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Written Question
Co-operative and Community Benefit Societies
Tuesday 18th July 2023

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask His Majesty's Government what plans they have to review the law covering cooperatives and community benefit societies.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

On 19 June, the Government informed Parliament[1] that it has invited the Law Commission to conduct reviews of the Co-operative and Community Benefit Societies Act 2014 and the Friendly Societies Act 1992.

The Treasury is now working with the Law Commission to formally agree a terms of reference and a timetable for each review once the projects are formally agreed. These reviews will aim to identify necessary updates to the legislation that will set co-operatives and friendly societies up for future growth and success. The Government expects that the reviews will start in the autumn.

[1] https://questions-statements.parliament.uk/written-statements/detail/2023-06-19/hlws847


Written Question
Red Diesel: Fraud
Thursday 9th February 2023

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask His Majesty's Government what is their latest assessment of the level of fraudulent use of red diesel.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

HM Revenue and Customs’ latest published estimate of the fraudulent use of red diesel in Great Britain is 1% of the market share, and for Northern Ireland, 4% of the market share. This results in a total UK duty and VAT loss of an estimated £150 million for the tax year 2020-21.


Written Question
Stocks and Shares
Thursday 9th February 2023

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the money raised in Initial Public Offerings on the London Stock Exchange over the last five years.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

Following a global slowdown in IPO activity during the pandemic period, 2021 saw a spike in activity, with London maintaining its status as the dominant European IPO market.

Over 120 companies chose to list in the UK in 2021, the highest number since 2014 and more than in 2019 and 2020 combined. These listings raised a total of £17 billion, the most raised in 15 years and comfortably more than any other European jurisdiction. 2022 saw limited IPO activity globally due to market turbulence.

The government is taking action to ensure that London remains Europe’s dominant IPO market. Government and the regulators are working together to deliver the outcomes of Lord Hill’s Listing Review, the Wholesale Markets Review and Mark Austin’s Secondary Capital Raising Review. The Financial Services and Markets Bill will be key in delivering these reforms as it seizes the opportunities of EU Exit to bolster the competitiveness of the UK as a global financial centre.


Written Question
FTX: Insolvency
Wednesday 4th January 2023

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the risks to investors following the collapse of the cryptocurrency exchange FTX.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

Recent events in cryptoasset markets – including the collapse of FTX – have highlighted the importance of establishing regulation which supports safe innovation and protects consumers and stability. The FCA and Bank of England have warned that cryptoassets are high risk, and that investors should be prepared to lose all of their money.

In January 2022 the government published a response to a consultation on a proposal to bring certain cryptoassets into the scope of financial promotions regulation. The forthcoming legislation on cryptoasset financial promotions, resulting from the consultation, and supporting FCA rules, will regulate in-scope cryptoasset financial promotions, requiring them to be fair, clear and not misleading. This is aimed at improving consumers’ understanding of the risks and benefits associated with cryptoasset purchases and ensuring that cryptoasset promotions are held to the same standards as similar risk financial services products. The government will also consult on its approach to regulating wider cryptoasset activities in the coming weeks.

The government will continue to closely monitor the wider cryptoasset market and will stand ready to take further regulatory action if required.


Written Question
Cryptocurrencies
Monday 27th June 2022

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask Her Majesty's Government what assessment they have made of the (1) safety, and (2) security, of cryptocurrencies.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

In April the Government announced a number of specific reforms to strengthen cryptoasset regulation, including a commitment to bring stablecoins into payments regulation, and to consult on a wider cryptoasset regulatory regime later this year. The Government has also announced forthcoming legislation which, along with supportive Financial Conduct Authority (FCA) rules, will regulate in-scope cryptoasset financial promotions, requiring them to be fair, clear and not misleading for consumers. The Government has taken action to mitigate the illicit finance risks associated with cryptoassets. All cryptoasset firms in the UK must now be registered for supervision by the Financial Conduct Authority. As a part of this process, cryptoasset firms must demonstrate systems, controls, policies and procedures adequate to deal with the particular risks of the cryptoasset market and any officers, managers and beneficial owners must be fit and proper.

