Backbench Business Committee — Oral Evidence (2026-01-27)
1/6Welcome to this meeting of the Backbench Business Committee, where we will consider applications from colleagues for debates in both the Chamber and Westminster Hall. The first request we will consider is for a debate on exposing the hidden credit liabilities that have destroyed thousands of UK businesses and still put them at risk. This is an application for either a Chamber debate or a Westminster Hall debate on a Tuesday or Thursday. John McDonnell is the sponsor. Please present your case, John.
Thank you for the invitation. On the advice of the Clerk, we have slightly amended the title to “The ongoing issue of hidden credit lines and their adverse consequences to thousands of UK businesses”. We thought that would be less abrasive and more encompassing. Let me declare an interest: I chair the all-party parliamentary group on investment fraud and fairer financial services. It is as a result of a number of years of consideration and representations to our all-party group from many constituents around the country that we have applied for this debate. Some of you will know the story of what went on with RBS, Ulster Bank, Lloyds and the NatWest Group, as it now is, with regard to some of your constituents. We believe that a significant scandal occurred that has affected thousands of people. It has been widely reported in the media, but our concern is that it has not been properly investigated, particularly by the Financial Conduct Authority. The background is straightforward. Large numbers of small and medium enterprises approached their banks. At the time, the RBS was the main lender, but we now know more about Lloyds and the Ulster Bank. The enterprises approached the banks for loans in the normal way, but often discovered later that attached to their loans were derivative interest swaps and others. Some were never even informed of the increase in the credit lines that were imposed upon them. Some were informed, but were convinced that it would not open them up to greater risk. The person who raised this early on, apart from the Chair himself, was Norman Lamb. It was raised in Parliament on a number of occasions. We have had a number of packed-out meetings here and heard some heartrending stories of what has happened. When interest rates fell, all the banks were doing was increasing the credit lines and often not even informing the applicant—the SME. Then, various measures were triggered. Sometimes it was agreements with regard to the loan to value covenants that were signed. The banks also found other criteria that they would use. The banks would then use break clauses and break costs that would fall upon the applicant—the debtor. Some of you will have dealt with these cases. RBS then put it into their global restructuring group. The global restructuring group was meant to help the SME. In fact, it often broke up the SME. It pushed some into insolvency and protected the bank’s interests, not the SME’s. That has resulted in people losing their businesses and their homes. We have had some loss of life as well as a result of people not being able to cope with it. A number of MPs have raised this in Parliament, in particular the Chair when he was the chair of the all-party group. He put an awful lot of effort into exposing what went on. The Ulster Bank is one of the most horrendous examples, but there is also the Lloyds Bank Group. Whistleblowers have come forward. The Lloyds Bank Group whistleblower told us about the way in which documents were doctored, and there were even forgeries of signatures in one instance. Over the period, we have tried to ensure that the FCA plays its role, but we believe that it has avoided addressing the issue effectively. It never included a whole range of cases in its interest rate hedging product review, on grounds that, we believe, were spurious and challengeable. In addition to that, it often left it for the banks to investigate themselves and then signed off their reviews. I do not think we would tolerate that in any other instance. We are asking the Committee to give hon. Members the opportunity to explain what has happened to their constituents. We will advise everyone to adhere strictly to the sub judice rule. We want to ensure that people are able to explore the general issues. They can use some past examples by all means, but we have to avoid sub judice cases. We will advise Members who speak in the debate, and of course we will be guided by Mr Speaker or whoever is in the Chair. What is our aim? Yes, we want to allow people to expose what has gone on and to express some of the anger on behalf of their constituents, but we also want a proper investigation. We do not believe that the FCA has undertaken that, so we are looking for an independent inquiry. Ideally, we would like a judge-led inquiry. This is on the scale of the Post Office scandal. We are talking about thousands of businesses and people losing their homes and livelihoods. I will say one final thing. There is lots of evidence, particularly with regard to RBS, to demonstrate that they targeted particular groups. They targeted groups of doctors working in the NHS to fund the development of their medical centres. Then we discovered that the debt that the individual doctors incurred, because they took on the liabilities, was often significantly more—70% more in some instances—than what they borrowed in the first place to afford the medical centre. That has had a direct impact on not only those individuals but the delivery of the NHS at the local level. We want to have the debate to expose all that, but we will be calling for a full inquiry. It was a failure of the FCA, and I don’t say that lightly. It is not just my view—it is a common view held by all those who have been involved in the APPG over the years. Once more Members are aware of that, they will understand why we want an independent inquiry, particularly a judge-led inquiry, to get to the bottom of what went on and to identify those to blame and what sanctions to bring forward.
