Oral Answers to Questions

David Tredinnick Excerpts

Tuesday 8th February 2011 Commons Chamber

[Jane Ellison (Battersea) (Con)]

3. What progress he has made in reforming the tripartite system of financial regulation.

[David Tredinnick (Bosworth) (Con)]

10. What progress he has made in reforming the tripartite system of financial regulation.

[The Chancellor of the Exchequer (Mr George Osborne)]

The tripartite system of financial regulation put in place by the new Chancellor and his advisers in 1997 failed spectacularly and cost the British people billions of pounds. That is why we are replacing the tripartite system with a much tougher and more coherent regime led by the Bank of England. We aim to have that system in place by the end of 2012. I repeat what I just said: we have today increased the rate of the Government’s permanent bank levy for this year in order to raise £2.5 billion net. This will mean that the banks pay more in tax in each and every year of this Government than they did in the last year of the previous Government. Through this new bank tax being made permanent and with the revenue announcement today, the banks will be making a fairer contribution to our economic recovery.

--- Later in debate ---

[Mr Osborne]

My hon. Friend is right. It was an interesting admission from the Leader of the Opposition that things started to go badly wrong when he was an adviser at the Treasury. Maybe the man he did the photocopying for will make a similar admission. The creation of a consumer protection and markets agency will provide a stronger consumer voice and a consumer champion. It will be a world-class regulator. We are assembling the right team to run that agency, including many talented people who were at the Financial Services Authority. I am delighted that Martin Wheatley has been appointed as the chief executive designate. He has an outstanding record as a regulator around the world and his arrival bodes well for the future of the new agency.

[David Tredinnick]

Was the three-way split in financial regulation the worst financial decision taken by the previous Government, or has something else caught my right hon. Friend’s eye?

[Mr George Osborne]

There is the selling off of the gold at a record low and the pensions tax that destroyed our pensions system, but I have to say that, in terms of sheer cost to the British taxpayer, the system of regulation designed by the shadow Chancellor was pretty catastrophic.