Private Members’ Bills: Money Resolutions

Debate between Andrea Leadsom and Marcus Jones

Monday 21st May 2018 Commons Chamber

[Andrea Leadsom]

As I have sought to explain, a lot of work, taxpayers’ money and consideration have gone into a boundary commissions review that will significantly update the information on the basis of which boundaries are set. It is important to allow the review to be completed, and if I may continue, I will provide the hon. Lady with a further explanation.

The Government have committed to continuing this boundary review, and it is important that we allow the boundary commissions to carry out this work, of which much has already been completed, and we will then consider the findings carefully. Given the need to hear the commissions’ conclusions and the fact that a lot of work has already been carried out at a significant cost to the taxpayer, it would not be appropriate to proceed with the Parliamentary Constituencies (Amendment) Bill at this time by providing it with a money resolution.

[Mr Marcus Jones (Nuneaton) (Con)]

My right hon. Friend is making a very good case. My constituents would find it absolutely absurd if the Government committed money to another boundary review without concluding the one that the public voted for in 2015 and committed to again at the last general election in 2017.

[Andrea Leadsom]

My hon. Friend explains the situation very clearly, and he is quite right. Our constituents would not expect us to initiate a new boundary review before we finished the existing one.

The Government have a constitutional duty to initiate financial resolutions in this place, and we are accountable to the people of the United Kingdom for the financial impact of such resolutions. Progressing with this private Member’s Bill might place a financial burden on taxpayers of an additional £8 million.

Bankers’ Bonuses and the Banking Industry

Debate between Andrea Leadsom and Marcus Jones

Wednesday 25th February 2015 Commons Chamber

[Guy Opperman]

Will the Minister give way?

[Mr Marcus Jones]

Will the Minister give way?

[Andrea Leadsom]

I will give way in a moment, but I want to be very clear at this point. In such debates, there is always a sense that somehow all bankers are terrible people. The truth is that the vast majority of the up to 2 million people employed in financial services do an honest day’s work and always have done. They would not seek to rip anybody off, or distort anything they do. They are honest, decent people. I want to pay tribute to the work of financial services not just in oiling the wheels of our economy, but in contributing so much to our economy as a whole. Notwithstanding the very real misconduct issues, which have disgusted all of us right across the country, it is true that only a small number of people are responsible for such wrongdoing. I will talk about what we have done to put that right after I have given way.

--- Later in debate ---

[Andrea Leadsom]

Philosophically, I agree entirely with my hon. Friend. Many people across the country will agree that the absolute level of remuneration in financial services needs to be clearly justified. Although the Conservative party truly believes that wealth creation, which creates jobs, tax revenue for the Exchequer and growth for our economy, should be properly remunerated, we want to give as much power as possible to shareholders to ensure that they can take decisions that make it absolutely clear that remuneration should reflect the contribution of the individual, and not just some norm in the industry.

We have agreed with the recommendations of the Parliamentary Commission on Banking Standards and asked the financial services regulators to look into implementing them, in particular the extension of clawback to 10 years when an investigation into an individual is ongoing and the extension of deferral to seven years for senior managers, which is a significant increase from the current three years. The regulators are due to publish final rules in response to the consultation shortly. I am sure that hon. Members will agree that we want to keep our independent regulators independent, so that they act in the best interests of our economy and not in the interests of a political party.

[Mr Marcus Jones]

My hon. Friend has mentioned power for shareholders and political interference. Does she agree that it is not right for the Government to intervene in certain situations, such as in the financial crash, when the last Prime Minister effectively pushed Lloyds TSB and RBS into a shotgun marriage?

[Andrea Leadsom]

I agree with my hon. Friend in principle. We want to see the market working properly, shareholders taking the decisions on remuneration and businesses acting fairly in the interests of all their stakeholders. That is why we have been so determined to sort out transparency, fairness and the binding votes that boards have in regard to the actions of the banks.

Our desire to see a lack of political intervention is why we have opposed and continue to oppose the deeply flawed and politically motivated EU cap on bonuses. My right hon. Friend the Chancellor, the Governor of the Bank of England and the head of the Prudential Regulation Authority agree that it will not control bankers’ pay, but instead push up fixed pay, make it more difficult to claw back earnings when things go wrong, weaken financial stability and make it more likely that the taxpayer, rather than the banker, pays the cost of mistakes. We continue to believe that the cap is fundamentally flawed. Members will know that we have, however, withdrawn our legal challenge to the cap and are instead looking at how else we can build a system of pay in global banking that encourages responsibility, rather than undermines it.

Financial Conduct Authority Redress Scheme

Debate between Andrea Leadsom and Marcus Jones

Thursday 4th December 2014 Commons Chamber

[Andrea Leadsom]

I am sorry, but I will not give way.

Many Members have mentioned the financial ombudsman scheme’s money award limit that it is able to offer to customers. This level was deemed to be most appropriate. It does ensure that most complaints made by consumers and micro-enterprises can be addressed, but reflects the fact that cases involving very large sums of money may be more appropriately dealt with by the courts, rather than an informal process that has limited prospects of appeal.

In the event that the financial ombudsman scheme considers that fair compensation requires payment of a larger amount, it can make a recommendation that a firm pay the balance. That decision on the higher amount is not binding on the firm, but there is evidence that suggests that firms that subsequently go to the courts will find the courts take into account the recommendation of the FOS in determining what the outcome should be.

[Mr Marcus Jones]

Does my hon. Friend not accept, however, that many of these businesses are extremely small and are not in a position to go to law to see the ombudsman’s recommendation backed up, and that therefore the ombudsman’s remit in terms of the damages it can impose needs to be wider?

[Andrea Leadsom]

I agree with my hon. Friend in principle, but, as I have just set out, the intention has been that the sophistication test captures those who are not sophisticated as well as those businesses that are small and do not have the means to go to the courts. In addition, if they have been to the FOS, the intention is that that would cover the vast majority of cases. As I have said, I urge Members to write to me with any specific cases that they want me to look at.