Credit Card Invoices

Lord Hodgson of Astley Abbotts Excerpts

Tuesday 26th March 2024 Lords Chamber

Asked by

[Lord Hodgson of Astley Abbotts]

To ask His Majesty’s Government what plans they have, if any, to require credit card issuers to provide a full description of goods or services provided on their customer invoices.

[The Parliamentary Secretary, HM Treasury (Baroness Vere of Norbiton) (Con)]

My Lords, while issuers are not obliged to provide full a description of goods or services, there is existing legislation governing customer transactions. This requires customers to be given a statement of their transactions at least monthly. Under the rules, providers must include a reference to help the customer to identify the transaction, and, where appropriate, information relating to the payee.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I am very grateful to my noble friend for that Answer, and also for allowing me to brief her on what I felt was the problem, but I am afraid her Answer does not satisfy me at all. How many Members of your Lordships’ House when they receive their credit card slip find transactions which they simply cannot recognise at all, for £5, £10 or maybe £15? How many times do noble Lords go on the fraud line and find, after quarter of an hour sitting there, that they have to put the phone down because they can go no further? Would the Government not agree this must be an incitement of low-level but quite extensive fraud, which is likely to get worse as we do more tap-and-go transactions and less in cash? Would it not be a good idea if it was a requirement to put on the credit card entry the name of the customer, the postcode that they operate from and a two or three-word description of the product or service provided?

[Baroness Vere of Norbiton (Con)]

My Lords, payments are governed by the Payment Services Regulations. The Government published a call for evidence in January 2023 to test whether the regulations are meeting their aims. The Government did not receive any evidence that would imply that more specificity would be helpful, either for customers or in terms of tackling fraud. However, I say to my noble friend—and I appreciate him raising this issue—that, as part of the smarter regulatory framework, firm-facing requirements will be repealed and replaced by rules from the FCA. Of course, this may be something that we can take forward in the future.

Financial Stability: Private Equity Firms

Lord Hodgson of Astley Abbotts Excerpts

Wednesday 13th December 2023 Lords Chamber

[Baroness Vere of Norbiton (Con)]

I am afraid that the noble Lord speaks about things I have no knowledge of.

[Lord Hodgson of Astley Abbotts (Con)]

I declare an interest in that I am involved in the private equity industry. If we in the industry do not calculate the risks properly, build into our modelling the necessary degree of leverage and allow for it, is it not right that we should be allowed to fail? We should not just be kept alive when we have shown incompetence.

[Baroness Vere of Norbiton (Con)]

I completely agree with my noble friend. Private equity is all about risk and returns, and not all firms will succeed in perpetuity. That is the way of a capitalist market, and it allows the correct allocation of capital within the system.

Alternative Investment Fund Managers Regulations 2013

Lord Hodgson of Astley Abbotts Excerpts

Monday 13th November 2023 Lords Chamber

[Baroness Penn (Con)]

I reassure the noble Baroness that the FCA has the appropriate powers to implement regulatory forbearance where it considers it appropriate, but it must operate within the legal framework and it does not have the powers to amend legislation—that is for this House to do. It is right that forbearance can only be a temporary, short-term fix. That is why the Government are committed to repealing and replacing retained EU law, including legislation related to cost disclosure, under our smarter regulatory framework.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, does my noble friend recognise that there really is a win-win situation here—a proven method of investment, offering individuals an opportunity to invest in new technologies relatively safely and new sources of funding for those technologies? The only thing standing in the way is the FCA. Where there is a will, there is a way, so could my noble friend please ask the FCA to engage in some digital extraction?

[Baroness Penn (Con)]

I reassure my noble friend that the FCA is indeed engaged in this issue, as are the Government. There are many problems with inherited EU financial services rules and we have set out a programme of work to look at how we can repeal them and replace them with UK-appropriate measures. These include the PRIIPs rules, which affect this issue, and the Government have set out our plans to repeal these measures and replace them with FCA rules, as soon as possible.

Financial Services and Markets Bill

Lord Hodgson of Astley Abbotts Excerpts

2nd reading
Tuesday 10th January 2023 Lords Chamber

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I need to begin by reminding the House that I have two interests. I am an approved person under the FCA rules, and I chair a regulated firm.

The Bill is big and important. I always felt that the task of trying to create a Europe-wide regulatory structure to deal with the many different types of financial markets—from quite small and unsophisticated to quite big, as we see in London—was going to be a big ask. Therefore, I was not surprised when we found a number of pinch points, many of which did not operate to London’s advantage. Given that the Bill’s strategic objective is to onshore our regulation, to get rid of one size fits all and to operate within a risk-based assessment framework appropriate to London, I support the Bill.

There are lots of things I would like to talk about, but I have only five minutes. I would like to talk about cash and the role of MiFID II, but I will focus on process. Here I follow the noble Lords, Lord Sharkey and Lord Butler. How do we get from here to there? What is the process to be followed? How is it envisaged that Parliament will play a role in the process envisaged under Chapter 1, Revocation of Retained EU Law? As the noble Lord, Lord Butler, pointed out, this Bill is a carve-out of a much larger Bill that will come before your Lordships’ House in a few weeks.

I chair the Secondary Legislation Scrutiny Committee and we have been taking evidence from Ministers on some of the practical aspects behind the Government’s thinking. I suspect that not many of us—not even my noble friend Lord Forsyth—who voted for Brexit thought that this risked handing powers from Brussels to Whitehall without any serious effective parliamentary scrutiny or involvement along the way.

I have made a rough count of the number of regulations listed in Parts 1 to 3 of Schedule 1; there are, I think, 246. Some of these will be technical and of no significance; others will not. It is this fact that makes the Bill a framework Bill. At the moment of passing the Bill, Parliament will not know what it is signing up to. That is really important. Will all of these 250 or so regulations be treated in the same way? There appears to be no triaging process to sort the important ones from the less important ones. I fear that the idea of saying “Affirmative resolutions go this way, and negative resolutions go that way” may not be sufficient in as complex an exercise as this.

There is a widespread view—again, pointed out by the noble Lord, Lord Butler, in his remarks—that the existing parliamentary powers for scrutinising secondary legislation are inadequate for the increasingly heavy weights being placed upon them. When my noble friend the Minister comes to wind up, will she tell the House what supporting documentation will be made available in respect of each regulation, to aid parliamentary scrutiny? Under current law, any regulation that carries an impact of more than £5 million is required to have a specific impact assessment, tabled at the time the regulation is laid. If this is now not to be the case, there is a real danger of Parliament being effectively muted.

Secondly, an important statutory requirement is the provision of post- implementation reviews. Post-implementation reviews decide where hope and expectation met reality and how they clashed. If we are not going to have post-implementation reviews—PIRs—then the opportunity for improving government performance will be greatly missed.

Finally, there is the question of tertiary legislation. Tertiary legislation is where the Government hand away the pen to another body, usually having very little if any democratic accountability. Despite that, the laws and regulations that these bodies produce bind us all just as tightly as any other law. Can my noble friend the Minister confirm my understanding that, under Clause 4, all tertiary legislation will be subject only to the negative procedure? If I am right about that, then I am afraid I shall regard this as a very disappointing response.

To conclude, I support the direction of travel of the Bill but, as we enter this brave new world, we should at the same time not allow the role of Parliament to examine, scrutinise and hold the Government to account to be further reduced.