These commitments are in line with the Government’s objectives to create a regulatory environment in which firms can innovate, while crucially maintaining financial stability and regulatory standards so that people can use new technologies both reliably and safely. The Cryptoasset Taskforce – HMT, the Bank of England, and the FCA – continues to monitor ongoing development in cryptoasset markets closely.

Volatility is a characteristic of certain cryptoassets. The FCA and Bank of England have warned that cryptoassets are high risk investments, and that investors should be prepared to lose all of their money.

The Bank of England’s Financial Policy Committee (FPC) has recently noted that direct risks to the stability of the UK financial system from cryptoassets are limited, and that crypto technologies are growing and becoming more interconnected with the core financial system.


Written Question
Financial Institutions: Fines
Thursday 23rd June 2022

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask Her Majesty's Government what was the total amount of fines levied on financial institutions in the UK by UK financial regulators in each of the last five years up to 5 April 2022.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

The tables below show the fines levied on financial institutions by the Financial Conduct Authority (FCA), Prudential Regulation Authority (PRA), and the Payment Systems Regulator (PSR) since 2017. The tables do not include fines levied on individuals.

FCA

Calendar year

Monetary value of fine or financial penalty

Number of fines

2017

£ 229,079,424

5

2018

£59,104,112

7

2019

£ 312,730,600

15

2020

£192,470,018

10

2021

£ 567,528,420*

7*

2022 (up until 5 April 2022)

£9,887,323

2

PRA

Financial Year

Monetary value of fine or financial penalty

Number of fines

2017 – 18 (March 2017 – Feb 2018)

Nil

0

2018 -19 (March 2018- Feb 2019)

Nil

0

2019 – 20 (March 2019- Feb 2020)

£45,011,512

2

2020 – 2021 (March 2020 – Feb 2021)

£48,308,400

1

2021 – 22 (March 2021- Feb 2022)

£51,926,000

2

2022 – 23 (March 2022 to 5 April 2022)

Nil to date

Nil to date

PSR

Calendar year

Monetary value of fine or financial penalty

Number of fines

2017

Nil

0

2018

Nil

0

2019

Nil

0

2020

Nil

0

2021

Nil

0

2022 (up until 5 April 2022)

£ 33,261,352

5

This information is publicly available on the websites of the FCA, PRA and PSR.

*National Westminster Bank Plc’s fine is included for completeness, however this fine was levied by the Court following the FCA’s successful criminal prosecution of the Bank.


Written Question
Red Diesel: Fraud
Tuesday 8th February 2022

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask Her Majesty's Government how many prosecutions have taken place for the fraudulent use of red diesel in the UK in each of the last 10 years.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

As HMRC does not record a specific offence when recording prosecutions, it is not possible to identify cases which were prosecuted for the fraudulent use of red diesel. However, information on the number of prosecutions for hydrocarbon oil related offences is available and can be found in the table below:

Financial Year

Number of prosecutions for Hydrocarbon Oil related offences

2011-12

5

2012-13

11

2013-14

10

2014-15

7

2015-16

25

2016-17

26

2017-18

17

2018-19

7

2019-20

14

2020-21

2


Written Question
Cryptocurrencies
Monday 7th February 2022

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask Her Majesty's Government whether they have made any recent assessment of the future of digital currencies; and whether they have any plans to trade digital currencies.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

Certain cryptoassets, offering new ways to transact and invest, are part of a trend of rapid innovation in financial technology. However, these developments also present new challenges and risks – including risks to consumers and to financial system. The Government established a Cryptoassets Taskforce in 2018, consisting of HM Treasury, the Bank of England and the Financial Conduct Authority (FCA).

