THE BANK OF BIRMINGHAM: A CLANCY PIPE-DREAM AND A PANACEA FOR BIRMINGHAM CITY COUNCIL’S FINANCIAL PROBLEMS: OR STILL A STEP TOO FAR?
After Mike Whitby single-handedly saved what is left of Birmingham’s oldest motor car maker at Longbridge(albeit with some Chinese assistance), he turned his considerable talents to single-handedly rescuing the bankrupt British banking system with his then ‘latest idea’ – The Bank of Birmingham.
This is nothing new………….
Lord Whitby of Harborne was following in the political footsteps of another great Birmingham Conservative, one Neville Chamberlain, whose fate as Prime Minister all Birmingham people are familiar with after Munich and the appeasement of Adolf Hitler in 1938.
He was the son of Joseph Chamberlain, creator of the modern municipal Birmingham.
While Lord Mayor of Birmingham, Neville Chamberlain first had the idea in 1915 of creating a Birmingham Bank….the ‘Birmingham Municipal Bank’.
During his time as Chancellor of the Exchequer in the National Government of the early 1930s, the Birmingham Municipal Bank moved to a prominent site at 301 Broad Street.
The former Birmingham Municipal Bank HQ has been acquired by the University of Birmingham as a showcase for all that is good that is going on at this Russell Group (amongst Britain’s top 12 universities) university at its main campus in Edgbaston.
At the Birmingham University main campus there is a huge reinvestment in the estate with a new £55 million Sports and Aquatic Centre on the site of the former Gun Barrels student pub on the A38 Bristol Road, adjacent to the university’s main entrance in Selly Oak, along with a new state-of-the-art Main Library in University Square.
This magnificent classical columned building, next to the former Warwickshire Masonic Temple Building before it moved to the Clarendon Suites in Sterling Road, Edgbaston, would have been the ideal place for the new Bank of Birmingham. It would have acted as the gateway to the proposed Arena Central development where HSBC is to site its UK Retail Bank HQ.
The HSBC Bank HQ is directly off Broad Street behind Alpha Tower, on the site of the former ATV Studios and opposite the new ‘Library of Birmingham’, another Lord Mike Whitby ‘dream’ which the Harborne Councillor and Black Country metal-bashing business owner has managed to turn into reality, along with his own ambition to become a ‘Lord of the Realm’, sitting in the Upper Chamber of the Palace of Westminster, a long way for a Black Country lad to drag himself……..
The new Library along with the shiny new New Street Station or the rather gaudily titled Grand Central shopping and railway station destination will be Mike Whitby’s gleaming legacy to the city he ruled for 8 years as head of the first prototype ‘ConDem Coalition’ latterly headed by his arch enemy Dave Cameron, who saw Whitby for what he is (or was)….a ‘showboater’…..
The founding of the Birmingham Municipal Bank at 301 Broad Street is commemorated in the foundation stone which lies to the left of the grand pillared entrance near to the gilded statue of three other great men, founders all of modern Birmingham, the ‘Grandfather of Birmingham’: Matthew Boulton, the Scottish engineering genius James Watt, the Bicentenary of whose death is to be loudly celebrated in Birmingham in 2019 and the third and least lauded of the 3 great men William Murdoch, who invented gas street lighting in Birmingham and at the SOHO Foundry (where Boulton and Watt made Watt’s improved steam engines, which powered the Industrial Revolution, whose magnificent golden statue is at the bottom of Broad Street.
Mike Whitby saw in his “new” idea for the Bank of Birmingham echoes of the great Birmingham Conservative and Liberal administrations of Birmingham’s municipal heyday which put our great global city on the map in the late 19th and early 20th centuries, led by Birmingham’s first family, the Chamberlains.
Certainly in “Old Joe’s” case, the ‘Father of Birmingham’ Joseph Chamberlain was both a Conservative and a Liberal during his long political career, similar to the former ‘Progressive Partnership’ of Conservatives and Liberal Democrats which pre-dated the failed Cameron/Clegg Coalition by several years in Birmingham Council House.
