Publication - Minutes

Financial Services Advisory Board minutes: September 2019

Date of meeting: 19 Sep 2019
Location: Edinbrugh

Record of discussion for the September 2019 meeting of the Financial Services Advisory Board (FiSAB).

Financial Services Advisory Board minutes: September 2019

Attendees and apologies

Attendees

  • First Minister
  • Cabinet Secretary for Finance, Economy and Fair Work
  • Philip Grant, Lloyds Banking Group, Industry Co Chair
  • Catherine Burnet, KPMG
  • Graeme Jones, SFE
  • Sue Dawe, EY
  • Maggie Craig, FCA
  • Stephen Ingledew, FinTech Scotland
  • Barry Connolly, RBS/FiSAB Skills & Talent Lead
  • Jim McConville, Phoenix
  • Linda Hanna, Scottish Enterprise 
  • Agnes Tolmie, Unite
  • Helen Page, CYBG/Virgin Money
  • David MacMillan, Prudential
  • Gerry Mallon, Tesco Bank
  • Colin Stewart, Citi 
  • Scott Stewart, Barclays 

Also in attendance

  • Ian Hanson, Skills Development Scotland
  • Neville Prentice, Skills Development Scotland
  • Clare Carswell, EY
  • Derek Brownlee, RBS
  • Hugh Edmiston, University of Edinburgh
  • David Judic, CYBG/Virgin Money
  • Charlie Yates, KPMG
  • Katie Stellard, KPMG
  • Colin Halpin, HSBC
  • Alistair Brannan,EY 

Scottish Government

  • Karen Rodger, Head of Financial Services & FinTech Policy
  • Iain Pearce, Economic Advisor
  • Francis Taylor, Financial Services, Policy Advisor
  • Lynne Blair, Financial Services, Policy Lead Financial Services Fin Tech and Sector Development

Apologies

  • Minister for Public Finance and Digital Economy
  • Barry O’Dwyer, Standard Life
  • David Ferguson, Nucleus
  • Malcolm Buchanan, RBS
  • Damien Yeates, Skills Development Scotland
  • David Skinn, Aviva
  • Professor Peter Mathieson, University of Edinburgh
  • Christine O’Neill, Brodies
  • Geoff Aberdein, Public Affairs Forum, SFE

Items and actions

1. Welcome and Introductions (ITEM 1)

The First Minister welcomed everyone to the meeting and noted apologies.  The First Minister welcomed Philip Grant as the new co-chair of FiSAB and thanked Jim Pettigrew, outgoing co-chair for his contribution to the financial services sector in Scotland. 

1.1. Philip Grant thanked the First Minister for the introduction, and the invitation to take on the role of co-chair of FiSAB.  

1.2. Philip noted the strong position of SFE, and the continuing focus on delivery of the financial services strategy with particular focus on skills and talent, societal impact and fintech. Philip noted the need to ensure momentum is maintained during current political uncertainty.

2.    

2.1. Graeme Jones updated members on SFE activity since the last meeting including meetings with UK and international stakeholders and partners.   

3. Scottish Government update (ITEM 2)

The First Minister noted that Brexit continues to generate uncertainty.  The Scottish Government’s focus remains on lessening the impact of a no deal which is considered to be the most probable outcome.  The Scottish Government will publish its plans over the next couple of weeks and the role of the Banking and Economy Forum will be crucial in order to be able to respond to events as they occur.  The First Minister confirmed that the Government is ensuring other work continues.  The Programme for Government, published on 3 September, includes a range of significant measures, with a focus on the essential shift to a low carbon economy.

3.1. The Cabinet Secretary gave a short update on Scotland’s economic performance highlighting the recent JP Morgan investment as a vote of confidence in Scotland’s economy, in spite of Brexit uncertainty.  He explained to members that the recent GDP figures showed a slight contraction however, there is sustained progress on productivity.  The Cabinet Secretary noted that a no deal Brexit could result in a recession which is difficult to mitigate against.  The Cabinet Secretary echoed comments made by the First Minister in relation to the Banking and Economy Forum which has an essential role in providing advice and support as Brexit position develops.

4. Financial Conduct Authority (ITEM 3)

4.1. Maggie Craig confirmed that the FCA expects firms to continue to plan for a no deal Brexit.  To help with this the FCA has introduced a campaign to raise awareness and a helpline for those seeking advice. As passporting will end when the UK leaves the EU there is a need to work with regulators in planning for those undertaking overseas activities.  Larger firms seem well prepared however smaller firms are not as advanced in their preparations. 

4.2. Maggie updated members on the progress of the FCA’s Scotland Strategy.  The strategy was finalised last November and is a 2-5 year plan.  Some of this will now be brought forward and Phase 1 is already in train.  This involves recruiting externally around 20-25 new members of staff with permanent and temporary accommodation is being sought.  Further recruitment will take place in Phase 2 bringing the total number of posts in Scotland upwards of 200.

