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Written Question
Pensions
7 Sep 2020

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what recent assessment his Department has made on the effect of reforming RPI to align with CPIH on pension schemes deficits.

Answered by John Glen

The Retail Prices Index (RPI) is a measure of inflation with a number of shortcomings. To address these shortcomings, the UK Statistics Authority (UKSA) has made a proposal to reform RPI by bringing the methods and data sources of the Consumer Prices Index including owner occupiers’ housing costs (CPIH) into RPI. Owing to the use of RPI in specific index-linked gilts, prior to 2030 the Chancellor’s consent to this proposal is required before it can be implemented.

At the Budget in March, the government and UKSA launched a consultation to consider whether UKSA’s proposal should be implemented at a date other than 2030, and, if so, when between 2025 and 2030. The consultation closed for responses on 21 August. As part of the consultation, the government has invited views on matters including how the holders of the government’s issues of index-linked gilts, all of which use RPI as their reference rate, will be affected by the implementation of reform. As noted in this year’s Debt Management Report, pension funds are a major holder of index-linked gilts. The consultation also contained a section which invited views on the broader impacts of the proposed reform of RPI.

The government and UKSA will respond to the consultation in the autumn.


Written Question
Occupational Pensions
7 Sep 2020

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what recent assessment his Department has made of the effect of reforming RPI to align with CPIH on employee pensions in (a) 2025 and (b) 2030.

Answered by John Glen

The Retail Prices Index (RPI) is a measure of inflation with a number of shortcomings. To address these shortcomings, the UK Statistics Authority (UKSA) has made a proposal to reform RPI by bringing the methods and data sources of the Consumer Prices Index including owner occupiers’ housing costs (CPIH) into RPI. Owing to the use of RPI in specific index-linked gilts, prior to 2030 the Chancellor’s consent to this proposal is required before it can be implemented.

At the Budget in March, the government and UKSA launched a consultation to consider whether UKSA’s proposal should be implemented at a date other than 2030, and, if so, when between 2025 and 2030. The consultation closed for responses on 21 August. As part of the consultation, the government has sought views on the broader impacts of the proposed reform of RPI.

The government and UKSA will respond to the consultation in the autumn.


Written Question
Self-employment Income Support Scheme: Driving Instruction
8 Jul 2020

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, whether driving instructors will remain eligible for the second grant under the Self-Employment Income Support Scheme if (a) they choose not to return to providing lessons on 4 July as the covid-19 lockdown restrictions are eased and (b) if their business is significantly lower than before the covid-19 lockdown.

Answered by Jesse Norman

The Self-Employment Income Support Scheme (SEISS) helps those adversely affected by COVID-19. Eligible self-employed driving instructors, and others whose businesses are adversely affected by COVID-19 on or after 14 July will be able to claim a second and final SEISS grant when the scheme reopens for applications in August.

A business would be adversely affected if its income is significantly lower because of COVID-19.

More information about when a business would be adversely affected can be found at https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme

and further examples can be found at

https://www.gov.uk/guidance/how-different-circumstances-affect-the-self-employment-income-support-scheme#adversely-affected-examples.


Written Question
Business: Coronavirus
25 Mar 2020

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, whether he plans to bring forward legislative proposals to support businesses operating as (a) co-operatives and (b) mutuals during the covid-19 outbreak.

Answered by Jesse Norman

The Chancellor has set out a package of temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19.

This package includes a £10,000 cash grant to the smallest businesses, delivered by local authorities. Small businesses, including co-operatives, that pay little or no business rates and are eligible for small business rate relief or rural rate relief will be contacted by their local authority; they do not need to apply. The funding will be provided to local authorities in early April.

The package also includes the Coronavirus Business Interruption Loan Scheme (CBILS), offering loans of up to £5 million for SMEs through the British Business Bank (BBB). Where co-operatives meet the eligibility conditions, including operating within an eligible industrial sector, they may be eligible for loans under CBILS. Final decision-making on whether a small business is eligible for CBILS is delegated to the accredited lender.

The Government recognises the value of co-operatives and mutuals, and officials will continue to engage with representatives from across the sector to understand the impact of the disruption caused by COVID-19.


Written Question
Occupational Pensions: Tax Allowances
5 Mar 2020

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what assessment he has made of the estimated annual cost of providing tax relief to beneficiaries on pension pots inherited before the recipient is 75.

