**CHECK AGAINST DELIVERY**

Minister of State, My Lords, Ladies and Gentlemen, good evening. As Bob said, it is great to see you all and to be here, in person. 

Thank you to EY for sponsoring tonights event.

Thank you for coming.

I started out on my financial services career in 1978 and back then I would never have imagined that there would be a time when we were unable to meet in person.

Actually, looking back, there were quite a lot of things that do have a link through to today.  Centralisation and automation were still just an idea in banking. I was rocking long hair, flares and acne.

My first role was sorting cheques to put in statements and then posting them directly from the branch to customers or in some cases actually walking them to the customers premises. A customer had to attend the branch or wait for the statement in order to get a balance.

In Bletchley, where I worked, we were just introducing ATMs. The first one was called Barclaycash. You had to buy a book of £10 vouchers, which incidentally had a six-month expiry, and then, when you wanted cash, you inserted said voucher, typed in a code and £10 crisp £1 notes were dispensed in exchange.

Almost comical looking back

Little did I know then that all these years later not only would cheques be withering away but so would cash. ATMs, now ubiquitous and more convenient are also seeing significant falls in usage. But, despite these big changes, cash remains important to many vulnerable customers and to SMEs. It is for that reason that in May we brought together banks, consumer groups, link, and the post office to try and find a way to deliver cash access in a way that balances the needs of customers with commercial reality.

We announced an industry commitment to preserve cash access for all those who need it, when they need it. Since then, we?ve been working hard on long term, sustainable solutions which build on the learnings from the Community Access to Cash pilots. The work has moved at pace and members? flexibility and willingness to engage has been excellent.

We see the provision of cash back without purchase as a key enabler along with ATM coverage, the Post Office network and potentially some shared bank hubs. We are aiming for an announcement in December which will demonstrate how committed the industry is to helping solve this problem.

The fact that we have been able to work with regulators and, Minister, you and your team at HMT in a really collaborative way has been hugely powerful and is real evidence of what we are able to achieve when we put our minds to big problems.

I started by looking back a long way, but I can't speak about the industry today without another glance over my shoulder, this time to 2020.

I wanted to reflect for a moment or two on what has happened since we last came together for a dinner.  During that period the industry responded to the pandemic by developing and then implementing Bounce Back loans and CBILS. At a pace and scale not seen in peace time. At one stage we were advancing half a billion pounds a day to British business.

The whole industry put its shoulder to the wheel and also proactively contacted seventeen million vulnerable customers to offer them help. In June 2020 almost one in five mortgage borrowers was on a payment deferral.

This shows what the industry is capable of. That huge mobilisation took place while most staff were working remotely too. Something we can all be incredibly proud of.

The rebound in the economy has been stronger than predicted and the arrears from the pandemic borrowing are lower than anticipated. There are, however, some clouds on the horizon. Fuel price rises, the NIC change, supply chain disruption and tax bills falling due mean there will be increased pressure on households and businesses.

For many people this could be quite a difficult winter.

How we tackle this next part of the crisis will define how we are viewed. I believe we will be balanced, sensible and fair.

Now that we in the UK are able to forge our own course, we can shape the industry to achieve the competitive advantage the Chancellor has spoken about. I am extremely optimistic about what we can achieve. There are some key enablers for this. I will touch on two.

Firstly taxation. The move to reduce the surcharge is welcome and the Treasury analysis of our competitive position was supported by the UK Finance report into bank taxation.

At a time of national emergency few would expect a tax cut. But let's not forget that despite the reduction in surcharge the effective tax rate for banks has still risen.

This shows that whilst the surcharge reduction is helpful there is still more to do. In order to be competitive we need to create an environment that allows incumbent players to thrive and grow financial services exports.

It also needs to be one that can attract and retain overseas banks that have plenty of choice as to where they locate. Taxation is a major factor in decision making and it is good that the Chancellor recognises this. We will continue to provide the argument strongly and based on data.

The second key enabler is regulation. Lifting our eyes up from spats with our near neighbours and helping shape the global agenda for regulation is key here. 

The incorporation of regulation into rules as opposed to primary legislation will also help us be more flexible and swifter to respond to change. The close working that UK Finance has had with Treasury on capital markets regulation has been a great example of what we can achieve.

