Queen's Speech Debate
Full Debate: Read Full DebateEarl of Caithness
Main Page: Earl of Caithness (Conservative - Excepted Hereditary)Department Debates - View all Earl of Caithness's debates with the Department for Environment, Food and Rural Affairs
(14 years, 2 months ago)
Lords ChamberMy Lords, I, too, congratulate my noble friends on their appointment as Ministers, particularly my noble friend Lord Henley on going back into the job. I served with him in government some time ago; to see him back on the Front Bench is a delight. He has a difficult job at Defra. I hope that he will pay attention to what the coalition wants and that there should be no gold-plating. Defra has been notorious for gold-plating some of the many regulations.
I know that another aspect will be drawn to my noble friend’s attention. It was highlighted by this House’s sub-committee on agriculture and the environment in discussing animal testing to try to get a level playing field across Europe. So often gold-plating is not necessary in the UK but Europe is not doing the same as us, which leads to added costs. My noble friend has a difficult challenge ahead with CAP reform. That has been talked about, but to try to undertake CAP reform in a period when one has to feed a growing world population will be an even harder job.
I shed absolutely no tears that we see the end of home information packs. I fought them tooth and nail all the way through the House. They were a complete waste of time and money by the Labour Government.
I notice that the coalition will,
“deliver an offshore electricity grid in order to support the development of a new generation of offshore wind power”.
It says nothing about wave and tidal power. Can my noble friend say anything about the proposals for wave and tidal power, particularly those that will affect us in the north of Scotland on the Pentland Firth? The right reverend Prelate the Bishop of Liverpool talked about renewables in the north-west of England, but the north of Scotland is also an area where the grid system is absolutely vital to development.
I watched with interest the relief on the faces of those in the Labour Party as it lost power, knowing full well that it had landed the new Government with what is called, in rugby terms, the hospital pass. Yet again, a Conservative Government must pick up a worse financial situation than they handed on to a Labour Government, and this one is particularly bad.
Our Government want to make the banking system better,
“to serve business, not the other way round”.
The words that are missing from that are “the individual”. I do not think that the banking system serves the individual. However, I was delighted to read that the Government,
“will establish an independent commission to investigate the complex issue of separating retail and investment banking in a sustainable way”.
Many of your Lordships will know that I have been banging this drum since, I think, 1997, when I made a speech on the issue from these Benches when the Conservative Government were still in power. In 2008 I introduced the Safety Deposit Current Accounts Bill, which—if it had been agreed—would have saved the banking sector from some of the financial problems that it came into.
I am a great believer in separating the retail and investment sides of banking, but it is not an easy solution. It is fraught with difficulties and I wonder whether this Government have the determination to do it. Separating retail from investment banking means that in the retail banking system the depositors should retain control over their money. At the moment, as your Lordships will be aware, if you deposit money at the bank, it no longer belongs to you; it belongs to the bank. You become an unsecured creditor. This is the result not of government legislation but of court cases in the 1800s—in 1811 and 1848. If we are going to reform the banking system, let us not tinker with it but look at what the real problem is. The real problem is how the banks work. There has been much criticism today of greedy bankers and the lack of regulation. That is true to an extent but the real problem is that the banking system itself is wrong. That is what needs to be reformed.
The ownership of deposits must return to the person who made the deposit rather than to the bank. That will also affect the money supply and inflation. By and large, it is the banks that create inflation. My noble friend Lord Ryder was absolutely right to drum that into us. It is something that we must avoid. Separating retail from investment banking and getting the banks to hold money for their depositors and not use that money for gambling purposes will reduce the money supply and go a long way towards stopping inflation. That is a courageous and bold step if the Government will take it. I hope that they will, but I fear that they will not.