Financial Services Bill

Debate between Baroness Noakes and Lord Judd

Report stage
Wednesday 24th March 2021 Lords Chamber

[Lord Judd (Lab) [V]]

My Lords, these amendments, and this Bill, are crucial to the future of the United Kingdom. We have heard repeatedly in the arguments deployed of an interaction. There is the need for financial services to be successful and effective because they play such an important part in ensuring the well-being on which the rest of our society depends. That is beyond question. However, we know that they have implications, socially and beyond, for which they need regulation, and this has been well spelled out.

I shall focus on Amendments 3, 22, 23 and 44 in particular. Fossil fuels inevitably have considerable and extensive risks for the climate. There can be no argument about that. They have great implications in terms of climate change, and I am glad to see that Amendment 3 is grappling with this.

Amendment 22 deals with the point I have just made in that climate change poses risks to financial services. Therefore, it is essential to have the right arrangements in place to ensure that those risks are, if not eliminated, minimised.

Amendment 23 makes the point I have often felt strongly about in legislation: it is sometimes crucial to have a specific person carrying a specific responsibility for bringing together the various threads in the policy for which we are aiming and ensure their delivery. It is a good amendment.

I do not share the rather dismissive approach of the noble Viscount, Lord Trenchard, to Amendment 44. My view is that the noble Baroness, Lady Bennett of Manor Castle, deserves considerable commendation for having tabled this amendment. We have happily joined these UN conventions, and our diplomats have usually played a large part in bringing them about, but we sometimes lack the discipline to follow through with what they require of us. At this point in our consideration of the Bill, it is appropriate to talk about the convention and the undertakings we have thereby committed ourselves to on biodiversity. On that issue, I find myself dismayed by the position of the noble Viscount, Lord Trenchard, because we are surrounded by a major crisis. The biodiversity of the world is in danger of collapse, and the consequences have direct implications for the survival of humanity itself. There is urgency about this situation.

In conclusion, I simply make this point: I said that we wanted the financial services sector to be successful and effective, because we recognise its indispensability, but we also must recognise that on climate change, we are long past the age of rhetorical language and theoretical commitment. We have to demonstrate that we have the leverage and the arrangements in place to ensure delivery; if we do not ensure delivery on the measures we want to see to protect the climate, we will be party to a cruise towards catastrophe for the global community. It is vital to have these disciplines, and these amendments spell out how we can bring those disciplines to bear.

[Baroness Noakes (Con)]

My Lords, I shall speak mainly to Amendments 3 and 23 in this group.

On Amendment 3, I should say I am not generally in favour of littering legislation with reviews, though I confess to having tabled a few amendments of that nature myself in the past. More substantively, I think this particular amendment as drafted is a waste of time.

I can predict the outcome of the review if this amendment is passed. The PRA will find that banks do not hold any significant “investments”—the wording used in the amendment—in fossil fuel assets, whether linked to existing exploitation and production or to new exploration. So all the things mentioned in proposed subsection (2) of the amendment will be irrelevant.

Risk weighting applies to the assets that banks hold. Banks’ assets will largely be loans of various kinds. Banks do not normally invest in physical assets used by other companies, nor do they invest in shares in the companies that own the assets. Banking is fundamentally about lending and not investing.

The noble Lord, Lord Oates, cited the recent speech by the deputy governor talking about prudential regulation being risk-based, which indeed it is, but he failed to understand that he was talking to insurers at the time. They do have investments. This is a fundamental difference between banks and insurers—they have completely different balance sheets.

As I said in Committee, most borrowing by oil and gas companies will be generic—for example, by way of bond issuance or commercial paper—and by one of the companies in a group. It will not be hypothecated to individual assets or groups of assets. Money is fungible and cannot be linked to any specific use. Bank balance sheets might have some leasing arrangements that might be caught by this amendment, but my main point is that the amendment is fundamentally aimed at the wrong target and, therefore, amounts to not much more than virtue signalling.

