On the money

Over the years my friend has been to many of these Downing Street gatherings
but, for the most part, he finds them frustrating. He complains that they seldom
seem to get to the point, because everyone is too polite and deferential to the
minister. No one says what they actually think.

Part of this deference may be rooted in history. Trade associations grew to
prominence in the City because they are the modern manifestation of the
centuries’ old guilds and livery companies – and because the Bank of England
uses them as a means of control.

The Bank encouraged their development as the City spawned new activities so
that it had organisations to go to whenever it needed information, and to give
itself an easy route into the sector for discipline and control.

Trade associations also understood that the Bank had the power in most cases
to make life financially difficult for those who displeased it.

Although the Treasury has now superseded the Bank – it is, after all, the
department that sponsors the financial services industry in Whitehall – the
inclination to deference lives on.

My source says that almost every City trade body is run by an ex-Treasury
official, or a civil servant from one of the other big departments. So being
polite to ministers is ingrained, debating rather than deciding is what they’re
used to, and, in many cases, deep down they feel their duty is to help the
government with its legislative programme rather than help a sectional interest
obstruct it.

Anthony Hilton is finance editor of the Evening Standard

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