MortgagesDec 22 2014

BSA calls for cabinet post to boost focus on housing

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The Building Societies Association is setting its sights on the upcoming general election in May, setting out a range of demands for any new government including boosting focus on housing issues by promoting the post of housing minister to a cabinet-level position.

Under current arrangements the housing minister, Conservative MP for Great Yarmouth Brandon Lewis, reports into communities secretary Eric Pickles and sits within the Department for Communities and Local Government.

While most cabinet posts are reserved for secretaries of state and key procedural positions, several lower order government ministers do attend cabinet, such as Conservative Party chairman Grant Shapps, who is currently a minister without portfolio, and employment minister and Tory rising star Esther McVey.

Key debates around the housing market include an ongoing paucity of building, which despite a number of initiatives still sits at around half the level many believe is required and is widely blamed for house price inflation in recent years.

Other specific BSA demands include a recognition of the value of mutuals, creating a level playing field in terms of regulation and a rational approach to capital, meaning they are able to raise capital in new ways.

Also included is the push for a policy on lowering the barriers to entry for financial mutuals, complementing what already exists for challenger banks.

Victoria Bamber, press and publications officer at the BSA, said she believes that competition and choice of different providers is lacking. “Far from improving since the financial crisis of 2008, diversity in the financial services sector is actually on the decline, meaning that the system is less stable and the largest high street banks continue to dominate.

“For us, 2015 is all about encouraging diversity. And we’re not just talking about more building societies – although, why not? The introduction of more credit unions and challenger banks is also welcome. We also want to see more support for mutual institutions, who are often considered as an ‘afterthought’ by the regulators.

In terms of BSA members, Ms Bamber said that the organisation was looking at branch and digital evolution.

“Our members understand that different customers want different things, so whilst the focus continues to be providing exemplary customer service and satisfaction on the high street – building societies are also placing more significance on social media, mobile apps and online banking.

“As for mortgage lending, this continues to be on the up. Savings rates are above average and trust in the sector remains high.”

ruth.gillbe@ft.com, ashley.wassall@ft.com