Trade Bill

Debate between Baroness Noakes and Lord Judd

Committee stage
Tuesday 13th October 2020 Lords Chamber

[Baroness Noakes (Con)]

My Lords, I had initially intended to take part in the debate on this amendment solely for the purpose of probing whether study, which is mentioned in the amendment, can logically be regarded as necessary for trade in goods or services. I had not expected this debate to go into our border control policies, with yet more angst over not having the same rights to travel throughout the EU as exist even today.

I would just say to noble Lords, including the noble Lord, Lord Fox, who seems to think that Conservatives might be upset at restrictions on movement, that we voted, both in the referendum and in the last general election, to take control of our borders—that is what the people voted for. That has consequences. Noble Lords who are trying to constantly recreate what we have had in the past as members of the EU do themselves no service. We have to change what we are doing going forward. That is not to say that we cannot have sensible arrangements with both the EU and other countries to facilitate the trade in goods and services, which I fully support. However, we should not be constantly harking back to life as it was when we were a member of the EU.

[Lord Judd (Lab) [V]]

My Lords, this is a very important impendent indeed, and we have cause to be grateful to all those who put it on the agenda. I have never understood how you can have an effective free market of any kind without the free movement of people. It makes a nonsense of it. In that sense, the arguments have been very well rehearsed in this debate. I would just like noble Lords to know that at least one of us on these Benches—I am sure there are many more—is very much behind the amendment.

--- Later in debate ---

[Baroness Noakes (Con)]

My Lords, first, I want to associate myself with the remarks of my noble friend Lord Lansley. I agreed with absolutely everything that he said.

It should be up to the Secretary of State to decide whether she needs any advice on standards or the criteria to be adopted. But, of course, this amendment is not about giving advice; it is about imposing criteria on the Government. Even if it does not cross the line, it is getting very close to interfering with the Government’s use of the royal prerogative in negotiating trade deals.

As noble Lords will be aware, there is already an extensive array of bodies—the Strategic Trade Advisory Group and individual trade advisory groups with extensive memberships—advising the Secretary of State. The only purpose of this amendment is to try to impose something on the Government. Yet again we hear something that we have heard before in Committee; this amendment is coming forward because “We don’t trust the Government to do the right thing”. I have to say to noble Lords that Governments do not legislate because noble Lords opposite do not trust them. Noble Lords must accept the Government’s assurances as they are given.

I will just say something on the Dimbleby report, because we have heard a lot about it both here and in relation to the Agriculture Bill. As I understand it, this is a draft report; it is not yet final. The Government have not made any response so far, and do not intend to do so until after the final version. It would be extraordinary to try to legislate in this Bill for policy that is not yet made. I accept that this is a probing amendment today, but I hope my noble friend will not press it again on Report.

[Lord Judd (Lab) [V]]

My Lords, although, as the amendment states firmly, it is not exclusively concerned with the issues of animal welfare, protection of the environment, food safety, hygiene and traceability, plant health, employment and human rights, these are important in the context of this debate. We have repeatedly discussed them in the context of this Bill, as well as during the debate on the Agriculture Bill earlier this month. These standards matter desperately. The amendments are important because they provide belt and braces—a system whereby we can provide more effective parliamentary scrutiny.

This bears repeating as often as we like: when we came out of the European Union, the case that the Government advocated over and over again was to take back control. Well, that must mean that the representatives of the people in Parliament have control and authority. If this body helps us to take that control more seriously and to be more effective, it is a good thing, and we should not be wasting time explaining why it is not really necessary. It may be belt and braces, but it underlines the importance of the people’s representatives taking back control.

These amendments are very important indeed. Not for the first time I congratulate the noble Baroness, Lady McIntosh, on introducing it. I was also very impressed by the speech made by my noble friend Lady Henig in support of it. I do hope we will give these amendments a fair passage.

Trade Bill

Debate between Baroness Noakes and Lord Judd

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Thursday 1st October 2020 Grand Committee

[Baroness Noakes (Con)]

My Lords, I shall start with Amendments 51 and 75, dealing with protecting the NHS and access to medicines. The Government’s position on this is clear: they are committed to the NHS and to high standards of public health, and they are committed to ensuring that any trade agreements will respect that. We have been quite explicit on that. What noble Lords think that other countries such as the US might want from a trade agreement is, frankly, not relevant and should not be driving the content of this Bill.

