Tag: 1998

The press release issued by HM Treasury on 26 November 1998.

“The Financial Services and Markets Bill will, by creating a single regulator with a single authorisation process, a single compensation scheme, a single ombudsman, and a single appeals tribunal, reduce the amount of regulation whilst at the same time provide for greater accountability, ” Chief Secretary Stephen Byers will say in a speech to City financiers tonight.

Speaking to the Corporation of London Finance Committee Annual Dinner he will stress that the Government is determined to make sure that its plans for reforming the regulatory structure of the financial services industry will be used as an opportunity to reduce the amount of regulation.

He will say:

“Modernisation and reform are the hallmarks of the Government’s new legislative programme set out earlier this week, and our plans to reform the regulation of the financial services industry are a reflection of our modernisation agenda.

Excessive regulation gets in the way of good business and is to no-one’s advantage. I therefore intend that the Bill will provide for the FSA to consult on the costs and benefits arising from regulations that they wish to introduce. In addition, there will be a statutory requirement for regulation to be proportionate.

These measures will ensure that the City can take advantage of the reduction of nine regulators to one by making sure that regulations are only introduced when absolutely necessary.These steps will play an important part in maintaining London’s attractiveness to the world as a place to do business.”

The press release issued by HM Treasury on 25 November 1998.

Action to prepare for the euro on 1 January 1999 among UK small and medium sized enterprises (SMEs) has more than doubled since May,Minister for Trade and Competitiveness Lord Simon announced today.

But the overall level of preparation suggests that many SMEs have still not recognised that they may be at risk of losing out in the new economic environment which the single currency will bring, according to a survey for the Treasury published today.

Commenting on the survey results, Lord Simon said:

“This survey shows clearly that the number of UK businesses preparing for the launch of the euro on 1 January 1999 has more than doubled. This growing number shows that the Government’s work with business organisations across the UK has had positive results.

“We are making progress, but not fast enough.Almost half UK SMEs have trading links with EU markets and risk losing competitiveness. Of these, only a quarter  (23%) have begun preparations so there is more work to be done. But this is double the number who had prepared in May and the trend is encouraging.

“The survey suggests that about 200,000 SMEs who need to prepare are getting ready to face the opportunities and challenges ahead, attending courses and seminars and talkingto suppliers and customers. But we should not be complacent.There are still many who have so far done nothing.

“The report also shows that very few SMEs have focussed on the key market-related preparations which are so important to win business.  Customers and pricing strategies are just not getting the attention in comparison to changes to IT and accounting systems. Marketing changes remain a priority to ensure UK SME competitiveness.”

These figures are included in the results of the second survey of SMEs carried out for the Treasury Euro Preparations Unit (EPU). This follows up the first survey carried out in May 1998 which formed the benchmark for the Government’s national information campaign to raise SME awareness of the euro.

The surveys track overall awareness of the single currency, the sectors of SMEs likely to be affected by having direct or indirect EU trading links, and how far they have made preparations. Comparative figures for levels of awareness and preparation in England, Scotland and Wales are:

May 1998 October 1998 October 1998

	(All respondents)	(All respondents)	Those with EU links
Awareness of  single currency	90%	94%	97%
Awareness of 1 January 1999	11%	23%	27%
Will the euroaffect my business? Q. not asked	48%	62%
Is it important for my business to prepare?	31%	34%	49%
Businesses already made preparations?	5%;	13%	23%

Column 1 and column 2 show responses from all SMEs, in the surveys of May and October 1998 respectively. Column 3 shows responses only from those SMEs (approximately half) who have one or more trading links with the EU.

Levels of awareness and preparation for Northern Ireland are generally higher than in the rest of the UK The survey shows that SMEs in Northern Ireland had higher levels of awareness and preparations than Great Britain. 99 per cent were aware of the single currency. Over half (54 per cent) thought that it would affect their business; 47 per cent considered it important for their business to prepare; and 17 per cent had already made preparations.

