Bank Accounts

Baroness Fox of Buckley Excerpts

Wednesday 19th July 2023 Lords Chamber

[Baroness Penn (Con)]

This is an issue we have discussed, including during the passage of the Financial Services and Markets Act. The Government legislated in that Act to protect access to cash for consumers and business depositors, which will help people continue to access banking. Banking hubs are also being rolled out in areas that may be seeing closures, and those signed up to banking hubs have given a commitment that, where a hub is due to be opened in an area, the last bank will not shut until it is open.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, as the Minister will remember, I tabled an amendment to the financial services Bill on this very question—as distinct from PEPs—of political values closing down accounts, and I was told that evidence was being sought. Is the Minister concerned that the only reason we now know this is happening is not because of anything the Government have done, but because a high-profile figure is pursuing the issue and getting a lot of attention? Secondly, can the Minister comment more broadly on the danger of the corporate power of financial services being used to bully customers into accepting certain values of equality, diversity and inclusion that have nothing to do with equality or diversity in any real sense, but with imposing their views on customers, for fear they will get their accounts cut off?

[Baroness Penn (Con)]

I reassure the noble Baroness that the Government’s commitment to issuing a call for evidence included issues of payment account terminations and freedom of expression. I believe the call for evidence closed before the issue that prompted this Question came to light. The Government are delivering on their commitment.

I close by stating once again that the Government unequivocally support the right to lawful free speech and consider it unacceptable for banks or other payment service providers to terminate contracts on these grounds.

UK Economy: Growth, Inflation and Productivity

Baroness Fox of Buckley Excerpts

Thursday 29th June 2023 Lords Chamber

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I too appreciate that the noble Lord, Lord Eatwell, has tabled this debate. It feels like at last the productivity problem and the lack of business investment is being discussed. For too long, many economic policies have amounted to financial tinkering or rows over distribution. Meanwhile, growth has been demonised as either bad for well-being or destructive of the planet. Even those espousing growth rhetoric have often neglected productivity. However, it is only in raising productivity that we have the basis for improving living standards and a vehicle for new skilled, well-paid employment opportunities, rather than low-paid, insecure, unskilled jobs. Productivity increases are the only way we will escape our high-debt, low-growth economic trap.

Until recently, we have been in denial. Productivity started flatlining before the 2008 financial crisis, and indeed before Brexit. However, throughout the last decade and a half, politicians of all stripes have repeatedly claimed that the British economy was fundamentally sound and robust, and arguments instead concentrated on how it was managed. It took the triple whammy of lockdown, the post-lockdown disruption of the global supply chain and the war in Ukraine to finally force the political class to admit we have a problem and put growth on the agenda.

However, whether lockdown or war, these recent global events are not to blame for the state we are in. The UK was affected badly precisely because our internal productive capacities have been hollowed-out by decades-old deindustrialisation and our dependence on imported goods, which means much less domestic scope to compensate for foreign supply shortages. The contrast with Asia illustrates this point, where they have been better able to offset supply bottlenecks. As developing countries, they are building up, rather than eroding, their domestic productiveness. That gives them more adaptability in the face of global disruptions. As a result, consumer prices in lots of Asian countries have not risen as much as they have in the west. There is a lesson there.

I have a nagging question: could narrowly focusing on inflation levels become a distraction from deeper, protracted problems? Surely, tweaks to monetary policy cannot fix the productivity slump—quite the opposite. After all, central banks’ monetary policies and cheap borrowing from 2008 camouflaged and extended productive decay. The Bank of England pumped masses of liquidity into the economy, created all sorts of price bubbles, printed money to fund the Government’s huge pandemic shutdown and never uttered a word of opposition to the wholesale closure of the economy.

But, despite the temptation, indulging in bank bashing lets culpable politicians off the hook. Ever since Gordon Brown made the Bank of England independent in 1997, successive Governments have wilfully outsourced their responsibility for economic decisions and have distanced themselves from, for example, interest rates. Worse, this has turned national economic policy-making into a seemingly technocratic exercise, far removed from democratic accountability or voters’ influence. This must change. It is time that the state assumes transparent responsibility by taking back control of the Bank of England. I want more of the state there, running the economy.

However, I think we need less state intervention on productivity. I get nervous when, in different ways, the Tories and Labour seem to think that government should take an active role in business, whatever form that takes, whether industrial subsidies, tax incentives or public investment. My fear is that this will hinder the very innovation that it is meant to promote. State aid damagingly sustains a business status quo that can keep inefficient, low-productivity firms afloat. This zombified economy is the antithesis of dynamic, future-orientated innovation. These state policies—state aid, and monetary, fiscal and regulatory policies—tend to favour larger legacy companies at the expense of smaller start-ups, which would usually be more inventive and experimental, and likely to drive productivity higher.

