Draft Financial Services and Markets Act 2000 (Ring-fenced Bodies, Core Activities, Excluded Activities and Prohibitions) (Amendment) Order 2024
Draft Financial Services and Markets Act 2000 (Designated Activities) (Supervision and Enforcement) Regulations 2024
Draft Short Selling Regulations 2024
(2 days, 20 hours ago)
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The Economic Secretary to the Treasury (Tulip Siddiq)
I beg to move,
That the Committee has considered the draft Financial Services and Markets Act 2000 (Ring-fenced Bodies, Core Activities, Excluded Activities and Prohibitions) (Amendment) Order 2024.
The Chair
With this it will be convenient to take the draft Financial Services and Markets Act 2000 (Designated Activities) (Supervision and Enforcement) Regulations 2024 and the draft Short Selling Regulations 2024.
Tulip Siddiq
It is a pleasure to serve under you, Mr Vickers, during this quiet week in politics. The regulations that we are introducing today will ensure effective, proportionate regulation for the financial services sector, first, by reforming the ringfencing regime to be more flexible while upholding financial stability safeguards; secondly, by creating a new framework for the regulation of short selling; and thirdly, by enabling better supervision and enforcement of designated activities under the Financial Services and Markets Act 2023.
I will turn first to the reforms to the ringfencing regime for banks. As the Committee will know, ringfencing was introduced following the global financial crisis on the recommendation of the Independent Commission on Banking, and it came into full force in 2019. It requires large, complex banks to separate the services that they provide to households and small and medium enterprises from investment banking activity.
In 2022, an independent statutory review of the regime recommended updates to ensure that it operates as intended and is proportionate. This statutory instrument improves the regime and implements changes from the review. The reforms that it contains will improve competition in the banking sector, reduce costs and support economic growth. They have been developed with the Prudential Regulation Authority, which is content that they also maintain appropriate financial stability protections.
I will outline the most material updates to the regime. The reforms will ensure that in future only the largest, most complex banks are subject to the regime, with two key changes. The first is an increase in the primary deposit threshold—the amount of core deposits a bank can hold before it is required to ringfence—from £25 billion to £35 billion. This accounts for growth in the deposit base and other relevant economic indicators since ringfencing was introduced and it supports competition. The second change is the introduction of a new secondary threshold, which exempts retail-focused banking groups from the regime, where investment banking activity accounts for less than 10% of common equity tier 1 capital.
This SI also makes changes to the way that banks within the regime can operate. It introduces measures to encourage more investment by ringfenced banks in UK small and medium enterprises and to reduce the compliance burden associated with the regime. It also creates significant new flexibilities to allow ringfenced banks to operate globally, subject to PRA rules, as well as to provide a wider range of goods and services to their customers.
I turn to the draft Short Selling Regulations. Short selling is the practice of selling a security that is borrowed or not owned by the seller with the intention of buying it back later at a lower price to make a profit. Short selling plays a healthy role in the proper functioning of financial markets. It provides essential liquidity to markets, which drives investment in British companies; it helps to drive economic growth; and it helps to ensure that investors pay the right price when investing in shares.
The draft regulations introduce a more streamlined UK short selling regime, which focuses on equities, rather than both equities and sovereign debt. The new regime also introduces a reformed public disclosure regime for short selling, ensuring that there is transparency over short selling activity, without the issues identified with the current regime through the 2022 call for evidence.
However, as I am sure the Opposition spokesperson will identify, there can be risks associated with short selling. As such, it is important for the Financial Conduct Authority to have the tools to effectively monitor short selling activity and intervene if necessary. This statutory instrument provides the FCA with broad rule-making powers in relation to short selling. This will allow the FCA to effectively oversee short selling in UK markets. It will also mean that the UK’s short selling rules can be adapted and updated by the FCA in a more agile way in future—for example, to better adapt to new global standards or to take account of market innovation and new business models. The instrument retains the FCA’s powers to intervene in relation to short selling activity in UK markets in exceptional circumstances, which is an important feature of the current regime.
Turning to the Financial Services and Markets Act 2000 (Designated Activities) (Supervision and Enforcement) Regulations 2024, to give the FCA the broad rule-making powers for short selling that I just mentioned, the new short selling regime operates under the designated activities regime—known as DAR. The DAR was introduced into the Financial Services and Markets Act 2000 by the Financial Services and Markets Act 2023, which the Opposition spokesperson will know very well, since we sat across from each other, debating it for days. It allows the Treasury to designate certain activities to be regulated by the FCA. However, persons carrying on those activities under the DAR do not need to become full authorised persons like banks or insurers. This enables proportionate regulation for activities where it would be disproportionate to have met all requirements for authorisation.
