Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill

Debate between Gareth Thomas and Guy Opperman

2nd reading
Tuesday 8th June 2021 Commons Chamber

[The Parliamentary Under-Secretary of State for Work and Pensions (Guy Opperman)]

I beg to move, That the Bill be read a Second time.

In the United Kingdom there are a wide range of opportunities for people to invest. The Government’s role is to try to ensure that the system of regulation and financial investment is suitably robust, so that individuals are treated fairly and have confidence in the financial system in which they invest. Unfortunately, no system of regulation can completely eradicate the risk that firms fail, or that there are bad actors intent on committing fraud. This short Bill is aimed at two areas where it is necessary for the Government to step in.

Clause 1 relates to a new Government scheme to compensate London Capital & Finance bond holders who lost money after the firm entered administration in 2019. Clause 2 will arrange a loan to the board of the pension protection fund to pay compensation to occupational pension scheme members who have been victims of pension fraud, following the recent High Court judgment in the case of PPF v. Dalriada. I will now expand briefly on those measures in detail.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

The Minister will understand that part of the reason why we are here today is because of Dame Elizabeth Gloster’s excoriating report into the capacity of the Financial Conduct Authority. Is he certain that the FCA now has the powers and, crucially, the capacity it needs to ensure that consumers of financial services businesses are properly protected?

[Guy Opperman]

Yes, I believe that is the case. The Treasury and the FCA are working together. The FCA is under new management, as the hon. Gentleman will be aware, and there is an acceptance by the FCA of all the findings in Dame Elizabeth Gloster’s report. More particularly there is fresh thinking, one hopes, that will be applied going forward.

Financial Guidance and Claims Bill [ Lords ] (Third sitting)

Debate between Gareth Thomas and Guy Opperman

Tuesday 6th February 2018 Public Bill Committees

[Gareth Thomas]

I am extremely grateful to you, Mr Rosindell, because you made your intervention just as I was drawing my remarks to an end. Given your great act of charity, I have made the three points I wanted to make, and I now look to the Minister to address my concerns.

[Guy Opperman]

That was undoubtedly the most ingenious way of creating a submission. I have to confess that, when I looked at the commencement order that I have to speak to, I did not expect to have to answer three specific points, but I hope I can give the hon. Gentleman a detailed answer. I assure him that if I fail in that task, I will give him a definitive answer next Monday, when we will meet to discuss these matters.

Let me take the hon. Gentleman’s points in reverse order. BrightHouse will be covered by the levy for the single financial guidance body. I believe that I will be able to give him more detail when I see him in 10 days’ time.

The hon. Gentleman will know that I founded and built up a credit union. I think I am the only MP to have been mad enough to do so—the grey hair I am rapidly acquiring is due to that mad endeavour, of which I am extremely proud. I am no longer specifically involved in it, but both I and my hon. Friend the Member for Salisbury are passionately committed to credit unions. We will review the nature of credit unions and how they are provided for statutorily under the Credit Unions Act 1979. I am happy to discuss that with the hon. Gentleman separately.

Let me make three points on access to data. First, the Money Advice Service already performs that service by creating a data bank and an information process by which it can judge the way ahead. Secondly, clause 18 specifically addresses requirements for the disclosure and interaction of data between the various bodies to ensure that the point the hon. Gentleman raised is addressed. Thirdly, with regard to the Bill as a whole, FCA work is also going on to obtain a quarterly dataset. Both the FCA and the Money Advice Service are doing that. I will happily reply in more detail to the three points that he rightly, and very ingeniously, put to me.

[Gareth Thomas]

I am grateful to the Minister for his generous response. Perhaps he would be willing to look kindly on a letter setting out some of the concerns about the dataset that is currently provided. I gently suggest that Ministers might engage with UK Finance to encourage the release of further data to help make that a more useful exercise.

[Guy Opperman]

I would be delighted to receive such a letter. I commend the Government amendments to the Committee.

Amendment 7 agreed to.

Amendments made: 8, in clause 29, page 25, line 37, at end insert—

“(3A) In section (Occupational pension schemes: requirements to recommend guidance etc)—

(a) subsections (1) to (5) extend to England and Wales and Scotland;

(b) subsections (6) to (9) extend to Northern Ireland.

(3B) Paragraph 25 of Schedule 3 extends to England and Wales and Scotland.”

New subsection (3A) updates the extent clause so that the amendments to the Pensions Schemes Act 1993 in NC2 extend only to England and Wales and Scotland and the amendments to the Pension Schemes (Northern Ireland) Act 1993 extend only to Northern Ireland. New subsection (3B) contains text previously in subsection (6) in consequence of restructuring this clause.