In other words, state handouts encourage corporate dependence and reduce pressure on businesses to become competitive, blunting the incentive to experiment and develop better technologies. They often come with political strings, which are usually prescriptive and distort business investment activities. My pet hates are those brought on by infernal net-zero targets, let alone the dreaded mandated ESG reporting and so on.

There is plenty that the state can do to create conditions that will allow investment to flourish. It can invest heavily in public research and science R&D, as so well described by the noble Lord, Lord Eatwell. That is essential for new ideas and technological breakthroughs to occur. It can end the fixation on decarbonisation, which narrows the horizons of economic development, as well as costing working people a fortune. It can prioritise cheap, efficient and reliable energy sources, from nuclear to North Sea oil. It can focus on infrastructure deficits—for God’s sake, let us build some more reservoirs; we might even get some hydropower out of them. It needs to tackle with urgency the broken and expensive transport system and drop the ideological war on cars, vans, lorries and flights—by the way, if that means nationalising the railways, I am all good with that. It means that we drop support for the nimbyist antagonism to housebuilding and ambitiously build new towns, cities, and sites for newly emerging productive industries, as was so brilliantly motivated by the noble Baroness, Lady Thornhill.

Perhaps we also need a productivity cost-benefit analysis on legislation and regulation. Sitting through the levelling-up Bill and listening to the plethora of amendments suggesting barriers to construction, I think that it will be a miracle if anything ever gets built in the future. We need to remove the blocks to construction. Finally, we must stop relying on cheap migrant labour as a solution. We need widespread and long-term training of domestic workers at home, especially the young.

Financial Services and Markets Bill

Baroness Fox of Buckley Excerpts

Committee stage
Tuesday 21st March 2023 Grand Committee

Moved by

[Baroness Fox of Buckley]

241B: After Clause 71, insert the following new Clause—
“Freedom of expression protections for payment service users
(1) Within six months of this Act being passed, the Secretary of State must, by regulations, make provision preventing payment service providers from refusing or discontinuing access to payment services on account of a person exercising their freedom of expression.(2) In this section—a “payment service provider” and a “payment service” have the meanings given by regulation 2(1) of the Payment Services Regulations 2017 (S.I. 2017/752), anda “person” means a payment service user as defined by regulation 2(1) of those Regulations.”

--- Later in debate ---

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I rise to speak to Amendment 241B in my name. After the US fintech company PayPal’s deplatforming of UK political campaigns—the Daily Sceptic, the Free Speech Union and UsforThem—last September, there was a debate about payment processing and censorship associated with this Bill. There was an amendment in the other place that received quite a lot of attention, and it led the Minister, Andrew Griffith, to note that he shared the concerns of the principal issue and potential risks of protecting customers’ freedom of expression when it came to payment providers. He assured us that it should not be possible for service providers, especially those with significant market position, to terminate customer relationships based on those customers’ views.

I was delighted when the Government confirmed that they will include this issue about the role of payment service providers in delivering services without censorship in their consultation about financial regulations enforced by the FCA. However, as I argued at Second Reading, I am not convinced that this is enough. Rather unusually for me, I would like to see more legislative guarantees.

The definition in this amendment is deliberately expansive. It goes beyond the likes of PayPal in order to cover banks and payment processers, whether they are card providers such as Mastercard and Visa or companies such as PayPal and Stripe. There are several reasons for this. The first relates back to important discussions on earlier amendments that I have sat in on and participated in. The ubiquity of electronic systems in an increasingly cashless society, and the emergence of the ubiquity of online payment, means that someone being deprived of those services or cut off from any source of funds would be akin to British Gas refusing services to a household on account of their beliefs or views or free speech that they had exhibited. We would not accept that.

Of course companies can make their own policies and contracts, and that would allow them to remove users without explanation. I understand that, but I am trying to explore whether the law can be used to prevent payment providers closing accounts on the basis of political beliefs. If we do not, global firms are likely to put their own interests—financial, reputational and political—before any moral duty to act fairly or without discrimination. I do not think we can have global tech firms, online payment services or banks deciding who they can censure or cut off from financial services because of the views they express.

This is a matter of some concern, not least because—this is the other focus that I want your Lordships to consider—at the moment, environmental, social and governance, or ESG, targets and equality, diversity and inclusion, or EDI, policies have been embraced zealously by many financial services companies. We have seen from recent controversies around failing banks that they were arguably far more concerned about ESG than whether they were banking well. We have a situation in which corporates have taken to moralising about how their customers should behave and think, which is a real and present danger.

Currently, the big tech companies in the US that deal in financial services have adopted political positions and are regulating the speech of their customers. That is considered a growing problem, as identified by a wide range of civil liberties organisations that I reeled off at Second Reading. Sadly, we know from broader cultural trends—for example, the way that cancel culture at universities started in the US—that what happens in the US should often be seen as a warning of what is likely to come.

