LIBOR (FSA Investigation)

Debate between George Osborne and Nicholas Brown

Monday 2nd July 2012 Commons Chamber

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

Does the Chancellor identify shortcomings in existing anti-fraud legislation, apart from the costs of pursuing an investigation and a prosecution? Will he confirm to the House that there will be no constraints on either investigation or prosecution costs?

[Mr Osborne]

There will be no constraints because of cost.

LIBOR (FSA Investigation)

Debate between George Osborne and Nicholas Brown

Thursday 28th June 2012 Commons Chamber

[Mr Osborne]

My hon. Friend was prescient in making his case. He has pointed to something that concerns a number of people: the apparent ability of, for example, authorities in the United States to use criminal sanctions, while the authorities in the UK have not been granted those powers by Parliament. That is precisely what we are looking at.

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

The Government’s new financial services regulatory architecture puts a lot of power and responsibility on the shoulders of the Governor of the Bank of England, but proposes no change to the relationship between the regulator and Parliament. May I ask the Chancellor to reflect again on the relationship of the House and the other place with the regulator, and how best we can establish a continuing—not adversarial—dialogue with the regulator so that problems, such as the one that he has shockingly reported to the House, can be explored and reflected on in a mature way, and not subjected to party political point scoring?

[Mr Osborne]

Of course, it is important that the regulator, including the Bank of England, is accountable to Parliament for its actions, and has to answer for its actions, while at the same time—and I think that there is cross-party support for this—we maintain the independence of the Monetary Policy Committee and the Governor in his role. The Financial Services Bill includes many new tools to increase accountability to Parliament and to the public. In the White Paper that accompanied publication of the Bill, we set out further changes that we are making in the House of Lords to increase that accountability.

Independent Banking Commission Report

Debate between George Osborne and Nicholas Brown

Monday 12th September 2011 Commons Chamber

[Mr Osborne]

I can absolutely give my hon. Friend that assurance. The report addresses the issue of Lloyds, which is required to sell branches under European Union state aid requirements. John Vickers thinks that the key test for the Government’s handling of the Lloyds issue will be whether we have created an effective challenger bank. He thinks that any such new bank should have about 6% of the personal current account market, which is more than the state aid proposals would lead to, and that it should be properly funded. I take those recommendations very seriously.

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

What reassurance can the Chancellor give the House that the ring-fencing will be effective at the time when it is most likely to be tested—namely, in the run-up to another debt or liquidity crisis? I listened to his earlier answer about the investment banks putting money into the high street banks, and about that being an advantage for the proposals for ring-fencing, but I have to tell him that I do not find that wholly convincing. If the idea is to get support, he has to be able to explain to the House how this proposal will work when it is required to do so.

[Mr Osborne]

In a sense, the right hon. Gentleman is right. The proof of all the arrangements that we are putting in place, and the international arrangements, will be in the pudding—although it is not really the kind of pudding that we want, because it is a banking crisis.