Eurozone Crisis

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Thursday 27th October 2011 Lords Chamber

[Lord Brooke of Alverthorpe]

I am grateful and I will be brief. I should like further clarification on the position of the IMF, which has been significantly involved with these negotiations. As I understand it, the IMF is already subscribing to three country adjustment programmes and will continue to do so. It has indicated that it may be required to look for more money from members of the IMF to put more cash into those programmes. I think that I am correct in my understanding of the Minister on that. If that is the case, we are therefore putting more money into the eurozone venture.

[Lord Sassoon]

My Lords, I will not repeat at length what I have said. It was the proposal of the previous Government, and endorsed by this Government, that we should support an increase of resources of the IMF to match its global commitments, which continues to be the situation. We will continue to be supportive of the IMF having resources in total commensurate with its global mission and mandate. That is quite separate from its contribution to EU programmes, which are looked at country by country in the same way as the IMF looks at the other 50 programmes that it has on the go at the moment, and other proposals that may come forward.

Banking: Savings Accounts

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Monday 23rd May 2011 Lords Chamber

[Lord Sassoon]

My Lords, the NS&I is a commercial operation and it has to make sure that it delivers its products in the way that customers want to receive them. It distributes a significant number of products through the post office network, including premium bonds. Some products are just marketed while others are available over the counter. I understand that these days the most popular channel for NS&I’s products is over the internet, but there is a variety of ways of obtaining them. NS&I’s products are designed product by product to suit customer needs.

[Lord Brooke of Alverthorpe]

As we have a majority share in two major banks in the country, could the Minister not press them to implement the very interesting suggestions put forward by his noble colleague?

[Lord Sassoon]

My Lords, shareholdings in the banks in which the Government have a significant shareholding are managed on an arm’s-length basis through UKFI. We want a functioning and transparent market in which consumers are able to shop around. The OFT looked at this last year and indentified some areas of the market that needed working on in terms of switching times and some aspects of transparency. The banks are working on that. Very usefully prompted by my noble friend’s Question, I spoke to them today to confirm that their noses are being kept to the grindstone on this. That is important and is what we should require of them.

Fraud: Staffing Levels

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Monday 9th May 2011 Lords Chamber

[Lord Sassoon]

My Lords, I suppose it is my fault for raising the FSA in my Answer, even though it is not a government agency and therefore, more than the other bodies we have been talking about, manages its own affairs. I would not for one moment, though, agree with the noble Lord’s assertion about the state of staffing at the FSA, which continues to do an important and extremely difficult job—albeit within a flawed regulatory structure. We have been through rounds of consultation. If we brought the legislation forward too quickly, I would be criticised about the lack of pre-legislative consultation and scrutiny. It is coming forward with due speed because, as the noble Lord recognises, this is a big mess that we have to clean up, we have to get it right this time, and we will do so.

[Lord Brooke of Alverthorpe]

Will the noble Lord be prepared to place in the Library the response that he gets from his colleagues to the question asked by the noble Lord, Lord Newby? Secondly, in that reply, will he give details on the number of HMRC revenue offices that will be closing annually between now and 2014?

Banking: Royal Bank of Scotland

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Tuesday 1st February 2011 Lords Chamber

[Lord Sassoon]

My Lords, we are doing a lot more than the previous Government ever did. We have set aside an additional £900 million of expenditure for HMRC over the next spending round—the noble Lord may shake his head but that is a fact—and that will result in millions-worth of additional revenue each year being collected compared with what the previous Government did.

[Lord Brooke of Alverthorpe]

The Minister has described the nature of the relationship between the Government and the Royal Bank of Scotland. Is he content with the composition of remuneration committees attached to public limited companies? Given the widening gap between the better paid and the lower paid, is there not a case for a change in the diversity of the people who sit on remuneration committees? Are the Government prepared to explore this and perhaps look at whether we could see more representative groups on remuneration committees, particularly with those in the lower socioeconomic groups being represented?

[Lord Sassoon]

My Lords, the Financial Reporting Council continues actively to consider a range of ideas for improving corporate governance, and of course in recent months there has been the UK Stewardship Code and a revision of the UK Corporate Governance Code. I think that the Financial Reporting Council listens to all good ideas for improving corporate governance and is actively on the case.

Deficit Reduction

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Tuesday 18th January 2011 Lords Chamber

[Lord Sassoon]

My Lords, as my noble friend says, there are liabilities as well as assets on the Government’s balance sheet as a result of the bailout of the banks. It will be a long process, in which the management of those banks is taking the leadership, to restore them to health, both for the benefit of the shareholders, including the nation, but also to ensure that they can continue to lend money to the businesses of this country.

[Lord Brooke of Alverthorpe]

Will the Minister give a straight answer to the supplementary question of the noble Lord, Lord Barnett? Will he also give a commitment that the Government will set out how the proceeds will be used?

[Lord Sassoon]

My Lords, as and when there are proceeds they will be fully accounted for. That is the position.