HM Treasury and UK authorities have taken a series of actions to support innovation while mitigating risks to stability and market integrity. These include launching a new anti-money laundering and counter-terrorist financing regime for cryptoassets in 2020; confirming an intention to legislate to regulate cryptoasset promotions, ensuring they are fair, clear and not misleading; and consulting on a proposal to ensure cryptoassets known as ‘stablecoins’ meet the same high standards expected of other payment methods. The Government will issue a response to this consultation shortly. The Government is carefully considering what, if any, regulation might need to follow as the cryptoasset market grows and evolves in the UK. The Government has adopted a staged and proportionate approach to cryptoassets regulation, which is sensitive to risks posed, and responsive to new developments in the market.

The UK, like many countries globally, is actively exploring the potential role of central bank digital currency (CBDC): an electronic form of central bank money that could be used by households and businesses to make payments. The Government has taken several actions to signal its commitment to leading the global conversation on the opportunities and risks of a potential CBDC, including: the creation of a new Taskforce led by HM Treasury and the Bank of England to lead exploration of a CBDC, with separate forums to engage civil society and technology experts; a public commitment to issue a joint consultation on the use cases for a UK CBDC in 2022, followed by the publication of a technical specification; and, at the international level, using our G7 Presidency last year to develop and agree a set of public policy principles for CBDC, which are intended to support and inform exploration of CBDCs in the G7 and beyond.

The Government and the Bank of England have not yet made a decision on whether to introduce a central bank digital currency in the UK, and will engage widely with stakeholders on the benefits, risks and practicalities of doing so.

The Government has not set out any proposals to trade cryptoassets or other digital currencies.


Written Question
Red Diesel: Excise Duties
Monday 7th February 2022

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask Her Majesty's Government what estimate they have made of the amount of duty lost because of the fraudulent use of red diesel in the UK.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

As set out in the Hydrocarbon Oils Bulletin published by HMRC, the taxation of 4,710 million litres of gas oil (i.e. red diesel) raised £522 million in 2020-21, and the taxation of 5,065 million litres of red diesel raised £559 million in 2019-20.

The Measuring Tax Gaps 2021 report published by HMRC sets out that the oils tax gap, which includes Great Britain and Northern Ireland diesel, is estimated at 1% (£190 million) in 2019-20, of which £150 million was in duty and a further £40 million in VAT. As set out in the annex of this report, the tax gap is driven by the misuse of rebated fuel, which is subject to a lower duty rate.

The Chancellor confirmed at Spring Budget 2021 that the Government will remove the entitlement to use red diesel from most sectors from April 2022. This will help to ensure fairness between the different users of diesel fuels and that the tax system incentivises the development and adoption of greener alternative technologies.

The reduction in legitimate red diesel usage following these reforms coming into effect is expected to reduce the level of illegitimate use overall, as it will be harder to obtain red diesel for deliberate misuse in road vehicles due to there being less red diesel in circulation.


Written Question
Red Diesel
Monday 7th February 2022

Asked by: Baroness Kennedy of Cradley (Labour - Life peer)

Question to the HM Treasury:

To ask Her Majesty's Government what is their latest estimate of (1) the amount of red diesel used in the UK, and (2) the duty derived from red diesel.

Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)

As set out in the Hydrocarbon Oils Bulletin published by HMRC, the taxation of 4,710 million litres of gas oil (i.e. red diesel) raised £522 million in 2020-21, and the taxation of 5,065 million litres of red diesel raised £559 million in 2019-20.

The Measuring Tax Gaps 2021 report published by HMRC sets out that the oils tax gap, which includes Great Britain and Northern Ireland diesel, is estimated at 1% (£190 million) in 2019-20, of which £150 million was in duty and a further £40 million in VAT. As set out in the annex of this report, the tax gap is driven by the misuse of rebated fuel, which is subject to a lower duty rate.

The Chancellor confirmed at Spring Budget 2021 that the Government will remove the entitlement to use red diesel from most sectors from April 2022. This will help to ensure fairness between the different users of diesel fuels and that the tax system incentivises the development and adoption of greener alternative technologies.

The reduction in legitimate red diesel usage following these reforms coming into effect is expected to reduce the level of illegitimate use overall, as it will be harder to obtain red diesel for deliberate misuse in road vehicles due to there being less red diesel in circulation.