Here in the UK, under current law, ESG has become a vehicle for companies to baldly state their right to block the accounts of those whose politics clash with their corporate values. Payment providers such as PayPal, but also high street banks, may terminate the accounts of groups on the basis of lawful speech—as long as they give adequate notice—according to the law. They can terminate accounts where views they deem unpalatable clash with those values if they include such provisions in their terms of service. Acceptable use policy often proclaims, “We will take action when we deem that individuals or organisations are involved in promoting hate or intolerance”, but “hate or intolerance” is increasingly seen as and understood to be a rather vague tagline which can be interpreted in a wide range of ways.

This was illustrated last year when Halifax was involved in a controversy after announcing its staff pronoun policy on social media—I do not know whether your Lordships remember this. We were shown a picture of Gemma wearing a “she/her/hers” staff badge; the idea was that this was a campaign that would stop any “misgendering” by the customers of Halifax. There was something of a customer backlash online, which led to Andy, the person who seemed to be in charge of Halifax’s online communications at the time, berating critics with the rather shrill

“If you disagree with our values, you’re welcome to close your account.”


As it happens, lots of people did close their accounts, because they were so outraged at being talked to in that fashion. Telling customers where to go is an unusual policy for growth for any financial service provider.

However, I think this was more than an overzealous EDI employee, because on its website Halifax says that any customers it deems to be transphobic could have their accounts closed down. Indeed, underneath the page entitled “What we stand for” it says:

“We stand against discrimination and inappropriate behaviour in all forms, whether racist, sexist, homophobic, transphobic or ableist”—


and, wait for it—

“regardless of whether this happens in our branches, offices, over the phone or online on our social media channels.”

The actions that it threatens customers with include account closure or contacting the police. Note that HSBC shared the Halifax post and tweeted it out to its 101,000 followers, saying:

“We stand with and support any bank or organisation that joins us in taking this positive step forward for equality and inclusion.”


Customers, it seems, are the target of political campaigning by financial organisations, rather than being seen as those who need to be given the very best financial services. We should also note that in 2022, when that tweet went out, Halifax cut 27 branches across the country. Never mind encountering Halifax staff wearing pronoun badges; the problem is that you would be lucky to encounter a Halifax staff member at all, badgeless or not, and there is certainly very little in the way of physical branches.

In a recent report Matthew Goodwin, politics professor at Kent University, noted that a growing number of companies and corporations are now “adrift” from the wider public by

“lecturing them about political issues and being seen to stifle their free speech and expression.”

Professor Goodwin also warns against potential discrimination against consumers and customers in this context, and account holders

“deemed to hold ‘controversial’ beliefs.”

However, as one Halifax customer noted:

“I don’t want to be having conversations about gender when I go into my bank. Frankly, I’d rather they be focused on lowering interest rates.”


Of course, we need to respect the right of private companies to choose whom they do business with, as I said. However, this rather modest amendment seeks to ensure that they are not free to discriminate because of political, philosophical or religious beliefs within the law any more than banks or online service providers would be allowed to discriminate against people on the basis of the colour of their skin. We therefore need robust measures in place to protect organisations and individuals from being punished by being cut off by those financial service providers whose EDI or ESG commitments have made them rather cavalier about going far beyond their financial remit. They should be prevented from acting against people for otherwise legal speech. Remember, we have laws in this country such as the equality law, which should not be undermined by the terms and conditions and values designed in Silicon Valley—which in many instances is what we are talking about and is exactly what happened when PayPal punished the Free Speech Union by removing any financial services from it.

I hope that this amendment urges the Government not to kick this regulatory duty into the long grass or suggest that some other piece of legislation would be appropriate. I put it forward in the spirit in which the Minister in the other place spoke about the importance of this issue, rather than it being trivial. I hope the Minister will consider accepting the terms of this amendment in any amended Bill that is brought back on Report.

--- Later in debate ---

[Lord Harlech (Con)]

My noble friend makes an excellent point. I will certainly feed that back to the department in terms of the review.

To conclude, the Government already have the means to act on this issue and have made a clear commitment to do so if necessary. We are clear that we first need public consultation and an evidence base before determining the right course of action on this matter. I therefore request that the noble Baroness withdraws her amendment.

[Baroness Fox of Buckley (Non-Afl)]

I thank the noble Lord, Lord Jackson, and the Minister for that response. I will not keep noble Lords long. What the noble Lord, Lord Jackson, said about self-censorship was important. I mention that because I am worried that the Government are underestimating the climate that financial services providers are embroiled in relating to ESG and EDI. This is a warning shot that we recognised around PayPal, but I did not confine it to PayPal. It is just one example. There are sadly lots of recent examples, with organisations such as GoFundMe refusing to accept certain people because of their views and so on. I know that is not strictly within the remit of this Bill, but I know that the Government understand that there are tensions here. I do not want them to be too narrow and technocratic in the way they approach it by saying “Oh, there are only three examples, so what is there to worry about?” We have seen this internationally. I note that the Chinese social credit system lurks around this debate as something we want to be careful of. Big tech financial companies do not have regard for free speech as their terms and conditions will often cut against what is required in equality legislation here. That was the point I was making.

