Draft Horserace Betting Levy Regulations 2017

Lord Garnier Excerpts

Monday 27th March 2017 General Committees

[Philip Davies]

I was presenting as evidence the remarks of a previous Minister; if the Minister would explain why the Department’s legal advice has changed so radically, that would be welcome. Perhaps, when she does, she will explain what will happen if the original legal advice, rather than the latest, proves accurate, and the European Court of Justice comes down on a different side of the fence from the one anticipated.

My second point is about the merits of the levy in the first place. I am astonished at the Labour party and Scottish National party support for it, because we all know that it is taking money from poor punters and giving it to rich owners; it is redistribution of wealth in reverse, so I am intrigued by their support. On the Conservative Benches we are, you will notice, Sir Alan, against subsidies for any industry unless it is farming or horse-racing. People may draw their own conclusions as to why Conservatives are all in favour of subsidies for those two industries but not for others.

The levy figures are clear. Something like 75% of the prize money in the UK goes to about the top 10 owners in the country, so it is a great benefit to Sheikh Mohammed, the Qatari royal family and Coolmore Stud—I am sure they are not really on their uppers. The question is whether we should be subsidising their sport and interests.

I have two more points to make. First, it seems to me that the Government have made changes to the scheme to satisfy the European Commission by extending the levy to the Tote and on-course bookmakers, which were not in the original proposals put out to consultation. Why do not the Government, given that they are now pursuing a policy that they do not support—it was not their original proposal—wait until after we have left the European Union, when they can introduce whatever policy they want without having to refer any of it to the European Commission and risk its going through the European Court of Justice?

Finally, we talk about the amount of money that goes from bookmakers to racing. When the levy started, it was a mechanism to do that. The Government have always been against the levy; they have tried to abolish it, because they think it is a bad system. However, it was a useful mechanism for transferring money from bookmakers to racing when there was no other mechanism for doing so.

I asked the Minister some questions not too long ago about how much money bookmakers give to the racing industry. Racing always wanted about £100 million out of the levy; that was the figure it wanted to achieve—a perfectly reasonable figure. However, let us take 2012 as an example. The levy has gone down since then but media payments have gone up, so the figure is probably still about right.

In 2012, the bookmakers handed over, in levy payments, £74 million. As my right hon. Friend the Member for Newbury said, that has gone down since—I accept that. In the same year, they also gave £153 million in media rights to show the racing in their shops and online, £88 million of which went to racecourses. That figure has gone up considerably since 2012. They also gave £12 million in sponsorship. The total going directly to racecourses from the betting industry was £174 million. However, it cost bookmakers even more than that, given the money taken out with respect to picture rights.

In that year, total prize money in racing, in the UK, was £97 million. If people were asked what proportion of prize money bookmakers in the UK should contribute to UK horseracing, I suspect that some might say half. Some zealots might say all of it. I suspect very few people would think that bookmakers should give virtually double the total UK prize money levels to the racing industry, yet that is what they do every single year. That, to me, seems excessive. The Government seem to be doing nothing to find a way to make sure that the horse-racing industry passes the money down from racecourses to owners and trainers.

If the Government proceed with this, I hope that they do not just try to extract more and more money out of bookmakers, which are actually taking less and less on horse-racing; it is becoming a smaller and smaller proportion of their business. I hope that the Government accept that bookmakers pay a huge amount into racing—I think it excessive, in many respects—and that they find a way to ensure that racecourses pass that money on in prize money, not just to the richest racehorse owners but to those at the bottom. I look forward to hearing how the Minister will say to the racing industry that, yes, the Government will make sure that it gets the money, but that it should make sure that that money goes from the racecourses to the people it is intended to support.

[Sir Edward Garnier (Harborough) (Con)]

rose—

[The Chair]

Sir Edward, give me a second before you proceed. Because of the two Divisions, we can now go on until 6.23 pm—although we do not have to.

[Sir Edward Garnier (Harborough) (Con)]

Sir Alan, I apologise, not only to you but to the Committee as a whole, for my slightly late arrival at the Committee. I will certainly not go on until 6.23 pm or anything like it.

I do not want to have a row with my hon. Friend the Member for Shipley because it simply would not be worth it. However, I do not want him to think that I accept that Leicester Racecourse, in my constituency of Harborough, is at the bottom end of the racing hierarchy. It may not have the cachet of Newbury, which my right hon. Friend the Member for Newbury proudly represents, and it may not be quite like Cheltenham, but it is not a bad racecourse. If this new arrangement enables more racing to be held there, and for there to be better prize money to attract higher-quality racing at the racecourse, so much the better.

