Preparing for Extreme Risks (RARPC Report)

Lord Hunt of Wirral Excerpts

Thursday 12th January 2023 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I declare my insurance and legal interests as set out in the register. Like other noble Lords, I welcome the Government’s resilience framework and its focus on building our understanding of risks and preparation. We have seen in recent times, particularly during the pandemic, how interconnected and complex our world has become. Having a common and comprehensive framework to build resilience and mobilise the whole of society around resilience is a significant step change in addressing the issues we face.

Many congratulations to my noble friend Lord Arbuthnot and his colleagues on this committee for producing what I feel, having now read it several times, is one of the best reports of its kind that I have ever scrutinised. As the report rightly observes, the Covid-19 pandemic exposed significant shortcomings in our national emergency planning. The considerable resilience that was displayed was all the more remarkable given those shortcomings. I do not know how many of my colleagues watched the film “Contagion”: if only we had paid a bit more attention to some of the episodes in that film, we would have been better prepared. Anyway, it is going to take many years for a definitive report on our response to the pandemic to appear, but it is, in my view, never too soon to start probing the ashes and thinking about what worked and what did not.

I do not think that anyone foresaw the profound disruption to the lives and education of students and pupils, many of whose vital exam years were horribly affected by the pandemic across three academic years—enough to blight a student’s entire time at university. The decades-long policy of reducing the number of beds in the NHS also began to look rather questionable, as those field hospitals were rapidly set up just in case the pandemic ran out of control.

Once again, the exemplary response of our Armed Forces was a model of its kind: brisk, efficient and to the point. As we look forward to future resilience planning, I think—as my noble friend pointed out in his opening remarks—that there is one aspect which is somewhat under-represented at present. A couple of days ago, we debated the Financial Services and Markets Bill, and I called for a closer partnership between government and our formidable financial services industry. My focus then was principally on the potential benefits for the industry and, streaming from that, for the UK economy. I think that the Government could gain too by drawing more upon the very considerable expertise that the private sector has to offer in the field of risk assessment.

I know very well from all my dealings with the insurance industry, particularly when I chaired the British Insurance Brokers’ Association, that the accurate assessment and quantification of risk is bread and butter for that industry. As the report rightly points out, the Government tend to focus disproportionately on higher-likelihood risks at the expense, in particular, of potentially high-impact risks that are believed to have a relatively low likelihood. The insurance industry, not least through its experience with climate change and, before that, long-tail industrial illness and asbestos-related claims, has learned the dangers of such an approach. I hope that colleagues on all sides will consider drawing more on private sector expertise in risk assessment and risk management.

Biosecurity, energy security, and food security—the very foundations of our social, economic and political order—are under severe threat. If we still believe, as I certainly do, that prevention is better than cure, then calmly, coolly and sensibly, I hope we shall follow the wise advice in this report and look to the future, not through rose-tinted spectacles, but in the light of the cold realities of 2023 and beyond in the longer term, using all the expertise at our disposal.

UK Cash Network

Lord Hunt of Wirral Excerpts

Monday 8th November 2021 Lords Chamber

[Lord Agnew of Oulton (Con)]

My Lords, basic bank accounts are one requirement of the banking system; the nine largest account providers are required to provide this to customers, and there are some 7 million basic accounts open with these providers. They are easier to open than ordinary bank accounts, and that facility remains available.

[Lord Hunt of Wirral (Con)]

I first draw attention to my interests as set out in the register, particularly as an independent director of LINK. Does my noble friend the Minister have an indication of when the fundamental review of financial services regulation will be concluded? Given that the pressure on cash infrastructure is now so acute, what news is there of the work the FCA is overseeing with the banks on developing a much-needed plan to protect cash infrastructure?

[Lord Agnew of Oulton (Con)]

My noble friend asks important questions. On access to cash, as I said in earlier answers, the Government are committed to legislating to protect access to cash and ensuring that the UK’s cash infrastructure is sustainable in the long term. In answer to my noble friend’s second question, the Government are undertaking a wider financial services future regulatory review, which aims to build on the strengths of the UK’s existing framework as set out in the Financial Services and Markets Act 2000. An initial consultation exploring these issues and a proposed approach was published by the Treasury in October last year, and we had 120 responses. We will publish a second consultation with detailed proposals shortly.

Cash Network

Lord Hunt of Wirral Excerpts

Tuesday 7th September 2021 Lords Chamber

[Lord Agnew of Oulton (Con)]

My Lords, to reiterate my earlier point, there are some 40,000 cash machines that are free at the point of use; they are sustained through an interconnection charge between the banks. As for what the Government are doing, in the Financial Services Act of this year we legislated to allow cashback without purchases. That became law in June this year, and it is something where everyone’s interests are aligned: the retailer gets the opportunity to increase footfall into their shops and to reduce the cost of having to bank cash, which is expensive. We are optimistic that this will provide a wide range of additional outlets for cash.

