Professional Standards in the Banking Industry

Debate between Lord Young of Cookham and Andrew Love

Thursday 5th July 2012 Commons Chamber

[The Leader of the House of Commons (Sir George Young)]

The debate got off to a difficult start and those watching it might have been driven to the conclusion that this was not the forum for a rational debate about the ethics and conduct of banking. Of course, the Government motion proposes a joint parliamentary inquiry, and those who have served on Select Committees and Joint Committees know that such inquiries are conducted in a far calmer atmosphere than the rather heated beginning of our debate, particularly if they are tempered by the presence of those from another place. My hon. Friend the Member for Harwich and North Essex (Mr Jenkin) made that point in his compelling speech.

I hope that Opposition Members read, if they did not listen to, the speech from my hon. Friend the Member for Chichester (Mr Tyrie), who has said that he is ready to serve as Chair of the Committee if it goes ahead. He made it absolutely clear that he was not interested in a witch hunt, that his inquiry would be forward looking, that the objective would be to get banking in better shape quickly and that he wanted a broad-based inquiry including participation from Opposition Members. I hope that Opposition Members will be reassured by his speech.

My hon. Friend also asked for an assurance about resources from the Treasury. In his statement on Monday, my right hon. Friend the Chancellor made it clear that the Treasury would be happy to give resources to the Committee.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

Will the Leader of the House give way?

[Sir George Young]

Let me make a little more progress.

I am also grateful to my right hon. Friend the Member for Haltemprice and Howden (Mr Davis). In a thoughtful speech, he made the point that the gap between the two forms of inquiry was narrower than many had implied, particularly so far as powers were concerned. He also reinforced the imperative of reaching a unanimous conclusion, which often happens with Select Committees of the House. Indeed, he drew on his own experience on the Public Accounts Committee. My right hon. Friend cast some doubt on the December target, but my hon. Friend the Member for Chichester seemed content with it.

I hope that Opposition Members will listen to what the hon. Member for Dundee East (Stewart Hosie) said. He is a signatory to motion 2 on the Order Paper and made it clear that if that motion was not carried he would not oppose motion 3. That is the right approach if we are to resolve the issue this afternoon.

I am grateful, too, to my hon. Friend the Member for Caithness, Sutherland and Easter Ross (John Thurso), who made the point that the gap between the two sides was not quite as wide as the rhetoric at the beginning of our debate implied. He underlined the urgency of making progress, particularly if we are to catch the legislative train that is going through the House in this Session.

The right hon. Member for Oldham West and Royton (Mr Meacher) asked why the Government were against the inquiry proposed by the Opposition. My right hon. Friend the Chancellor set out in his speech the timetable for public inquiries and that was one reason why we did not think that that was the right way forward.

My hon. Friend the Member for Rochester and Strood (Mark Reckless) made an interesting speech explaining the difference in culture that had occurred in the City, a point also made by my hon. Friend the Member for Macclesfield (David Rutley), who was put off a career in the City by being asked the question, “How greedy are you?” One only has to look at him to realise that the answer is not at all, as he has the figure of a pipe-cleaner.

My hon. Friend the Member for Witham (Priti Patel) spoke on behalf of the thousands of people who work in banking who were not responsible in any way for what has occurred but whose reputations are now tarnished by the actions of a minority. She spoke on behalf of the hard-working majority in our banking services and supported the parliamentary inquiry.

Many of the contributions underlined powerfully the need for urgent action to put out the fires that are threatening to engulf one of our leading financial institutions and to prevent further wrongdoing at the heart of banking. Banking employs more than 1 million people, and it generates £63 billion in Exchequer revenues and 8.9% of our gross domestic product.

I do not think that there is any disagreement between the Government and the Opposition on what we need to do, which is to sustain a strong, vibrant, transparent and more accountable financial sector in the UK that commands international confidence. Although we are united on the direction of travel, there are clearly differences on the choice of vehicle and its speed. We favour a cross-party Joint Committee of both Houses that is accountable to Parliament; in operation before the summer recess; equipped to navigate the legal minefield of criminal investigations; and well positioned to produce recommendations that can be implemented through legislation that can be introduced in this Session. The Opposition, as we have heard, prefer a more costly public inquiry led by a judge and run by Queen’s Counsel and other lawyers that would coincide with and perhaps undermine other regulatory proceedings operating on a time scale that cannot easily be controlled.