I declare my interest as the former chair of the all-party parliamentary group, and I echo what you have to say.
I declare my interest. I have signed the application. Q2             Mary Glindon: Thank you, John, for that full explanation of why this debate is needed. You have given a proposed alternative neutral title. I don’t know whether this one is okay for you, but we had “hidden credit liabilities and the role of the Financial Conduct Authority”. Would you be happy with that?
That is fine. That covers everything we want to debate. I think we got a bit excited in our original design of the title. Q3             Mary Glindon: I am glad you like that. Was the motion that you originally provided—the one you got excited about—intended to be a divisible substantive motion? It would need to be the same as the neutral debate title, but if you want it to be divisible, the debate would need to be in the Chamber rather than in Westminster Hall.
I am happy to accommodate your own demands on your time and your availability. We just want the debate itself. In my view, having the debate and just getting it out there will have the impact.
My question has already been covered—it was on sub judice.
We will be explicit, as we have been in past debates. The Chair ensured that when he was chair of the all-party group. We will be explicit on that and we will liaise with the Clerk and the Speaker’s Office to ensure that we set the parameters early on in the debate.
Is there any time sensitivity?
We are under quite a bit of pressure at the moment. Part of it is because of the frustrations of individuals. I am worried about the impact on a number of Members’ constituents. We want to try to give them some hope that people are addressing this. As you may know, we held one of our meetings here and it was packed out—we’re talking about 150 people turning up—and those Members who sat through that heard some of the most distressing stories you could hear about how lives have been affected. We want to try to bring it on as soon as possible so that we can give people hope that Parliament is taking this seriously, and that we may well get a Government response as a result.
Who would be the answering Department?
I think it would have to be the Treasury at the end of the day.
It is just that your request is for either a Chamber debate or a Tuesday or Thursday debate, and for Tuesdays we can only fit in with the relevant answering Department on the rota. Thank you very much, and thank you also for the additional evidence that was supplied in support of the application. It was very comprehensive and comprehensible, on a very difficult subject.
We will go through an educative experience of explaining what interest rate swaps are, because it is complex. The complexity means that you can understand how the borrowers—the SMEs—have got into this situation when they did not have the liabilities properly explained. That is one of the issues we have raised, and I think it is in some of the briefings we have provided. There is a legal duty on the regulators to ensure that the banks and others explain the full liabilities and properly set caps on credit lines. That is one of the things that they failed to do and we want to expose.
We have a long queue of requests for debates. The Committee will consider the application in private after this meeting, and the Clerks will be in touch with you in due course. I thank you and the visitors in the Public Gallery for attending. Dave Robertson made representations.
The next application is from Dave Robertson and Chris Bloore, and the request is for a debate in the Chamber on the performance of Royal Mail—that is a neutral title in its own right. Over to you, Dave.
