asks a number of questions about the scope of the review on which he would welcome early views.
These will help focus the substantive work of the competition analysis of economic markets which forms the core of the review, alongside the views of the banking sector, consumer groups and other interested parties.
Announcing the consultation, Mr Cruickshank said:
"Customers are best served by competitive markets operating in a strong, stable macroeconomic environment. The core of the review will be a thorough competition analysis of the economic markets in which banks operate. This is underway.
"There are no predetermined answers, but there are a number of issues of obvious interest which we shall be looking at. Some warrant investigation without waiting for the outcome of the analysis. These include credit for small businesses, money transmission systems and credit cards.
"The consultation document is quite technical. It may not appear at first sight as a rallying cry to address the things consumers have said they are concerned about: overcharging, poor service, and failure to understand the needs of small businesses. But alleged failings like these can only be addressed by first understanding the competitive structure of the industry.
"I look forward to responses to the consultation document and a continuing dialogue as work progresses. To get the widest and fastest possible exchange of views, I am pleased to announce that we have set up an internet website where research results and the views of respondents, unless confidential or dealing with individual cases, can be seen and commented on as the review progresses. "
The terms of reference of the review are to:
The review proposes to focus on the services provided by the banking sector rather than the institutions or the specific products they offer. As well as banking services themselves, the review also proposes to consider the relationship between these and the economic cycle, and the potential impact of the single currency and the single market in financial services.
There are also issues being addressed elsewhere which lie outside the remit of the review, but which it will take into account and may in turn inform. These include consumer information and redress, and financial aspects of social exclusion.
Don Cruickshank's final report is expected to be available for the Government to consider towards the end of the year.
1.Chancellor of the Exchequer Gordon Brown announced the setting up of the banking review in his Pre-Budget Report on 3 November 1998. He invited Don Cruickshank, currently Chairman of the Action 2000 Millennium Bug Campaign, to lead the review. The review is being undertaken by a team of Treasury officials, and will call on the advice of outside experts.
2.Mr Cruickshank was formerly Managing Director of the Virgin Group Plc (1984-89); Chief Executive of the NHS in Scotland (1989-93); and Director-General of OFTEL (1993-98).
3. The consultation document and this press release are available on the Bank Review website, see link below. Responses to the consultation document will also be available at this address.
4. Written responses should be addressed to :
Sue Lewis
Banking Review Team
Room 20/3
HM Treasury
Parliament Street
LONDON
SW1P 3AG
Tel : 0171 270 4823
Fax : 0171 270 4730
See email address below:
Responses to this initial consultation document are
requested by 26 February 1999.
5. General enquiries should be addressed to the Treasury Public Enquiry Unit on 0171 270 4558.
6. Media enquiries should be addressed to Charles Keseru at the Treasury press office on 0171 270 5188.