Those who support the first motion should listen to what the former Cabinet Secretary Lord O’Donnell said in the debate in the upper House on Tuesday:

“I was involved very much in setting up the Leveson inquiry, and my experience of judge-led inquiries is that you have to be incredibly careful about tying them down to specific issues and timetables.”

That is what the Opposition are seeking to do. He continued:

“What people have said they want from this specific inquiry means that it will grow bigger and take longer or that it will be incredibly superficial”.

Lord O’Donnell was not alone in expressing those concerns. Two other former Cabinet Secretaries voted against the Opposition’s proposals, and even Lord Eatwell, the Labour Treasury spokesman said:

“I am supportive of the idea of a Joint Committee moving forward to deal with the specific implications and consequences of the LIBOR element—what Mr Tyrie refers to as the ring-fence proposals.”—[Official Report, House of Lords, 3 July 2012; Vol. 738, c. 617-623.]

Some hon. Members have claimed that a parliamentary Committee will be unable to rise above the political fray. However, we all realise that a Committee report pushed through on party lines will quickly be devalued. Others have suggested that a parliamentary Committee would lack the inquisitive force of an inquiry barrister. I want to make it absolutely clear that a Joint Committee will have what it needs to carry out an inquiry including, if it wants them, resources for counsel. If we establish a Joint Committee we are fortunate to have more than 1,000 Members in both Houses with the necessary expertise to hold an inquiry. The advantage of a parliamentary Committee is that it is in a position to ensure that the recommendations are carried forward—something that we cannot have with a judge-led inquiry.

A number of my hon. Friends have made the point that today’s debate has not just been about the conduct of the banks. To a lesser extent it has been about the capacity, reputation and relevance of parliamentary institutions to rise to the challenge. I have to say to those who resist a parliamentary inquiry that I have more confidence in the ability of Parliament and its Committees to rise to the challenges that confront us this afternoon than all those who say we are the wrong people to do this.

The hon. Member for Wallasey (Ms Eagle) did not make clear—and neither did the shadow Chancellor—whether, if motion 2 is defeated and motion 3 is carried, the Opposition will participate in the inquiry. I very much hope that if motion 2 is defeated the whole House will support motion 3. I hope that all parties will nominate those with the qualities needed, of whom there are many throughout both Houses, to the Joint Committee, and I hope that we can show the country that we have the ability and self-confidence to discharge the responsibilities placed on us and address the central issue at stake today—restoring confidence in the UK’s banking industry.

Question put.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 17th May 2012 Commons Chamber

[Sir George Young]

I am grateful to my hon. Friend for reminding the House that the compounded saving of two years’ freeze is worth up to £147. I pay tribute to those local authorities that have been able to make sometimes difficult decisions to pass those benefits through. He also contrasts the record of the coalition Government in our first two years with the record of the previous Labour Government, under whom, as he said, council tax doubled.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

Has the right hon. Gentleman seen the report by three independent housing organisations on the emerging housing crisis? The report confirms that, last year, only 109,000 homes were completed, which is much less than the 140,000 homes completed on average under the previous Government, and less than half the number that the Government know would meet demand. Homelessness is also on the increase—it is up 27%—and more than 600,000 are affected by overcrowding. Home building, therefore, is a win-win situation: it will increase growth, which the Prime Minister will talk about today. Will the Leader of the House provide Government time for a debate on housing and how we achieve better economic growth?

[Sir George Young]

As a former Housing Minister, I take a close interest in this matter and have seen the report to which the hon. Gentleman refers. We inherited a not very positive record from the previous Government: the lowest peacetime house building since the 1920s. I am sure he will welcome our affordable homes programme, which is set to exceed expectations and deliver up to 170,000 affordable homes and a £1.3 billion investment to get Britain building. I hope he will also welcome what we have done to enable planning decisions to be made more quickly, to make public land available to house builders, and to help first-time buyers. I hope, too, that he will welcome our fiscal decisions, which, crucially, enable interest rates to remain low, helping first-time home buyers.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 1st March 2012 Commons Chamber

[Sir George Young]

