Financial Services and Markets Bill

Lord Balfe Excerpts

2nd reading
Tuesday 10th January 2023 Lords Chamber

[Lord Balfe (Con)]

My Lords, I draw attention to my entry in the register and I begin by welcoming my noble friend Lady Lawlor. I was one of her sponsors. I am delighted to see her here; she will add huge intellectual firepower to our Benches. I hope not too much of it will be turned on me, as I do not think we agree very much on the European Union. I also thank my noble friends Lord Remnant and Lord Ashcombe, who will also add considerably to these Benches.

This is an interesting Bill. It is a good basis for a debate, and it follows a good deal of consultation. I am afraid that I disagree with my noble friend Lord Holmes, who is not in his place, on the subject of cash. Things move ahead. In 2020, I went to our local Turkish shop just after Covid started. I offered the shopkeeper some money and he said, “We’ve stopped accepting money, sir. We might get Covid.” I thought, “This is interesting.” Believe it or not, I stopped using money. Of course, the difficulty for poorer people is that they do not have access to credit or debit cards that they can just hand over all the time, so we need to retain the ability to pay in cash. But shops will maintain that for us, because they will want to continue to sell their goods, which is a pretty good thing.

As I see it, the growth of cryptocurrency, which I regret, is the next big scandal on the horizon—I thank the most reverend Primate for giving me a drink of water; it is jolly good to be given one by the Archbishop of Canterbury.

I warn us against cryptocurrency. We need to look at regulating it, because it is totally out of control, and it is meaningless. I discovered the principles of Warren Buffett before they were popular; if you want an investment, you should be able to see it, understand it and answer the question, “Does it do anything useful?” If you cannot get positive answers to all those points, you are likely to be investing in a dud. All these bubbles over the last umpteen years have been about things that do not exist. They did not have any benefits and most of them did not pay any dividends. You need to be very careful. I predict that anyone investing in cryptocurrency will come to regret it pretty shortly.

I welcome Clause 69 of this Bill, in particular the ability to develop credit unions further. We often forget the role that they play, particularly in providing secure finance for poorer people and in the trade union and working people’s movement. Anything we can do to strengthen credit union regulation, while making them dependable, is something to be gained. Enabling them to extend cautiously into hire-purchase agreements and insurance, and to lend to and borrow from each other, is extremely good. I hope that, as we pass this Bill, we can look carefully at how to support credit unions.

Finally, we need to look at the dangerous “buy now, pay later” phenomenon. Problems are already beginning to arise with the idea that you can go into a shop and say, “I’ll pay in three months.” This sector needs bringing under some sort of financial regulation. I hope that we can get some sort of outline during the course of this Bill of how we can get a regulatory framework.