Financial Services Bill

Debate between Baroness McIntosh of Pickering and Lord McNicol of West Kilbride

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Monday 22nd February 2021 Grand Committee

[Lord McNicol of West Kilbride (Lab) [V]]

My Lords, I will be brief, as I set out many of my concerns and issues when speaking earlier on the first group.

I support Amendment 8, proposed by my noble friend Lord Stevenson of Balmacara. Before I start, I would like to make the Grand Committee aware of my financial interests, as set out in the Lords register.

As touched on in Amendment 4 earlier, low financial resilience and overindebtedness are a huge problem for both individuals and the country at large. We should all do all that we can, especially under the current circumstances, to push back against those issues.

Either we are saying that there is a problem and we need to do something about it, or we are saying that there is not a problem and we just carry on as before. With the figures and the personal stories of overindebtedness and unaffordable, unsustainable financial predicaments, I believe that there is a problem that does need resolving.

The FCA recently found that the number of people suffering from low financial resilience had increased by one-third to 14.2 million people. That is one-quarter of the UK adult population. |In earlier amendments, we heard a number of noble Lords, and a little from the noble Baroness, Lady Neville-Rolfe, saying that any increase in regulations, bringing in a duty of care or a duty to promote financial well-being, was either not the responsibility of the FCA or, in some earlier comments, would put more costs on individuals in increased fees and on businesses with increased administration. I do not believe that that is the case with the amendment as laid out by the noble Lord, Lord Stevenson. If you look at the text of it—and I understand it is a probing amendment—you see that the power of the FCA to make general rules includes a power to require authorised persons to promote the financial well-being of consumers in carrying out regulated activities under this Act.

I am very new to this sector and I may be a little naive, but I believe that one of the most significant drivers of costs to the industry is from non-repayment or defaulting on loans. We need financial well-being and literacy to be increased. The noble Baroness, Lady Neville-Rolfe, is right that it needs to start in schools and carry on through employment and employers, but that should not preclude the Financial Conduct Authority being able to step in and help. There is a benefit to businesses as well. If financial well-being can be increased, the number of defaults from people falling into indebtedness or failing to pay reduces, thus increasing profitability of a product, then in turn reducing the cost of that product to individuals and businesses. There is a lot in where the amendment proposed by my noble friend Lord Stevenson is trying to take us.

We touched a little on the Woolard review and its 26 proposals, and I hope that we will see a bit more of those. The noble Lord, Lord Holmes, touched on fintech. With the increase in open banking and the ability to look at individuals’ accounts, better and more detailed decisions can be made on how a product or a business moves on. My noble friend Lord Stevenson referred to the University of Edinburgh Business School report, which it carried out for Salad Projects, looking at the health and well-being of NHS workers who had applied for a loan. The report provides a unique insight into their financial lives, based on millions of individual transactions. What came out of that was information about their low financial resilience—the ability of those working in the NHS to deal with a financial shock to their lives. Often it was just a small shock, but they were unable to tap into the bank loans that many of us can take; they were forced into the high-cost credit loans market.

If we have the development and promotion of financial well-being, I hope we will see a reduction in those who are driven into that sector. This amendment will help to deliver that, but it does not preclude delivering that in schools or the workplace. The FCA is a powerful body that can help push it even further.

[Baroness McIntosh of Pickering (Con) [V]]

My Lords, I am delighted to support this group of amendments. I take this opportunity to pay tribute to the noble Lord, Lord Stevenson, and my noble friend Lord Holmes for their huge contribution to this field of financial inclusion. I single out the noble Lord, Lord Stevenson, not just for his role on the Front Bench but previously in chairing StepChange. He will be greatly missed from his Front-Bench responsibilities, and I am sure it will not be long before we see him return.

I also congratulate my noble friend Lord Holmes on being indefatigable in his campaigning for financial inclusion and bringing our attention to fintech. I join the authors of these amendments in identifying a need to address this issue, and I hope that my noble friend, in summing up, will answer this point. The noble Lord, Lord Stevenson, has asked for a high-level response, and I shall use that expression later—I like it. Perhaps we might get something more from my noble friend.

No less of an authority than “You and Yours”, of which I am an avid listener—I think there are two compulsory programmes we should listen to, one is that and the other, I have momentarily forgotten what it is, is the one that gives us all the figures and responses—spent the best part of a programme looking at credit ratings. What struck me is that often it is through no fault of an individual that they find that their credit rating has been so badly affected that they can no longer qualify for any credit. It can take months, if not years, to redress this.

I am concerned that if my understanding is correct Expedia is no longer acting for the Government in this regard. Can my noble friend confirm that we are down to two credit rating agencies? Do the Government share my concern that we should address this area of financial inclusion, financial awareness and each of us being aware of what our credit worthiness and credit ratings are? Amendments 8, 9 and 134 have identified issues that are worthy of attention in this Bill and I look forward to the response from the Minister.