I appreciate that my hon. Friend the Member for Shipley speaks with great knowledge of the bookies’ industry. I was also delighted to hear from him that one of his many horses once ran at Leicester, steered by the great Dettori. I look forward to seeing my hon. Friend riding one of his own horses.

[Philip Davies]

No chance!

[Sir Edward Garnier]

“No chance”, he says. There we are—there is a God.

While we are getting excited about what my hon. Friend may think is the unfair nature of this new arrangement on the bookmaking industry, I think it is important that we also discuss the unsung heroes of the racing world who work at and run, shall we say, the less famous racecourses throughout the country.

The last time I went to Leicester Racecourse—last summer, for one of the summer meetings—the number of people working backstage was probably just as great, proportionally, as it would have been at Cheltenham, Newbury or Aintree. However, the cash flow and the money going through that particular racecourse is not nearly as great as at some of the great festival racecourses.

[Richard Benyon]

Does my right hon. and learned Friend also agree that the cost of putting on a day’s racing and complying with all that we now require—on crowd management, health and safety and all of the other good policy changes that have been made for the public’s safety—is extremely burdensome on precisely those smaller courses?

[Sir Edward Garnier]

My right hon. Friend makes the point I was trying to make rather better than I was making it myself; I am grateful to him for having done so.

It is perfectly true that the number of people from the medical services, vets, stewards and other officials now needed to put on a day’s racing is enormous. From the stable yard right the way through to the car park, there are lots and lots of people, all of whom have to be paid, apart from some of the kind volunteers who help out for the love of it. Those are not racecourses that are putting on tens of meetings a year or attracting the greatest of the prize money. Of course, the famous yards that my hon. Friend the Member for Shipley mentioned will no doubt benefit from the regulations, but I hope the money will trickle down and enable racecourses such as Leicester and—is there a racecourse at Hexham?

[Guy Opperman (Hexham) (Con)]

“Is there”? It is the best racecourse in the country!

[Sir Edward Garnier]

Well, there we are. I have achieved publicity for that great racecourse in Northumberland, in addition to the one in Leicestershire.

Even if these regulations lead to an increase in the cash flow coming into the small racecourses by only a small measure, the Government will have achieved a public benefit. I salute the Minister for what she has achieved. I wish this new levy system Godspeed, and I trust that vast sums of bookies’ money will end up in Oadby, the home of Leicester racecourse in my Harborough constituency.

Article 50: Parliamentary Approval

Lord Garnier Excerpts

Monday 11th July 2016 Commons Chamber

[John Penrose]

As I said in my opening response to the urgent question, I am sure that there will be many opportunities, on many different occasions, for Members in this Chamber to discuss and debate all sorts of different issues, including the one that the right hon. Gentleman has just mentioned and many others. This negotiation will be an ongoing process, not a single event, and therefore he is absolutely right that there will be many opportunities where specific issues will become salient, where people in this Chamber will have very strong views and where people in devolved Governments will have very strong views. Those views need to be heard and aired throughout the process.

[Sir Edward Garnier (Harborough) (Con)]

Does my hon. Friend agree that there is just the slightest chance that over the next few weeks we may be capable of generating more heat than light on this subject? It is not Parliament that will be negotiating with the European Union as we come out of it; it is the Government. Will he ask our right hon. Friend the Chancellor of the Duchy of Lancaster to ensure that, while Parliament must be kept informed and may express its view, it will be for Ministers and for the Prime Minister, essentially, to carry out these negotiations once article 50 has been triggered? Parliament should not hamper the negotiating stance—[Hon. Members: “Hamper?”] I think somebody wants their lunch. Parliament should not constrain the negotiating tactics of any Minister.

[John Penrose]

My right hon. and learned Friend gets the parliamentary award for optimism for saying that there is only the “slightest chance” that we might generate more heat than light on the matter over the next few weeks. He is absolutely right to say that this is something that Ministers need to take forward but, as I said earlier, I am absolutely certain that the Government, the Opposition, the Backbench Business Committee and others will take many different opportunities to make sure that Parliament’s views are forcefully expressed and the issues are debated as we go.

