Customers attack Lloyds
WALTON-upon-Thames is the kind of decent Surrey town where you would not expect to see a consumer rumpus. But just such an event occurred in the Lloyds Bank branch on Tuesday lunchtime.
Small businesses paying in cash, office workers wanting to settle bills and techies waiting to pick up euro notes erupted in anger as the queue at the single open cashier desk snaked to the front door.
It took a swelling of indignant rage from the queue for more staff to be conjured up.
The bitter scenes at Lloyds outlets could become worse after it said it is to close a further 100 branches, cutting 325 jobs as part of a 200-branch shuttering.
Lloyds is not alone. Some 525 have been closed in Britain so far this year on the grounds that online banking is making branches superfluous.
Indeed, since Lloyds absorbed HBOS at the height of the financial crisis it has sacked more than 50,000 people having at the time described reports of the loss of such numbers as untrue.
Online banking is changing the face of finance. But for the elderly, small businesses and entrepreneurs, people looking for other services such as travel money and those of us who distrust the security of online banking (my elderly father’s Barclays account has been electronically raided several times in a month), the comfort of dealing with real people and secure systems is critical.
A great achievement of Lloyds under the stewardship of Antonio Horta-Osorio has been to hammer down costs. When it comes at the expense of customer service it is a real danger and likely to send consumers to challengers such as Metro Bank.
Lloyds’ goal at present is loading as many of its customers up with high-return credit card debt as demonstrated by its top-ofthe-market purchase of MBNA.
Chairman Lord Blackwell and the board need to rethink priorities.
Mini madness
BMW ownership of the Mini is an inward investment in Britain which has really worked. More than 210,000 Minis were built in the UK last year.
In addition, the company built 4,000 RollsRoyce motor cars at its Goodwood plant in West Sussex and it has brought engine manufacturing back to Britain at Hams Hall in Birmingham.
As much as this paper bangs the drum for final salary pensions, there is now widespread recognition that axing the tax breaks on dividends paid into such schemes, intense regulation and gold-plated inflation adjustments have made many plans unaffordable. Even the most profitable employers such as Shell have given them up.
Tesco managed to hang on until it was brought low by scandal, having regarded its final salary pensions as a significant benefit for the low-paid.
It is an act of economic suicide for Len McCluskey’s Unite union to have voted for eight strikes at Mini, starting on April 19, in defence of final salary pensions. Existing benefits accumulated to members of the scheme over the years must be preserved.
But as other workforces throughout Britain switch to more manageable defined contribution schemes it is inevitable that BMW will do the same to remain competi- tive. No one wants to rob the workforce of what should be important, irreversible benefits, since workplace pensions ease the pressure on the state.
There is another, far more important reason why Unite needs to sit down and do a deal with BMW.
If ever there were a moment when UK workers needed to get behind manufacturing in the UK it is now, as Article 50 talks are under way. The possibility of BMW taking production of an electric Mini to Holland already is a source of speculation.
Unite intransigence and self-indulgence could prove disastrous for future BMW investment and innovation in Britain.
Hot deals
THE German-controlled family investment firm JAB and Reckitt Benckiser, the main source of its riches, are moving in opposite directions.
Heirs to the Benckiser fortune, the Reimann family, have snapped up the US baking and sandwich chain Panera for just under £5bn. This brings the spending binge in food, including coffee brands, up to £30bn or so in the last decade as they build a rival to Nestle.
In contrast, Reckitt is leaving food behind to concentrate on consumer hygiene, healthcare and baby foods.
Fascinating.