Oral Answers to Questions

Debate between Dave Doogan and Bim Afolami

Tuesday 19th December 2023 Commons Chamber

[Dave Doogan (Angus) (SNP)]

UK capital requirement regulations mandate a 50% level of capitalisation to be held by lenders for longer terms as opposed to 20% for shorter terms. Car manufacturer banks, such as Renault’s RCI Financial Services, underpin every franchise car dealer across these islands and operate on a seven-day notice period to terminate in order to minimise their capital requirements at 20%. The problem arises when a bank such as RCI maladministers a serious activity report, panics over its obligations under the regulations and terminates an award-winning Renault, Nissan and Dacia dealer such as Mackie Motors in my constituency with seven days’ notice. Will the Chancellor or one of his Ministers meet me to discuss this crisis?

[The Economic Secretary to the Treasury (Bim Afolami)]

I thank the hon. Gentleman for his question. Indeed, I will meet him to discuss the matter to make sure that this regulation does not have the adverse effects that he has outlined.