Thank you, Mr Blackman, and the Committee for hearing me today. As you mentioned, I should note that I made this application jointly with my hon. Friend the Member for Redditch, but unfortunately he is travelling with the Northern Ireland Affairs Committee today, so you get the less pretty one of us. Apologies for that. The application is for a debate is about Royal Mail’s service. We have suggested the title “Performance of Royal Mail”, slightly tongue in cheek; it could possibly be “The Performance of Royal Mail, or Lack Thereof”. We can see from the number of signatures that this is a significant issue. We have got 60 signatories and they are completely cross-party, which signifies the significance of what is going on in constituencies. I should add that we managed to garner those 60 signatures in 24 hours. We did not spend three weeks putting the application together. I think that if we spent another three weeks on it, we would very easily get past 100, if not 200 and beyond, because there is so much chatter in Facebook groups, in constituencies, in WhatsApp chats and within the corridors of this Palace. One of the reasons why so many people were eager to support the application is that there is not just a significant problem but it appears to be getting worse. That is certainly what is filling my postbag, and those of the vast majority of people I have spoken to about this—well, in emails; I wonder when my postbag will arrive. The core motivation of the application for this debate is that Royal Mail is routinely and dramatically failing to meet its delivery requirements under the universal service obligation. The USO reflects the fact that the postal service is a public service, and although the number of letters sent in Britain is declining, mainly thanks to email, we do all receive very important communications through the post, and those deliveries must be protected. It is not always just a letter from Great Auntie Mabel; it is bank cards, replacement PINs, doctor and medical appointments, and a variety of other things. We rely on the service coming through our letterbox, and we rely on the universal service obligation requirements being met. In some of the stories that we have heard from constituents, far too often they are not getting the regularity of delivery that they should be able to expect. In my constituency, across Lichfield, Burntwood and the villages, many people are going weeks and weeks at a time with no mail, and then they get a bundle of delayed letters. The most recent email that I saw about this was someone getting in touch to say that they have not received post in 2026. The most egregious example that I have heard recently was that of a constituent who waited 69 days for mail, and then a bundled pile came through. You can often test how long it has been by going back to the earliest date that is stamped on one of the letters. Royal Mail is not just slightly missing its targets; this is a complete abandonment of USO principles. The consequences are very serious. Some of the stories of our residents that we have heard—myself, the hon. Member for Redditch and others—include missing jury service, court hearings, and hospital and GP appointments, and people being fined for late payment of credit card bills that they have yet to receive or people being charged administrative fees for not paying things in a timescale that they were unaware of. There is a long list there, but I will not trouble you with it all this afternoon. We know that this is a massive issue across the country; it is not just some specific issues. The specific issues in my constituency, I think, were a bit of a trailblazer for what was coming to the rest of the country. In 2024-25, almost a quarter of all first-class deliveries were delayed and, from all the information that we are getting in from across all the different sources that are coming to us at the minute, that is getting worse, not better. Ofcom made the decision to fine Royal Mail £21 million last year, in light of its failure to meet its obligations under the universal service obligation. We welcome that decision, but the fine has clearly not resulted in service improvements. It has clearly not sent the message that this must get better, because from everything that we are seeing, it is getting worse, not better. It would be particularly timely to discuss this now in Parliament, in the Chamber, given that Ofcom has recently been consulting on changes to the universal service obligation. I am sure you will be aware that, after listening to Royal Mail and other stakeholders, Ofcom reduced several targets under the USO in July last year. By and large, I think people are willing to work with Royal Mail on that, but it is one thing to be willing to work with it on the USO and another to see the shambolic service that our constituents get. It is difficult to marry those two pieces of information. The new obligations mandate that 90% of first-class letters should be delivered by the next working day, down from 93%; and 95% of second-class letters should be delivered within three working days, down from 98.5%. If I were to stand in Lichfield city centre or Burntwood town centre this weekend and say that that is what the Royal Mail should be achieving, I am not sure there are enough eggs in the country for how many people would want to throw them at me—because that is simply not happening. We are being told that supposedly 90% of first-class letters and 95% of second-class letters should arrive within one and three days, respectively, and yet one of the people we have spoken to did not get mail for 69 days. I will regularly go home on a Thursday or Friday from this place, having not received a letter all week. I do a lot of my transactions online these days, but yes, it is very rare for an entire week to go by when not one thing needs to come through the door. That is one story from one person, but I am sure we all have stories, and I am sure we all have constituents who have been in touch with us, because the problem is so widespread. It