I hope that this short debate will be taken note of in that consultation. I also hope the Government do not feel that they can just deal with it simply through the consultation but will keep a close eye on what could be a dangerous and nasty situation of financially powerful organisations having an impact on individuals, frightening them into thinking that if they say the wrong thing they will not get banking. That is not the sort of society that we would like to end up with. I beg leave to withdraw the amendment.

Amendment 241B withdrawn.

Financial Services and Markets Bill

Baroness Fox of Buckley Excerpts

Committee stage
Monday 13th March 2023 Grand Committee

[Viscount Trenchard (Con)]

My Lords, I apologise that, in the earlier group of amendments, I omitted to declare my interests as a director of two investment companies.

All four amendments in this group seek in different ways to find a solution to the problem that all noble Lords, and members of their families, suffer as a result of being designated as politically exposed persons. Regulation 35 of the 2017 regulations provides that a regulated person must “manage the enhanced risks” arising from having a business relationship or conducting a transaction with a PEP. It assumes that such a business relationship always carries a higher risk than a business relationship with a person who is not a PEP. From my experience, I suggest that the reverse is the case—in other words, entering into a business relationship with a Member of your Lordships’ House carries, in general at least, a lower degree of risk than the average risk posed by a customer of a relevant person.

However, the regulation requires more personal KYC information to be provided in respect of PEPs than for other customers. As noble Lords are well aware, it is currently hard enough for anybody to open a bank account or an account with any financial institution. Long-standing customers with active accounts with banks who fail to answer emailed requests for proof of address or the like find their account summarily closed, without any appeal. It is very difficult and time consuming to speak to anyone with responsibility for such decisions. Quite extraordinarily, when a credit card operator obtains KYC information for a customer with regard to one account, it does not automatically regard that information as being equally relevant to other accounts held with it by the same customer. The situation for PEPs is disproportionately worse.

My son, who was resident in Taiwan, was nominated by his employer as a signatory on his corporate bank accounts but was subjected to entirely disproportionate questioning which caused a considerable degree of irritation. He experienced the same thing when proposed by his employer as a signatory on a Singapore bank account. He has now had to agree with his employer not to be nominated on the corporate bank accounts in Korea, where he now resides, and in several other jurisdictions.

I have put my name to Amendment 227, well introduced by my noble friend Lady Noakes, which sensibly seeks to disapply the application of PEP status for this purpose by the FCA in respect of UK citizens. Amendment 215, in the name of my noble friend Lord Moylan and others, would place an obligation on the Treasury to achieve the same thing. But these amendments do not solve the problem for overseas relevant persons. I hope that the adoption of more proportionate and reasonable guidance, as proposed by my noble friend Lord Kirkhope in his Amendment 234, to which I have also added my name, might eventually be copied by overseas regulators too.

In any event, I ask my noble friend the Minister to respond positively and to commit to take action on these proposals. It really is time that something was done about the expensive waste of time caused by the current regulations.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I will be brief. The noble Baroness, Lady Noakes, made the point that this should not be just about us and anecdotes about ourselves. That is true, but the fact that family members are caught up in it leads you to think, “Maybe I could cope with it, but why should innocent members of my family be affected in this way?”

However, I am falling into my own trap because I am saying “innocent family members” as though we are not innocent. One of the most disconcerting aspects of this whole discussion is that this is about the law of unintended consequences. We all know who these regulations should be aimed at, and none of us would advocate being soft on money laundering or not having the kind of regulatory framework necessary to deal with money used for terrorism and so on. But can you imagine what it would say to the public were they to find out that the PEPs on that list that the noble Lord, Lord Moylan, read out are considered to be dodgy people who are not to be trusted? We are telling the public that political figures in this country are what some of the more cynical and nihilistic commentariat might have us believe—that everybody is on the brink of money laundering. It sends a terrible message, but I feel as though it is just the law of unintended consequences.

As noble Lords know, if you ask whether this is happening because you are a politically exposed person, the person you are talking to goes through the most extreme example of gaslighting, where they kind of glower at you and, as one noble Lord said, either imply that it is happening to everyone all around the country or that you are making it up. You are made to feel completely paranoid, even though you know that that is probably the cause. Without telling anecdotes, I can say that I am met with a certain amount of aggression.

On lots of aspects of the Bill—certainly the parts that I was involved in the other day—we have talked about the public’s frustration that banks are closing all the time. Barclays has just announced a whole set of closures. We are worried about the consequences of not being able to go into a bank and talk to a manager and about what kind of lives we will have if everything is overly removed from people’s interactions. Here we have the most unnecessary example of risk-averse, bureaucratic time wasting from banks which should be spending their time serving the public and working for society’s financial services as we face an economic crisis. Can you imagine how much time they waste checking on us? I know how much time I have wasted during their completely unnecessarily and spuriously checking on us.