Amendment 9, in clause 29, page 25, line 38, leave out subsections (4) and (5) and insert—

“(4) Part 2, other than the provisions mentioned in subsections (5) and (5A), extends to England and Wales and Scotland.

(5) The following provisions extend to England and Wales—

(a) section24(12) and Schedule4;

(b) section27;

(c) section (PPI claims: interim restriction on charges imposed by legal practitioners after transfer of regulation to FCA).

(5A) Section (Cold calling about claims management services) extends to England and Wales, Scotland and Northern Ireland.”

This amends the extent clause, so that the new clause inserted by NC3 extends to England and Wales only, and the new clause inserted by NC6 extends to England and Wales, Scotland and Northern Ireland.

Amendment 10, in clause 29, page 25, line 42, leave out subsection (6) and insert—

“( ) This Part extends to England and Wales, Scotland and Northern Ireland.” —(Guy Opperman.)

This amendment contains a minor drafting change consequential upon the restructuring of the extent clause.

Clause 29, as amended, ordered to stand part of the Bill.

Clause 30

Commencement

Amendments made: 11, in clause 30, page 26, line 13, at end insert—

“(1A) Subsections (6) to (9) of section (Occupational pension schemes: requirements to recommend guidance etc) come into force on a day appointed by order made by the Department for Communities in Northern Ireland.

(1B) An order under subsection (1A) may make—

(a) transitional, transitory and saving provision in connection with the coming into force of any provision in section (Occupational pension schemes: requirements to recommend guidance etc)(6) to (9);

(b) incidental and supplementary provision, and

(c) different provision for different purposes,

and the power to make such an order is exercisable by statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979 (S.I. 1979/1573 (N.I. 12)).”

This amendment gives the power to bring into force the provisions amending the Pension Schemes (Northern Ireland) Act 1993 in the new clause inserted by NC2 to the Department for Communities in Northern Ireland.

Amendment 12, in clause 30, page 26, line 14, leave out “28” and insert “(PPI claims: interim restriction on charges imposed by legal practitioners after transfer of regulation to FCA)”

This amends the commencement clause, so that the new clause inserted by NC3 comes into force 2 months after Royal Assent.

Amendment 13, in clause 30, page 26, line 21, at end insert “except section (Occupational pension schemes: requirements to recommend guidance etc) (6) to (9)”

This amendment is consequential on amendment 11.

Amendment 14, in clause 30, page 26, line 29, at end insert “, and

(ii) section (Cold calling about claims management services)”

This amends the commencement clause to provide for NC6 about cold calling in relation to claims management services to be brought into force on a day appointed in regulations made by the Secretary of State.

Amendment 15, in clause 30, page 26, line 31, at end insert “, other than section (Cold calling about claims management services)”

This amendment is consequential on amendment 14.

Amendment 16, in clause 30, page 26, line 31, at end insert—

“( ) The Treasury must obtain the consent of the Lord Chancellor before making regulations under subsection (3) or (5) in relation to section (Legal services regulators’ rules: charges for claims management services).”—(Guy Opperman.)

This amendment requires the Treasury to obtain the consent of the Lord Chancellor before making regulations for the commencement of the new clause inserted by amendment NC4.

Clause 30, as amended, ordered to stand part of the Bill.

Capital Gains Tax (Rates)

Debate between Gareth Thomas and Guy Opperman

Wednesday 23rd June 2010 Commons Chamber

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Yesterday’s Budget should be judged on three key tests. First, will it protect and enhance economic growth, and nurture an all too fragile recovery from the worst global recession since the 1930s? Secondly, is it fair and will the poorest and those least able to defend themselves be affected the least? Thirdly, less than two months after the general election, does it reflect the election manifestos of the coalition Government? On each of those tests, the Government’s Budget is found wanting.

It would be remiss of me not to congratulate the hon. Members for Harrogate and Knaresborough (Andrew Jones) and for Carlisle (John Stevenson) on their maiden speeches. The hon. Member for Harrogate and Knaresborough made a fluent and interesting maiden speech. Having initiated the first debate on social enterprises in this House, I welcomed in particular his interest in and support for social enterprises. He talked about his constituency being affluent and having excellent schools; perhaps at another time, he might acknowledge more generously the part played by the excellent work of the previous Government in that respect. The hon. Member for Carlisle also made a fluent and interesting speech, offering generous praise to his predecessor, Eric Martlew, who continues to be well liked on both sides of the House. I hope that the hon. Gentleman will forgive me for being unable to share his assessment that the Budget was, although tough, also fair, but I shall come to that later.

