Asked by: Lord Vinson (Conservative - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government, further to the Written Answer by Lord O’Neill of Gatley on 27 January (HL4999), when the Financial Conduct Authority (FCA) last monitored or audited the procedures that require institutions explicitly to set out that they may lend shares on behalf of investors for the purpose of short selling; and what assessment they or the FCA have made of whether beneficial owners of shares are fully aware of the consequences to them of their shares being lent for short selling.
Answered by Lord O'Neill of Gatley
This is an operational matter for the Financial Conduct Authority (FCA), who are operationally independent from Government. The question has been passed on to the FCA. The FCA will reply directly to the Noble Lord by letter. A copy of the letter will be placed in the Library of the House.
Asked by: Lord Vinson (Conservative - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government whether they will consider making it an offence to lend shares for short-selling without permission of the beneficial owners.
Answered by Lord O'Neill of Gatley
The short selling of securities is a legitimate and longstanding investment technique that can provide a positive contribution to efficient market functioning through supporting price formation and providing liquidity to markets.
It is already illegal to lend any property, including shares, without the consent of the beneficial owner. However, there are limited circumstances in which fund managers are able to lend shares on behalf of investors (including for purposes such as facilitating a short sale). Under the Financial Conduct Authority’s rules, fund managers are able to do so if they have explicitly set out that they will do this in fund documentation, including the prospectus. This documentation forms part of the contract, which the investors agree to when they invest in the fund. FCA supervisors monitor compliance with applicable rules in this regard. These existing rules allow the FCA to take action, where appropriate, if shares are lent without the permission of the beneficial owner.
Asked by: Lord Vinson (Conservative - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government what is the annual cost (1) per taxpayer, and (2) per household, of servicing the United Kingdom national debt.
Answered by Lord Deighton
In 2013 central government debt interest payments were £49.1 billion. Using the relevant household and population numbers the annual cost of servicing the national debt in 2013 was:
£1,841 per household; and
£766 per person.