My right hon. Friend the Chief Whip was 6 feet away from my hon. Friend a few moments ago, when there would have been an opportunity for a direct dialogue. I would be misleading my hon. Friend if I said that, in the remaining days of the Session, his Bill was likely to reach the statute book, but he knows that we have the chairmanship of the Council of Europe, and my right hon. and learned Friend the Lord Chancellor is seeking to reform the ECHR in a way that my hon. Friend would approve of to tackle the backlog and to ensure that cases reach the European Court only when there is no alternative, thus returning more to subsidiarity of the national courts. Although I cannot promise my hon. Friend any progress on his Bill, I hope that he will endorse the direction in which the Government are now travelling.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

May we have an early debate in Government time on the national policy statement for waste water? Yesterday, during a debate on the Water Industry (Financial Assistance) Bill, the Secretary of State for Environment, Food and Rural Affairs said that

“there were 21 working days for the national waste water policy to be debated from the moment it was laid before Parliament…There is still time and I am sure that hon. Members will take advantage of that.”—[Official Report, 29 February 2012; Vol. 541, c. 354.]

In conversations with the Journal Office today, it was made clear to me that until the Localism Bill becomes law, the decision on whether there is a debate on the national policy statement is entirely in the Government’s hands. Will time be made available for that important issue?

[Sir George Young]

I read the exchange in Hansard to which the hon. Gentleman refers. As he knows, Second Reading of the Bill was adjourned. I will seek to ensure that, in the winding-up speeches on Tuesday, the Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Newbury (Richard Benyon) has the response to the hon. Gentleman’s question.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 23rd February 2012 Commons Chamber

[Sir George Young]

I am grateful to my hon. Friend and commend the initiatives that she has been taking in her constituency. I would welcome a debate to talk about the Work programme, which is helping 3 million people, together with a massive increase in apprenticeships, which number over 400,000 this year. I applaud the work that is taking place in her constituency to reduce the number of young people who are out of work.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

This morning the Royal Bank of Scotland announced a pre-tax loss of £766 million and, at the same time, announced a bonus pool of exactly the same amount. In explanation, it tells us that the bonus pool has been cut in half, but my understanding from reports in the Financial Times is that that is being made up for by increases in people’s fixed salaries. This whole announcement takes place against a backdrop of thousands of redundancies up and down the country. For reasons very different from those of the right hon. Member for Wokingham (Mr Redwood), may I ask for an early debate on RBS, the banking system, and banking bonuses?

[Sir George Young]

The Financial Services Bill, which is going through the House, sets up a new financial structure for regulating the banks. There may be an opportunity to have the debate that the hon. Gentleman requests when the Bill comes back to the Floor of the House. I gently make the point that the party that he supports took no action at all to control bonuses when it was in government.

Parliamentary Contributory Pension Fund

Debate between Lord Young of Cookham and Andrew Love

Monday 17th October 2011 Commons Chamber

[Sir George Young]

The administration will be performed by the trustees; there is no change in that. The contribution rates and ultimately the shape of the scheme will be determined by IPSA, which will set the rules. The trustees will continue to administer the scheme, with some slight change in their membership to reflect IPSA’s new involvement.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

Will the Leader of the House give way?

[Sir George Young]

If I may, I will make a little more progress, and then I will give way.

The amendment tabled by my hon. Friend the Member for Christchurch (Mr Chope) suggests that the parts of the motion relating to the Hutton review should be removed. Its implication is that our scheme should not be treated the same as other public sector schemes, and I do not think our constituents would welcome such an interpretation.

--- Later in debate ---

[Sir George Young]

Let me make a bit more progress and then I will give way.

The motion also states that

“IPSA should introduce…a new pension scheme for hon. Members which is informed by the Commission’s findings”

by 2015. That is a similar timetable to that for the rest of the public service. However, as with other public service pension reform, changes should neither be retrospectively made nor have an impact on past benefits.

[Mr Love]

In his final report, Lord Hutton spoke warmly about the continuation of defined benefit schemes in the public sector. Is the Leader of the House fully aware of that, and does he support that recommendation?

[Sir George Young]

Indeed; the Government welcomed Lord Hutton’s report, including the interim report, the final report and the budget. He made it clear that he wanted to retain a defined benefit scheme, and on that basis negotiations are continuing. IPSA will be mindful of that recommendation by Hutton—and, indeed, of the hon. Gentleman’s views.