The Financial Services and Markets Act 2000 (Designated Activities) (Supervision and Enforcement) Regulations 2024 enable the FCA to supervise and enforce the rules it makes under the DAR. They do this by enabling the FCA to exercise existing supervision and enforcement powers under FSMA 2000 on persons carrying out designated activities, whether or not they are authorised. In the first instance, these powers will be extended to the activities covered by the Consumer Composite Investments (Designated Activities) Regulations 2024 and the Short Selling Regulations 2024. Tha will enable effective supervision of these regimes.
I thank the Committee for putting up with these quite technical amendments. The statutory instruments ensure that our financial services industry is subject to a rulebook that is fit for purpose, more proportionate and tailored to UK markets. I hope the Committee will join me in supporting these regulations.
Gareth Davies (Grantham and Bourne) (Con)
It is always a pleasure to see you presiding over us, Mr Vickers. The Minister has covered the instruments pretty well, so I will make a few remarks, and then I have a couple of pretty straightforward questions. Let me first speak to the statutory instrument on ringfencing. As the Minister set out, the regime came into force in January 2019, requiring the largest UK banks to separate core banking services from their investment and international banking activities. The intention with the ringfencing regime was to protect British banks from shocks, whether originating from elsewhere in the group or in global financial markets.
The regime currently applies to banks with more than £25 billion in retail and small and medium-sized enterprise deposits. The original legislation contained a statutory review clause requiring His Majesty’s Treasury to commission an independent review within two years of the regime coming into effect. The review was commissioned in 2021, chaired by the excellent Sir Keith Skeoch, and the review panel reported in March 2022. The SI that we are debating seeks to implement recommendations from the Skeoch review that were aimed at improving the operation of the regime. It amends previous FSMA-related SIs from 2014 to adjust the regulatory regime applying to ringfenced bodies.
As the Minister set out, the changes will raise the threshold for inclusion in the ringfenced regime from £25 billion to £35 billion, and add a new exemption for retail-focused products that undertake minimal investment banking activity. Regulatory reporting requirements by ringfenced banks are also being reduced, while restrictions on the geographical operations are being relaxed. The products and services that ringfenced banks can offer are also being relaxed, as in the case of trade finance agreements. Finally, when banks become the subject of the regime because of an acquisition by a ringfenced bank, a four-year transition period is being introduced.
This is a long way of saying that I very much welcome the action that is being taken by this Government as relates to this statutory instrument. However, there are two points that I would like some clarification on, given that the financial landscape is continually changing and has changed a lot in the past two years alone. Regulation must adapt to changing conditions, so let me ask two questions. First, will the £35 billion threshold be reviewed again in the future? Secondly, what will be the process for adjusting the threshold in response to future market developments and inflationary pressures?
Turning to designated activities, under the 2023 Act His Majesty’s Treasury makes regulations to designate activities related to financial markets, including financial market exchanges, instruments, products or investments. The Act also gave the FCA powers to make rules and give directions relating to those designated activities. The designated activity rules framework includes provisions that allow the Treasury to designate certain activities to be regulated by the FCA, without the requirement for those carrying on the activities to become authorised persons. The SI in front of us today rightly aims to provide the FCA with the supervisory and enforcement powers to enforce the rules it makes within that framework.
We support the measures set out in this SI. However, I again have a couple of points to raise, particularly points that were raised in the other place and points that I understand were raised by the Minister, as reported in the Financial Times on 4 December 2024, regarding the naming and shaming of firms by the FCA. I completely appreciate that the FCA has reopened its consultation, but I should be grateful if she would provide clarity on two points. First, at what point exactly in the enforcement process would the naming and shaming take place? Secondly, how will the Government hold the FCA accountable for its new approach, as the Minister herself said was needed in the interview?
Finally and briefly, we turn to the Short Selling Regulations 2024. The SI establishes a new legislative framework for the regulation of short selling by creating a designated activity of short selling, thus giving the FCA powers to make and enforce rules for this practice. Short selling does play a vital role in financial markets, such as providing liquidity. However, it is important that the FCA has the tools it requires to monitor short selling activity and intervene when necessary to mitigate risks. This SI introduces a requirement for the FCA to publish anonymised aggregate net short positions based on all individual position notifications that it receives. It also removes restrictions on uncovered short selling of sovereign debt and sovereign credit default swaps, as the Minister said, as well as sovereign debt notification requirements.