I do not know which of the amendments I prefer but, for once, I just want the law to change. I shall go with whichever is likely to win and pass. We are not doing the public any favours at all by worrying that they might think that we are just talking about ourselves in this instance, because the public are having their financial services wasting time on something that is not due diligence but a complete distraction from attacking the real problem.

--- Later in debate ---

[Baroness Bowles of Berkhamsted (LD)]

This goes back to when the Minister mentioned the FATF provisions. I thought she mentioned the risks in business relationships. All the stuff we get as PEPs is our personal stuff; it is nothing to do with business relationships. I have not been interrogated about anything to do with the London Stock Exchange, of which I am a non-executive director; I am interrogated about my father’s will and that kind of stuff.

Again, I am happy—in fact I would almost prefer—for the Minister to write the replies because it is hard to put together quoted bits and pieces, even when we get them back in Hansard. It seems that the whole risk assessment business is being set aside at the behest of the security agencies, which just like the idea that they have another captive load of people and that they may be able to track something with money—which I doubt, because these forms go to an outsourced place, they are filed, and nobody ever looks at them. There is no “know your client” going on. They may look at one or two, but I do not see how it adds up at all, even taking that security aspect into account, because if anybody was really a security threat, there are other ways of vetting.

[Baroness Fox of Buckley (Non-Afl)]

I am confused. I always encourage people to find out what is happening in this House by telling them to look at the speeches and follow Hansard, but now I am dreading anyone watching this because we have a government Minister implying that the security services at looking at us, particularly our private financial affairs, because we are high risk. Why? I do not think that is true. I want to denounce the notion that because you are in the House of Lords you are more likely to be doing something such as that.

I do not think the Minister can answer my second point, but I think we would all feel that it is a generalised accusation rather than specifically going after individuals who might be doing things that are wrong based on evidence, which nobody here objects to. Never mind the families; I have got to the point now where it is not just the families. I am sitting here feeling embarrassed, thinking, “Oh god, somebody is basically saying that the security forces think that we are all up to no good”. If the public find that out, it is said by a Minister and it is the general atmosphere, that is not good, is it? I usually put my speeches up on social media; I am not putting this one on. I do not want anyone to know about this conversation, because it will discredit the reputation of this House far more than anything else.

[Baroness Penn (Con)]

My Lords, I have already set out for the Committee, and I repeat now, the reasons why UK domestic PEPs may be at greater risk of money laundering. For example, in the general sense, the positions of influence that we have can put us at greater risk. I have also tried to set out—and will set out in writing for noble Lords—the approach that we are taking to look at risk in this area. I will share any further details that I am able to.

Theatre Tax Relief

Baroness Fox of Buckley Excerpts

Thursday 9th March 2023 Lords Chamber

[Baroness Penn (Con)]

I am greatly encouraged by the support that this House has offered to the creative industries sector. When we look at tax rates, we need to look at individual sectors and the individual response that those sectors have. I can reassure my noble friend that we are committed to having a competitive tax regime that stimulates growth and attracts businesses to the UK.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, it is the case that theatres and all artistic venues need artists. One group that has some support from taxpayers is the BBC. Will the Minister condemn the decision by the BBC to cut the BBC Singers, which is such a tragedy for the arts world? I would like to support them here, just before the end.

[Baroness Penn (Con)]

My Lords, I believe that is one for the BBC to comment on, rather than me.

Financial Services and Markets Bill

Baroness Fox of Buckley Excerpts

Committee stage
Tuesday 7th March 2023 Grand Committee

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I enthusiastically support Amendment 186. I thought that the noble Baroness, Lady Tyler of Enfield, spelled out extremely articulately the importance of banking hubs and how that name could often be prosecuted for mis-selling. Even banks themselves, in terms of the service that they offer when you go into the few that are still open, can be accused of having only the minimum service required.

The noble Lord, Lord Hunt of Kings Heath, told a heartbreaking story about a 91 year-old but you do not have to be 91 and have a heartbreaking story. Things can just go wrong; your card can stop working or whatever. When you try to solve it on your phone and it does not work, you then go into the bank and, to be honest, you are treated as though you are wasting the bank’s time and as though you have done something wrong. The staff often cannot solve the problem and ask, “Why don’t you solve it online or on your phone?” The answer is that I would have done so if I could have done. In other words, I do not think that it is necessarily a special needs problem, as the noble Lord just said. I think it can happen to anyone. Sometimes, you need human intervention to sort out your banking.

