Royal Bank of Scotland (FSA Report)

Debate between David Morris and Mark Hoban

Monday 12th December 2011 Commons Chamber

[Mr Hoban]

It is our commitment to implement Basel III. We want to ensure that it is implemented consistently across the whole of Europe in capital requirements directive IV and we are pushing for member states to have the freedom to go further and raise capital standards when they believe it is in their interests to do so. We want to see tougher regulation of banks and that requires better and more capital and better and more liquidity.

[David Morris (Morecambe and Lunesdale) (Con)]

The FSA’s report mentions three Ministers in the previous Government who applied sustained political pressure to give a light touch, shall we say, to the regulation. Can my hon. Friend tell me who they were?

[Mr Hoban]

It is interesting, is it not? It is not often that we see particular Ministers highlighted in reports published by independent bodies. The three who are mentioned are Tony Blair, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown) and the shadow Chancellor. The shadow Chancellor took great pride in taking credit for the design of the regulatory structure, which failed, and he compounded those mistakes in the design of the structure by putting pressure on the FSA to go for a light-touch regime. The taxpayer has picked up the consequences of the failure to design that structure correctly and of the inappropriate pressure to have a light-touch regime when it came to the regulation of RBS and others. The taxpayer is paying the cost and the Opposition should be apologising for that.