Strategy: Joe Garner says Nationwide still owns many of its affiliates
Not many executives will openly say they are proud to be one of the UK’s largest taxpayers. Most of them intend to minimize the amount they transfer to income to satisfy their shareholders.
Another is Joe Garner, executive director of the Nationwide Building Society. As head of a reciprocal campaign – owned by its members and run solely for their benefit – he sees paying hundreds of millions of pounds in taxes as a tribute, especially at a time when the chancellor needs to replenish the treasury after paying billions of pounds to help the country survive the pandemic. and the cost of living crisis. The construction company ranked tenth out of 40 creditors in total taxation for the fiscal year to April 2021.
“I think it would be a surprise to many to hear that Nationwide is in the top ten UK taxpayers, but I think it’s good,” he says. “We pay our taxes with pride because it’s another way to contribute to the society we serve.
“I can proudly say that we are a major taxpayer than we would be if we were one of those organizations that found clever ways, through subsidiaries that are far away to avoid payments or minimize their tax impact “- he adds to the excavations at major banks, some of which are productively using offshore harbors for themselves and their customers.
For the year ended April 2022, Nationwide paid more than £ 650 million including corporation tax, bank fees, bank fees, employer’s national insurance contributions, irreparable VAT and business rates. He does not claim to pay the 8 percent tax levy levied on all creditors in retaliation for the credit crunch, although Nationwide was not particularly guilty compared to such as RBS or Lloyds, both of which demanded huge taxpayer assistance.
The 52-year-old Garner says on the eve of his departure from the UK’s largest construction company after six years in office.
He was a staunch advocate of reciprocity at a time when the concept was under threat.
There was never the slightest speculation that Garner would try to sell the company to fill his own pockets, like the bosses of LV, the second largest mutual insurer in the UK, who tried to transfer the firm to private equity.
His successor, Debbie Crosby, will be the first woman management company when she starts her new job later this week.
It goes on a high note, doubling Nationwide’s revenue to £ 1.6 billion last year.
However, sober that many customers – he prefers to call them members – are waiting for hard times because of the cost of living crisis.
Garner expects house prices, which remained strong throughout the pandemic, to slow in the coming months. But he argues that Nationwide’s reciprocal status means it has good opportunities to help depositors and borrowers survive a future storm, not least because, unlike its major banking rivals, it does not intend to pursue a wholesale branch closure program . The Society has 625 outlets, making it the third largest network in the UK.
“From time to time, yes, we do close a branch,” he says, “but we closed 5 percent of branches in an industry where about 30 percent closed. The key difference is that many of our competitors are trying to find ways to close branches, while we are trying to find ways to keep them open. ”
After the pandemic Nationwide introduced flexible work, and branches could be closed one to two days a week. But, he says, employees continue to help people over the phone and through digital channels.
“I listen to some competitors say that transactions in branches have decreased, but look at the nature of these transactions. Why do people go to the branch? ‘ He asks. “Often this is because they are dealing with difficult, sensitive issues where personal contact is more important, such as vitamin deficiency, power of attorney or financial difficulties.”
So the banks that are cutting their networks – including the TSB, which until recently was run by Crosby – were wrong? “Debbie hasn’t started yet, but I have a feeling that there is a deep belief in our society and our leadership to be on the main street for members and communities,” he says.
“Our branches are usually smaller than banks. A few years ago we weren’t as enthusiastic as many of our competitors with drugs for sales and rents, so we still have a large share, which means our rent is lower. “And usually we’re not in super-acceptable places, so our economy is different.” Some competitors, he says, “see value in affiliates, but we see in them real value.” Garner has been criticized for the size of his salary, although it is fair to say that in April 2020 he was the first head of a major lender to volunteer for a big position to show solidarity with staff and customers during a pandemic.
Last year, he took home around £ 1.2 million compared to just under £ 2.4 million in 2019 before Covid – large sums, but much less than the heads of major banks.
Garner is very concerned about inflation, which, he said, “is, frankly, bad for everyone.”
“It undermines the value of savings and hits on affordability,” he says, adding a more optimistic note: “But isn’t it good that there is financially secure engagement with an exclusive goal?”
“If the pressure intensifies, we will not feel a dilemma, we serve shareholders or customers. We only have one job, which is to support members.
“I am worried about inflation, I am really worried both at the financial level and, let’s face it, in the geopolitical environment. Who would have thought that we would see a war in Europe? At the same time, all wars end in a deal. None of us knows how much it will be, but it will happen, and often the darkest hour falls at dawn.
As part of the charity program, Nationwide raised more than £ 1 million at the urging of members and staff of the British Red Cross in Ukraine, including a donation of £ 250,000 from the lender itself.
Last year he also donated £ 4 million to local housing charities and projects.
Endurance: Joe Garner’s hobby is triathlon, where she represents the UK in her age group
In terms of mutual benefit, members are offered a number of advantageous product tariffs and participate in a monthly raffle of prizes of £ 1 million. Over the past year, the financial benefits handed over to them have risen 23 per cent to £ 325 million, although Garner says he would like to return even more to members.
The latest results, he said, do not reflect the cost of living crisis.
“So far we are not seeing an increase in debt. We saw that where people were already fighting, it became even harder for them, ”he adds.
Garner, who previously held senior positions at HSBC, Dixons, Procter & Gamble and BT Openreach, has not officially decided on his next move, but Downing Street has asked him to investigate the growth of banking fraud.
But his greatest achievement, he said, is that under his command Nationwide “remained true to our values,” adding, “As CEO, I was only a temporary custodian of the integrity of this mutual cooperation.”
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Country boss Joe Garner, who is leaving, is taking on big banks
Source link Country boss Joe Garner, who is leaving, is taking on big banks