Financial Services and Markets Bill [HL]

Lord Empey Excerpts

Report stage
Monday 7th September 2026 Lords Chamber

[Lord Weir of Ballyholme (DUP)]

My Lords, I support the amendment in the name of the noble Baroness, Lady Hoey. It is well thought through, balanced and modest. The House will be relieved that, for once, neither I nor the noble Baroness, Lady Hoey, are even mentioning the Northern Ireland protocol or the Windsor Framework as part of this, albeit that that may be to our shame. The amendment is about trying to tackle a genuine problem for consumers. It is very much within the keeping of the Bill. Part of the purpose of the Bill is not necessarily to increase regulation but to have better and smarter regulation. This proposal very much fits in with that.

The amendment is cautious in its nature, because it would not compel the Government to take immediate action. It would give the power to the Treasury. Indeed, before any next steps could be taken there would need to be consultation, discussion and agreement with the devolved institutions and the respective departments. It would not be acted on by government but would have to be brought forward through the affirmative procedure. The amendment would take this in a sensible approach, one step at a time.

Ultimately, the amendment is to deal with a very real problem. Any of us who has been involved politically in Northern Ireland know that, during canvassing for every election, people will raise the issue of the higher rates of insurance. I am sure there will be agreement across the Chamber about this. Even as recently as the last general election, a number of candidates from different parties said that that was something that had to be tackled.

The noble Baroness, Lady Hoey, highlighted that part of the issue is that this has tended to fall between the cracks. It is not under the exact remit of any one particular department. Whatever the long-term issue is, it has become exacerbated in recent years, particularly since the end of Covid. In the last few years, we have seen shrinking choice. The number of insurance brokers and insurance companies has reduced for home and motor insurance. This has led to a vicious cycle of increasing premiums which, of itself, has meant more dependence on the role of CMCs. The direct impact of CMCs has been to raise overall premiums in Northern Ireland perhaps by around 30%.

As indicated by the proposer of this amendment, it is not purely the CMCs that have led to these increases, but they have played a very significant role. When part of the industry is unregulated, unaccountable and unchecked, it is no wonder that, for some, this has become almost a licence to print money. How this has then filtered down to the consumer has had a major impact. Any of us in Northern Ireland is used to the annual exercise, when we renew either our house insurance or our motor insurance, of our brokers quote us an exorbitantly increased level of cost. Generally speaking, we then try to probe that by asking them to explore whether there are any other options. At best, they will come back with something slightly less than what they originally quoted, but the prices go up and up for everyone. It is particularly acute for first-time motorists, for example. They face a situation either of exorbitant motor insurance costs or, in some cases, of simply not being quoted at all.

This is something which can be tackled. We have offered a very practical way forward through this amendment. The Government and, in particular, the new Prime Minister have put at the heart of the agenda the cost of living, not simply in a general sense but for every postcode in the country. If we are looking for something that can deliver on this promise then this is quite low-hanging fruit. I urge the Government either to accept the amendment or to find some formula, through discussions, in which its spirit can be brought forward so that we can actually start to tackle this problem once and for all. The amendment offers a solution by way of the Government intervening through the Treasury—or, at the very least, the sheer threat of the power may well lead to CMCs reducing back their costs. I hope that it may lead to good behaviour on their part. I urge the Government to give this very serious consideration. I look forward to the Minister’s response.

[Lord Empey (UUP)]

My Lords, taking up the last point from the noble Lord, Lord Weir, the Prime Minister, on his recent visits and tour of the UK, has emphasised that the primary focus of the Government is to help people with the cost of living. Because our population in Northern Ireland is spread out more than it is in Great Britain, there is much heavier reliance on motor vehicles to get around. This has a huge impact not only on farmers but on people who are resident in rural areas.

At one point a number of years ago, as Minister for Enterprise, I had responsibility for consumer protection. I have no recollection that financial matters of this nature were incorporated in the devolution settlement, so I believe that the Treasury has a key role to play. It seems odd that we in Northern Ireland have a sector that is unregulated. It is the only part of the United Kingdom where it is unregulated. People need to grasp that there is a different legal framework for dealing with claims for damages under insurance. For instance, the noble Baroness, Lady Hoey, referred to a list of settlements that should be reached, whereas we have a thing called the green book, which allows for much greater flexibility and has resulted in much higher claims.

The noble Baroness quoted one example, for soft tissue injury, but that is only one. It does spread out, and of course that is not the only potential claim. There could be other mental health claims arising from the situation. So the Minister should perhaps reflect on this. If he is not content with this amendment, cautious though it might be, he could table something at Third Reading.