Outlining action to help British business prepare for the euro, Lord Simon said:

“Since the election, the Government has worked continuously with British business to ensure that information and support to prepare for the euro are available. Firms will be able to hold company accounts and pay tax and VAT in euro if this gives them a business advantage.

“We have held business seminars across the UK and set up regional forums for business representative organisations to coordinate their preparations in every region. I am impressed by the determination of businessmen and women to ensure that their businesses are ready.

“Our set of 20 fact sheets, helping businesses look at their trading activities and identify action points, have been very popular as an excellent starting point for firms looking to prepare. Boosted by our TV and other advertising, over 300,000 have already been requested.

“The Government will continue to help UK SMEs up to and beyond 1 January 1999. It is vital that they do now take urgent steps to prepare for the coming change to the whole European business environment.”

The press release issued by HM Treasury on 20 November 1998.

An open national debate on how to boost Britain’s productivity performance was launched today by Chancellor Gordon Brown as part of the Pre-Budget Report consultation. Together with Scottish Office Business and Industry Minister, Lord Macdonald, the Chancellor hosted the first nationwide “Productivity Challenge” roadshow in Edinburgh.

Speaking before an audience of local business people and others from the world of education and training, the Chancellor said:

“Britain today faces a major challenge – the productivity challenge.  Our productivity is now way behind that of our major competitors.  Productivity levels in the US are 40 per cent higher than in Britain, and 20 per cent higher in Germany than here.

“This problem has been ignored for too long.  We need to tackle it now.  We need to raise our game.  Improving our productivity is the key to a stronger economy – to higher growth, more jobs and opportunities, and better living standards for us all. We have made a good start through the Government’s Private Finance Initiative, which expects to invest over #300 million this year and over #1 billion in the next three years in Scotland alone.

“The Pre-Budget Report has begun to set out what we must do to equip the British economy for the challenge ahead.  The Government wants to work together with business and educators to raise our productivity and match the best in the world.

“That is why I am here today, to discuss what needs to be done to meet the productivity challenge.”

Lord Macdonald said:

“I am delighted to welcome the productivity roadshow to Edinburgh.  Scotland has a vital role to play in meeting the productivity challenge.  This morning’s event will do much to focus attention on how to boost our productivity performance in Scotland.”

The roadshow will travel round the UK over the next few months, as part of the Government’s consultation on the Pre-Budget Report.  Ministers from a number of Government Departments will be involved – they will want to discuss directly with local business people and others possible solutions for closing the productivity gap.  The roadshow will end in Birmingham on 5 February.

The press release issued by HM Treasury on 19 November 1998.

Job creation and enterprise is the focus of a new joint working group announced by Chancellor of the Exchequer Gordon Brown and

Welcoming the agreement to the joint working group of UK and German finance ministry officials reached at the Downing Street meeting, their first since the election of the new German Government, Mr Brown said

“Our meeting was extremely productive. We discussed a wide range of issues, and it is clear that we share a common agenda for promoting growth and employment. We have agreed that we should use every opportunity to intensify co- operation between us.

“Our officials are already in regular, close touch. We have agreed, in particular that we should look together at what more we can do to promote job creation and enterprise in our economies. We have decided to establish a joint working group to study these issues and report back to us next year. This group will complement the work of the group set up by Bodo Hombach and Peter Mandelson.

“We can learn much from each other in terms of improving economic performance, for example, in raising UK productivity towards German levels. This points to increased  dialogue, to ensure that good practice is shared. The establishment of this working group is an important first step in this process.”

The press release issued by HM Treasury on 17 November 1998.

Getting best value for the £12 billion central Government Departments spend annually is the target of a review of central Government’s civil procurement activities announced by Paymaster General Geoffrey Robinson and Cabinet Office Parliamentary Secretary Peter Kilfoyle today.

Launching the review, Geoffrey Robinson said:

“Peter Kilfoyle and I are convinced that efficient public sector procurement is an essential element in delivering the Government’s modernisation and competitiveness agendas.

“Some 200 Departments and agencies employ 5000 staff on procurement tasks. They spend £12 billion of taxpayers’ money every year. It is important to ensure the best value for this major element of public expenditure.

