The bruiser handing out a battering to our greedy bank bosses

Chris Blackhurst
4 Mar 2009

When all this is over, who will emerge with their reputation enhanced, their place on the side of right assured? One person who is having a very good war is John McFall, chair of the Commons Treasury Select Committee.

Since 2001, the West Dunbartonshire Labour MP has headed a body that, until this crisis erupted, was known more for its ponderous examinations of macro-economics and respectful chats with Gordon Brown as Chancellor and Bank of England Governor Mervyn King than fearsome interrogations.

McFall, 64, has become a modern witchfinder-general, responding with relish to the unfolding drama, riding out to seek perceived evil. Yesterday, he was in action again, putting John Kingman and Glen Moreno from UKFI through the wringer.

It's a familiar spectacle - the hapless financiers and officials sitting at one end, the silver-haired McFall at the other, with his committee colleagues spread out alongside him. When he doesn't believe something, which is frequently, he takes off his glasses for theatrical effect and jabs the air with his index finger. His mouth contorts into a snarl that would have done the hardest man in his native Glasgow proud. Indeed, but for the distance between them and the security guards, you feel he would like his hand or even his head to connect with the witnesses, such is his fury at what he is hearing.

"They should reflect on the damage they have done to society," he fumes. "They have threatened the economy and destroyed people's lives." In case anyone is in any doubt, he adds: "There is real anger, and the Select Committee is the only vehicle to get that public message across."

Yet McFall is himself not above being sniped at. He is known as a close supporter of Brown, even though he was among the first to back Tony Blair in the Labour leadership contest, and his failure to treat the Prime Minister with the same disdain he has reserved for the City figures is marked. He has impressed upon Brown the public's rage but has stopped short of blaming him for much of the mess we're in.

It was the fault of greedy bankers and a too cosy City, not Brown. "There was a long period of low interest rates, low inflation and economic stability that pushed the appetite for growth. The private sector was given the opportunity to get on with their own business until it crashed. Even the regulator didn't understand what was going on, perhaps because they are too dominated by City interests."

Among the financial community, there is a mixture of resignation and annoyance where McFall is concerned - an acceptance the bankers have failed, and it is the right of elected politicians to turn the screw, but irritation at his belligerence and the open hostility and grandstanding that accompany some of his sessions.

During the inquisition of the RBS and HBOS ex-chiefs, for instance, he and his committee asked about their qualifications. Sir Fred Goodwin was able to respond that he held a degree in law, was a chartered accountant and headed the Clydesdale and Yorkshire banks before joining RBS.

Goodwin, of course, was far too polite to ask what, exactly, qualified McFall to chair the Treasury Select Committee and lead a major inquiry into the banking industry. What answer would Goodwin have received? McFall left school without any highers. He worked for the local council, weeding the parks. He studied for a BSc in chemistry from Paisley College, followed by a BA in education and philosophy from the Open University. He became a teacher, and was a deputy head for 13 years.

Teaching chemistry and maths by day, he studied for an MBA from Strathclyde University at night. "I wanted to have a broader introduction into management techniques," he said. "I enjoyed the academic world." Later, he was a visiting professor at Strathclyde University Business School, a position he now holds at Glasgow University.

In short, there is nothing in his pre-Westminster CV to suggest he has any practical grounding in what it takes to run a large publicly quoted commercial organisation that is a huge employer, crosses the world and differing markets, and must pay due heed to the competing demands of investors, staff, customers and regulators.

Married to Joan, a fellow teacher who was his childhood sweetheart in working-class Dumbarton, and with four grown-up children, he joined the Commons in 1987. McFall's late father, John, was a school caretaker who lost both legs and was looked after for 10 years by a district nurse.

The MP was also an ardent trade unionist, and the feeling of a committee chairman delighting in taking on thee Scottish Establishment is hard to resist. At times, there has been something almost personal in his pursuit of fellow Scots Goodwin and Sir Tom McKillop, the RBS ex-chairman. During his exchange with McKillop, he said: "Sir Tom, a straight answer? You come from Irvine [so] a straight answer." McKillop replied: "Dreghorn actually, but near enough." It was good-natured but there was no mistaking who, now, is in charge.

McFall never acquired high ministerial office. He was in the whips' office and Under-secretary of State for Northern Ireland, but that was all. He backed Blair but wasn't a natural, comfy Blairite. At the same time, he never enjoyed the patronage of Brown - having supported Blair, he was sent into exile by Brown for years. He might have expected to have become a minister upon Brown's ascent to Premier, but no serious offer was forthcoming.

As events have turned out, he has become more prominent and powerful than any minister in the Brown Government. By his own admission, in 2001, when he took the job of chairman he knew next to nothing about the financial services industry. He's learned a lot, but has been able to play the innocent abroad card to stunning effect.

He has also turned hindsight to his advantage, and used memorable put-downs against often verbose opponents. He accused former Northern Rock chief Adam Applegarth of being "asleep at the wheel". He told Sir John Gieve, the then Bank of England Deputy Governor, he was off the case "in the back shop while there was a mugging out front".

But he's not always had it his way. When private-equity bosses were paraded before him, the consensus was that they gave as good as they got, and on that occasion the lack of knowledge of McFall and his members was evident. That is suspected by some at Westminster as being the reason McFall and co noticeably failed to follow up their questioning of the RBS and HBOS bankers with detailed supplementaries - they didn't want to be exposed.

But he is unapologetic about his behaviour, and his lack of financial experience - it is up to the bankers to explain themselves to Parliament, not him. The City might not like him but that's not his problem.