Storage of Carbon Dioxide (Amendment and Power to Modify) (EU Exit) Regulations 2018

Debate between Baroness McIntosh of Pickering and Lord McNicol of West Kilbride

Wednesday 13th February 2019 Grand Committee

[Baroness McIntosh of Pickering (Con)]

I am grateful to my noble friend for moving this statutory instrument. I have just one question. He said that there has been consultation with only the Oil and Gas Authority, which presumably is the regulator in this instance. Page 5 of the Explanatory Memorandum says that it will apply to,

“activities that are undertaken by small businesses”.

Was a conscious decision taken not to consult widely with the industry, and, if so, what was the reason for that? Obviously the regulator will have a view, but those who work in the industry might have an alternative view.

[Lord McNicol of West Kilbride (Lab)]

My Lords, I am standing in for my noble friend Lord Grantchester, who cannot be with us this afternoon. This is another of the no-deal Brexit SIs, which would be completely unnecessary if the Government were to do the right thing: agree with Labour and others and rule out the possibility of a no-deal Brexit. If the Government were to do that, this House and the other place could spend more time dealing with far more important and relevant issues, and save the Civil Service, the ministerial Opposition and industry time and money—a simple solution.

This SI has already been through the other place, where it was passed in 10 or 11 minutes, so we are giving it a little more scrutiny in this House than in the other place. I note Dr Whitehead’s comments and those made by the noble Lord, Lord Teverson. On carbon capture itself, Dr Whitehead’s said that,

“it would be rather nice if we had some carbon capture and storage to put into those regulations”.—[Official Report, Commons, 28/1/19; col. 5.]

I have a couple of questions to add to the others asked by noble Lords. As the noble Baroness, Lady McIntosh, said, the Explanatory Memorandum details that BEIS engaged with the Oil and Gas Authority and the devolved Administrations. Could the Minister enlighten us as to the response from the authority and the Administrations?

The Government have stated that no specific monitoring arrangements are needed for this. Can the Minister detail whether the Government envisage any situation where the instrument will need to be looked at again? On the Minister’s second point, on changes to technical or scientific specifications, will there be any parliamentary scrutiny or oversight, or do those changes sit in the hands of the department and the Minister?

Trade Bill

Debate between Baroness McIntosh of Pickering and Lord McNicol of West Kilbride

Committee: 4th sitting (Hansard): House of Lords
Monday 4th February 2019 Lords Chamber

[Baroness McIntosh of Pickering]

I am grateful to the noble Lord and will be content as long as my noble friend the Minister can answer my specific questions. My only concern is that they do not get lost in the general wash of the next grouping, as they are very specific.

[Lord McNicol of West Kilbride (Lab)]

My Lords, my noble friend Lord Stevenson talked about a speech, but I think he might have overemphasised what we are going to go through. I have pulled together a few comments and was looking to move Amendment 83, but many of the issues overlap with the last two speeches so I will weave in some of the themes.

The group beginning with Amendment 83 deals largely with the setting up and running, as has been touched on, of the Trade Remedies Authority. I will deal with some of the specific amendments and work through them quite quickly because we have another two groups to work through this evening. Many of them are probing amendments to solicit further clarity and details from the Minister on the running and formation of the TRA.

Amendment 83 itself touches on consumers and would add a third subsection to Clause 10(2) not just looking at countries, exporters or producers but adding a further consideration—the consumer. That is a sensible consideration that the TRA should be asked to look at when making any decisions.

Amendment 84 touches on the annual reports that the TRA needs to prepare and sets out a bit more detail about those, looking at any of the guidance, advice or assistance that is given to the Secretary of State. Probably most important is the final part of it regarding the laying of the report in front of Parliament. That is not touched on in detail in the Bill just now, and this adds in that little bit extra.

The noble Baroness, Lady Brown, and others will touch on Amendment 101A, but suffice to say that including and involving UK producers and trade unions is obviously a sensible way forward. It would not tie the hands of the Minister, the chair or the chief executive, but would bring in organisations and individuals who could bring wide and independent knowledge to the formation of the TRA.

Amendment 102 seeks that the chair be vetted by the International Trade Committee of the other place, which is just sensible good practice and happens already with many other bodies of similar stature to the TRA.

Amendment 104 touches on non-renewable terms. The reason for tabling it is that, all too often, individuals who have been appointed to boards have an eye on the reappointment that is coming at the end of their time. Single-term appointments are becoming more common on boards, which means that those individuals can be far sharper and clearer, not tied up in any considerations about the next set of appointments.

Amendment 105 and 106 tie together quite neatly and delve a little more into the detailed knowledge and expertise that we would expect members of the TRA to have. The Bill itself does not go into any specific detail on this so the amendments would put in a little more detail about the individuals and their having knowledge and expertise. God forbid that someone would be appointed to a board for a political reason by the Secretary of State. The amendment would just add a little more depth and weight to those individuals.

Amendment 106 again touches on the criteria, looking at consumers, producers, trade unions and workers being involved with that.

Amendment 107 brings more detail in the clause regarding individuals, going back to the earlier question about how you set what “unfit” is. The Bill itself is quite bland on this; this amendment just brings a little bit more clarity and detail to it. Sub-paragraphs (a), (b) and (c) have been used by many other boards for the ability to exclude individual members if they fall below the expected standard.