Personal Finance: Coaxing a yes vote

THE Cheltenham & Gloucester Building Society has been forced to be mean to some of its customers by the court ruling that barred members of less than two years' standing, and borrowers, from receiving the cash pay- out from Lloyds Bank.

Last week, C & G tried to mitigate the damage to its plans to become part of Lloyds by bringing forward the two-year qualifying date from the end of December last year to the end of December this year. So anyone who opened an account before 31 December 1992 and keeps it open until the deal goes through in about a year will qualify for a cash payment.

But savers who joined after that are now excluded. Borrowers will also be out in the cold, although manywill also be savers and will benefit by virtue of their savings account.

C & G's problem is that the voting hurdles to approve the deal are extremely high.

There are two separate votes. The borrowers' vote just requires a majority, so a positive response from the borrowers who also have a savings account should be enough to get the vote through. Disappointed borrowers who thought that they were going to share in the windfall could counter with a 'no' vote, but as long as they are not in the majority everything will go forward. Abstainers will not upset the applecart.

The savers' vote, however, is very different. This resolution must be passed by 75 per cent of those who vote, and it must also be approved by at least half of those eligible to vote, or investors holding 90 per cent of the funds of those eligible to vote.

Some of these savers will not have heldtheir accounts long enough to qualify for the pay-out, but their votes will still be needed. With the original December 1991 cut-off date, around 27 per cent of members fell into this category, but with the date moved on a year there may be fewer than 10 per cent in the cold.

These people need to be persuaded to vote for the deal in large numbers even though they do not stand to gain directly from it.

It would certainly be in the interests of all members who qualify for payments - to the tune of pounds 500 per account plus at least 13 per cent of balances - to find an excluded C & G customer and operate a bit of true building society mutuality by offering to share some of their windfall.

They would not, of course, be thinking of bribing the unfortunate ones to cast a 'yes' vote. But you never know what effect a bit of generosity might have . . . .

THERE seems to be little doubt that the next movement on interest rates will be upwards. The only questions are when, and by how much.

No one wants to have their savings stuck in an uncompetitive account when things are on the move. Anyone with a 90-day notice account has until 1 September to give notice and get their money out before the Budget on Tuesday 29 November. There could, of course, be a rate change before then, but the Budget always gives with one hand and takes away with the other, so any nasty medicine should be well sugared.

POOR old Barclays. On the day last week that it announced half-year profits of pounds 1bn, it tripped up over two tots and the pile of coins saved for their summer hols.

The six and four-year- olds marched into a Barclays branch in Newcastle upon Tyne and asked to change pounds 10 worth of coins into notes. Barclays said it would charge pounds 5 for the service and the family went off in a huff.

But it turns out that the family did not even bank with Barclays and expected the service for nothing.

Would they expect shoe shop assistants to tie the children's laces, or M & S to supply them with free lollies?

Kids and their piggy banks are all very sweet, but why on earth do people think that banks are some sort of social service?