Budget Changes

Lord Garnier Excerpts

Monday 21st March 2016 Commons Chamber

[Mr Gauke]

The Chancellor will debate the Budget resolutions tomorrow evening, and he will be the first Chancellor of the Exchequer to have done so since my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke). In 11 Budgets, Gordon Brown never once participated in the debate on the Budget apart from in his initial speech. As far as the public finances and compliance with the welfare cap are concerned, we will set things out at the autumn statement. Let us be absolutely clear that with the Labour party appearing to be upset about the public finances, Labour Members should listen to what they have been saying for the last six years.

[Sir Edward Garnier (Harborough) (Con)]

My hon. Friend will know that members of the armed forces are sadly not immune to mental health problems and that, even more sadly, some of them take their own lives. As a member of the advisory board of the Samaritans, may I thank the Minister and my right hon. Friend the Chancellor for the £3.5 million given to the Samaritans to assist military personnel who are suffering in this way?

[Mr Gauke]

I am very grateful to my right hon. and learned Friend for highlighting that point.

Greece

Lord Garnier Excerpts

Monday 6th July 2015 Commons Chamber

[Mr Osborne]

The worst for the UK and the whole of Europe will be a completely disorderly situation over the next few weeks that has an impact on Europe’s financial system. As Britain is one of the most open economies in the world, that will impact on us. We saw the impact of the problems in the eurozone in 2012 and how they spilled over into the UK. That is the challenge of any financial crisis and it is a challenge for the UK as an open economy. That is why we are urging those on all sides to try to resolve the situation.

[Sir Edward Garnier (Harborough) (Con)]

The United Kingdom Exchequer will be exposed whether Greece stays in or leaves the euro. Will my right hon. Friend publish, if he can, the assumptions on which his assessment of those contingencies can be made?

[Mr Osborne]

Of course, we have a very small direct exposure as our banking system has greatly reduced its Greek liabilities. We have four pretty small Greek branches and one subsidiary. We are not directly exposed to loss and although we are a member of the IMF, no country has ever lost money supporting the IMF. Of course, people ask what might happen to Greece should it leave the euro, but I think we can leave that for another day.

Equitable Life

Lord Garnier Excerpts

Thursday 26th February 2015 Commons Chamber

[Bob Blackman]

The clear issue is that when the assessment was made of the amount of compensation due to policyholders—this point is crucial—it was decided that £4.3 billion should be paid in compensation. Clearly, £1.5 billion has been allocated, although it has not all been spent, as my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) mentioned, meaning that a compensation bill of £2.8 billion is still outstanding.

The Prime Minister quite rightly said at the Conservative party conference that as the economy recovers and we fix this country’s problems, tax rates will come down, but I would say that there is a still a bill to be paid to the people who saved for their retirement. Therefore, as the economy recovers and the public purse allows, we should compensate policyholders who have suffered a relative loss, as we committed to do at the last general election.

[Sir Edward Garnier (Harborough) (Con)]

May I congratulate my hon. Friend and the co-sponsors of the motion on bringing this matter before the House? I am a past and, I think, a continuing policyholder of Equitable Life; given yesterday’s debate, I suppose that is a matter of deep interest to the world. I am concerned that the amount of compensation to be paid to individual policyholders is relatively small. Does my hon. Gentleman agree that there is now a duty on the Government to get rid of these fairly small claims as quickly as possible? Many of my affected constituents are in their 70s and 80s, and they need satisfaction as soon as possible.

[Bob Blackman]

I completely concur with my hon. and learned Friend.

I should say that the Chancellor made a key and very brave move to compensate the pre-1992 trapped annuitants with a one-off payment of £5,000, which was doubled to £10,000 for those on pension credit. That was very welcome, but we are talking about the most vulnerable people trapped by the scheme, and my view is that they should receive total compensation. The estimate for total compensation for that element alone is £115 million, which I consider a drop in the ocean compared with the total pension bill due.

Financial Conduct Authority Redress Scheme

Lord Garnier Excerpts

Thursday 4th December 2014 Commons Chamber

[Sir Edward Garnier (Harborough) (Con)]

I begin, as have others, in congratulating my hon. Friend the Member for Aberconwy (Guto Bebb) on initiating this debate. It is sad, as he said, that this is the second or third time he has had to bring this matter to our attention either on the Floor of the House or in Westminster Hall. He has plugged on, and my constituents and I are very grateful to him.