Joseph Chamberlain left a great legacy of adequate, sanitary housing and clean water for Birmingham’s artisans and created the ‘Workshop of the World’ out of that “City of a thousand trades” which supplied Britain and its Empire with manufactured goods from Chamberlain’s GKN’s nuts, bolts and screws to Cadbury chocolate…….
Mike Whitby’s ambitious aspirations to leave a legacy like Chamberlain came to fruition in 2013 with the new Library of Birmingham.
Joseph Chamberlain left a legacy of his own with Chancellor’s Court in 1900 at the then new Edwardian ‘redbrick’ University of Birmingham and its magnificent campanile dubbed ‘Old Joe’ after the university’s creator and benefactor.
Chamberlain’s vision for Chancellor’s Court as a ‘crescent of learning’ was finally realised in 2012 with the completion of The Bramall Building in Chancellor’s Court.
The Bramall houses the Elgar Concert Hall in tribute to another great Edwardian: Sir Edward Elgar, the new university’s first Professor of Music who composed The Enigma Variations and the putative ‘English National Anthem’: ‘Land of Hope and Glory’ the highlight of the soon to be realised ‘Last Night of the Proms’ at the Royal Albert Hall on BBC TV
The main political difference between Mike Whitby and Joe Chamberlain was that Joe was both a Conservative and a Liberal in his career, like his political rival, the young Winston Churchill.
To Mike Whitby, Neville Chamberlain’s idea of a ‘Bank of Birmingham’ at that time (pre banking crisis and any recession) seemed like good policy. Mike Whitby saw the ‘Bank of Birmingham’ like the old Birmingham Municipal Bank as a possible solution to the city’s financial woes as the BMB had been when it was in Broad Street back in another time of financial and political crises, the 1930s.
This great Birmingham financial institution was a grand idea for young aspirational Brummies like me mom and dad, who were building their homes and families after the deprivations of the Second World War.
They obtained their first mortgage from the Birmingham Municipal Bank in the late 1950s. My mom then opened a savings account with the bank to help pay off their mortgage.
Mom and dad had grown up in the urban squalor of the courts in the back-to-backs of Summer Lane in Aston in Dad’s case and Dugdale Street in Winson Green of me Mom’s Merriman family.
To them, being able to buy their own home was the stuff that dreams are made of considering their roots and where they came from.
From memory, I think they borrowed GBP 2,500 to buy their first home in Bearwood, following marriage and living in ‘digs’ in Rotton Park and Edgbaston.
The Birmingham Municipal Bank made the difference for my mom and dad. As the family grew with the arrival of my brother and sister in the early 1960s the values, business sense and financial acumen that such a Birmingham institution brought to people of my parents’ generation was incalculable.
My dad’s parents, after being moved after slum clearance in Aston, went from the back-to-back courts around the Gun Quarter and Summer Lane to the fields and open spaces of Weoley Castle’s Paganel Road, near to the real ‘Weoley Castle’ in Alwold Road off Barnes which was bliss compared with the dirty insanitary streets of Aston.
My Dad’s family the Bracey’s were not prepared to get into debt, as my grandfather and uncle put it, and could now only afford to live in council housing in Weoley Castle which was a great improvement on Aston nonetheless.
My dad, as an aspirational risk-taker, was prepared to take a chance on his skills as a ‘blue collar’ contracting electrician and take out the Birmingham Municipal Bank mortgage and get into debt in order to buy his own home and better himself and his family.
Both Chamberlain and Whitby came up with a fundamentally sound idea with the Bank of Birmingham, borrowing against the assets of a 3 billion GBP business in Birmingham City Council.
The new bank had to be structured to appeal to ordinary Birmingham folk as the BMB had done to enable aspirational Brummies to own their own homes like it did for my mom and dad back in the 1950s.
The problem now post banking crisis and after a severe recession is that to make a real difference Birmingham City Council would have to put in considerably higher sums of money than it could afford especially after the recent High Court equal pay decision which means that BCC could be liable to pay over 700m GBP to its former women employees. This would consequently expose the council and its ratepayers to considerably more risk than might be wise in the current economic climate.