[Lord Hunt of Wirral (Con)]

I declare my interest as an independent non-executive director of Link. What are the Government’s plans to ensure that an effective hub network of physical access to financial services is maintained right across the country in the future? Amid the increasing tension that exists between banks, post offices, the banks’ attempts at hub pilots and local shop services such as cashback, what are the Government doing to co-ordinate the picture to ensure we have free access to cash?

[Lord Agnew of Oulton (Con)]

My Lords, the Government welcome industry efforts to develop solutions to provide continued access to financial services. The community access to cash pilots are an industry-led initiative, taking place in eight locations in the UK at the moment. These are trialling and testing sustainable solutions for ensuring that communities can conveniently withdraw and deposit cash. The Government’s proposals for cash will enable firms to use a range of solutions, including existing facilities, to provide access to cash for the purpose of meeting geographic requirements, provided they are judged to be delivering reasonable access by the responsible regulator.

Budget Statement

Lord Hunt of Wirral Excerpts

Friday 12th March 2021 Lords Chamber

[Lord Hunt of Wirral (Con) [V]]

My Lords, I am proud to have the opportunity to pay tribute to a brilliant maiden speech by my noble friend Lord Benyon. It sets a very high standard for us all. My noble friend quickly made a significant impact as MP for Newbury. After a distinguished career, which he has already mentioned, in the Royal Green Jackets and in local government, he was Wildlife Minister for several years, and greatly respected as a man of principle, particularly when, on an important issue, he had the Conservative Whip removed—but only for a few weeks. I have to tell my noble friend that he is warmly welcomed on these Benches. We look forward to hearing his wise words and skilful guidance in future debates for many years to come.

I draw attention to the register, in particular my interest as a partner at DAC Beachcroft, the global legal firm. I strongly welcome this Budget. The furlough scheme has so far slowed the rise in unemployment but, sadly, sooner or later, we know that many jobs will be lost. When I became Employment Secretary in 1993 we were emerging from another short and sharp recession. A decade of supply-side reforms had given us the most flexible labour market in Europe, an advantage we still possess. We also had a range of creative measures to support people into work. I even went to the TUC, at the kind invitation of the noble Lord, Lord Monks, and gave an unprecedented commitment to full employment. I hope that this Budget will, in due course, enable this Government to proclaim a similar aspiration to ensure that every citizen can enjoy the dignity of work.

Financial Services Bill

Lord Hunt of Wirral Excerpts

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Thursday 28th January 2021 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I first draw attention to my interests as set out in the register and I congratulate my noble friend Lord Hammond of Runnymede on a maiden speech of great breadth and insight, which served to underline what a considerable asset he is going to be to these Benches in particular and to this House more widely. As my noble friend reminded us, he has served with distinction in a number of departments, culminating in his time as Chancellor of the Exchequer. How right he was to point out huge sectors of our economy, in particular financial services, where we are not in the business of finessing a new relationship with the European Union but are yet to ensure that there are any arrangements at all. When my noble friend speaks on economic matters, he does so with rare authority and I look forward to hearing much more from him.

There is one specific point that I would like to develop in my remarks today. The Financial Services and Markets Act 2000—FiSMA—set out four objectives for the Financial Services Authority, the FSA, as it then was: market confidence, public awareness, the protection of consumers and the reduction of financial crime. In addition, the FSA was required to have regard to a number of other factors, including efficiency, proportionality, innovation and

“the international character of financial services and markets and the desirability of maintaining the competitive position of the United Kingdom.”

The Financial Services Act 2012, in response to the 2008 banking crisis, removed that requirement because it was argued that it had served to dilute the robustness of regulation. This argument was founded on an entirely false dichotomy between effective regulation and international competitiveness, for the truth is that a robust, respected and proportionate regulatory regime is an intrinsic part of the UK’s competitive advantage in financial services. We now have the future regulatory framework review. In its phase 2 consultation paper, which I happen to have with me, the Government acknowledged this:

“A gap in the original FiSMA model is that, while it set high-level general objectives and principles, it did not provide for government and Parliament to set the policy approach for specific areas of financial services regulation.”


A partial move towards more activity-specific regulation is seemingly adumbrated in Schedule 3 to the Bill, which has been referred to by the noble Lord, Lord Sharkey. This would require the PRA, when considering capital requirements regulation, to have regard to

“the likely effect of the rules on the relative standing of the United Kingdom as a place for internationally active credit institutions and investment firms to be based or to carry on activities.”