I have no doubt that all who contribute to the debate will mention constituency cases. It is right for us to do so. I had originally intended not to mention my constituents’ names or the name of the bank with which they had to grapple because I thought it unfair, but since the hon. Member for Newcastle-under-Lyme (Paul Farrelly) and other hon. Members have already mentioned the bank and because I think the bank is big enough to look after itself, I shall not shrink from doing so.

My constituents, Bob and Stephanie Hamblin, are directors of a small property company called Hybeck Estates, which they founded in the early 1990s. Their companies had banked with RBS for many years since the 1980s, and they entered into first one and then a second lending arrangement. Sixty years ago, it might have been seen as somewhat unorthodox, but in the conditions that operated in the 1990s and the early part of this century, such arrangements have become increasingly usual, if not wholly orthodox.

All went well until about 2006, when the bank decided that the Hamblins and their company needed to restructure its existing hedging arrangements, and the bank recommended replacing the second loan arrangement with a swap, a collar or a knock-in collar on the basis that this would reduce the company’s quarterly premium payments. On 16 February 2006, the bank sold the Hamblins a £3.5 million, 10-year amortising base rate collar.

In August 2012, the company submitted a complaint regarding the sale of the replacement collar in the context of the interest rate hedging product mis-selling review, and submitted further written evidence on 28 January this year. The complaint was essentially that the replacement collar was unsuitable for the company because of the risks involved—risks that were never adequately explained by the bank. The bank should have allowed the company to continue with the protection of its earlier arrangements, which would have protected it against the possibility that interest rates would rise, without exposing it to the risks inherent in the new replacement collar.

On 1 July this year, the bank wrote a letter to the company, containing the bank’s provisional offer of redress. It acknowledged that in the course of the sale of the replacement collar, the explanations it had provided to the company, initially in a crowded pub,

“in respect of the features, benefits or risks of alternative products did not comply with the standards agreed with the FCA.”

The bank’s failure to explain the

“features, benefits or risks of alternative products”

also extended to the appropriate alternative strategies, which were not explained at all. The company’s desire for premium reduction could have been satisfied in a number of simple and risk-free ways—but they were not. The risks were simply not explained. The second cap—the earlier lending arrangement—exposed the company to no risks at all, but the new one exposed it to potential losses of more than £950,000 in the event of interest rates falling. That risk was not disclosed to the company; neither was the fact that, as a consequence of the liability incurred via this collar, the company’s flexibility to refinance with another bank would be seriously impaired.

It seems reasonable to draw the inference—I am sure others would concur on the basis of their own constituency experiences—that the bank’s poor sales practices were driven by the additional profit it could make by putting the company into this new vehicle. Derivatives pricing experts calculate that the expected net gain to the bank on the day of the transaction was over £43,000, and it incidentally cost the Hamblins and the company £0.33 million to extract themselves from it this year. The replacement collar, furthermore, is in serious breach of the 7.5% rule announced by the FCA at the outset of the review. This collar exposed the company to potential losses of very nearly £1 million—equivalent to 27% of the amount notionally hedged, which is almost four times higher than the stated 7.5% maximum.

Given these circumstances in which the bank has acknowledged that it neither explained the risks of the new collar, nor offered any of the simple premium-reducing strategies outlined above, the bank’s conclusion that the company

“would have chosen a vanilla collar in any event”

is clearly absurd.

Here we have a company that has been in the property business for some little while, and a director of that company who knows something about—indeed, quite a lot about—the financial services industry, but is not an expert on hedging. To suggest that he would expose himself, his wife and his company to a product that would place them in such dire jeopardy is absurd. Nevertheless, the bank has concluded—through its internal review process, which has been validated by the FCA’s independent review system—that they are not entitled to redress. The bank has made an admitted mistake and has caused admitted consequential loss, but it has said “You would have bought one of these anyway, so we will not pay you any compensation.”

[Guy Opperman]

I am following the case of my hon. and learned Friend’s constituent with interest, because it is very similar to cases that I have encountered in my constituency. If, like me, my hon. and learned Friend has met senior managers at RBS—the bank that is involved in both our constituents’ cases—he will know that while they are very keen to resolve these cases, the middle managers who are dealing with the individual claims that are being assessed seem incapable of accepting the principle that they were at fault and are to blame. The Government ought to make it clear to senior management at RBS that they must ensure that there is true accountability in their own organisation.