This is the Conservative party’s Budget—no one seriously thinks that the Liberal Democrats were the driving force behind it, despite the protestations of the Business Secretary and others—and to listen to the Conservatives, one would think that there had not been a global recession. One would think that there was not a need to protect families or to keep demand in the economy, and that the borrowing and other measures that the previous Government took to stimulate the economy were not needed. We took decisive action to invest in the economy and to create the demand that the private sector needed to minimise business failures and job losses.

As the shadow Chancellor made clear, the measures that we took were continuing to have a positive impact. There was a return to growth—fragile, yes, but it was a return to growth. Unemployment was stabilising and starting to fall, while tax receipts were up and borrowing was lower than expected. The Office for Budget Responsibility has made it clear that the measures taken by the last Government are the reason why the economy is growing now. Indeed, those measures were part of Government spending plans which, as the shadow Chancellor pointed out, the party opposite supported until the end of 2008.

The run-up to the Budget was marked by a remarkable level of dangerous scaremongering by the party opposite. The Chancellor has been marching from one television studio to another and, like Don Quixote, he has continued to tilt away at Greek windmills while the Chief Secretary and now the Business Secretary have been competing to be Sancho Panza, bobbing loyally along behind.

We are not remotely in the same position as Greece, yet time after time, Front Benchers and Back Benchers opposite have sought to raise the spectre of Greece to justify the approach behind the Budget. The truth is that this Budget puts at risk a fragile economic recovery. On the OBR’s forecasts, growth will be down this year as a result of measures in the Budget, and down next year too. Unemployment will be higher as a result of the measures in the Budget, which will cut jobs in the public sector and the private sector too because, as my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith) noted, many companies supply goods and services to the Government. The OBR acknowledges that employment will drop by 100,000 as a result of this Budget, and it is true to say that many outside voices expect the figure to be higher still. With tens of thousands more on the dole queue and employment levels down, it is fair to say that this is a return to traditional Tory politics.

The Budget also fails the fairness test. It savages support for the poorest and most vulnerable. Child benefit will be cut, and tax credits reduced for families on low and modest incomes. Support for families with young children is being axed, and the VAT rise will hit the poorest hardest. The Conservative party promised not to balance the Budget on the backs of the poorest, yet they have done exactly that. The Financial Secretary may not yet be aware of the damning verdict of the Institute for Fiscal Studies on the fairness of this Budget, but it has said that it will

“hit the poorest hardest and…keep on hitting them more and more every year”.

The same point was made with considerable force by my hon. Friends the Members for Pontypridd (Owen Smith), for Ogmore (Huw Irranca-Davies), for Kingston upon Hull North (Diana R. Johnson) and for Derby North (Chris Williamson), and by the hon. Member for Brighton, Pavilion (Caroline Lucas).

[Guy Opperman]

Will the hon. Gentleman give way?

[Mr Thomas]

Given the time, no. I apologise to the hon. Gentleman.

The Budget also breaks clear promises made to the British people by the coalition partners at the election. The now Prime Minister told Jeremy Paxman in an interview in late April that his party had “absolutely no plans” to raise VAT. He recognised then that VAT was regressive and that it hit the poorest hardest. He said:

“It does, I absolutely promise you.”

The Deputy Prime Minister agreed that VAT was “very regressive”. He went further, making fear of Tory VAT plans a memorable part of his election campaigning. Yet now, with the electorate having cast their votes, we have an immediate volte-face from the parties opposite.

As my right hon. Friend the shadow Chancellor made clear, in a classic effort to pull the wool over the public’s eyes, those on the Government Front Bench use Labour measures to try to pretend that this Budget is fair. The charts deployed in the Red Book to justify that fantasy claim fail to acknowledge the scale of benefit reductions that will not have worked their way through fully in the period covered. They certainly do not include the impact of looming cuts in public services that are likely to hit the poorest households the most, or of changes to housing benefit. I have a specific question for the Financial Secretary: will he publish charts showing the impact of the Budget not just in 2012-13 but in future in years, by income distribution?

It is not just Opposition Members who recognise the unfairness of the Budget. Robert Chote, the head of the IFS, has said:

“The Budget looks less progressive, indeed somewhat regressive, when you take out the effect of measures that were inherited from the previous government—when you look further into the future than 2012-13 and when you include some other measures which the Treasury has chosen not to model.”

Some Liberal Democrats—perhaps those such as the Orange Book Liberals—will be entirely comfortable with the unfairness of this Budget. Others on the Liberal Democrat Benches need to find the courage of the convictions that they had before 6 May to challenge their Front Benchers.

This is a Budget that puts economic growth at risk. It fails the fairness test. The poorest will suffer the most. The IFS analysis blows away the pretence that we are all in this together. It is a Budget of broken promises. On VAT both coalition parties broke election promises. It is a Budget that is overwhelmingly Thatcherite in tone and we will not support it.