However as traditional banking practices over the last few years have proven to be unreliable with the ‘casino banking’ of the investment banks, the LIBOR rate fixing scandal and money laundering by HSBC being just three of many examples of unsound banking practices.
Perhaps it is a time for radical thinking and a return to the old values of thrift, prudence and not borrowing beyond one’s means?
It may do no harm and could lead to solution to a banking crisis brought about by the banks not lending to one another through lack of trust.
The UK is undergoing a chronic shortage of affordable housing which affects Birmingham just as much as other major cities.
So much so that Birmingham City Council is considering building houses on Green Belt land near to the A38 in Sutton Coldfield…..I am sure that the ‘Good Burghers’ of Sutton will NOT stand for that being imposed upon them by the workers’ co-operative that is Birmingham City Council, as opposed to the ‘Royal Town of Sutton Coldfield’…….
Sir Albert Bore, the dethroned ex-leader of Birmingham City Council and his former deputy Councillor Ian Ward, had put forward the idea of developing affordable housing in the Green Belt at the former Peddimore inward investment site in Minworth near to a major industrial and warehousing development at the former Minworth Sewage Works, once owned by Severn Trent Water just north of the so-called ‘Royal Town’ of Sutton Coldfield off the major Trunk Route the A38.
The A38 Trunk Road has proven to be an excellent ‘Development Corridor’ with the Fradley Industrial Estate, a few miles further north, towards Derby, Nottingham whose University I attended, attaining a ‘Gentleman’s Degree’ in History and European Politics in the 1980’s as a ‘Mature’ student, if there is such a thing in the late 1980’s and the wider East Midlands.
In my opinion this is seriously misguided and will be vehemently opposed by the residents of Sutton Coldfield just as the Peddimore investment site was in the late 1990’s, when Dutch-based global company Philip’s were offered the Peddimore site as a location for a computer chip manufacturing facility just as the bottom fell out of the world semi-conductor market.
We cannot afford to jeopardise the future of the Green Belt with such short-term thinking, when vision is needed to solve the housing crisis by building on brownfield sites and looking at innovative ways of developing cities and urban areas.
As the former British ‘Motor City’ like the US’s Detroit Birmingham has finally ‘cottoned on’ to the idea of Light Rail or Trams with the recent Metro proposals for the links out along the A45 Coventry Road to Birmingham International Airport (BHX) and the NEC and its new ‘Resorts World’ shopping and leisure development.
Like Detroit Birmingham was once a great industrial city in decline. Look what happened to the once great American ‘Industrial Powerhouse’ with great swathes of the city of Detroit laid waste and left to the tumbleweed with the city in severe need of ‘Regeneration’.
Birmingham has reinvented itself as a tourism (especially ‘Business’ Tourism) shopping and leisure city with initially Albert Bore’s Bullring Centre, The Mailbox, and latterly Grand Central on the back of the New Street Station redevelopment (crucially the rail capacity of New Street has NOT been increased) leading to a vibrant ‘Shopping City’ with Whitby’s new Library of Birmingham kick-starting the Arena Central Development, so much so that HSBC or the Midland Bank as I prefer to call it (founded in Birmingham along with Lloyd’s Bank in the 18th century) is relocating its British Banking Headquarters to the ‘new bright’ Birmingham in 2017.
At last Birmingham and The Black Country has a coherent and connected Transport Strategy after years of nibbling around the edges of the West Midlands region’s transport issues due to a perceived ‘lack of cash’ from Central Government pleaded for as the reason for this inertia by local Transport Authority CENTRO along with the West Midlands Councils and Birmingham City Council, laid low by its own financial difficulties of its own making with the Women Workers Equal Pay claim: a scandal in my opinion, and a distinct lack of good leaders after the spectacular fall from grace of the ‘great municipal monster’ of political power: Sir Albert Bore……..
