Financial Services Bill

Florence Eshalomi Excerpts

Report stage & 3rd reading & 3rd reading: House of Commons & Report stage: House of Commons
Wednesday 13th January 2021 Commons Chamber

[Sir Robert Neill (Bromley and Chislehurst) (Con) [V]]

There are a lot of good things in the Bill that I welcome, and I refer to my entry in the Register of Members’ Financial Interests. I welcome the assistance given to financial services in Gibraltar, and I welcome a number of the technical changes to the operation of retained European law in relation to markets. I particularly welcome new clause 6, on FinTech, which is a really important growth sector for this country. Added to the listing regime changes in the Bill, this gives us the opportunity to encourage the bringing forward of initial public offerings of FinTech companies in the UK and to build a critical mass.

I have sympathy for new clause 4, but I do not want to pre-empt the work of the Law Commission. That said, the Government do have to act more swiftly and with more urgency in relation to reform of corporate criminal liability. It has been kicking around for a long time. The Justice Committee has heard compelling evidence on the need for reform. I do not accept the contention that there is a balance on this. The balance of evidence is clearly in favour of reform. Both the current and former directors of the Serious Fraud Office have highlighted the deficiency in criminal liability in this field, as have at least two former Attorneys General. I hope that as soon as the Law Commission reports, we will move swiftly to enact this reform, because we lag behind other jurisdictions in this regard.

The other area where I do not think it is necessary to legislate is progress on equivalence. Although we may not need to legislate, it is really important that the Government address this with urgency. Of course, as we build our way forward outside the EU it will not always be appropriate to follow everything by way of regulatory equivalence, but there are many instances in which it will be very much in the interest of the City and the broader financial services sector to do so.

In the immediate term, is important that we acquire further equivalence agreements with our EU partners; that is in the interests of both sides. Currently, we have a commitment to a memorandum of understanding by the end of March, but the EU says that it has no immediate plans for further equivalence discussions. That needs to be resolved. Although it does not require legislation, we need from Ministers greater commitment to resolving the issue. There has sometimes been a feeling that financial services are being taken for granted in the Brexit negotiations; that needs to be put to bed. Financial services are the jewel in the economic crown of this country and need to be front and centre of our ongoing economic policy.

[Florence Eshalomi (Vauxhall) (Lab/Co-op) [V]]

I wish to focus my remarks on amendments 1 and 2, tabled in the name of the Leader of the Opposition. As my right hon. Friend the Member for Wolverhampton South East (Mr McFadden) said, the amendments are desperately needed now to ensure that regulators must take into account the Government’s target of achieving net zero carbon emissions by 2050. I was therefore disappointed to hear from the Minister that the Government will not support the amendments but might “consider” the matter “in the future”. We cannot afford to wait. Climate emissions are cumulative, and a large part of the carbon that we produce today will stay in the atmosphere for hundreds, if not thousands, of years.

If we are serious about tackling the climate emergency and reaching our 2050 target, we must reduce our emissions as quickly as possible. The sensible and least-destructive way to do that is to start to adapt our economy now; the irresponsible thing would be to leave it too late, thereby making the inevitable economic adjustment more painful for everyone. Regulation is one of the most powerful tools in our box of options and will ensure that the whole financial sector is unified in its actions towards this really important goal and, most crucially, acts within a timeframe that reflects the climate emergency we face.

I do not want my two young children to ask me one day why I missed the opportunity to fight for a better, more sustainable future for them. That is why I will support amendments 1 and 2, and I urge all Members in the House to join me.

[Jessica Morden (Newport East) (Lab) [V]]

I wish to speak briefly in support of new clause 7, tabled by my hon. Friend the Member for Walthamstow (Stella Creasy), to whom I pay tribute for her work with campaigners on the issue. Her new clause would require buy-now-pay-later operators to be regulated by the FCA.

As others have said, buy-now-pay-later is a new and growing industry, the popularity of which has rocketed in the pandemic, with one company reporting a 43% increase in sales. It is a form of credit that promotes impulse buying—one in four users spend more than they planned—and it is targeted at young consumers who are pursued by companies using celebrity influencers and targeted ads. StepChange, the debt charity, is seeing many more under-40s coming forward for advice with this type of debt. Let us protect consumers and properly regulate the sector, which is currently uncontrolled and operating with a social media-savvy face. Let us not wait for people to get into trouble with unsustainable levels of debt, particularly when we will see an increase in personal debt because of the pandemic.