Infrastructure Bill [HL]

Debate between Baroness Kramer and Lord McFall of Alcluith

Thursday 3rd July 2014 Grand Committee

[Lord McFall of Alcluith (Lab)]

My Lords, I support the noble Lord, Lord Whitty, in what he says. The Treasury has been rigid in its application, but there was a great initiative on innovation by the Chancellor in the last Budget, whereby he put £130 billion behind the Help to Buy scheme, which some would call the “help to vote” scheme. That was the Treasury showing real initiative. If the Chancellor can do it for the housing market and show flexibility there, why can we not do it for infrastructure at a time when borrowing is at its lowest ever? If we cannot do it now, we will never be able to do it.

[Baroness Kramer]

My Lords, I have to be quite quick to be sure that I finish before rising time, so these will be somewhat abbreviated responses. A strange hare may have been started running by some of the language used here. The commercial activities that the SHC engages with, such as selling salt supplies to the local authorities, is all piddly ante stuff, to be taken care of in the governance documents rather than the RIS, which I think is the relevant place for it.

As for funding road infrastructure, the power to retain decision-making over tolls or tariffs for the Secretary of State, under the amendment to Clause 6, is just not necessary, because all the powers to make decisions over tolls or road usage remain with the Secretary of State, who is not minded to enter into road pricing—although that may distress some noble Lords who have spoken here tonight.

It would be possible for the Secretary of State to permit this body to raise its own financing, but he would have to give that permission. Given the way in which the Government work, there would have to be Treasury support for that. This Government certainly are not minded to do it because, as the noble Lord, Lord Whitty, said, borrowings would go into the public sector borrowing requirement. Therefore, to pay higher pricing for financing that could be obtained by the Government themselves borrowing directly is not something that this Government are minded to do for their road infrastructure. This project commits long-term funding, which will come overwhelmingly from the Government. An exception might be possible if there were a discrete road project, which might be PFIed, although nothing in that range is being contemplated at the moment.

Looking at all those issues, while it may disappoint Members that we are not engaging in plans for road pricing or extensive borrowing by the HCA in the public markets, I still ask the noble Lords to withdraw their amendments and understand that this is really a policy issue and that the Government have made appropriate decisions in determining these issues.

Financial Services Bill

Debate between Baroness Kramer and Lord McFall of Alcluith

Monday 15th October 2012 Lords Chamber

[Lord McFall of Alcluith]

My Lords, I support my noble friend Lord Kennedy in his proposal, not least because, on my way down on the train today, I received a call from 0843 5600827. They wished to talk to me about my PPI claim of £3,350. Notwithstanding that, I received a text message saying that “time is running out”. I have never taken out a PPI policy.

This is an example of the instability which the industry is suffering at the moment because of this situation. I did chair a committee with consumer and industry representatives two months ago, in order for them to approach the MoJ to try to sort this issue out. Given these demands that have been made on the industry, the £8 billion that has been put aside for PPI mis-selling will surely increase. Let us not forget that we have interest rate swaps. On one of the sub-committees of the Parliamentary Commission on Banking Standards, of which I am a member along with the noble Lord, Lord Lawson, I asked an expert on interest rate swaps about the £8 billion. He said that that mis-selling could dwarf the £8 billion for PPI.

So this issue is current and will have a destabilising effect on the industry for the next few years, and also on consumers’ confidence. I do not think that the Government can escape their responsibilities on that by saying that this is not really a financial services matter, but for the MoJ. It is most certainly having an impact on financial services at the moment. Therefore, as a matter of urgency, the Government should take note of my noble friend Lord Kennedy’s amendment so that they can look at this issue in the cold light of day, outwith this Chamber, and get an adequate and decent solution, both for the industry and for the consumers who are suffering.

