Housing: Shared Ownership

Lord Eatwell Excerpts

Monday 25th October 2010 Lords Chamber

[Lord Sassoon]

My Lords, I am wary of straying too far from financial regulation into housing policy areas but I will ask my ministerial colleagues in the Department for Communities and Local Government to write to my noble friend on that point.

[Lord Eatwell]

My Lords, is the Minister aware that in the source book referred to by the noble Baroness, Lady Gardner, there is a clear premise that building societies—mutuals—are significantly less risky than banks because, as the source book itself says, of their,

“lower exposure to wholesale funding and complex financial instruments”.?

If they are less risky, is it not time to reduce the punitive levy on building societies for the Financial Services Compensation Scheme—a levy which is reducing the funds available for lending to house buyers?

[Lord Sassoon]

One of the beauties of the current system and our future system of financial regulation is that decisions about the relative riskiness of different classes of financial assets are emphatically not for government but for the financial regulator, which in due course will be the Bank of England. So while I can ask the Financial Services Authority to write to the noble Lord, I am certainly not going to second-guess its judgments.