--- Later in debate ---

[Sir Edward Garnier]

I could not agree more. The banks and the FCA must take responsibility for what they have done, and if that requires the urging of the Treasury, please let that happen. These banks are making vast amounts of money, and although I am a Conservative capitalist and like companies to make profits, I expect them to behave properly.

[Paul Farrelly]

Do the hon. and learned Gentleman’s constituents feel that they were advised by the bank to take on that collar? I ask because in the recent Crestsign case it was found that a company had been advised by RBS, but the bank was none the less allowed to rely on its disclaimer that it has not given advice. Does he agree that that legal position only compounds the uncertainty and the risks posed to businesses that take the banks on?

[Sir Edward Garnier]

I will not comment on the legalities or illegalities involved in that specific case, but I will say in relation to the case to which I have referred that the bank not only failed to explain the risks of moving into a new loan vehicle fully, properly and candidly, but subsequently sought to hide its own responsibilities for its failures. Such action, besides being—in my view—immoral, lowers not just the trust and confidence that small businesses should have in the retail banking sector, but the collective confidence of Members of Parliament, who should hold the Government to account for those failures if they are such, and if they occurred on the Government’s watch.

[Ann McKechin (Glasgow North) (Lab)]

Another problem, which has been described to me by a constituent, is the fact that the documents with which the internal reviewer is provided by the bank are not necessarily made available to customers or their own advisers, unless a freedom of information or data request is submitted. The lack of transparency in the way in which the review is carried out, and the inability of customers to correct the information that is given to the reviewer, constitutes another failure in the system.

[Sir Edward Garnier]

I agree, and that reflects what happened in the case that I have described. If there is anything that ought to be done—and the motion deals with this—the transparency of the banks, and hence their accountability, should be increased. It is no good the independent reviewer saying “Nothing to see, do move on”, because there is plenty to see. It is simply a question of being able to find it, expose it, and reach proper conclusions, either at law or as a matter of reasonable inference from what has gone on.

There is too much lack of candour, too much obfuscation, and too much dissembling. It is high time that the FCA lived up to its responsibilities; it is high time—I must say this to my hon. Friend the Economic Secretary, who has done a sterling job since entering the Government—that the Treasury leant on the FCA rather more heavily than it may have done in the past; and it is high time that the FCA, this new body, stopped pulling its punches with the salespeople, whether they are operating in pubs or in banking offices, in order to ensure that honest dealing is what we get from our banks.

amendment of the law

Lord Garnier Excerpts

Monday 24th March 2014 Commons Chamber

[Hilary Benn]

I certainly support all measures that will help us to get housing supply up because that is an objective shared across the House. I shall have something more to say about Ebbsfleet in a moment.

We have also called for local authorities to have a higher proportion of small sites in their five-year land supply and to give guaranteed access to public land for small firms and custom builders, something to which the Secretary of State referred and that was also in the Budget. That is also why we have said that a proportion of homes in new towns and garden cities should be built by smaller firms and custom builders. The truth is that if we are going to make progress, we have to change the way in which the housing market and the building market work, which is something that Ministers have not yet acknowledged. Why? We know that the high cost of housing is driven by the cost of land. We know that not enough land is being released for housing development. We know that by the time that land is given planning permission, it is often prohibitively expensive and we know that this can create an incentive to bank, rather than build on, the land.

As the Planning Minister told me in a written answer earlier this year, as of January there were 538,000 units with planning permission that had not yet been completed. About half had been started and the rest were working towards a start or were on hold. He says that land banking is not an issue. He says that in many an answer to a written question, but he forgets that a 2008 Office of Fair Trading survey found that strategic land bought with options, which accounted for about 83% of land banks, was worth 14.3 years of production. That is about enough land to build 1.4 million homes.

What is more, under the current system, there is very little that local authorities can do about it, because existing compulsory purchase order powers are legalistic, expensive, time-consuming and complex. Authorities are in a weak position to try to get the land brought forward. That is why we have argued for and will deliver much greater transparency in the system by ensuring that developers register the land that they own or have options on. We will give councils the power to charge developers escalating fees for sitting on land with planning permission to incentivise them to actually build the homes they said they wanted to build.

The idea is denounced by the Secretary of State but it is supported by the International Monetary Fund and by the hon. Members for Rossendale and Darwen (Jake Berry) and for Stratford-on-Avon (Nadhim Zahawi) and indeed it was supported by the Planning Minister before he got his job. As a last resort, we will give local authorities proper compulsory purchase powers so they can, in the right circumstances, buy, assemble and grant planning permission on land that is being held back from development.