“Important progress has already been made over the last year. This review will examine whether the current disposition of procurement activities supports this and, if not, what improvements can be made. It will put us on course to deliver even better value for money for the taxpayer”.

The review, commissioned by the Prime Minister, will be undertaken by Peter Gershon, Managing Director, Marconi Electronic Systems, supported by the Treasury Procurement Group and the Cabinet Office Efficiency Unit. It will complement implementation of an earlier review of Government procurement efficiency and effectiveness undertaken in the context of the Comprehensive Spending Review.

Its terms of reference are :

“To review civil procurement in Government in the light of the Government’s objectives on efficiency, modernisation and competitiveness in the short and medium term and to report within three months”.

The review will start on 1 December, drawing on private and public sector expertise. It will report its findings to the Prime Minister in February 1999.

The press release issued by HM Treasury on 16 November 1998.

Proposals Published to Help Credit Union Movement Develop

A package of measures to boost credit unions and help those less well-off in our communities has been announced today by the Economic Secretary, Patricia Hewitt.

In a consultation document, “Proposed Amendments to the Credit Unions Act 1979”, a series of measures are set out which aim to help expand the credit union movement while maintaining its focus on the poorer members of society.

The measures are:

• allow credit unions to borrow from external sources,
  other than authorised banks and other credit unions e.g. building societies, insurance companies;
• allow credit unions to offer interest bearing share accounts;
• allow credit unions to charge fees for providing basic
  services e.g. bill payments;
• abolish the #750 maximum limit on youth accounts, bringing it into line with the #5,000 adult limit, and lower the minimum age for joining credit unions;
• make the common bond requirement more flexible i.e. the “living or working” rules which allow people qualifying to join a credit union;
• remove the current 5,000 maximum membership limit;
• allow credit unions more flexibility to dispose of re-
  possessed collateral; and
• extend repayment periods for secured and unsecured loans.

Commenting on the proposals the Minister said:

“We have one of the most competitive and sophisticated financial services sectors in the world – but some people are still missing out. And for those people financial services mean cheque-cashing shops and illegal loan sharks.

“Credit unions have been doing invaluable work by providing savings facilities, low cost credit, and financial education to the less well off, giving them the chance to build up a good credit record.

“The Government is determined to encourage the sector and these proposals aim to build on the vital work that credit unions do, particularly in poorer communities.”

Most of the proposed changes could be made through a Deregulation Order under the Deregulation and Contracting Out Act 1994.

The Minister also published proposals for the future regulation of the credit union sector. The Government has asked for comments on two options:

• transfer to the Financial Services Authority the existing functions of the Chief Registrar; or
• bring credit unions within the scope of the FSA’s full regulatory and supervisory powers. This would involve repealing some of the provisions of the 1979 Act, leaving the FSA free to lay down new, or amended, requirements under its rule-making powers.

Commenting on the proposals the Minister said:

“We have to find the right balance for credit union regulation – allowing the sector to develop while ensuring there is adequate protection for savers.

“We will also be looking to the FSA to come forward with a fee structure that meets credit unions’ needs.”

The consultation period ends on 12 February 1999.

The press release issued by HM Treasury on 12 November 1998.

South East and East Midlands small and medium sized enterprises (SMEs) were the most responsive to a Treasury campaign to increase awareness of the introduction of the single currency on 1 January 1999, Lord Simon, Minister for Trade and Competitiveness in Europe, announced today.

Addressing the first national meeting of the heads of twelve regional euro forums, Lord Simon said :

“The Martin Skinner advertising campaign has been a great success. It has so far led to some 300,000 requests for “business preparations for the euro” factsheets from businesses and trade associations.

“It shows that at a regional and local level businesses are now much more aware that the euro is not some distant development of no concern to them, but represents a significant change in the business environment in which they will do business after 1 January 1999.

“SMEs are now getting the message – although the UK will not be joining the single currency on 1 January 1999, businesses across the UK economy will be affected.

“The overall response rate was excellent. The ten per cent response from the target audience was more than three times the average for such campaigns.

