HISTORIC PRESS RELEASE : Helen Liddell calls on building societies to show their commitment [November 1997]

The press release issued by HM Treasury on 13 November 1997.

Helen Liddell calls on building societies to show their commitment Building societies must seize the challenge and start promoting mutuality, Economic Secretary Helen Liddell said today.

Speaking at the Building Societies Annual Lunch Mrs Liddell told societies that they were effective and efficient organisations which should have the confidence to put forward the case for mutuality to their members and the public more widely. She said:

“Mutuality does have a future. Millions in the country do believe in it. And it is worth fighting for. But you have to be in the front line.

“The more people who know and understand the benefits of mutuality, the less likely they are to be seduced by the arguments for conversion or takeover.”

The Minister announced that the threshold on turnouts for conversions will be increased from 20 to 50 per cent. This will bring it into line with the threshold for takeover votes.

Mrs Liddell said it was now time to draw a line under the 1997 Building Societies Act and look to the future. The third and final Commencement Order was made earlier this month and the Act is now fully in place.

She said:

“This new Act has given you the ability to compete freely in offering the services which your members demand. It sweeps away the restrictions on commercial freedom that had been holding back development, and which had artificially disadvantaged societies compared to banks and other providers of financial services.

“It removed the quality asset threshold, so that there is no longer a distinction between the powers of smaller and larger societies.

“So the challenge for societies is to make the most of these new powers, combined with the unique benefits that their mutual status brings, to compete even more efficiently in the market place.”