Kalifa Review of UK Fintech

Debate between Lord Agnew of Oulton and Lord Flight

Tuesday 27th April 2021 Lords Chamber

[Lord Agnew of Oulton (Con)]

My Lords, we are certainly keen to support the creation of a centre for finance, innovation and technology. In UK FinTech Week the Chancellor announced his support for the industry, and we certainly recognise a private sector-led centre for finance, innovation and technology’s potential as an accelerator of fintech sector growth. This can be achieved through research, thought leadership and working with regional fintech hubs and national fintech bodies. The Government are committed to working with industry to make this a reality.

[Lord Flight (Con)]

My Lords, as we have just heard, the Government welcomed the recommendations of the Kalifa review, which has diagnosed the ingredients, including the EIS, that have led to the UK economy blossoming over the last decade, especially the SME sector. I have been chairman of the EIS Association during this time. The UK is recognised as the best place to start and scale up a business. What aspects of the findings of the Kalifa report do the Government view as the most important?

[Lord Agnew of Oulton (Con)]

I gave noble Lords a sense of the key findings in my opening answer, but there are several others that I can make my noble friend aware of: for example, a task force led by the Treasury and the Bank of England to co-ordinate exploration of a potential UK central bank digital currency, and a new Bank of England account type that will allow innovative financial market infrastructures to provide enhanced wholesale payments and settlements. There are also the DIT initiatives that I mentioned earlier.

Economic Update

Debate between Lord Agnew of Oulton and Lord Flight

Tuesday 12th January 2021 Lords Chamber

[Lord Agnew of Oulton (Con) [V]]

My Lords, we expect to provide over £3 billion-worth of support to local authorities over the next year, on top of the support we have already given. For example, over Christmas we provided the £1,000 Christmas support payment to wet-led pubs in tiers that were subject to lockdown. I feel the noble Lord might be being a little harsh; there has been a great deal of intervention to support local authorities and small businesses.

[Lord Flight (Con) [V]]

My Lords, I congratulate the Government and the Treasury on a remarkably quick response through very large programmes of financing. I have a simple question: we see different figures of the impact on the economy, but what was the net UK economy contraction during the calendar year 2020 and what is the forecast contraction for the calendar year 2021?

[Lord Agnew of Oulton (Con) [V]]

My Lords, I do not have those figures to hand, but there will be ongoing economic Statements and my right honourable friend the Chancellor will address this in his Budget in a few weeks’ time. It is perhaps worth pointing out international comparisons; the way the ONS uses data here has had a detrimental impact on how it has reported on the shrinkage of our economy, because it considers outputs instead of inputs on things such as the salaries of teachers and other civil servants, who were not necessarily working because of the crisis but were still being paid. There will be more information on this, particularly in the Budget.

Future of Financial Services

Debate between Lord Agnew of Oulton and Lord Flight

Wednesday 11th November 2020 Lords Chamber

[Lord Agnew of Oulton (Con)]

I am not able to give specific answers to the noble Baroness, Lady Wheatcroft, on those subjects at the moment. They will, no doubt, be included in the ongoing negotiations. If we receive clarity on that in the next few weeks, I will happily write to her.

[Lord Flight (Con) [V]]

My Lords, I apologise that my screen has gone wrong while waiting. I first declare my interest. [Inaudible.]

Economy: Update

Debate between Lord Agnew of Oulton and Lord Flight

Tuesday 28th April 2020 Lords Chamber

[Lord Agnew of Oulton]

I thank the noble Lord for his question and indeed for his perspicacity in the statements he made on 18 March, and on them becoming policy very shortly afterwards. In that light, if the noble Lord would like to write to me with his ideas, I assure him that I will follow that up with the Chancellor of the Exchequer and see what more we can do. I completely agree that we will need a more flexible and nuanced system as we move into the next phase of this crisis.

[Lord Flight (Con)]

May I add my congratulations to the Chancellor and the Treasury team for the dexterity with which they have brought in imaginative measures? My specific question, where I declare an interest as chairman of the EIS Association, is on whether the Government would consider introducing for the short term an increase in the size of the value of EIS tax credits? I believe that this would stimulate substantial private investment in SMEs; indeed, some £20 billion has been invested as a result of these EIS measures in the past. EIS has played a vital role encouraging the SME sector in this country.

[Lord Agnew of Oulton]

I thank my noble friend for his question and I will certainly take it back to the Treasury. It is worth remembering that the combination of the EIS, SEIS and VC schemes are pretty generous for investors, with the tax reliefs that they get. I suspect that, as an experienced investor, my noble friend Lord Flight will know that valuations will fall pretty dramatically for businesses looking for funding if they are early stage. Therefore, there will be a lot of opportunities for the entrepreneurial investor over the next few months. None the less, I will certainly take my noble friend’s suggestions back for further consideration.

Covid-19: Self-employed

Debate between Lord Agnew of Oulton and Lord Flight

Thursday 23rd April 2020 Lords Chamber

[Lord Agnew of Oulton]

My Lords, delivering a scheme for the self-employed is a difficult operational challenge, particularly in the rapid timescale required. The Government’s priority is to get support to those who need it as quickly as possible, in the fairest way. The design of the scheme, including the £50,000 threshold, means that it is targeted at those who need it most, and who are most reliant on their self-employment income. Some 95% of those who are mostly self-employed will benefit; those who do not meet the eligibility criteria for the SEISS may have access to a range of other support, including the more generous universal credit and deferral of tax schemes. I hope to address the dividend points in answer to a separate question.

[Lord Flight (Con)]

My Lords, will the Government give greater priority to speeding up the provision of financial assistance to SMEs, in particular through the new future fund?

[Lord Agnew of Oulton]

My Lords, the Government are making sure that people and businesses have access to the support they need as quickly as possible. We have tried to design measures that can be made operational quickly and effectively. Lenders have increased the number of loans they are approving every day and staff are working to process applications as quickly as possible. Over 12,000 CBILS loans have been made to businesses so far, meaning benefits of some £2 billion in finance and the rate of approvals is accelerating.