“The best response levels were from SMEs in the South East and East Midlands regions – 30 per cent and 20 per cent above the national average respectively.

“But I am concerned that some regions have not yet reached these high levels. Responses for the North East, North West and London were 20 per cent  below the national average.

“To those who have not responded, my message is simple: the euro is less than two months away. Call 08456 01 01 99 for the information you need to make an informed judgement about the likely effect of the euro on your business now.

“Or you can contact your local regional forum through your regional Government Office. They can help you to contact other local businesses and agencies which can offer advice  – often based on their own experience – to get you ready to meet the challenge and take the opportunities offered by the single currency.”

Twelve regional forums, covering the whole of the UK, coordinate practical advice to local businesses, especially SMEs, about the possible impact of the launch of the single European currency. Welcoming the progress they have made already, Lord Simon said:

“Each of the regional forums have now met at least once to encourage euro preparations in their local area. They are a vital part of our strategy to prepare British business,  bringing together key regional partners, including Business Links, the CBI, Chambers of Commerce, trade unions, local authorities and other public sector bodies.

“They enable participants to share their concerns and their experiences trading in Europe and preparing for the euro, and to develop coordinated strategies to sustain and  enhance regional as well as individual company competitiveness after 1 January 1999.

“They look specifically at what needs to be done at a regional level to ensure that business has the support it needs to compete in a changed market place. They are able  to deal with SMEs at a local level, bringing an understanding of the particular pressures and difficulties which these businesses face on a daily basis.

“I am grateful that the twelve Chairmen here today have agreed to play this crucial role. I am sure that their invaluable local knowledge, contacts and experience will make a significant difference to the commercial prospects of their regions in meeting the challenges ahead.”

The press release issued by HM Treasury on 12 November 1998.

Building societies were today challenged to contribute their ideas to tackling financial exclusion in our most deprived  neighbourhoods by the Economic Secretary, Patricia Hewitt.

Speaking at the Building Societies Association Annual Lunch the Minister pointed out that there were between 2.5 and 3.5 million people, concentrated in the most deprived neighbourhoods, without a bank or building society account. The main reason being that people did not think that traditional bank our building society facilities were suitable for them. The Minister said:

“The big challenge for banks and building societies is to redesign the products on offer to better suit the circumstances and preferences of those currently without access to them.

“One important step forward is the availability of the new accounts where on-line debit cards replace cheque books and access to credit is withheld until both the customer and the institution feel comfortable with it.

“The creation of these new accounts signals the industry’s growing awareness of profitable banking opportunities among these sections of the community.”

The Minister said that building societies have shown a tradition in community involvement. She said:

“Based on your principle of mutuality and tradition of community involvement, building societies have a vital contribution to make to tackling financial exclusion. Many  of you are already involved – indeed most of you carry the name of your community, and many support local activities too.

“Combined with your expertise in financial services, you are ideally placed to be at the heart of this initiative. So I would like to challenge you to contribute your own ideas to tackling financial exclusion – to think hard and imaginatively about how financial services might be available to all in our society.”

The Minister also urged building societies to think about how they could help credit unions. She said:

“I urge all building societies to think about how you can help credit unions, not out of a sense of duty to those worse off than yourself, but because it will give people the opportunity, currently denied to them, to become valued members of your society.

“So, by playing your part now you will help to build new customers for the future. We are not talking about charity, but about developing a market which in every sense of the word will be mutually beneficial to all concerned.”

The press release issued by HM Treasury on 12 November 1998.

A review of the Private Finance Initiative (PFI) and Public Private Partnerships (PPPs) is to be conducted in advance of the expiry of the Taskforce’s mandate in late summer 1999, Paymaster General Geoffrey Robinson announced today.

Sir Malcolm Bates, Chairman of Pearl Group, has been asked to examine the progress made in the delivery of PFI and PPPs by this Government and in the light of this new experience, recommend any changes to the existing arrangements which could further improve the government’s approach to PPPs.

