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Ombudsman idea is scorned

Peter Rodgers,Financial Editor
Thursday 17 December 1992 00:02 GMT
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PROPOSALS for a small business ombudsman, canvassed this week by the Treasury, were yesterday rejected as a 'bad idea' by Sir Nicholas Goodison, president of the British Bankers' Association and chairman of TSB.

Complaints sent in by small businesses were commercial complaints, and they had the courts available for redress. A small business ombudsman, or an extension of the powers of the present ombudsman to cover this area, would also be a volte face on the part of the Government, which had rejected the idea once already, he said. The brief of the present banking ombudsman, Laurence Shurman, was to cover personal customers and unincorporated businesses, and he could not cope with the workload of an extension to companies, Sir Nicholas said.

After meeting Norman Lamont, the Chancellor, he added that allegations that banks had not passed on base rate cuts to small business customers were 'simply not true'.

The claim that the banks were being carpeted was 'way off beam and inaccurate. What we are thinking about is the best way forward in any recovery in the economy and what the banks can do to help,' Sir Nicholas said.

Derek Wanless, chief executive of NatWest, and Andrew Buxton, chairman designate of Barclays, also told the Chancellor that the vast majority of allegations about treatment of small businesses were unsubstantiated and misplaced.

A pilot project in Leeds for a US-style credit counselling service was approved at a meeting in London of more than 100 financial institutions. Sponsors include Barclaycard, GE Capital and Leeds Permanent.

Commentary, page 25

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