The Opposition support the measures set out in this SI. I have no further questions.
Tulip Siddiq
I thank the Opposition spokesperson for his questions. I am grateful that he is supporting us. He agrees that the SIs represent an important step in ensuring that our approach for the regulation of financial services is effective and proportionate. We feel that these are sensible, technical reforms. The Treasury undertook detailed work with the PRA after the independent review, which the hon. Gentleman mentioned, released its final report in 2022, consulting on a draft package of measures in 2023 and refined those proposals in line with feedback.
It is recognised that the ringfencing regime was originally designed so that the threshold would need to be adjusted over time to reflect the evolution of banking practices and growth in the deposit base. The Treasury considered several metrics as well as financial stability and competition considerations in proposing the £10 billion increase. Increasing the deposit threshold will provide smaller banks with more headroom to grow before being subject to the requirements and costs of ringfencing. We feel that will support domestic competition in retail banking markets. A competitive and dynamic market will improve outcomes for depositors. The reform may encourage inward investment in the UK as new entrants to the UK banking market will have more room to develop economies of scale before being subject to the regime.
While the independent review, which the hon. Gentleman mentioned, did not suggest that uprating was necessary to maintain the policy aims of the current ringfence, the Government have recognised that the threshold acts as a barrier to the growth of smaller players in the market, dampening competition for retail customers. His points are valid, and we will be looking at them, but there are no plans at this point to change the threshold in the way he mentioned.
On the hon. Gentleman’s points about name-and-shame proposals, I am very pleased to hear that he has been reading my interviews in detail. I have raised those proposals several times with the FCA and welcome the fact that it has listened to industry feedback on them. It has taken some steps to address some of the concerns raised by industry, which he will know about. I have been clear with the FCA that effective, proportionate regulation is key to our aims, and that it needs to deliver the Government’s mission to drive inclusive growth.
As the hon. Gentleman knows, the FCA is operationally independent but accountable to Government and Parliament. I am engaging closely with the FCA on name-and-shame proposals and will make sure that any potential impacts on international competitiveness and growth are properly considered. That is not to dismiss the concerns about those proposals from industry, which I have heard first hand. The subject comes up repeatedly in my meetings with the FCA. I hope that reassures the hon. Gentleman a little bit.
I think I have covered most of the hon. Gentleman’s questions, but am happy to write to him on any others. Generally, we feel that this SI is important overall to our mission of growing the economy. I know that when the hon. Gentleman was in government, he had sight of a similar SI and was in agreement with it. I thank the Committee for agreeing to pass this legislation.
Question put and agreed to.
DRAFT FINANCIAL SERVICES AND MARKETS ACT 2000 (DESIGNATED ACTIVITIES) (SUPERVISION AND ENFORCEMENT) REGULATIONS 2024
Resolved,
That the Committee has considered the draft Financial Services and Markets Act 2000 (Designated Activities) (Supervision and Enforcement) Regulations 2024.—(Tulip Siddiq.)
DRAFT SHORT SELLING REGULATIONS 2024
Resolved,
That the Committee has considered the draft Short Selling Regulations 2024.—(Tulip Siddiq.)
Draft Electricity Capacity Mechanism (Amendment) Regulations 2024
(2 days, 20 hours ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)
I beg to move,
That the Committee has considered the draft Electricity Capacity Mechanism (Amendment) Regulations 2024.
Good morning and happy new year to all members of the Committee. It is a pleasure to serve under your chairmanship this morning, Mr Efford.
The instrument revokes and alters several provisions of the assimilated regulation 2019/943 of the European Parliament and of the European Council of 5 June 2019 on the internal market for electricity relating to the capacity market, which from now on I shall refer to as the assimilated electricity regulation. Before I outline the provisions of the draft regulations, I shall briefly give some context.
Great Britain’s capacity market was introduced in 2014. It is designed to ensure that sufficient electricity capacity is available to meet future predicted demand, to maintain security of electricity supply. It is our main tool for that purpose, providing all forms of existing and new-build capacity with the right incentives to be on the system when we need them. It covers generation, storage, consumer-led flexibility and interconnection capacity. Capacity markets auctions are held annually one year and four years ahead of delivery to ensure that we have supply when we need it and to meet future peak demand in a range of scenarios, based on advice from the capacity market delivery body, the National Energy System Operator.
