Autumn Statement 2023

Lord Hunt of Wirral Excerpts

Wednesday 29th November 2023 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I draw attention to my interests as set out in the register, particularly as chair of the financial services division of the global commercial law firm, DAC Beachcroft.

Like many other speakers, albeit in varying degrees, I warmly welcome the Autumn Statement. I have known the Chancellor of the Exchequer, Jeremy Hunt, for many years and I am confident that the economy is now in safe hands again. His presentation of the Statement was characteristically unflashy, and the reassuringly calm response of the markets spoke volumes.

Speaking as a solicitor still practising in the City of London, the one message I hear all time is that businesses crave certainty. In this world, especially now, there can be no certainty, but Governments can still strive to create stability and productivity—that is how we encourage businesses to invest and innovate. That, it seems to me, is the hallmark of this Government’s approach.

The House does not need me to remind it of the storms the UK economy has had to navigate in recent times. The political decision taken was to leave the European Union, but the direct consequence was to leave the single market, which many of us still regard as one of Margaret Thatcher’s greatest achievements. For that, shall we say, reorientation of the economy to coincide with the first pandemic in a century would test any economy, Government or society. That now we find ourselves in relatively calm waters is quite an achievement, and the Prime Minister and Jeremy Hunt deserve much credit for that.

What I hope to hear more of now is a renewed determination to tackle the red tape that continues to stifle innovation and enterprise. Some is a legacy from our European Union years—the committee I chair is working its way through that as I speak—but so much is either homegrown or gold-plated. Of course, I am not saying that all regulation is bad, just that it must always be proportionate and targeted. The Digital Markets, Competition and Consumers Bill is an excellent example of how statutory intervention in a market can both protect consumers from unacceptable market behaviour and foster competition. I look forward to our debates on that Bill and hope for more of the same, especially as the latest innovations in financial services regulation bed down.

Buried away at the end of the Autumn Statement is a very welcome proposed consultation on a UK regime for captive insurance companies. I applaud many of the comments of the noble Lord, Lord O’Neill, on that; I think it was number 99 on the list of measures. Two years ago, the London Market Group produced an excellent plan for the future, pointing out that the UK lacks a specific regulatory regime for captives, which, by definition, present relatively low risk to the overall financial system. This is another example of regulation that is not fit for purpose, because this is a fast-growing market, estimated at over $100 billion, and we have a golden opportunity to see a repatriation of UK company captives and to be a competitive location internationally.

A bespoke UK captive regime would be consistent with the new international competitiveness objectives in the Financial Services and Markets Act, strengthening the UK’s position in the international reinsurance market. The London Market Group has worked with HM Treasury to produce a detailed implementation plan setting out the legislative and regulatory changes required. Importantly, this could be done entirely through a single statutory instrument.

I therefore hope that my noble friend the Minister, whom we warmly welcome to her new role, can commit tonight to launching the consultation quickly, with a view to implementing it as soon as possible. This could have major economic benefits, and there is no time to waste. In summary, I welcome the Autumn Statement and hope for more of the same for many years to come.