It has meant that the market and the government and regulators can shape appropriate and sensible regulation that works for all without undue risk.

In order to be an attractive place to do business we must also be a safe place to do business. unfortunately, we, in the UK, are a major centre for fraud. In the first half of this year four million pounds was stolen through fraud each day.

Fraud is a weasel word. It sounds inoffensive and almost neutral. Like something that happens on paper remotely. The truth is that it is a toxic scourge which damages individuals and businesses and fuels the worst type of crime including human trafficking, drug addiction and terrorism.

It is organised, big business and we need to deal with it urgently.  This year UK finance has focussed considerable effort on tackling this major issue. The dedicated card and payment crime unit which is a team formed from UK Finance, the Met and the City of London police forces has saved over £97m during 2021.

UK finance has led the way and sought to tackle the root of this pernicious problem in two ways. Firstly, by looking to stem the flow of new fraud. Much of this emanates from online platforms and phone companies.

70 per cent of scams start online, so this year we?ve been working closely with the technology sector to encourage them to put their considerable weight behind solving the problem.

We led the creation of a new Online Fraud Steering Group to bring together banking, tech and telephone sectors, along with law enforcement, to see how we can best combine our efforts. Already it has resulted in major technology companies. donating one million dollars in advertising to our Take Five to Stop Fraud awareness campaign. There is much more to do but these early steps are very positive.

Secondly, we have examined what we can do with the faster payments system, both now and as it is redeveloped, to bring about a reduction in fraud. We have brought together key stakeholders to discuss the regulatory, legal and operational barriers we need to overcome.

There is no silver bullet that will solve this problem; however, I believe that a combination of changes to the payments process and an increased ability for banks to share information will make a difference.

So, cash and fraud are big issues but perhaps the biggest issue facing society is the move to net zero. I think that, in time, we will see the green agenda morph to include the wider environment and biodiversity as well as use of finite resources. And financial services will be at the centre of the transition.

I won't reiterate the big picture soundbites around green finance but instead ask you to come with me to Sheffield. Picture a small street of ex council terraced houses, part of a huge 1930s estate. 20 properties cheek by jowl. Parking for maybe ten cars.

A friend of mine recently purchased one of these houses for £44,000. It was a really big moment for her after 20 years work. She is a hardworking single Mum on her way to qualifying as a teacher. She drives a ten-year-old petrol car.

My question is how will she and the thousands and thousands of people like her in Sheffield and other cities and towns around the country make the transition? My friend cannot just add £10,000 to her mortgage and upgrade her car to electric even if someone would finance it.

She simply couldn't afford the payments. And that presupposes there will be systems that work in properties like that, that there will be enough installers to do the work and that somehow people will be able to charge vehicles on neighbouring streets at sensible cost.

The deadlines for change are close and, minister, my worry is that lenders will be, let's say ?encouraged?, to drive for an average EPC rating. The current EPC rating is something of an art rather than a science and how it will change is still unclear.

This may seem a small thing, but we have all experienced the huge impact of fire safety changes on the occupants of flats and regulatory changes on people who took mortgages out in 2007. The green transition will dwarf these issues if we don't plan effectively.

So, let's not turn our gaze away and just carry on with big picture rhetoric. We must work together to look at the right blend of finance, government support and timetabling so that we have a truly fair transition. One that works for our street in Sheffield.

What's been consistent through all these areas I?ve touched upon this evening is the way UK Finance has been able to draw stakeholders together and progress issues with pace and with tangible outcomes.

It demonstrates that when we build trust and work collaboratively with government and regulators we make a real difference. I particularly want to thank John and his colleagues at the Treasury, some of whom are here this evening, for their willingness to engage and the energy and support they provide. 

As your trade body, our role is to deliver value to you, our members. What the past eighteen months has clearly demonstrated is that we do when we work together. It's what has helped us all respond to the challenges of coronavirus. And it is what will help us continue to be a forward-looking, inclusive industry.

That young statement clerk back in 1978 might have been able to predict a few of the changes we have seen, although possibly not the enforced change of hairstyle, but one thing hasn't changed in those 43 years and that is the vibrant, important, confident and positive industry in which we work. It is a real force for good and I am proud to be part of it.

I should like finish by thanking you all, on behalf of myself and the team at UK Finance for all you do to support us.

Please join me and raise a glass to our customers.

Thank you.