Since its introduction, the capacity market has contributed to investment in just under 19 GW of new, flexible capacity needed to replace older, less efficient plant as we transition to the net zero economy. The capacity market was originally approved under European Union state aid rules for a period of 10 years. Following the UK’s withdrawal from the EU, a requirement in EU law for approval of up to 10 years was brought into our domestic law as part of the assimilated electricity regulation. To date, the capacity market has been successful in ensuring that Great Britain has adequate electricity capacity to meet demand, and it continues to be required to maintain security of supply and investor confidence. This will be increasingly important as further sectors of the economy are decarbonised through the transition to net zero, increasing demand for electricity.
The draft regulations revoke and alters certain provisions relating to capacity mechanisms in the assimilated electricity regulation, including article 21(8), which requires that
“Capacity mechanisms shall be temporary and shall be approved for no longer than 10 years”,
and other references to such mechanisms being temporary. The draft instrument also revokes several provisions that require minor correction following changes made for the UK’s withdrawal from the EU, or that impose requirements that are no longer considered to be necessary. We are making these changes now because of the ongoing need for the capacity market to ensure sufficient investment in reliable electricity capacity.
The domestic subsidy control regime was introduced after our withdrawal from the EU. It does not require subsidy schemes to be granted an approval or to be limited for a specified period. The approval requirement in the assimilated electricity regulation does not, therefore, reflect our post-EU exit arrangements. It is of course important to keep the capacity market under review, and there are several controls in domestic legislation, such as the Secretary of State’s discretion not to hold auctions, as well as a statutory requirement to review the capacity market every five years, which provides an opportunity to review the need for the scheme. They will all be retained in the domestic capacity market legislative framework.
The draft instrument revokes and alters certain provisions related to capacity mechanisms in the assimilated electricity regulation, including the requirement for an approval lasting no longer than 10 years and references to capacity mechanisms being temporary. The aim is to ensure that our domestic legislative arrangements reflect the continued operation of the capacity market, which is Great Britain’s main mechanism for ensuring security of electricity supply. I commend the draft regulations to the Committee.
Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
It is a pleasure to serve under your chairmanship, Mr Efford. Good morning and happy new year. It is good to be back in this Committee dealing with yet another piece of delegated legislation.
The draft regulations make changes necessary for the operation of the capacity market outwith the EU and sensibly revokes the 10-year approval requirement. On that basis, I do not oppose it and we will not stand in the way of business today.
The capacity market scheme was introduced in 2014, as part of the electricity market reform, to ensure security of electricity supply by providing payments for reliable sources of electricity generation capacity, or in some cases for reduced demand. In 2013, the Government identified that while introducing renewable energy sources into the energy mix,
“The amount of gas capacity we will need to call on at times of peak demand will remain high, with potentially significant amounts of new gas generating capacity required by 2030.”
That prediction rings true, and truer still when we acknowledge the intermittent nature of weather-dependent renewable energy sources such as wind and solar. That is why in a speech made at Chatham House in March, the shadow Secretary of State, my right hon. Friend the Member for East Surrey (Claire Coutinho), called for new unabated gas power plants, to make sure that we can keep the lights on when the wind is not blowing and the sun is not shining.
As the NESO report states:
“Around 35 GW of unabated gas (broadly consistent with the size of the existing fleet) will need to remain on standby for security of supply. This requirement for gas capacity will remain throughout the early 2030s until larger levels of low carbon dispatchable power and other flexible sources are able to replace it.”
Indeed, its “Clean Power 2030” plan sets out the intention to reform current market mechanisms such as the capacity market to
“help enable the continued operation of unabated gas for security of supply.”
This will, however, be more expensive due to the sporadic use of gas as a result of the dominance of renewables. The capacity market will provide income to combined cycle gas turbine plants, which will produce only 5% of overall generation, requiring much higher capacity prices.
As the Secretary of State charges toward grid decarbonisation, it is imperative that we retain our capacity for gas generation and maintain the capacity market scheme to facilitate that, but due to the decisions made by the current Government it will be more expensive —one of the many pitfalls of their “renewables at any cost” approach. I am sure we will soon debate this at greater length and in greater detail; it is not for today’s Committee. We have no problem with the specific provisions of the draft regulations before us.
Michael Shanks
I thank the shadow Minister for his support. I have no doubt that in 2025 we will have many debates on the “Clean Power 2030” action plan, and I look forward to hearing his support for our work. As I said in opening the debate, the draft regulations are technical in nature. They are about ensuring security of supply long into the future, and I hope the Committee will support them today.
Question put and agreed to.