What is the purpose of this? It is to address the current imbalance in power between communities and developers. This is the point the hon. Member for Dartford (Gareth Johnson) raised. Where communities decide where new housing needs to go, which is what neighbourhood planning is all about and why I strongly support it, and when permission has been given, they should be able to do more to ensure that the houses actually get built. But there is a problem here, and it is the reason why the Planning Minister gets a lot of stick from many of his Back Benchers. When a five-year land supply has been identified, all the cards are stacked in the developers’ favour. They can look at one site and say, “That’s brownfield, too expensive to develop, there is contamination. We are not going there.” They can look at another site and say “That’s not viable.” They do not explain their measure of viability but just end the conversation by saying it is not viable. They look at a third site and say, “Okay we can do about 100 houses a year on that site”, even though, physically, it could take 250, 500, or say, 1,000 houses. Then, at the end of the process, when the numbers are added up against the council’s assessment of its annual housing need, what happens? Lo and behold, developers say, “Your five-year land supply is inadequate and therefore, we would like to build there and there and there.” That is what is going on up and down the country.

I think the deal is that communities have to take responsibility for identifying sufficient land for housing supply, but they then have to be able to ensure that the houses that are needed are built on the land that they have identified. What we have at the moment is a system in which communities and their local authorities have very little power and that is why change is required.

[Sir Edward Garnier (Harborough) (Con)]

What does the right hon. Gentleman mean by community? How does he identify the community in this context?

[Hilary Benn]

First, the community is represented by the local authority, and, secondly, I think the community has a really important part to play by joining in the process of neighbourhood planning. We have seen from some parts of the country—Thame is probably the best example—that the community took responsibility. It consulted and had a referendum and, from memory, 73% of people voted in favour of the plan. It identified sites for housing development. I think that is the right approach, because for too long, we have had a system where no one has taken responsibility and everyone has pointed the finger at somebody else when it comes to housing supply. That is why we need change.

--- Later in debate ---

[Sir Edward Garnier (Harborough) (Con)]

I agree with a certain amount of what the right hon. Member for Wolverhampton South East (Mr McFadden) has said. I am delighted to hear from him and other Opposition Members a gentle—or, in some cases, not so gentle—movement towards accepting that the saving public, the pensioners, should be allowed to choose their own vehicles to finance their retirement income.

I introduced a private Member’s Bill in 2003, entitled the Retirement Income Reform Bill. It was designed to lift the compulsion to purchase an annuity at the age of 75. The then Government opposed it, but it so happened that I got a majority of more than 100 on that Friday in the spring of 2003. These things happen on Fridays when Government Members are elsewhere. Eventually, however, the Government talked the Bill out. It was defeated on the basis that the public were unable to make their own decisions on the funding of their retirement. It was said that they would waste the money, or simply not do what the Government wanted them to do with their retirement funds. I happen to take the view that the Government are a poor parent, a poor business man and a poor manager of people’s old age. I was disappointed, but not surprised, that the then Government talked out my Bill. The number of private Members’ Bills that get talked out is too big to worry about.

I was interested to hear my right hon. Friend the Chancellor of the Exchequer announce in the Budget statement last week that he intended to liberalise the way in which we deal with pension income. I was even more interested when the shadow Secretary of State for Work and Pensions, the hon. Member for Leeds West (Rachel Reeves), announced that her party and her Front Bench were coming round to accepting that the public should be trusted with the management of their own financial affairs in retirement. She made that announcement rather half-heartedly, but she made it none the less. I think that that is practically and philosophically the right thing to do.

In the course of this afternoon, I have smelled the burning rubber of handbrake turns from Labour Back Benchers who are beginning to realise that they need to catch up with those on their Front Bench, who in turn are deciding that they need to catch up with those on our Front Bench and with public opinion that is in favour of greater liberalisation of the pension and retirement income system. The fact that criticism has been made of the banking system and of the financial services sector does not undermine the practical and philosophical benefits of liberalising the system.

[Frank Dobson]

I agree that those criticisms do not undermine the philosophical side of things, but it is the practicalities that people are bothered about. Most of the concern arises from the fact that the various institutions have been giving people a bad deal on annuities and that, unless they actually go out of business, they are likely to be offering the products that are the alternative to annuities. Does the hon. and learned Gentleman really believe that those self-same institutions will be offering people a good bargain, if they have not done so in the past?

