Supreme court decision on banking charges is wrong.
Yesterday the new “Supreme Court” ruled that the Office of Fair Trading was not allowed to investigate “unfair” bank charges. The court ruled that the basis under which the OFT was investigating was unlawful.
This will seem frankly astonishing to many of us, surely the whole point of the OFT is to investigate whether or not prices and fees charged by commercial enterprises are fair. And it throws up one of the important facets of civil society. Namely that there is a clear demarcation between what is right, and what is lawful.
And for my “two cents” these bank charges are clearly wrong. It is disproportionate to charge someone £30 for going a few pence overdrawn. Further all the evidence suggests that bank charges mainly effected those on lowest income… single parents, the unemployed, those on minimum wage.
Effectively a business model for the retail banks has been for the poorest customers to subsidise free banking for those better off. This is surely unfair, irrespective of whether or not it is strictly outside of the letter of the law.
In the current climate, with half of all banks only solvent and in existence due to taxpayer bailout (OUR MONEY) in seems that times should be ripe for change. Things have to be different, and uniquely we should be in a position to enforce that change. To Gordon Brown and Peter Mandleson, reigning in corrupt and greedy banks and making things fairer for ordinary people is going to be a vote winner. Time to act.
There are other things that need to happen. Clearly the CWU’s campaign for a “Post Bank” to be established should gain momentum http://bit.ly/8y2UpC . The idea has cross party, mass popular and even business support (the federation of Small Business are part of the coalition)
Secondly community based banking solutions such as Credit Unions and Co-Operatives can help move the provision of banking services onto a fairer footing, and one that is in the interests of ordinary people and not just big business and the super rich. The CWU is in the process of establishing a Credit Union, and this will hopefully help our members.
Lastly the fight over the bank fees is not quite over yet. In the supreme court ruling the door has been left open for the OFT to still challenge the fees on different grounds. There is some suggestion that competition and anti trust many be the avenue. This is because the charges across the industry have been very standardised with little variation. This suggests that the banks may have formed some sort of loose “cartel” to try and keeps the charges steady and uniform.
Whatever happens things have to change, it is wrong and unsustainable for the poorest in our society to be unfairly penalised so those more wealthy can enjoy free banking.