Draft Representation of the People (Northern Ireland) (Amendment) Regulations 2025
(2 days, 20 hours ago)
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The Parliamentary Under-Secretary of State for Northern Ireland (Fleur Anderson)
I beg to move,
That the Committee has considered the draft Representation of the People (Northern Ireland) (Amendment) Regulations 2025.
It is a pleasure to serve under your chairship, Mr Mundell. As we set out in our manifesto, this Government are committed to strengthening and encouraging participation in our democracy. The draft regulations will help to achieve that by ensuring that those who remain eligible to be registered, but who did not respond to the last electoral canvass, can remain registered while attempts are made to contact them. I thank the Electoral Commission and the chief electoral officer for Northern Ireland for their support in the design of the retention framework that is set out in the draft regulations.
Unlike the process in Great Britain, there is no annual canvass in Northern Ireland. Instead, the CEO is required to conduct a canvass at least every 10 years; the last was held in 2021. During the canvass, all eligible individuals must respond by completing a full new application form; otherwise, they risk removal from the register. The current law provides that individuals who do not respond to a canvass can be retained for up to three years if the CEO continues to be satisfied of their eligibility; such individuals are called retained electors. The CEO is able to assess eligibility by cross-checking the register with local and Government data.
Following the 2021 canvass, there are 87,000 retained electors on the register, or approximately 6% of the electorate in Northern Ireland. As that canvass took place three years ago, under the existing provisions they would all be removed from the register next month. That is why it is really important that we are all here today. The CEO’s assessment is that almost all of these retained electors remain eligible.
The draft regulations would correct the position by extending the retention period from three to six years. Given that three years have already elapsed since the 2021 canvass, the current retained cohort will start the new framework in year four of the 10-year cycle and will be subject to the provisions relating to years four to six of the scheme. Electors retained on the register following any subsequent canvass, including the one scheduled for 2030, will be subject to the steps for years one to six.
Crucially, the new provisions stipulate the required minimum engagements by the CEO in each retention year to encourage re-registration, including an annual audit of retained electors and a framework of correspondence. The provisions are designed to prevent the loss of retained electors, which would have a negative impact on the quality of the electoral register in Northern Ireland and would potentially disenfranchise electors.
The CEO is clear that he has full confidence in the quality of the data available, allowing him confidence in retention and removals where they are warranted. Owing to additional data and improvements in data science, the data available is of a much higher quality than when the current law was conceived.
I will explain a little more about the details of the framework. The draft regulations will introduce a new residence audit that the CEO will be required to conduct annually to check residence details of retained electors against the external data available. Where the audit raises a question as to the elector’s residence, a removal warning notice must be sent. If the elector does not re-register within 28 days of the notice, they will be removed from the register.
In years one to three following the canvass, if the CEO remains satisfied as a result of the audit that the elector remains eligible to be on the register, no further action will be taken. However, in years four to five of the electoral cycle, which is where we are now, if the CEO is satisfied that retained electors remain resident, they will be sent a household notice showing which electors must re-register or risk removal. They will not, at that stage, be removed, but the primary legislation is clear that non-respondents may not be retained indefinitely. Consequently, in the sixth and final year, all remaining retained electors will be sent up to three notices informing them that they will be removed if they do not re-register. If they fail to respond, they will then be removed.
The purpose of the framework is to ensure that reasonable efforts are made to prevent the loss of eligible electors from the register. As the last canvass was held in 2021, only those provisions in the regulations concerning years four to six will apply to the current retained electors. I hope that the Committee agrees that these changes will encourage and secure participation in the democratic process in Northern Ireland.
Alex Burghart (Brentwood and Ongar) (Con)
May I welcome you to your place, Mr Mundell, and wish you and all hon. Members a happy new year? The Opposition do not intend to oppose the draft regulations, but we have some reasonably significant questions and I am interested to hear what the Minister has to say.
Some 87,000 voters are about to fall off the register. I believe that to be an unusually high number. What do we think is the cause? Perhaps we are dealing with the symptoms rather than the cause of the problem, so it would be useful to know what the Government think has led such circumstances to arise.
The Committee could do with some reassurance about the reliability of the local and Government data used in this process. I have read and understood the explanatory memorandum, but we could do with a little more detail so that we know that the data is accurate.
It would be helpful to know whether the Government have considered harmonising the good system that we have in Great Britain with the one in Northern Ireland. We have a very reliable system of annual canvasses here. I understand why there was thought to be a need to differentiate Northern Ireland when the Representation of the People Act was passed in 1983, but a lot has moved on since then. Would it not be better for the whole country if one system were used in all four of the home nations?