4.3. As a final point it was confirmed that Nicola Anderson, currently on secondment to FinTech Scotland, will have her appointment extended by a year.  The FCA will continue to fund that secondment which is already bringing added value and has been well received by the sector.

5. FinTech Scotland (ITEM 4) 

5.1. Stephen Ingledew gave an update on the work of FinTech Scotland.  With continued support from SG and SE, FinTech Scotland will move forward to develop and achieve its objectives, developing a strategy for their next stage of operation from 2020.  A draft outlined three key themes that will involve all aspects of society; Innovative Community, Impactful Collaboration and Inclusive Cluster. 

5.2. FinTech Scotland is currently pursuing the bronze label of cluster excellence for fintech.  This should be achieved by the beginning of 2020 and will be the first fintech cluster of excellence awarded in Europe.  A move to a gold award will be pursued and is likely to take about two years to achieve. 

5.3. In September 2019, FinTech Scotland launched a Consumer Panel to support inclusive fintech business development, the first panel of its kind.  The Panel will connect consumer and citizen advocate groups into the fintech ecosystem with the emphasis on citizen financial inclusion, problem solving and innovation.  The Panel will provide ease of access to a citizen and consumer voice for fintech innovators, and build an inclusive network across consumer groups, innovation and technology.

5.4. A submission for funding for the Global Open Finance Centre of Excellence led by the University of Edinburgh was made on 18 September with the results not being known for several months.  Stephen will contact some members for assistance in obtaining data to help scale up the research required. Finally, Stephen highlighted that the Fintech Festival was currently underway and encouraged members to attend the diverse range of events taking place.

5.5. First Minister thanked Stephen for the update and referred to positive feedback she had received on FinTech Scotland from external stakeholders.  A short discussion on the work of FinTech Scotland took place with members agreeing that there is broad sectoral support for the organisation and its activities.  

5.6. FM noted that work is underway to review the current Industry Leadership Groups and that the establishment of FinTech Scotland, and the wider role of FiSAB, could be used as a case study.  Stephen Ingledew agreed to support the review and confirmed that he would be happy to speak to Nora Senior who is leading that work.

5.7. ACTION: Stephen Ingledew to speak to Nora Senior regarding the ILG review.

5.8. Stephen Ingledew to contact FiSAB members to request assistance with obtaining further data. 

5.9. Helen Page updated members on progress made explaining that there had been a few challenges due to organisational changes. However, progress was still being made and an overview of their five key workstreams was provided. These are:

  1. Transforming the reputation of financial services in Scotland
  2. Helping Scotland to invest in a more socially fair future
  3. Helping Scottish teenagers to become the most financially fit in the UK
  4. Mobilising Scottish teenagers to digitally support the most financially excluded in Scotland
  5. Helping the financially excluded to take back control of their money

5.10. Helen followed the presentation with a request for further partnership and support from FiSAB and from SFE members to develop this work.

6.Sector Skills & Talent Update (ITEM 5)

6.1.    Barry Connolly updated members on the work of the Sector Skills and Talent Group. Their focus is to: 

  • Inspire a more diverse group to engage in financial services
  • Provide effective pathways and conversion mechanisms
  • Be outcome focused

He explained work was taking place to ensure access to apprenticeships in Scotland and that an updated apprenticeship website was now available.

6.2. There was an update on the Financial Services Unified Schools Programme (USP) from Colin Halpin.  He explained that the Programme is making huge strides to transform how the financial services industry in Scotland attracts the next generation of talent.  By creating a connection with young people while they are at school and curious about what career they may pursue they are creating a vital and unique opportunity to promote Scotland’s financial services to the next generation and bolster the talent pipeline into the industry.

6.3. Through the USP, financial services organisations will have direct access to thousands of young people (S4 - S6 school pupils) who are deciding their next step after school.  USP materials are flexible enough that they can support an established Work Experience Programme or be used to develop a new, Work Experience Programme.

6.4. Scott Stewart told members that there were opportunities for people who want to re-skill.  Barclays are building a new campus in Glasgow and have recruited 500 new people already.  A new 5 week course co-designed with industry was in train with two further courses planned. This rapid conversion model was welcomed by members.

6.5. Strategic forecasting was seen as hugely important and Skills Development Scotland are getting traction through this approach.

7. AOB/conclusions and actions (ITEM 6)

7.1. The First Minister thanked members for their presentations and contributions.  Philip Grant also thanked members and echoed FM’s comments regarding good progress being made. A date for the next FiSAB meeting would be issued as soon as possible.

Contact

Email: francis.taylor@gov.scot

Telephone: 0300 244 1200

Post:
Scottish Government
Financial Services and Fintech Policy Team
Enterprise and Innovation Division
Directorate for Economic Development
5 Atlantic Quay
150 Broomielaw
Glasgow
G2 8LU