I am also interested in supporting those amendments that would allow access to cash, including Amendments 180 and 181 in the name of the noble Lord, Lord Tunnicliffe. I especially like Amendment 189 from the noble Lord, Lord Holmes of Richmond, and its attempt to make cash critical national infrastructure in the UK; I also support Amendment 189A, which is headed “Access to physical banking services”.

I suppose I am concerned about noting that the importance of cash relates not just to those who struggle with their phones or other technology. This discussion sometimes implies that some of us are just Luddites who cannot cope or do not want to embrace the full excitement of new technology and digital futures. I want to emphasise that I can see the advantages of a cashless society. Mainstream cashless transactions carry certain information about payment participants, what was purchased and when, which can be a huge barrier to money laundering and tax avoidance. That is genuinely important but, for individuals as consumers, it can also mean—this may be slightly different to what others have emphasised—that it helps people with budgeting because they have electronic receipts and can see both what is going in and what is going out. I am rather enthusiastic about those technological steps forward; I do not in any way want to hold back the march of progress, in the way that some have implied.

However, precisely because cashless transactions mean that information about payment participants is available to financial institutions and banks in a different kind of way, they can also give those organisations huge surveillance capability and invasive powers in ways that we did not see so much in the past. It is then not about you taking cash out but about everything having to be recorded. This means that people are not able to do the things you could with discretion. It should be noted—this is not entirely being paranoid—that, in China, financial surveillance is used to censor and restrict people’s freedom to express opinions against the state.

Noble Lords might think that that would never happen in a democracy but, in a later amendment in my name—when I say later, I mean if it ever arrives; it is Amendment 241B, should anyone like to note that, because I do not suppose that anyone will be here to listen to my speech on it—I was inspired by payment processing in fintech companies, such as PayPal, and the move towards everything being cashless, with a cashless society and everything being digitised. This has meant that PayPal, for example, can close down accounts on the basis of politics; in fact, it has done so, so I am not just being paranoid.

There also tends to be a casual assumption that those who want to keep their financial transactions private—that is, by using cash from time to time—might be up to something dodgy, as though the only reason someone might want to be free to choose to use cash is if they are involved in embezzlement or tax fraud. Today, it has been much friendlier than that; people just assume that you are technologically incompetent and old-fashioned, so cannot keep up. We just have to be a bit careful about this. I have also noticed a trend where financial services are judging how individuals are making their purchasing decisions—judging their use of money in a way that they may not have done if were not quite so detailed.

Recently, I was interested that HSBC—my bank—was involved in a report that condemned people’s decisions about how much they spent on gambling and was backing affordability checks. I know that I disagree with some noble Lords in the Room on gambling—I can already see them—as I think that is a legal leisure activity and that you should be able to do what you want. The idea that the bank is saying that it has customers who spend too much on gambling, a perfectly legal leisure activity, and then gives a breakdown of them, indicates that rather than being a dispassionate financial service it is getting involved in things in a way that it perhaps should not. I have never gambled, but my bank could well send me a note about how much I am spending in TK Maxx, saying that has all gone a bit mad.

When we had cash, we took the money out, we spent it on what we wanted and nobody could see. A cashless society creates a slightly different situation. Amendment 186 on accessibility and Amendment 184 on levels of cash acceptance, along with the whole issue of digital exclusion and financial inclusion, are very important but do not quite capture some of the broader political trends associated with this issue.

I am also very sympathetic to the notion of the noble Baroness, Lady Noakes. On the one hand, cash is not a human right—I do not want to get stuck on that, as I am never keen on regulations lasting for ever; a time-limited sunset clause is a good idea—but I am anxious that we do not forget the political trends surrounding this by simply treating it as a technical issue.

[Baroness Lawlor (Con)]

My Lords, if I may come in briefly, I am very sympathetic to the aims of noble Lords who wish to see cash access and banking services available to those who need them and do not use or rely on digital. However, I agree with the aims of the Bill: international competitiveness and growth. I do not think that this Bill’s powers regarding the financial markets and services sector should be used in a blanket way to impose an obligation on service providers to provide a service whose use, by all accounts and evidence, is on the decline.

Not only do I support the two amendments from my noble friend Lady Noakes, but I think we should pay attention to the overall aims for the regulators in this Bill, which are international competitiveness and growth. I urge the Minister to focus on the real problem of access to cash and banking services for many people, and, where there is a problem or gap, to focus the efforts and use the powers of government on trying to deal with the declining number of users in our society—albeit a real group—rather than use the law to impose obligations in a blanket way on the sector, contrary to the aims of competitiveness and growth. As noble Lords have explained, such a move could undermine the competitiveness of the banking sector.

Financial Services and Markets Bill

Baroness Fox of Buckley Excerpts

2nd reading
Tuesday 10th January 2023 Lords Chamber

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I welcome the three new Peers and their thought-provoking contributions so far to this crucial Bill. I want to focus on one fairly narrow but I think important consequence of an increasingly cashless society: that is, that a handful of mainly US tech giants now have unprecedented power over the public square.