[Sir Edward Garnier]

Yes, I do. I find that view deeply depressing, although not in the least surprising. The right hon. Gentleman is a good old-fashioned socialist and I respect him for that. I wish that more of his colleagues were as clear in their views as he is. I happen to take the view, however, that Mr and Mrs Retirement Person should be allowed to do what they like with their pension funds and that if the financial services sector misconducts itself, we should prosecute it or take regulatory action against it. We should not act to prevent the vast majority of individuals from doing what they think best for their financial future, either pre-retirement or post-retirement, simply because we fear that there might be one or two bad hats in the financial services sector. If those of us who are about to retire wish to invest our pension funds in property or in stocks and shares—

[Mr McFadden]

rose—

[Sir Edward Garnier]

I fear that I am limited to one free hit, and the right hon. Gentleman may not have one. Perhaps he should see his financial adviser instead.

If those of us who are about to retire wish to invest our pension funds in property or in stocks and shares—or in buying an annuity—let us do it. Let us be allowed to make informed, adult decisions. Yes of course we must build protections into the system to prevent people from being mistreated or misled, as the Chancellor made clear in his Budget statement, but we must allow them to make their decisions from a position of knowledge. For goodness’ sake, let us not imagine that Mr Whitehall Man, or even Mr Labour Cabinet Minister, is better able than anyone else to decide how I should lead my life. I really object to that form of nanny state—

[Bill Wiggin (North Herefordshire) (Con)]

Quite right!

[Sir Edward Garnier]

I used that expression in order to encourage my hon. Friend. I do not like the kind of jargon that we are forced to use in these short, time-limited debates.

If there is one thing in the Budget that we ought to appreciate, it is the liberalisation of the pension and old-age retirement income. My private Member’s Bill was defeated by the then Government. I think that Ruth Kelly was the Treasury Minister who organised its destruction. I hope that, were she here in the House now, she would welcome the statement made by my right hon. Friend the Chancellor last week. I hope, too, that Opposition Members will come to realise that they need to catch up with public opinion and to acknowledge the desire of all people, whether they vote Labour or Conservative—I dare say one or two might even vote Liberal Democrat—to support their own independence and to make their own decisions. I congratulate the Chancellor and I wish him all good speed with this measure.

Corporate Structures and Financial Crime

Lord Garnier Excerpts

Thursday 4th July 2013 Commons Chamber

[Emily Thornberry]

I am grateful to the hon. Gentleman, but in the time I have available, I would like to look to the future and consider the best method that we have for solving the current problems. I am happy to talk to him at some length outside the debate, because I am committed to the issue and will be interested to hear his point of view.

It seems to me that one good way in which the assets in question can be used, instead of lowering the levy, is to put them into a pool that prosecutors can use in future. That would help to pump up what we are doing. That seems to be a way forward, and I am putting it before the House today to get some sensible responses.

[Sir Edward Garnier (Harborough) (Con)]

Will the hon. Lady give way?

[Emily Thornberry]

Unfortunately I am running out of time, but I would like to hear from the hon. and learned Gentleman briefly.

[Sir Edward Garnier]

The hon. Lady urged us to look to the future. Does she agree that one thing that we need to consider with reasonable urgency is an alteration in how corporate criminal liability is described in law? At the moment, we have the Victorian “directing mind” principle, which is not really appropriate for vast international companies. Does she agree that we need to Americanise the system—

[Helen Goodman]

She’s just said that. If you’d been here, you’d have heard it.

[Sir Edward Garnier]

It is always so lovely to hear the hon. Lady, but I am actually addressing the shadow Attorney-General.

[Madam Deputy Speaker (Dawn Primarolo)]

Order. Before the hon. Member for Islington South and Finsbury (Emily Thornberry) responds, I point out again that interventions made by people who have only just arrived in the Chamber, not having been present at any point during the debate, do not show the best courtesy to the House. I hope that all Members will bear that in mind.

[Sir Edward Garnier]

On a point of order, Madam Deputy Speaker. If I have caused any offence, I apologise. The reason I addressed the hon. Member for Islington South and Finsbury (Emily Thornberry) was that she and I have a joint interest in the matter. I am sure she did not take offence.

[Madam Deputy Speaker]

Thank you, Sir Edward, but you are continuing the debate. Your point is on the record, but we are now eating into the Minister’s time. I understand that he does not mind, so I call Emily Thornberry to conclude her speech.