Independent Commission on Banking

Lord Newton of Braintree Excerpts

Monday 19th December 2011 Lords Chamber

[Lord Sassoon]

My Lords, I am sure that there will be other occasions and places in which to discuss the Joint Committee’s important report on the Bill, so I do not want to get dragged too far into doing that. I recognise that, even for those of us who have been involved in the banking industry, confusing “regulation” and “supervision” can sometimes be a trap into which it is easy to fall. Supervision will be the responsibility of the Bank of England in the new structure, if the Bill is passed by Parliament.

[Lord Newton of Braintree]

My Lords, I have two quick questions. First, is there any estimate or expectation of a rise in the costs of retail banking as a result of these proposals? It seems to me that that must be a possibility. Secondly—I declare an interest as a 55-year long customer of Lloyds TSB bank in Harwich, Essex—given that the Minister has welcomed the sale of some Lloyds branches to the Co-op Bank, what will happen if we immediately use our switching rights to go back to another branch of Lloyds Bank if we are sold like a commodity?

[Lord Sassoon]

My Lords, the ICB estimates that the increased cost of borrowing could be of the order of 0.09 per cent to 0.16 per cent as a result of implementing these proposals. That is a very modest additional cost which is well within the smallest ever incremental change to the bank rate introduced by the Bank of England. I will not speculate about what might happen to bank customers where they are sold from one bank to another, but I believe that it is completely right that we should make it easier in all circumstances for bank customers to be able to switch their accounts. That is what the banking system is going to deliver.

National Insurance Contributions Bill

Lord Newton of Braintree Excerpts

Wednesday 2nd February 2011 Lords Chamber

[Lord Newton of Braintree]

I had not intended to intervene—this is a bit of an overcrowded gap, and I apologise for not having given notice—but I was quite struck by the references to charities. I should declare an interest as I was until recently the chair of Help the Hospices and have a whole variety of other charitable connections of one kind or another that are listed in the register.

I understand what has led the noble Lord, Lord Myners, to make this point, but I would also say that in the charitable world in general, including in the Charities Commission, there is some doubt about whether we really want to go on encouraging the creation of more and more small charities which often end up competing with each other; and whether, in that case, we should want to give an advantage to new charities against existing small charities in the way that is suggested. It sounds good, but it needs some fairly hard thinking.