The ‘Black Country Metro Extension’ through some areas of Sandwell which have suffered severe deprivation since the collapse of Birmingham and Black Country ‘metal-bashing’ under Prime Minister Thatcher in the early 1980’s when once proud steelworks and foundries like Round Oak in Brierley Hill and Stewart’s and Lloyd’s in Wednesbury were closed due to a slavish adherence to ‘Market Forces’ and a desire for a more service-driven economy shown by the fact that the Round Oak Steel Works was replaced by a shopping centre: Merry Hill!
Eventually these former industrial ‘Brownfield’ sites were turned into Shopping and Leisure developments by far-sighted and forward-thinking property speculators like Richardson Developments of Oldbury and Richard Smith’s OPUS Land based in Warwick.
OPUS Land and the developer Richard Smith redeveloped the former Lucas Industries site on the A34 in Shirley near Solihull into an Office Park.
At one time in the mid-1990’s OPUS Land owned the former IMI site in Witton, near to Villa Park.
I worked on this development in my pseudo-property agent role with ‘Locate in Birmingham’ the former Birmingham City Council Investment Promotion Agency. My job was to work with prospective industrial and office occupiers in order to try to find companies and corporations to take space at The HUB Development, initially with OPUS Land and latterly with PRUPIM, the Prudential Insurance Company’s Property Development Company.
PRUPIM will finally be redeveloping the last vestiges of the former IMI Works after over 20 years since the IMI site was initially cleared for redevelopment by OPUS Land into the new Birmingham Markets Complex which will free up the land near Birmingham China Town for yet another shopping and leisure development by the US developer Hines, to be known as ‘Smithfield’.
I can’t help thinking that Birmingham’s over-concentration on city centre redevelopment and regeneration has left a severe ‘Economic Deficit’ in deprived inner-city suburbs like Alum Rock, Ward End, Washwood Heath and Bordesley to the east of the city centre and Ladywood, Winson Green, Handsworth and Lozells to the west of the city centre.
This economic deficit and the feeling of abandonment by Birmingham City Council of inner city citizens, who no longer have much ‘Civic Pride’ or indeed connection to where they live, as evidenced by the recent Channel Four expose of life in inner-city Birmingham in Winson Green’s James Turner Street in TV’s ‘Benefits Street’ showing the daily struggle of Birmingham residents and portrayed ordinary Brummies as a bunch of feckless, drug-dealing litter louts….
The germ of the idea of the new Bank of Birmingham, could, if soundly financed and run properly once again enable proud Birmingham citizens to own their own homes at affordable interest rates, provided by council borrowing at preferential rates which only Birmingham City Council can obtain as a £3billion GBP business.
Whether Birmingham council tax payers would wish the city council to take on the risk of setting up its own bank in the current economic situation is a difficult question to answer.
Most Birmingham council tax-payers would say: ‘get your own house in order first’!
However, Mike Whitby should have been applauded for innovative thinking “outside the box” and putting forward the idea of recreating one of Birmingham’s greatest and soundest financial institutions.
The Birmingham Municipal Bank was subsumed into the Trustee Savings Bank in the 1970’s. It then became part of what is now the biggest UK bank, Lloyds TSB, or as it is now known: the Lloyds Banking Group. The TSB ceased to exist as a separate banking entity as late as 1976. Coincidentally, Lloyds Bank was founded in Birmingham in the late 18th century along with the Midland Bank, the forerunner of what is the now the world’s largest bank HSBC.
My rallying cry to Birmingham City Council and its Birmingham Council Labour Group Leader John Clancy should it wish to consider setting up the Bank of Birmingham would be:
“We did it once, we can certainly do it again; a Bank of Birmingham, founded on the principles of hard work, sound business practice, sensible borrowing within ones means, and prudence allied to thrift can succeed once more.”
Birmingham citizens could once again have the ‘People’s Bank’ in Birmingham, whatever you wish to call it.
Perhaps innovative Birmingham people could teach the bankers of the City of London a thing or two about sound banking practice…….?
They certainly can’t do any worse.
Birmingham Blogger, Historian and Poet and ‘Aroight Brummie’ AKA#Brum Poet the #BrummieBard