FSA Investigation into LIBOR

Debate between Lord Sassoon and Lord Radice

Thursday 28th June 2012 Lords Chamber

[Lord Sassoon]

My Lords, on the particular case, the FSA report sets out what was going on. The important point for my noble friend is that the point of highlighting the dates which my noble friend gave was that this activity was going on before the financial crisis. It was going on in an atmosphere of greed in what were perceived to be the good times. When the financial crisis hit, the activity of the individuals at Barclays was motivated by something else, which was to do with the reputation and standing of Barclays in the market. The particular relevance of those earlier dates was to distinguish what then happened during the later period, in the financial crisis.

As the FSA and other regulators’ investigations go on, they will tell us more about the extent and duration of these activities. Given that the banks have been on warning of this for a period, I would like to think that they have taken significant steps to clean up their activity. We want to make sure that, as I have described with this ongoing review of the LIBOR system, the system is appropriate to the new market circumstances.

[Lord Radice]

As a former chairman of the Treasury Select Committee, I of course strongly support the idea of its investigation. Does the Minister agree that if the executives of Barclays did not know what was going on, they ought to consider their position? If they did know what was going on, they ought to resign immediately.

Autumn Budget Forecast

Debate between Lord Sassoon and Lord Radice

Tuesday 29th November 2011 Lords Chamber

[Lord Sassoon]

My Lords, I dread to think what would happen to interest rates. The interest rates on our 10-year money have stayed rock solid. They are slightly down today, at below 2.3 per cent. Where is Italy? It is north of 7 per cent. Every 1 per cent increase in our interest rates would cost this country £21 billion or £22 billion. To look at it another way, by keeping our interest rates below the levels which were forecast by the OBR only in March this year at the time of the Budget, we have saved £21 billion or £22 billion on our interest bill, money that can be much better spent on our public services. I dread to think where we would be, but it would be in horrendous territory.

[Lord Radice]

I welcome the Government’s infrastructure schemes, but what impact will the measures announced in the Autumn Statement today have on output and jobs?

[Lord Sassoon]

My Lords, I can only refer again to the numbers in the OBR’s document. I do not want to detain the House by repeating them all, but they show the cumulative effect of all these measures, including the infrastructure measures. I am grateful to the noble Lord for drawing attention to those measures because they are now more central. The economic infrastructure in particular has become central to the Government’s thinking and planning in a way that it has never been under previous Governments.