In launching the Review, Mr Robinson said:

“We have made great strides with PFI in the past year. But we must continue to improve, identify and develop new opportunities and partnerships with both the public and private sectors. As well as improving value for money to the taxpayer this will ensure the delivery of a higher sustainable level of public sector investment.

“I want to see such partnerships extended beyond PFI. We need to exploit all commercial potential and spare capacity in public sector assets through a sensible balance of risk and reward. Sir Malcolm Bates’ first report reinvigorated PFI and I very much look forward to reading the outcome of his second review.”

The first review under Sir Malcolm Bates proposed the creation of the Treasury Taskforce to help central government departments and agencies road-test significant projects for their commercial viability. The Treasury Taskforce’s two-year life comes to an end in late summer 1999. The Government wants to look ahead and ensure that the best possible arrangements are in place for a smooth transition at that time.

Sir Malcolm Bates will commence his review immediately and complete his work by mid February 1999.

The press release issued by HM Treasury on 11 November 1998.

The Diana, Princess of Wales Memorial Committee met today to consider progress on the four proposals set out in its preliminary advice to HM Government, published on 24 June.

Commenting on the progress made, Chancellor Gordon Brown said:

“I am delighted to outline progress on the proposals for community children’s nursing teams, awards to celebrate the achievements of young people, a memorial in Kensington Gardens and the commemorative coin.

“The Department of Health has today invited bids from local health authorities for teams for the first phase of this scheme. As this service expands across the UK, it will become a permanent memorial to Diana, Princess of Wales’s own care and compassion for children and their families especially in times of sickness. The Department of Health will make a detailed announcement shortly.

“The Memorial Committee was impressed with the detailed proposals developed by the Department of Health. We feel that, by providing hands on care and practical and emotional support, community children’s nursing teams will provide significant additional support to the care already available from the NHS and the voluntary bodies who have led the way in this area of care.

“Good progress has also been made on the Diana, Princess of Wales Memorial Award for young people at secondary school. The DfEE has received tenders from a large number of organisations to run the Central Awards Office which will administer the scheme. The bids are being analysed and a further announcement will be made in due course.

“The Memorial Committee have considered the results of a preliminary consultation exercise held locally on the early, outline proposals for Kensington Gardens. Having listened to local people, the Memorial Committee recommend that these proposals should be significantly improved.

“The Memorial Committee propose that a memorial walk through Kensington Gardens, Hyde Park, Green Park and St James’s Park should be established to celebrate the life of Diana, Princess of Wales. This would be one of the most
magnificent urban parkland walks in the world passing many points of interest, with spectacular views across the Serpentine, St James’s Park Lake and across the Round Pond towards Kensington Palace.

“In recognition of Diana, Princess of Wales’s love of children and in particular the disabled, the Memorial Committee have recommended that this memorial walk be complemented by improvements to the children’s playground to the North of Kensington Palace. This would create an area where disabled and able-bodied children could play together, dedicated to Diana, Princess of Wales. The Department for Culture, Media and Sport will also consider how designs developed for the playground in Kensington Gardens might be used as a blueprint for children’s play facilities around the country.

“It is also intended that necessary repair work in the Dial Walk area South of Kensington Palace should be implemented.  This will help accommodate the extra numbers who, surveys confirm, continue to visit that area.

“The Royal Parks Agency will be asked to take these proposals forward. And they will do so in close consultation with the local authorities and local residents’ groups.

“The commemorative coin will be released for general circulation on 1 July 1999, the anniversary of the birthday of Diana, Princess of Wales. Collector versions will be available from early next year. The proceeds from the sale of the commemorative coin will go towards the memorials recommended by the Memorial Committee and the ongoing costs
will be met by the Government.

“On behalf of the Memorial Committee, I should like to thank Frank Dobson, David Blunkett, Chris Smith and all the agencies involved for the work which has been done to develop all four proposals so promptly.

“The Memorial Committee feels that, together, these will form a fitting, long-lasting national tribute to Diana, Princess of Wales which will recognise her unique contribution and the example that she set, particularly in enriching the lives of children and encouraging them to play the fullest possible part in the life of their communities.”