is imperative that Royal Mail meets its obligations under the USO, for all the reasons that I have mentioned—jury service, doctor appointments, medical appointments, PINs, credit cards, and so on and so on. It is very clear that it is failing to do so correctly. Engagement by Royal Mail has also been exceptionally poor: despite the evidence that MPs have presented, we are constantly told that there is no problem. When I first raised this with Royal Mail, around spring or summer time last year, I got a letter back saying, “Don’t worry. It’s all under control; everything will be sorted soon”. That did not appear to work. I did a visit to my distribution office to be told, “Don’t worry—everything’s fine.” They showed me that everything was empty and everything had gone out. By the time I got back to the office, I had already received emails from people working there to say that there had been overtime put on in the couple of days leading up to the visit to clear some of the backlog, and that most posties went out that day with at least two routes on their back. They expected that at least one of those would come back, but there was an impression given. I went and did an unannounced visit just before Christmas and it was a very different picture. You would expect it to be busy then, but it is very difficult to tie up what I saw that day with what I saw in the summer. Obviously, there is more traffic then, and I am completely willing to recognise that, but there were significant levels of post in the distribution office at that point. We feel it is important that this issue is heard in Parliament. Hundreds of my constituents have written to me about this, and I know that many other Back Benchers are in a similar position. We want to give a voice to those people in Parliament, and we feel that it is an important method we can use to pressure Royal Mail to get this right. However, it is ultimately the company that has the power and responsibility to seek improvements in this space. We want to make sure that it is heard in Parliament, in the Chamber, but we also want to make sure that we can raise this with DBT, because they do have the oversight role, through Ofcom, and MPs need to have the chance to set out the tangible impact on their arena, so that we can make sure that DBT are fully aware of the issues our constituents are facing. I know the Committee has a huge number of applications to get through—the Chair regularly raises it on Thursday mornings, and I look forward to seeing him this week—but I would ask that, given the significant levels of support that were gathered so quickly, the significant impact on a wide range of constituents and the worsening situation, the Committee look to schedule this at an early opportunity.
Thank you for bringing forward this important debate. I have had this raised by my local postie as well as in the emails. It is a little more around tone, but maybe you want to consider the additional pressure that the posties are under, because they are saying they are getting abuse on the doors for not delivering late letters, which is not necessarily their fault. Obviously, you have a fantastic amount of support for this. Do you think a half day in the Chamber will be adequate to make sure that all the Members get a chance to speak, as you have 60 already and you think there will be more?
There were two points in that, and I thank you for raising them. I did not cover it in the speech because I knew I was already going a little long, but this is not individual posties—this is not down to the person who is putting the mail through your door. It is a systematic failure of the organisation, and I think that is where, if it were individuals or something that was going wrong in a few places, it could be raised through casework with the organisation. This is so systematic and nationwide that it needs to be a national response. On whether half a day in the Chamber will be enough, I do not want to try to peek that far into the future. I am unaware of any other way in which we can have a longer session in the Chamber; if you are aware of one, I would love to hear it. But yes, we got 60 signatures in 24 hours and have subsequently had another dozen people getting in touch asking if it is too late to sign.
On that point—and I will accept your guidance, Chairman, on whether this is appropriate, as you are a much longer-standing Member than I—would it lend itself well to an urgent question or asking a Minister to give a statement? I know this is a big issue: we all want to see Royal Mail succeed, and postal workers are generally doing a fantastic job. Would that be an appropriate lever for this?
We will come on to that, maybe at the end of the application.
Dave, you are already aware that we have a very long waiting list for the Chamber. Apart from the obvious of it being a topical issue, is there any other specific reason it needs to be debated now?
There is and there isn’t, is the answer to that. One reason is that it appears to be getting worse, so every time we delay this, there will be more interest, and we are allowing a service that is deteriorating literally in front of our eyes. Secondly, there is no upcoming big piece of legislation that may change this putting a ticking clock on it, but our constituents are still missing doctor’s appointments or jury service and are still not getting PINs and bank cards. That has a real impact on their lives, so I think there is a ticking clock on behalf of the people we are here to represent, but in terms of those broader brushes, I do not think one is there. I would rather be clear on that than try to make something up.
I just wanted to make something up—no, not make something up. We have elections happening in large parts of the country in May, and lots of people will rely on postal votes—including posting in postal vote applications and getting them back. Royal Mail put on extra clearing services during elections, but they have a high peak of traffic shortly coming down the road, which will probably make everything even worse.
