Lord Eatwell
Main Page: Lord Eatwell (Labour - Life peer)Department Debates - View all Lord Eatwell's debates with the Leader of the House
(14 years, 5 months ago)
Lords ChamberMy Lords, in the absence of my noble friend Lady Royall, I thank the noble Lord for repeating the Prime Minister’s Statement made in another place. I also echo the tribute he has made to servicemen who have lost their lives. We all have deep sympathy for the loss suffered by their families and friends.
Much of the G8 summit was taken up, according to the communiqué, with problems of international conflict and tensions around the world. As noble Lords will be aware, most of the economic agenda was shifted to the G20 summit, to which I shall turn shortly.
On international issues, in a widely publicised article published just before the G8 summit opened, the Prime Minister made the commitment to withdraw UK troops from Afghanistan within five years. Will the noble Lord tell us whether our allies were consulted prior to the Prime Minister’s announcement?
While the whole House will applaud the concern that the G8 summit displayed for development issues, will the Minister confirm that the G8 has reneged on the Gleneagles promise to double aid to Africa? On the important issues of maternal health, which quite properly dominated the development section of the G8 communiqué, will the Minister tell us whether the UK’s contribution of funds for this purpose will be new money, or will it be met from the existing aid budget?
I turn to the G20 summit. As the House will be aware, it dealt predominantly with economic and financial matters, building on the earlier summits in Washington, London and Pittsburgh. Those earlier summits were characterised by a remarkable degree of unity on facing up to the global financial crisis. The unity of analysis and purpose was led at those earlier summits by the British Government, with significant support in Pittsburgh from the Obama Administration. Sadly, the Toronto communiqué exhibits a quite different tone. On the balance between stimulation and fiscal consolidation, the communiqué stresses the differences between national approaches. On the banking levy, the previous universal approach has been abandoned. On regulatory reform, it is not at all clear whether other Governments will follow the US lead in banning proprietary trading by banks, or whether they will adopt US strictures on derivatives trading. Does the Minister share the widespread concern that the present communiqué does not exhibit the earlier unity of purpose?
On specific matters, the communiqué states that,
“advanced economies have committed to fiscal plans that will at least halve deficits by 2013”.
Will the Minister confirm that the Office for Budget Responsibility has calculated that the Budget measures introduced in March by my right honourable friend Alistair Darling were indeed sufficient to achieve exactly that goal? In the Statement, the Prime Minister says that,
“the summit specifically welcomed the plans set out in our Budget last week”.
Is the noble Lord aware that that welcome does not appear in the communiqué?
The Prime Minister’s Statement also refers to the need for “clear, robust new rules” on financial regulations—not principles but rules. Will the noble Lord confirm that the coalition expects international rules to be imposed on the financial sector of the UK? Which elements of financial regulation does the Prime Minister expect that imposition to cover?
I turn to some of the specific measures in the financial section of the G20 communiqué. Will the Minister confirm that it is the intention of Her Majesty's Government to impose a leverage collar on UK banks, as suggested by the communiqué? Will he also clarify the coalition’s position on the requirements that previously over-the-counter derivatives should now be traded through central counterparties by the end of 2012, as the communiqué also states? Are the Government concerned about the consequent concentrating of risk in central counterparties, and what do they intend to do about it?
Given the considerable concern expressed by the banks about the premature implementation of higher capital requirements, will the noble Lord explain why the idea of pro-cyclical provisioning, which was prominent in the communiqués of the previous three summits, is notable by its absence here? Has the idea been abandoned? If so, what are the implications for the size of capital buffers to be held by the banks?
At several points, the communiqué refers to the need for mutual assessment by G20 countries of the implementation of agreed measures. Can the noble Lord tell us by what process that mutual assessment is to take place? Who will do it? What precisely are the criteria to be applied? Will it be done before the next summit?
Finally, although we all welcome the fact that the Prime Minister was treated to a helicopter ride by President Obama, did he also have the chance to undertake bilateral discussions with Mrs Merkel while watching the football? As is well known, the German Chancellor is having considerable difficulty holding her coalition together. Did the Prime Minister advise her on the benefits of having weak and submissive coalition partners?