Consider how any civil society organisation has to operate today. Consumer campaigns, pressure groups, NGOs, the third sector—all will be dependent on payment processes such as US fintech PayPal to operate in order to organise online payments for goods, services, events, and to receive membership fees and donations, et cetera. Can your Lordships imagine if these digital corporates took it upon themselves to freeze assets and suspend accounts with no notice or explanation, all because some big-tech apparatchik disapproved of the aims of such organisations? Surely such censorious demonetisation would be a threat to democracy. Yet this is not some dystopian future—it is happening now. So I urge the Government to use the Bill to protect civil society organisations’ ability to conduct basic commerce regardless of their political views.

Noble Lords will remember the media coverage of events in September last year when PayPal deplatformed a number of UK organisations. Suddenly the Free Speech Union—I declare an interest as a member of the advisory board—the Daily Sceptic, Law or Fiction, and UsforThem, an advocacy group set up by mums who opposed school closures during lockdown, had no way to process membership or access their own funds, had no ability to raise money and were made to feel like criminals. All their processing services were just switched off abruptly, risking their whole financial viability. Toby Young, who heads up two of the targeted organisations, explained at the time:

“PayPal’s software was embedded in all our payment systems, so the sudden closure of our accounts was an existential threat.”


Indeed, even PayPal’s co-founder Peter Thiel told the Free Press in December:

“If the online forms of your money are frozen, that’s like destroying people economically, limiting their ability to exercise their political voice.”


Such financial censorship reminded me of when the Canadian Prime Minister Justin Trudeau froze the Freedom Convoy protesters’ bank accounts last February. That was shocking, but at least it was clearly a political act. The problem when payment process organisations defund based on content is that they are often evasive and opaque about who it is targeted and why. PayPal gave contradictory and vague explanations last September, initially citing its acceptable use policy associated with criminality and hate speech, and later telling the Times that the accounts were guilty of misinformation about vaccines. Few were convinced. Miriam Cates MP told the other place:

“It is … hard to avoid interpreting PayPal’s actions as an orchestrated, politically motivated move to restrict certain views within the UK”,—[Official Report, Commons, 7/12/22; col. 430.]


or, in the FSU’s case, even defending those expressing such legal but dissenting views.

After high-profile press coverage and Members from both Houses—across parties and of none—causing a fuss, PayPal eventually backed down, reinstated the accounts and denied that there was any political interference. However, there is no room for complacency. When Sally-Ann Hart MP proposed an amendment to this very Bill in the other place, seeking to legally prevent financial service providers refusing to provide services if related to the exercise of the right to free speech, the Minister Andrew Griffin gave a robustly positive response. He stated that the Government respected

“the balance of rights between users and service providers’ obligations … whether of the Free Speech Union, the trade union movement, law-abiding environmental movements or anyone else expressing lawful views.”—[Official Report, Commons, 7/12/22; col. 395.]

However, he seemed rather reluctant to agree with the need for primary legislative change and stated that the PayPal incidents did not represent a wider pattern. I beg to disagree.

We need to look at what has happened in the US over recent years—and think about whether it might happen here—where big tech companies regularly use defunding to regulate speech, so much so that in June 2021, a large coalition of US civil liberties groups wrote to PayPal and its subsidiary Venmo asking for transparency, due process and clarity behind this escalating practice of economic limitations on multiple varied accounts, from WikiLeaks to News Media Canada’s payment to submit an article about Syrian refugees for an award. The coalition, comprising eminent organisations such as Article 19, the ACLU and the Electronic Frontier Foundation, never even got a reply from PayPal. Also, less high-profile instances of deplatforming dissenting views are happening in the UK, for example with Patreon, CrowdJustice and GoFundMe affecting our citizens. What is more, the majority of major payment providers grant themselves the right to block accounts of those whose views clash with Silicon Valley’s increasingly ideological corporate values.

I intend to table an amendment to say that, while I understand that private companies have a right to choose who they do business with and should be vigilant about fraud and illegal transactions, they should never discriminate on the basis of an organisation’s political, philosophical or religious beliefs. This Bill might be a place where we can put that right.

Autumn Statement 2022

Baroness Fox of Buckley Excerpts

Tuesday 29th November 2022 Lords Chamber

[Baroness Fox of Buckley (Non-Afl)]

My Lords, it gives me great pleasure to follow and warmly welcome the noble Baroness, Lady Lea of Lymm. Too often, professional economists are dull technocrats who have disavowed the political drivers and implications of budgetary or fiscal policy. But, as we have heard from her maiden speech, and her prolific writings over the years if noble Lords have followed them, the noble Baroness’s undoubted expertise is never devoid of an awareness of the democratic context and consequences of economic decisions.