[Baroness Kramer]

My Lords, I suspect that everyone in this House has been plagued by the various attempts by the claims industry to get us to pass over all kinds of personal details. That worries me. Anecdotally, I have heard reports of people who responded positively to one of these messages and handed over their credit card details. They then found themselves being charged without realising that they were getting themselves into that situation. We have talked to various institutions, many of which say that half the claims presented to them are from people who have never had any relationship with them whatever. It was entirely a fishing expedition. At a time when we want our banks to focus on appropriate lending to individuals and small businesses, which they are all struggling to do effectively, to have the complete distraction and cost associated with keeping this abusive industry afloat is surely unacceptable to all of us.

Financial Services Bill

Debate between Baroness Kramer and Lord McFall of Alcluith

Monday 8th October 2012 Lords Chamber

[Baroness Kramer]

My Lords, I want to speak very briefly to Amendment 150B in this group. As your Lordships will know, the Bill amends Section 55 of FiSMA. Section 55Q as now in the Bill refers to the,

“Exercise of power in support of overseas regulator”.

I would like the Minister to clarify the definition of “overseas regulator” because neither I nor some of those who are much more sophisticated than me in trying to understand regulation are fully certain whether that definition would include an agency or instrumentality of the European Union such as the three supervisory authorities—the ESMA, the EBA and the EIOPA—which have direct regulatory powers in their own right. All I am asking for at this point is some clarification as to whether these EU agencies or instrumentalities are encompassed in this and if they are not, why not.

[Lord McFall of Alcluith]

I will briefly refer to Amendments 151 and 152. They oblige the regulator to have regard to those associated with a person who has applied for, or has been given, permission. We realise that proposed new Section 55R provides that when considering previous issues the regulator may have regard to the applicants’ relationship. I suggest that this provision should be mandatory rather than discretionary and that relationships should be defined as including family, business or other associations. It would bring more clarity to the interpretation of this clause.

Financial Services Bill

Debate between Baroness Kramer and Lord McFall of Alcluith

Wednesday 18th July 2012 Lords Chamber

[Lord McFall of Alcluith]

My Lords, I should like to add my support. My name is not on the amendment. A number of months ago I spoke to Giles Andrew, of Zopa, about peer-to-peer lending, and I was very taken by what he said. I think back to the MPC and the American whose name escapes me but who is just departing from the MPC to take up a post at the Peterson Institute in America and his comments about a spare tyre. We lack a spare tyre in the UK in terms of our banking. Whether it is a Labour Government or this Government, none of us has solved the problem of getting lending out. We have a lot to learn in that area. Our top banks are responsible for 450% to 500% of our GDP. We will not make progress on that. This initiative should be looked at. Nothing fundamental will change tonight but it is good that it is on the agenda and I am delighted to be associated with it.

[Baroness Kramer]

My Lords, I am in full agreement with the three previous speakers, who have covered virtually all the territory—which at this hour I will not repeat. However, I should like to add one point. The only argument that I have received from Ministers outlining why this area should not be regulated is that regulation is potentially too heavy-handed and will prevent the sort of growth of a new, young industry. I think that in this House we have rather more faith in the regulator, which has begun to move forward and understand that appropriate and proportionate regulation is a standard that can be achieved. I say that in order to pick up the entity to which the noble Lord, Lord Lucas, referred. Unlike the peer-to-peer lenders which fall outside the current regulatory framework, Seedrs had to be regulated because it is marketing equity investments. It falls into the regulated arena and has had to seek authorisation.

I quote from the blog of the chief executive:

“The authorisation process was long and sometimes painful, but we feel that it was an absolute necessity in order to satisfy both the letter and the spirit of the law. The FSA scrutinised every aspect of our business model and operations, and after over a year of iterative questions and answers, they gave us the go-ahead.

We are proud to be the first platform of our kind to receive FSA authorisation—or, to our knowledge, approval by a major financial regulator anywhere in the world. But more importantly, we are convinced that it was the right thing to do to go down this route, and we now look forward to launching the Seedrs platform as a fully authorised business”.

It is using the authorisation as a marketing mechanism. Having talked to the regulator and then followed through with Seedrs publications, it is clear that both sides have been satisfied with this process. Rather than being too onerous, there is a sense that regulation has been appropriate and that the authorisation has matched the circumstances. If we can achieve that with the equity platform, surely we can achieve that with the lending platform.