View from the House

This column is not a view from the House but a view from the North-East.

There is no doubt that the region I represent is now feeling the effects on export markets and the deflationary shocks passing around the world.

It is also feeling the beginnings of the effects on export product prices as rival exporters, in currency zones where massive devaluations have occurred, sell cheaper.

The effects on the North-East are already real and dramatic. Prime minister Tony Blair lent his weight to the calls for lower interest and exchange rates, when he told regional TV programme ‘The Chips are Down’, on 9 September: ‘In the end, if we get over this interest rate peak – as I hope we may be – and the pound is already coming down gently in the way it should, that if we pursue the right policies and we make sure that the government financial position is sound, then we have the best chance of long-term stability for the future, and that is the best guarantee of jobs.’

But these events raise broader issues of power and responsibility that will wash up on the shores of accountancy, too.

Blair’s search for a ‘third way’ will challenge the dominant idea of the past that only men of property, or those possessing ‘finance capital’ had rights and that only their interests mattered.

Since then, people have struggled to secure the ballot. But the old ideas are still dominant in the enterprise. The accounting standards are preoccupied with the welfare of shareholders and/or creditors only – that is, the providers of ‘finance capital’.

The rights of ordinary ‘stakeholders’ who invest their lives and skills in generating wealth don’t appear on the Accounting Standards Board agenda.

The ASB meets the representatives of finance and creates rules for their affairs. Its meetings remain firmly closed to the ordinary people. Now wider ‘stakeholders’ will raise their voice.

Will accountancy meet the challenge of the ‘third way’? Education has a key role. Professional accountancy education does not require any reflection on the social role of accountancy.

Aspiring accountants should be required to reflect upon the impact of their craft on the lives of people.

It is a question the people of the North-East are beginning to ask.

Jim Cousins is Labour MP for Newcastle Central.

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