Answered by John Glen

Since April 2015, individuals were able to pass on their unused defined contribution pension savings up to their Lifetime Allowance to any nominated beneficiary when they die, instead of paying the 55 per cent Income Tax charge which applied to most cases prior to that date.

The Exchequer cost of this change was set out at Autumn Statement 2014. In particular, information has been published on page 46 of the ‘Autumn Statement 2014 policy costings’ document, available here: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/384071/AS2014_policy_costings_final.pdf


Written Question
Financial Services: EU Law
29 Jan 2020

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

What plans the Government has to comply with provisions of the Markets in Financial Institutions Directive on broker dealers after the UK leaves the EU.

Answered by John Glen

We will leave the EU on 31 January with the same regulatory rulebook, including Markets in Financial Instruments Directive (MiFID) II regulations on broker dealers, as the EU27. We have brought MiFID II regulations into UK law. Firms will be expected to comply with these UK regulations after the Implementation Period.

The UK is committed to building a strong and mutually beneficial future relationship on Financial Services with the EU after we leave.


Written Question
Financial Services: Trade Agreements
24 Jan 2020

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, whether it is the Government's policy that the UK EU trade deal will include the financial services sector.

Answered by John Glen

Yes. The UK has always been clear that we are seeking a broad and stable future relationship with the EU in financial services.
Written Question
Public Works Loan Board
29 Oct 2019

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, for what reason (a) the borrowing rate for local authorities from the Public Works Loan Board was increased by HM Treasury by 100bps on 9 October 2019 and (b) that increase was not disclosed in a Delegated Legislation Committee which considered the Instrument that increased the borrowing limit for that board on 3 October 2019.

Answered by John Glen

The Public Works Loan Board enables Local Authorities to borrow money at low rates. Some local authorities substantially increased their use of the Public Works Loan Board over the summer, as the cost of borrowing fell to record lows. To ensure the continued availability of lending for local government investment in capital projects the Government increased the level of available PWLB funding by £10 billion and restored rates to levels available in 2018. In 2018 Local Authorities delivered £25.8bn of capital expenditure in England.

Borrowing from the Public Works Loan Board sits on the Government’s balance sheet and HM Treasury keeps this under review.

It was not possible to announce the rate change prior to its implementation because the change was market sensitive.


Written Question
Financial Services: EU Countries
21 Oct 2019

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what the Government's preferred method is of ensuring continued market access to the EU for UK-based financial services firms after the UK leaves the EU.

Answered by John Glen

The Government is determined to leave the EU with a deal. We are committed to an ambitious, broad, deep and flexible economic partnership, based on a best in class Free Trade Agreement. This is the best way to maintain and enhance our position as an open, global leader in financial services after we leave the EU.

The UK is committed to a relationship based on an expanded and improved approach to equivalence. That is the best short and long-term solution for markets, firms and investors in both the UK and the EU. Such a relationship respects the autonomy of each Party over judgements about access to their market and over legislation.


Written Question
Mortgages
13 May 2019

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what steps the Government has taken to improve access to the mortgage market for underserved groups.

Answered by John Glen

The Government is committed to maintaining an accessible mortgage market. The Financial Conduct Authority (FCA), which is responsible for regulating the market and protecting consumers, found in their Mortgage Market Study, published March 2019, that the market is working well and that consumers have access to mortgages that are suitable and affordable.

The FCA recognises that lenders should have flexibility to decide what type of evidence of income they can accept from customers, including those who are self-employed or have alternative sources of income.

Many lenders also offer custom mortgage products designed for contractors or the self-employed. These commonly include features designed to account for income volatility, such as the ability to make capital repayments at any time, or income assessments using averaged figures to smooth out monthly variations.

Beyond the FCA’s regulations, decisions around the type and availability of mortgage products are commercial decisions for lenders, and the Government does not seek to intervene in these decisions.


Written Question
Mortgages
13 May 2019

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what steps the Government is taking to improve access to the mortgage market for (a) small business owners, (b) self-employed people and (c) people working in the gig economy.

Answered by John Glen

The Government is committed to maintaining an accessible mortgage market. The Financial Conduct Authority (FCA), which is responsible for regulating the market and protecting consumers, found in their Mortgage Market Study, published March 2019, that the market is working well and that consumers have access to mortgages that are suitable and affordable.

