In a letter seen by The Daily Telegraph, Toby Perkins, shadow minister for small business, and Chris Leslie, shadow financial secretary to the Treasury, have called on the Chancellor to back measures aimed at providing more support to busineses that claim to have been mis-sold interest rate swaps.
Specifically, Labour is asking the government to join its move to get banks, including Barclays, Lloyds and RBS, to offer assurances that none of their customers who raise a complaint over the way they were sold the swaps will be “adversely treated”.
“It is imperative that due legal process is allowed to take place without businesses operating under the perception that to make a complaint would lead to catastrophic consequences in their relationship with their bank,” wrote Mr Perkins and Mr Leslie.
MPs are due to debate the growing scandal of interest swap mis-selling on Thursday, while the Financial Services Authority will complete a review of the issues surrounding the alleged mis-sale of the products by the end of the month.
Opposition politicians have already written to the chief executives of Britain’s largest lenders asking them to agree to the measures saying it would represent an act of “good faith” by the industry.
Among the concessions being asked for, is an immediate moratorium on foreclosures on small businesses where the customer has registered a complaint against the sale of an interest rate hedge, as well as an agreement by banks to waive the statute of limitations to give customers adequate time to prepare a complaint.
Bob Diamond, chief executive of Barclays, RBS boss Stephen Hester, and Antonio Horta-Osorio, chief executive of Lloyds, are among the bank executives to have been written by Mr Perkins and Mr Leslie.
In public comments on the allegations the banks have downplayed the claims they were involved in the systematic mis-selling of billions of pounds of swaps to their customers. Mr Diamond admitted “mistakes” were likely to have been made, but added that the number of complaints was a “very small number”.
Speaking at the RBS annual shareholder meeting last month, Sir Philip Hampton, the bank’s chairman, said the proportion of the lender’s small business customers sold interest rate swaps was less than half of 1 per cent.
Barclays, HSBC and Lloyds are among the banks to have already settled legal claims brought by some customers over claims the banks sold them inappropriate hedging products. The details of these settlements have not been made public, but have generally seen lenders agree to forfeit the break costs of terminating the swaps, as well as repaying all the money paid by customers to service the contracts.