This week saw Business Secretary Vince Cable turn up to the BIS Select Committee on Wednesday to answer questions on bank lending to SMEs.
His colleague from 1 Horse Guards Road, the Chancellor of the Exchequer, was invited too. But George Osborne politely declined, a move that seemed to frustrate committee chair, Adrian Bailey.
Bailey suggested Osborne was the real organ-grinder to Cable's monkey when it came to the banks, meaning a Cable-only appearance was more of a side-show than the main event.
Cable calmly deflected criticism of Osborne's no-show, suggesting the two had distinct – but related – responsibilities – and in any case everyone's calling the same tune. And with that the meeting turned to matters of substance.
While Cable didn't come out with a whole lot that was new, he did raise a couple of interesting points.
Firstly, Cable repeatedly drew attention to the non-transparency from the big banks – with the exception of Lloyds and Santander – as to how they were linking CEO pay to SME bank lending.
This pay-link was a commitment under the Merlin agreement on bank lending reached between the banks and the government in February.
In Cable's view, incentives of this nature were key to changing the internal culture of banks, which needed addressing in his view because the decline in ‘relationship-based banking' was a major drag on lending to SMEs. Cable repeatedly came back to not knowing how the banks were applying their incentives – but that he really wanted to know. That's the first inkling of any kind of a challenge to what the banks are doing from the government in a few months.
The second interesting point Cable made was with respect to competition.
Cable said that the Cruickshank report of 2000, which noted that the SME lending market was uncompetitive and high cost, still stood.
If he thinks that's the current situation it implies he has in mind a new landscape that is characterised by more competitive SME lending and lower cost, linking, one would think, to the ICB's Sir John Vickers' call for additional branches of Lloyds to be sold.
Again this seems somewhat at odds with the banks, which themselves were represented at the Treasury Select Committee later the same day (albeit to discuss the ICB's recommendations not SME lending).
HSBC's Douglass Flint said a break-up of RBS or further sell off of Lloyds' branches was not really the way to drive competition in SME lending. Customers will make their choices of institution based on the perception of a bank's strength, possibly driven by brands.
And Lloyds' Antonio Horta-Orsorio has, not surprisingly, come out strongly against extending the sale of Lloyds' branches beyond the currently agreed 600.
It would have been interesting to have George Osborne's take on it given City A.M.'s comment this week that HM Treasury and Lloyds seems to be ploughing ahead with selling just the 600 branches, which apparently will make it hard to add in more branches later.
So an interesting little appearance from Cable that shows despite relatively modest steps to date, the government is still thinking hard about SME lending and wants to see more from the banking sector on how it's going to improve.