The FCA recognises that lenders should have flexibility to decide what type of evidence of income they can accept from customers, including those who are self-employed or have alternative sources of income.

Many lenders also offer custom mortgage products designed for contractors or the self-employed. These commonly include features designed to account for income volatility, such as the ability to make capital repayments at any time, or income assessments using averaged figures to smooth out monthly variations.

Beyond the FCA’s regulations, decisions around the type and availability of mortgage products are commercial decisions for lenders, and the Government does not seek to intervene in these decisions.


Written Question
Mortgages
10 Apr 2019

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what steps the Government is taking to encourage greater switching and transparency in the UK mortgage market.

Answered by John Glen

The FCA’s final report of the Mortgage Market Study found that there are high levels of consumer engagement, with over three quarters of consumers switching to a new mortgage deal within 6 months of moving onto a reversion rate.

The Government has worked closely with the FCA to consider how to remove the regulatory barriers that prevent some customers, particularly those with inactive lenders, from accessing better deals. The Government welcomes the FCA’s plans to move the affordability assessment from an absolute test to a relative one. This change removes the regulatory barrier that prevented some customers, who otherwise may have been able to switch, from accessing new mortgage products. The Government also welcomes the industry voluntary agreement covering 95% of the UK mortgage market to help ‘trapped’ customers of active lenders.

Transparency and fairness in the mortgage market is a priority for the Government. The Treasury welcomes and supports the work the FCA are doing to improve this as a result of their findings in the final report of the Mortgage Market Study. The Government will continue to monitor the market and support the FCA when necessary.


Written Question
Access to Cash Review
26 Mar 2019

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what steps the Government is taking to (a) minimise the effect of IT outages on consumers’ ability to pay for goods and services and (b) ensure that digital payment systems are more reliable.

Answered by John Glen

We take the operational resilience of the finance sector and any detrimental impacts on consumers very seriously. HM Treasury works closely with the Bank of England, the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) (collectively the ‘Financial Authorities’) to assess, test and improve the operational resilience of the sector and to respond to any major disruption, including to payment systems.

In July 2018, the PRA and the FCA published a joint Discussion Paper on an approach to improve the operational resilience of firms and financial market infrastructures, including to payment systems. The Authorities will use responses to this to inform supervisory activity and future policy-making to support firms’ and FMIs’ operational resilience[i].

The Financial Authorities also have a single mechanism, the Authorities’ Response Framework, to coordinate a response to incidents affecting the finance sector. The Financial Authorities regularly exercise incident response frameworks with the sector to assess their effectiveness and identify improvements. The Bank of England held a sector resilience exercise (SIMEX18) in November 2018 which tested the joint response by public authorities and industry to a simulated disruption.

1 https://www.bankofengland.co.uk/-/media/boe/files/prudential-regulation/discussion-paper/2018/dp118.pdf?la=en&hash=4238F3B14D839EBE6BEFBD6B5E5634FB95197D8A


Written Question
Access to Cash Review
26 Mar 2019

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, when his Department plans to publish the findings from its call for evidence on cash and digital payments; and what steps he is taking to progress that work.

Answered by John Glen

Following a programme of currency modernisation we initiated a discussion on payment methods last year, through our Call for Evidence on Cash and Digital Payments in the New Economy. This was launched at Spring Statement 2018. This sought to gather evidence on how changing preferences for cash and digital payments impact on different sectors, regions and demographics. Furthermore, it demonstrated the Government’s intent to explore how cash can remain accessible.

The Government intends to publish a response to this Call for Evidence in due course.


Written Question
Access to Cash Review
26 Mar 2019

Questioner: Jonathan Reynolds (LAB - Stalybridge and Hyde)

Question

To ask the Chancellor of the Exchequer, what steps his Department is taking to examine the (a) role of cash in the UK and (b) effect of reduced access to cash has on different groups and communities.

Answered by John Glen

Following a programme of currency modernisation we initiated a discussion on payment methods last year, through our Call for Evidence on Cash and Digital Payments in the New Economy. This was launched at Spring Statement 2018. This sought to gather evidence on how changing preferences for cash and digital payments impact on different sectors, regions and demographics. Furthermore, it demonstrated the Government’s intent to explore how cash can remain accessible.

The Government intends to publish a response to this Call for Evidence in due course.