My last question is slightly outside the Minister’s brief, so I will understand if she or one of her colleagues answers in writing. There is a long tradition in Northern Ireland of voter ID to accompany registration. There have been some rumours in the press recently that the Government are considering doing away with voter ID in the UK. Would that cover just GB, or would it also cover Northern Ireland? When can we hope for some clarity on the Government’s position?
Robin Swann (South Antrim) (UUP)
It is a pleasure to serve under your chairmanship, Mr Mundell. I have a couple of queries for the Minister. The chief electoral officer says that 87,700 retained electors are due to be removed on 1 February. The explanatory memorandum suggests that almost all of them live at the address on the register and
“are therefore eligible to be registered to vote at this address.”
That would suggest that those 87,700 electors are real, live people who are able and eligible to vote in Northern Ireland, so I assume that they had the opportunity to do so in the general election only six months ago. In my opinion, that is an exceptionally high number. I wonder whether the Government, although perhaps not at this stage, could ask the chief electoral officer to provide a breakdown of those 87,700 retained electors by constituency so that we can see whether there is any trend or specific registration issue in Northern Ireland of which we need to be aware.
I turn to a more specific question. Proposed new regulation 46C of the Representation of the People (Northern Ireland) Regulations 2008, which is entitled “Retained register entries: residence audit”, provides an opportunity to
“conduct a residence audit in respect of any retained elector”.
That indicates that there will be opportunities to do an individual residence audit. Is that the intention of the draft regulations? If so, who would instigate such an audit of an individual’s residence to see whether a retained elector is eligible to vote before a removal warning is issued? Could a residence audit be instigated only by the chief electoral officer and his staff, or could a member of the general public query the eligibility of an elector or their residence at an address?
Further to the point that the shadow Secretary of State for Northern Ireland, the hon. Member for Brentwood and Ongar, made about voter ID, may I encourage the Government to look at how voter ID is used in Northern Ireland? Perhaps I might encourage them to extend that approach to the rest of the United Kingdom.
Fleur Anderson
I thank the hon. Members for Brentwood and Ongar and for South Antrim for raising those questions. The draft regulations are an important piece of legislation and it is important to get them right.
The number of retained electors sounds very high, but given the total electorate of 1.36 million, some 87,000 is not an unusually high number in the history of elections in Northern Ireland. It is increasingly difficult to get people to fill out forms, but we hope that by enabling electors to be retained for another three years, the draft regulations—along with a concerted effort of correspondence and checking—will increase the number. The draft regulations set out how the CEO will try to contact non-respondents. The CEO does not consider that the number is unusually high or that it represents a particular spike. The numbers who are not on the electoral roll, but could potentially be on it, are in line with the standard across the United Kingdom.
The CEO has made assurances about the reliability of the data, which is achieved through cross-checking it with other systems. If, as a result of cross-checking with other Government data, someone is found to have moved, they will be asked to be removed from the system. Those who are retained are on the system in another area of Government data, so the reliability of data can be assured.
The harmonising of the system in Great Britain is a whole other issue, but making the draft regulations will give the Government an extra three years to consider what changes could be made and to look again at the issue. We will be looking at other ways in which to increase democratic participation; it will be a subject of discussion for the next three years, but the draft regulations will enable exactly that. There is a different history in Northern Ireland, which is why there are different systems, so a direct harmonisation is not as easy as it sounds, but it needs to be discussed.
The shadow Secretary of State asked about using voter ID. I do not know about speculation in the press, but I can ask the relevant Minister to get back to him on the question of when it will be discussed. I know that the Government are committed to extending the franchise to 16 and 17-year-olds; that will be on the table for the next few years and it will be discussed.
In answer to a question asked by the hon. Member for South Antrim, the CEO has confidence, but I will ask for a breakdown of the numbers by constituency. It will be interesting for hon. Members and others to see whether there are differences, discrepancies or reasons why there are fewer retained electors in certain constituencies.
Cross-checking is done with other data. Can an individual query the register? That is a system for the CEO to look at. The draft regulations will put the method of using cross-checking every year into legislation, but an individual querying whether another person should be on the electoral register is a different matter entirely.
I thank both hon. Members for their questions and thank all hon. Members present, as well as my Northern Ireland Office officials and the Clerks, for being here so that we could consider the draft regulations, enabling us to ensure that we strengthen the electoral system by doing all we can to encourage engagement in democracy. Confidence that the system works for us all is essential. I am pleased to commend the draft regulations to the Committee.
Question put and agreed to.