The Constitutional Reform and Governance Act already provides full protection for pension benefits already earned, including a link to the salary on leaving the scheme, so any new scheme would apply only to future service. Furthermore, the legislation includes comprehensive provisions requiring IPSA to consult widely before making any changes to parliamentary pensions.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 8th September 2011 Commons Chamber

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

Following on from my hon. Friends the Members for Wansbeck (Ian Lavery) and for Bolton West (Julie Hilling), may I ask the Leader of the House whether he has seen early-day motion 2135, which is signed by 60 Members from both sides of the House, and which calls on the Government to support Palestine’s membership of the UN?

[That this House recalls the target set by President Obama last year of welcoming ‘a new member of the United Nations - an independent sovereign state of Palestine’ by September 2011, a target also endorsed by the EU and the Quartet; notes that the World Bank, International Monetary Fund, United Nations and EU have all reported that Palestine is ready for statehood; recalls that Palestinian negotiators entered talks with Israel and offered substantial concessions; regrets that talks broke down because of Prime Minister Netanyahu’s refusal to extend even a partial freeze on illegal settlement-building; further notes that Palestinians have recognised Israel since 1993 despite Israel's refusal to recognise a Palestinian state; further notes that 122 countries with nearly 90 per cent. of the world’s population now recognised Palestine and even among Israelis 48 per cent. support recognition and only 41 per cent. oppose; and concludes that the way forward is to recognise an independent Palestinian state alongside Israel and support its admission to the UN because this will be the most effective guarantor of a resumption of negotiations and will also be the best protector of the rights not only of Palestinians in the Occupied Territories, but also of Palestinians living in Israel and of Palestinian refugees abroad.]

The Leader of the House mentioned earlier an Adjournment debate on Tuesday, in which the Government Minister said that the Government reserved their position on the question of Palestinian membership. This matter is being dealt with by the UN later this month, so it is of some urgency. May we have an urgent debate or a statement so that the Government can take the temperature of the House on the need to support Palestine’s membership?

[Sir George Young]

The Government took the temperature of the House in that debate. I suspect that if there were another debate, the answer from the Minister would be the same. There is an opportunity on 25 October at Foreign and Commonwealth Office questions to raise that issue again, and I hope the hon. Gentleman takes it.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 14th July 2011 Commons Chamber

[Sir George Young]

I understand my hon. Friend’s concern. TB causes real difficulties for farmers in many parts of the country. My right hon. Friend the Secretary of State for Environment, Food and Rural Affairs has been consulting on a range of options to tackle that disease. I cannot promise an immediate response from her, but I will convey my hon. Friend’s interest and see whether we can get a reply on the timing of any Government announcement as soon as possible.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

Earlier this week, I was surprised and just a little shocked to learn from the National House-Building Council that only one house was started in my constituency in the last six months for which figures are available. With the massive cut in grant funding for affordable housing, and with the shambles that appears to be developing over the Government’s so-called affordable rents policy, may we have an early debate, preferably in Government time, in September, to discuss the future of affordable housing in this country?

[Sir George Young]

I understand that there was a debate on housing market renewal on Tuesday in Westminster Hall. I hope the hon. Gentleman welcomes the measures announced in the Budget to help first-time buyers, and that he recognises that house building starts fell to an all-time record under the Administration whom he supported.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 16th June 2011 Commons Chamber

[Sir George Young]

I understand my hon. Friend’s concern, which I am sure is shared by many Members on both sides of the House. I think it regrettable that two teachers’ unions have decided to take industrial action at a time when the Government are still negotiating with them about the future of pensions. That will be bad news for the children, and bad news for parents who go out to work.

Responsibility for contingency planning rests with individual employers, and at this stage the Government have no plans to change the legislation, but I will bring my hon. Friend’s concern to the attention of the Secretary of State for Education, and will see whether there is any further action that he can take.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

In his Mansion House speech last night, as well as pre-empting the final report of the Independent Commission on Banking, the Chancellor announced the sale of Northern Rock to the highest bidder. I do not know whether that will be considered in the statement that will follow business questions, but, if not, may I urge the Leader of the House to arrange a debate, or indeed a statement, on the issue? That would enable the House to be told why, in this instance, the Government have chosen not to implement the pledge in the coalition agreement

“to foster diversity in financial services, promote mutuals and create a more competitive banking industry.”