Banking: Bonuses

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Tuesday 11th January 2011 Lords Chamber

[Lord Sassoon]

I am grateful to my noble friend Lord Higgins for recognising the progress that we are making on reform of the regulatory structures, and in relation to bonuses. We are absolutely not going soft on the banks, which is why, as we speak, discussions are ongoing to make sure that bonuses this year are lower than otherwise they would have been, and, in parallel with that, that banks will lend in a verifiable way more than they would have lent. We are not back-pedalling on any of this and are continuing to work actively with the banks.

As far as concerns the management of RBS and Lloyds, the basic construct put in place by the previous Government ensured that the banks would be managed on an arm’s-length basis without the Government directing their day-to-day operations. That is the broad principle to which we are sticking. Nevertheless, it is important that the Government, as a significant shareholder in RBS and Lloyds, make their views very clear on all matters including bonuses.

[Lord Brooke of Alverthorpe]

My Lords, it would help if we had some honesty in dealing with some of these issues. The Statement says that the previous Government’s failure to address them brought this country’s economy to its knees. Presumably the previous Labour Government were responsible for the banking failure in the USA, Portugal, Greece, Ireland, Spain and other parts of the world. This is a worldwide problem that is not solely related to the previous Government.

To come back to the Statement, the Chancellor said, and the Minister concluded with it, that, “if the Opposition that created this banking mess has a better idea, let us hear it”. My noble friend Lord Myners asked four questions and we await answers to them.

[Lord Sassoon]

My Lords, all I can say is that I will listen to any ideas. I did not hear the question at the end of the four ideas put forward but I am willing to listen to all ideas from noble Lords on a whole range of topics. I am always listening but I am puzzled that when the noble Lord had so much time in government to put those ideas into operation he did not think that they were so good at the time.

Banking: Bonuses

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Monday 1st November 2010 Lords Chamber

[Lord Sassoon]

My noble friend is completely right that this problem arose under the watch of the last Administration, who implemented a one-off bonus tax that is now widely regarded to have been a failure—so we have to take the time to find a better way of dealing with this in the medium term.

[Lord Brooke of Alverthorpe]

In considering other possible action, as he mentioned, will the Minister have a look at the Private Member’s Bill which was promoted by my colleague the noble Lord, Lord Gavron, last year to try to get all companies, including banks, to put on the front page of their annual accounts the proportion of the highest paid compared with the lowest paid? A good deal of cross-party support was given to that and, while the Minister was not in the House at the time, would he go back and have a look at it again?

[Lord Sassoon]

My Lords, I am always up for looking at good ideas; this sounds a bit extreme, but disclosure of remuneration for bankers is indeed unfinished business.

Government: Savings

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Thursday 24th June 2010 Lords Chamber

[Lord Sassoon]

My Lords, I want to read some words that my noble friend may recognise:

“I am most concerned about the people who are hardest hit ... They have been trying to deal with their own responsibilities themselves, and … to take the burden off the State and look after themselves. The wasteful money-spending policy of the Socialist Government has virtually ruined their little nest eggs”.—[Official Report, Commons, 13/3/55; cols. 2158-59.]

Those are the words of my noble friend in another place some 55 years ago, so I applaud him for the consistency of his concern that the size of the public sector be reined in. It reminds your Lordships that such reining in has, regrettably, had to be done in the wake of successive Labour Governments. Therefore, this time round, I can absolutely confirm everything that my noble friend asked for. In particular, we will ensure that departments completely meet their commitments on reducing admin spend. This, as I said, will be done by a cut of at least one-third, which is committed so far. That is a starting point and we may look to go further.

[Lord Brooke of Alverthorpe]

Can the Minister say whether the Palace of Westminster is classed as one of the arm’s-length bodies? Will there be a savings of one-third here? What plans does he have for implementing them and what is the timetable? If he does not have such plans, can he explain why?

[Lord Sassoon]

My Lords, I have not been here very long but I know that I would be foolish to get into off-the-cuff answers on admin costs for the Palace of Westminster. Rather than waste time giving the noble Lord a definition of what is included, I shall write to him.

Financial Services Regulation

Debate between Lord Sassoon and Lord Brooke of Alverthorpe

Wednesday 16th June 2010 Lords Chamber

[Lord Sassoon]

My Lords, I thank my noble friend Lord Newby for drawing further attention to the fact that we need to deal in an appropriate way with all the personnel issues. The system has failed but there are extremely good officials in the Bank of England, the FSA and elsewhere working on these matters. It is imperative that we act as sensitively as we can to enable them to carry on with their important work, particularly at a time of continuing financial fragility. While there will be a tension with the desire for speed, the need for legislation and so on, we are discussing these points with both the Governor and the chairman and chief executive of the FSA.

[Lord Brooke of Alverthorpe]

My Lords, as many people next week will face a substantial cut in their standard of living, will the commission deal with the issue of pay and bonuses within the banking industry? If not, who will and when?

[Lord Sassoon]

The remit of the banking commission has been placed in the Library of the House. Fundamentally, it refers to reducing systemic risk, moral hazard, firm failure and promoting competition. It will be up to the commission, but I am sure it would value any input from the noble Lord, Lord Brooke, or anyone else from this House who wishes to remind it of the linkage between pay and bonuses, or anything else, and the commission’s remit.