Weirdly, many years ago, I was involved in a by-election in my constituency—long before I was an MP, I was the agent for one of the candidates—and I remember getting a phone call from the local elections authorities to say that they had been informed by Royal Mail that 30 ballots had not been delivered. They were literally on a shelf in the distribution office. A new member of staff had not had some training, and did not know the urgency of getting them to where they needed to be. It turned out that the majority was three more than the number of postal votes that were not delivered, so we did not end up in the situation of a recall election or anything along those lines. However, there is that real worry that that is someone’s democratic right, and even though in that situation it did not affect the outcome, it does affect people’s ability to be able to have their say at the ballot box. That is a concern. Those times are getting very nearby, and again, if we are talking about some people not getting their post for 69 days, two months from now gets us perilously close to the postal vote application deadlines, and the register-to-vote deadlines, which are now often done online, but—
At the moment, this is an application for a general debate. What do you want to see happen as a result of the debate?
One of the things that is really clear is that people do not feel heard. Being able to bring their voices into Parliament allows them to understand that this pressure is being put on Royal Mail. We know that Royal Mail will take a very strong interest in that. I think it would be very good to see DBT summing that up.
If the debate is held in the main Chamber, it is up to the Government who they put up to answer—
I hope it would be DBT.
But are you looking for action from the Government?
Certain things the Government can do. The Government and DBT have a role in the regulation of the USO in particular. The main people who need to get this right are Royal Mail. The actual solutions lie with Royal Mail, but the Government, through DBT, have a role in putting the pressure on, as well as we do through Parliament.
At the moment, you do not have a specific motion with this application, and obviously if you want action from the Government—or potentially from Royal Mail—a divisible motion would put the pressure on. Presumably it would be passed, because I cannot see anyone opposing it, and that would have implications for the service and indeed for the Government, potentially. You might want to think about that. It is your application, so we can only suggest.
The main reason for asking for a general debate was that we thought that that might get it into the Chamber sooner. If you are advising us that—
That is the reverse of what happens.
We will get back to you very shortly.
Okay. The Committee will consider the application in private, after this meeting, and the Clerks will be in touch with you in due course. As has been mentioned, there is a long queue for main Chamber debates, probably up to the summer recess already, so how we prioritise this, if we can prioritise this, will be awkward for our waiting list. The Clerks will be in touch with you in due course. Chris Vince made representations
The final application that we are considering this afternoon is from a member of our Committee. This is an application from Chris Vince on access to education and training for young adult carers, for a debate in Westminster Hall on either a Tuesday morning or a Thursday afternoon. Over to you, Chris.
Thank you, Chair. It is a pleasure to be in front of this excellent Committee, which I have always been a big fan of. I declare an interest as the chair of the all-party parliamentary group for young carers and young adult carers. The reason I am asking for the debate is that we are coming up to Young Carers Action Day—I wrote down the date, and yes, it is 11 March. Being on the Committee, I appreciate the length of wait that there might be, but I will come back to that. To give you a bit of a reason why I have picked this title in particular, we regularly have young carers and young adult carers come to our APPG to talk about their experiences in education—people will know my background as a teacher. What we have found, talking to some of the young carers who are in their late teens, was that the real challenges they found were not just at school, but in the transition going from school to higher or further education, and then obviously to training and employment as well. That is the focus of our inquiry. Recently, we published a report, and this would be a good opportunity to link the publication of that inquiry report to Young Carers Action Day 2026. It is an opportunity for Members to talk about the challenges that young carers face in their constituencies. Obviously, I have the required eight Members of, I think, three different political parties, some of whom have experiences of being young carers themselves—I will not say who—and others, like myself, who have experience of working with young carers. I think this would be an opportunity to highlight the challenges that young carers and young adult carers face going into higher education, and employment or training. I hope it would also be an opportunity to ask Ministers to consider the recommendations of the report and some of the things that we think can be put in place to support young carers at that stage of their development. I am happy to answer any questions.
Since there are no questions from colleagues, they seem to be happy with the application, so thank you, Chris. To make it clear to the public, although Chris is a member of the Committee, he will not take any part in the discussion of this application when the Committee goes into private session, or on the allocation of any time for this application.
I realise that asking for a date like 11 March at the end of January is a big ask, because I know what the delay is. My ask would be later than that date, rather than before, because—but no, it is going to have to be after that date, isn’t it? That was a stupid question. Sorry. That is all—end of March is fine.
The Clerks will be in touch with you in due course. Thank you very much. That concludes the public business of the Committee. The Committee will now go into private session to consider the applications and the allocation of time.