[Sir George Young]

Let me respond to the direct question posed by the hon. Gentleman by saying that whether a question about Northern Rock would be in order in the statement that is to follow would be a matter for you, Mr Speaker. I see that you are reflecting on it as we speak.

It has always been the Government’s policy to return Northern Rock to the private sector, and that is what my right hon. Friend the Chancellor announced yesterday evening.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 17th March 2011 Commons Chamber

[Sir George Young]

I gather that that proposition received extensive attention during the debate on the Scotland Bill a few days ago. It was a very good joke the first time round, but it has diminishing returns. There are limits to the extent to which one can take devolution.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

If there is to be no statement on the publication this week of the Hutton report—the Will Hutton report—which rejected a pay cut in the public sector alone and called for much greater transparency on pay in both the public and private sectors, may we have a debate on top pay in both, so that we can see what can be done about the arms race that has been going on in recent years?

[Sir George Young]

The Government are grateful to Will Hutton for his recently published report, and we will respond in due course. There will be an opportunity in the Budget debate to discuss differentials between low, medium and top pay, and approaches to reducing them.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 10th March 2011 Commons Chamber

[Sir George Young]

I think that there is an appetite in the House for a debate on the Government’s proposals. There is widespread recognition that we need to change the system, and many Members on both sides of the House will have tried to help parents through the rather complicated process, which seems to take an infinity as meetings are cancelled and local authorities sometimes play for time. There is an appetite for a better system. I suggest that my hon. Friend goes to the Backbench Business Committee on a Tuesday morning and bids for a debate on the subject. I think that he will find that he has a lot of support on both sides of the House.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

I welcome the Hutton report’s avoidance of a race to the bottom on public pensions, but it is a package of measures that is not to be cherry-picked. The Government already seem to have pre-empted some of its decisions, so it is not good enough to subsume it within a much more general debate on Budget issues. We have to have a debate on the whole package. Will the right hon. Gentleman make Government time available for such a debate?

[Sir George Young]

I recognise the importance of the Hutton report. It would be appropriate to discuss it during the Budget debate. Lord Hutton has looked not only at the entitlements of those entitled to public sector pensions, but at the obligations on taxpayers. He made it quite clear that the present situation was simply unsustainable. I hope that there will be an opportunity during the three or four days of debate on the Budget for some debate on pensions.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 3rd February 2011 Commons Chamber

[Sir George Young]

My hon. Friend rightly makes a point that was also made in last week’s debate on the Health and Social Care Bill. I hope that it will be re-emphasised in Committee. It is indeed our policy to reduce the overheads of running the NHS and put the resources saved into front-line care.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

May we have a debate in Government time on the tax gap and the contribution that reducing that gap could make to tackling the deficit? Estimates of the gap vary from £20 billion to £100 billion, and we need to clarify the situation. I note that the Government have invested an additional £900 million to gain £7 billion in additional tax. Given that tax offices have closed, would it not be sensible to have a debate so that we can clarify whether we should be investing in this system, rather than reducing it?

[Sir George Young]

As the hon. Gentleman said himself, we are investing in the system. We have put an extra £900 million into tax collection, precisely to reduce the gap. He will have an opportunity on Tuesday to cross-question the Chancellor on this matter.

Business of the House

Debate between Lord Young of Cookham and Andrew Love

Thursday 3rd June 2010 Commons Chamber

[Sir George Young]

I was sorry to hear about the death of the hon. Member’s constituent. I see no reason why he should not get an answer from the Secretary of State for Health giving him an assurance that, where health authorities contract out and use the independent sector, they first of all assure themselves that all the appropriate safeguards are in place to ensure that patient health is not prejudiced.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

According to the Bank of England’s annual report, which was published today, the Governor was paid £305,000 last year. However, that pales into insignificance when compared to the salaries of the chief executives of major—and indeed minor—financial organisations. They are regularly paid more than £1 million a year, and sometimes £10 million or even £20 million. The hon. Member for Wellingborough (Mr Bone) would like a debate on public sector salaries, but will the Leader of the House find time for a debate in Government time on all high salaries? That would allow the House to be aware of the vast disparity that obtains in this country.

[Sir George Young]

I understand the hon. Gentleman’s point. I think that I am right in saying that Will Hutton has been invited to do a study into pay differentials in this country, and I hope that that will inform the question that the hon. Gentleman has asked.