I first met the noble Baroness, Lady Lea of Lymm, when she was head of the policy unit at the Institute of Directors, when she invited me for lunch over 20 years ago. I had never been inside the IoD. It was very grand and a tad intimidating, but the noble Baroness made me feel totally at ease. She was not overly formal: she was down to earth, frank and great fun. Despite coming at politics from completely different sides of the political spectrum—a long time before we were on the same side on Brexit—that lively and intellectually stimulating conversation over lunch showed me that the noble Baroness has a generosity of political spirit that, in 2022, is an underrated virtue, but one that will be valuable in this House.

What we had in common, and which has kept us in touch ever since, was the noble Baroness’s passion for freedom, free speech and enhancing accessible public debate. If you look at her eye-wateringly impressive CV, you will see that she has committed her whole adult life to public service. I am glad to see her continue the tradition by taking her place here. If I might say so, it is long overdue.

I am not usually one to focus on representation or role models, but that the noble Baroness was more than equal to making her presence matter in a man’s world was and is inspiring. I am sure that many noble Baronesses across the House will welcome this fearless, clever woman, and independent thinker, as a great asset to the Chamber.

The noble Baroness was very insightful in her comments on the Office for Budget Responsibility, and I shall follow her remarks about the Autumn Statement by disagreeing with her—she will understand that. In the aftermath of the Truss-Kwarteng mini-Budget, many critics suggested that if only Downing Street had allowed the OBR to publish its forecast, financial turmoil could have been avoided. Surely this credits the OBR with some all-knowing, ever-present, god-like qualities when, in reality, it is an unelected watchdog established only in 2010. Rather than treating it as representing unchallengeable truth, its outlook should be open to scrutiny and debate. For example, the OBR’s model assumes that higher interest rates are a negative for economic growth, whereas I agree with those who argue that artificially low rates and cheap credit over the past few decades have disguised serious underlying problems of productivity while facilitating unproductive sectors at the expense of investment in new innovative enterprises.

Regardless of opinions on this, my broad concern is that over recent months politicians have done too much deferring to third-party bodies. The extraordinary intervention by the IMF, with its demands that an elected UK Government should change their economic policies because it did not approve, was cheered on and cited by far too many politicians as proof of the need to halt the growth plan. It was as though everyone forgot that the IMF has been a brutal enforcer of failed austerity policies internationally. I remind the House of the 2010s euro crisis, when the troika imposed such harsh measures on Greece that its public sector employment was slashed by 30% and youth unemployment peaked at 86%, consolidating me as a Brexiteer.

Beyond the OBR and the IMF, there was the narrative that there was no alternative but to bring in the drastic measures of the Autumn Statement because we need to satiate unhappy financial markets. What the self-described grown-ups in the room need to understand is that financial markets do not have emotions, are not unhappy and do not have a purpose. They are simply places where people and institutions sell and trade. By mystifying them as some omnipotent power, markets are given the authority or are provided with an excuse for blocking democratic choices. There is little doubt that Liz Truss’s shallow, tax-cuts-equal-growth intervention was a debacle, but I fear the Autumn Statement throws the growth baby out with the bathwater. Shadow Chancellor Rachel Reeves is right. We need to escape the doom loop of low growth. We need the economy to grow, produce, make and manufacture more in less time in order to crack the long- standing and deeply entrenched productivity crisis that long predates Brexit, but which politicians of all parties have avoided, often preferring to claim credit for superficial gains of cheap credit and state subsidies. Breaking the productivity deadlock requires supply side reforms, such as cheap childcare and business investment in training and skills, not cynically cheating by treating migrants as cheap labour. Of course, we need to free up planning and infrastructure from smothering hyperregulation, so how dispiriting to see so many MPs supporting anti-growth amendments to the levelling-up Bill that threaten to institutionalise nimbyism, block desperately need housing and cost thousands of job in construction.

Meanwhile, the Autumn Statement trots out the same old net-zero priorities that put restraints on production and the use of energy, putting the majority of eggs in the renewables basket that limits options. We need maximum access to all energy sources. Yes, wind farms, but that crucially means also fossil fuels, shale gas and lots more nuclear. That kind of reliable energy is needed as the lifeblood of modern industrialisation, investment in technology and innovation, and lots of R&D. We need to fuel productivity increases as the main guarantor of improved living standards by creating skilled jobs on decent wages. Eco-austerity hurts millions however much it drapes itself in green self-righteousness. Perhaps the only positive of the chaos of the past few months is that we are now facing up to the reality of Britain’s economic stagnation, a refreshing change from decades of smoke-and-mirror claims that our economy was fundamentally sound, shamefully illustrated by all parties gaslighting the public with reassurances that locking down business, halting production and paying furlough for months on end would be cost free. What an illusion. At least now we are going to have an honest debate, and I am sure that the no-nonsense voice of the noble Baroness, Lady Lea, will be an invaluable asset in it.