Financial Services and Markets Bill

Lord Carrington of Fulham Excerpts

Committee stage
Wednesday 1st February 2023 Grand Committee

In addition, the Government are supporting Sir Mark Hendrick’s Private Member’s Bill, which would allow co-operatives, mutual insurers and friendly societies further flexibility in determining for themselves the best strategies for their business relating to their surplus capital and restrictions on the use of these assets. Furthermore, we are in active discussions with the Law Commission on options to proceed with a review of both the Co-operative and Community Benefit Societies Act 2014 and the Friendly Societies Act 1992, with a view to launching these reviews in the next financial year. I hope that has reassured the noble Lord, Lord Tunnicliffe, and my noble friend Lord Naseby, among others, that the Government remain committed to this agenda and have a further programme of work to look at what more we can do to support mutuals in future.

[Lord Carrington of Fulham (Con)]

On a point of clarification, my noble friend talks about mutual societies, which are very important. Mutual firms have many characteristics that are similar to those of so-called Islamic banks—banks that are sharia-compliant. Do her comments also refer to that slowly growing part of the economy?

[Baroness Penn (Con)]

They refer to organisations that were formed under the legislation to which I referred. We are taking forward work to look at amending the Building Societies Act, the Co-operative and Community Benefit Societies Act and the Friendly Societies Act. The definition of who I am talking about is driven by those Acts.

Amendments 157 and 158 are on transparency over who has responded to the regulators’ consultations. While promoting transparency is important, confidentiality must be respected. If a respondent has not consented to the publication of their name, they may be deterred from responding by the knowledge that a category description will be published, which risks making them identifiable. This is particularly the case in areas where only a small number of firms are affected. It could therefore reduce the number and scope of responses, which would weaken the effectiveness of the consultation process as a way for the regulators to receive challenge and feedback on their proposals. This would be contrary to the Government’s aims and, I believe, to the intentions of noble Lords, including the noble Baroness, Lady Bowles.

This brings me to the conclusion of my remarks—