payments. and of course payments globally continue to change apace, so we thrive on our engagement with other central banks on key topics such as standards harmonisation, where our close collaboration is a crucial part of how we can collectively transform the payments landscape. working together provides the opportunity to learn, share insights and collaborate on common challenges. conclusion just as payment systems are at the heart of the economy, industry engagement must remain at the heart of the programme. user input enables us to create the platform and capability that industry needs to innovate : the building blocks to transform the payments landscape. but as we mobilise delivery at the bank, we need industry to mobilise too. we are on track against our plan and we need firms to develop theirs – so the payments industry is ready to transition safely to the new service and maximise the opportunities for innovation and transformation promised. we are developing a strategy to work closely with direct participants to provide information, monitor key milestone completion, undertake testing and seek assurance that they are each ready to implement changes. together, we can build and promote a resilient and thriving financial system, and so i look forward to continuing to engage with many of you here – be you users, end users, suppliers, innovators, peers - to help shape and deliver a resilient and innovative payment ecosystem. https : / / www. bankofengland. co. uk / payment - and - settlement all speeches are available online at www. bankofengland. co. uk / news / speeches

six months after lehman brothers collapsed world trade fell by nearly 20 % – a faster decline than in the great depression. around the world, the same telling phrase was repeated : economic activity was “ falling off a cliff ”. in its statement to the london g20 summit in april 2009, the international trade union movement argued that “ the first priority for g20 leaders must be to restore confidence by halting the freefall in world growth ”. that has been achieved. world output grew by 4 % over the past year. and in the united kingdom, growth has been somewhat faster than anticipated a year ago. nevertheless, total uk output remains around 10 % below where it would have been had the crisis not occurred. so how do we prevent this happening again? if we are to prevent another crisis, action is required on both of the fundamental causes. first, we need to resolve the problems caused by massive capital flows from poor to rich countries. yet the imbalances are growing again. this problem can be tackled only by international cooperation – most obviously through the g20 – and i hope that the trade union movement will continue to engage with that process. second, our financial system needs radical reform. slowly but surely, we must move towards a banking system that does not put both the economy and your members ’ livelihoods at risk. in the long run, banks will have to hold much more capital and be much less highly leveraged. part of the answer is improving the way we regulate banks, and devising policy tools to control the risks taken by the financial system as a whole. the aim should not be to prevent all bank failures. just as with every other company in the economy, banks that get it wrong must be allowed to fail, without risk to ordinary depositors or taxpayers. in 2008, banks were bailed out not to protect them but to protect the rest of the economy from the banks. that may not seem fair – and it isn ’ t – when other companies, such as jaguar, had to stand on their own feet or go to the wall. so banks too must face market discipline. but we need to do more than reform our banking system. if the world economy needs rebalancing, so does our own. the substantial trade deficit over a number of years means that national spending exceeded production. we need a higher national saving rate, a shift in spending and production away from consumption and towards exports. and a key part of that is a reduction in our budget deficit