In my view, these amendments are part of the continuing public scaremongering about my party’s approach to the NHS. Indeed, I was surprised to find noble Lords mentioning the existing and long-standing involvement of private sector companies in the NHS, some of which are owned by non-UK interests, in derogatory terms. Unlike the noble Lord, Lord Patel, I celebrate the fact that we use private sector services where it makes sense in the delivery of healthcare services, and the fact that we use them to a marginal extent in the NHS does not affect the Government’s commitment to the NHS nor their determination to protect it. I wish that noble Lords would hear that. I was frankly shocked to hear what the noble Lord, Lord Rooker, said about not trusting the Prime Minister on the NHS.

The real reason I put my name down to speak on this group is that my attention was caught by Amendment 13 in the name of the noble Lord, Lord Bassam of Brighton. I know that he is an old-fashioned Labour man and that, deep down, he will want to nationalise or renationalise anything that moves. Indeed, I first met the noble Lord when we were debating private finance initiatives back in the 1990s. Needless to say, the noble Lord opposed anything to do with the private sector being involved, and I have to say that I lost that debate, but it was, of course, before the Labour Government of the noble Lord, Lord Bassam, came in and took up PFI with such misguided enthusiasm that they practically wrecked the finances of the NHS. However, I say to the noble Lord that he cannot seriously think that a Conservative Government will put in a Bill introduced by them references to public services being subject to monopoly or exclusive rights or, more importantly, allowing them to be brought back into the public sector as if those are good things. I accept that sometimes they are necessary things, but the thought that we would legislate as if they are good values to protect in legislation is, frankly, for the birds.

[Lord Judd (Lab) [V]]

My Lords, I want to take up one point made by the noble Lord, Lord Fox, about today’s drugs not always necessarily being the cheapest. I accept that, but on the other hand, I am sure he would agree that in the overwhelming range of medicines, today’s drugs are highly valuable and economic.

I remember that during my time as director of VSO, I attended a training course for medical personnel of all kinds, doctors, nurses and so on, who would be going off to take up exacting assignments in the poorest parts of the world. The lecturer was absolutely brilliant. He was an eminent physician who has gone on to even more eminent positions. At a certain point he dished out two pieces of paper each to everyone in the room. He said, “Please write down on one piece of paper the last drug that you prescribed for a patient. On the second piece of paper, please write down the name of the last drug that you took.”

The lecturer collected these in and then went into a state of outrage—he was a very effective performer—saying, “You are going to do vital medical work in various parts of the world”. As he went through the bits of paper, he said, “Look at this! You know that, for this patented drug, there is a generic drug available at a cheaper rate. You know that—why have you done it?” People were just flummoxed; they did not know why they had done it. They had got into a culture where too much of the sale of medicines was in the hands of PR and advertising companies that were, on the back of drugs, making a lot of money by finding more attractive ways of presenting things that were available generically.

I also remember at that time that, in Bangladesh, there was a great deal of concern because we were trying to support a factory—an enterprise—that was making generic drugs available in Bangladesh. My goodness, the moves that were afoot to try to undermine the viability of that company.

I thank my noble friend Lady Thornton for having introduced her amendment because, if there is one thing that we must hold dear, it is that we cannot allow any further privatisation of the health service by the back door. It is inadvertent sometimes, but sometimes it is quite deliberate by those who try to manipulate trade deals in the interests of their own countries and industries.

I also commend very warmly my noble friend Lord Bassam. He is absolutely right that it is vital that Governments of all persuasions have available without inhibition the opportunity to introduce public ownership where it becomes essential. We again know that there have been too many dangers that these rights may be curbed. We have had a peculiar situation in Britain where, because of the curbs that already exist, we have had nationalised companies in other European countries running British rail systems. That is just absurd. We must not open the door to the possibility that more of that could occur. My noble friend is absolutely right to have brought his amendment into the context of the Bill.