Business of the House

John Glen Excerpts

Thursday 18th April 2013 Commons Chamber

[John Glen (Salisbury) (Con)]

Two of my constituents recently contacted me about a loophole that allowed the Bank of Ireland to raise the differential rate on their mortgage, leading to a 200% increase. The Financial Services Authority argued that it could do nothing about it, as it had happened before 2004. Will the Leader of the House make time for a statement from the Treasury so that we can find out what can be done about this?

[Mr Lansley]

My hon. Friend raises an important point. As he suggested, such cases are the responsibility of what is now the Financial Conduct Authority, and he will know that Martin Wheatley, the chief executive of the FCA, has exchanged correspondence on the matter with the Chair of the Treasury Select Committee, my hon. Friend the Member for Chichester (Mr Tyrie). Those letters have been published on the parliamentary website. Mr Wheatley states:

“We currently have no plans to treat this as a prima facie case of mis-selling.”

In the case of the constituent of my hon. Friend the Member for Salisbury (John Glen), the FCA appears to cite the fact that the mortgages originated before such mortgages were included in the scope of regulation in 2004, and that to address the issue would require retrospective legislation. My hon. Friend will understand that we could consider that only in the most exceptional circumstances. However, I understand that the Bank of Ireland has waived early repayment charges for customers affected by the changes. That might mean that his constituents will be able to find a more competitive rate elsewhere.