A similar obligation is to be imposed on the FCA when making Part 9C rules in relation to internationally active investment firms. So competitiveness is edging slowly and surely back into the picture sector by sector and it is a process that I believe many of us want to see accelerate in the months ahead. I also hope that the Government will now come forward with a clear action plan to establish the UK not only as the world centre for broking—that is to say, the selling of insurance and reinsurance—but as the natural home for insurers and reinsurers.

I warmly welcome the Bill because it suggests a direction of travel that will deliver the high-quality, agile and responsive regulation that we need, putting the UK at the forefront of the world market in terms of competitiveness, consumer protection and innovation.

EU-UK Trade and Cooperation Agreement

Lord Hunt of Wirral Excerpts

Friday 8th January 2021 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I draw attention to my entry in the register. I share the general relief that a deal was achieved, but the agreement does not cover services.

I am proud of the UK insurance and long-term savings industry—the fourth largest in the world—and there are three connected matters that I would like to raise. The first is the so-called green card. We assume that the UK will remain in the scheme, but early confirmation is vital. Secondly, it is high time that the Government reintroduced an international competitiveness duty into the UK’s regulatory framework.

Thirdly, on equivalence, the UK has granted Solvency II equivalence to EU insurers and reinsurers under all three tests, and we must now seek reciprocal recognition from the EU of the UK’s prudential regime. Equivalence would offer much-needed stability, but I believe that we must fashion far bolder plans for the future. Our skill at brokering insurance is nonpareil, but it is striking how few major international firms have even considered locating their headquarters in the UK. To establish the UK as the leader in financial services, we need a comprehensive strategy with support from the very top to make this an attractive place to be. This requires a proportionate and effective regulatory regime, but it is also about schools, neighbourhoods and the sectors that are being cruelly punished by the pandemic—notably, our hospitality and creative sectors. We must press for what my noble friend the Minister mentioned earlier—reciprocal, visa-free travel arrangements for touring performers and crews.

So, the withdrawal agreement is wholly welcome but we must now move swiftly from the era of mitigation to an era of opportunity.

Finance Bill

Lord Hunt of Wirral Excerpts

2nd reading & Committee negatived & 3rd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords & 3rd reading (Hansard) & 3rd reading (Hansard): House of Lords & Committee negatived (Hansard) & Committee negatived (Hansard): House of Lords
Friday 17th July 2020 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I draw attention to my entry in the register. The Budget on 11 March, first conceived in a time of peace, was delivered under heavy bombardment. The Bill was published on 17 March—the day on which theatres closed and the grim truth sank in that full lockdown was imminent. Since then, as a nation and as families, friends and neighbours, we have endured a period when fear ran rife and hope seemed forlorn. Many of the Bill’s provisions are, of course, technical, conceived in what now feels like a different, far-off world. While we discuss the principles of this Bill, far greater principles must be in all our minds.

The coronavirus hits indiscriminately, yet it also affects different individuals and different groups in very different ways. The furlough scheme—more properly the Coronavirus Job Retention Scheme—has sustained millions of employees in this time of crisis. The brutal reality is, however, that as the furlough scheme tapers away, many jobs will disappear for good and many sectors may never recover fully. Hospitality and the performing arts are the most obvious but not the only ones. We may hope for the best, but we must also prepare for the worst. As my noble friend Lord Lamont of Lerwick put it at the start of the debate, the difficult part is yet to come.

As several noble Lords have referred to, the Prime Minister has alluded to Roosevelt’s New Deal—a highly effective response to mass unemployment in the 1930s when the free market failed. The nation needs not only tax reforms and short-term palliatives but a comprehensive response to a crisis that is obliterating the education, exams and employment of young people and leaving older people isolated and fearful. I strongly agree with my noble friend Lady Noakes that we need to see the Government being more joined up and working at top speed. We need a response that unites the nation as one nation—a response that is practical but securely founded in a shared sense of social justice. The Bill may be only one step on that urgent journey, but we will need to take many more steps before this year is out.

Covid-19: Economy

Lord Hunt of Wirral Excerpts

Thursday 4th June 2020 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I declare my interests as set out in the register.

We have already learned brutal lessons from the pandemic. I have always been a one-nation politician, with a firm belief that we can realise our full potential as a nation only if we work together. But this crisis is putting our unity under tremendous strain. Many of the firms that are closed will never open again. Tens of thousands of them are, inevitably, heavily dependent upon physical interaction—as in a pub or restaurant, club or theatre.

Our theatres do so much to define who we are as a nation and as a society, so often giving a voice to those who are otherwise underrepresented or even not heard at all. They also contribute significantly to the economy, but in the months ahead they will need our help if they are to survive at all. I thank the noble Lord, Lord Kerslake, for having highlighted this key issue.

Even as we emerge from total lockdown, all employers will have to adapt, not only through social distancing but through improved ways of dealing with sickness and absence from work. This is a long-term challenge brought into sharp, short-term relief. I strongly commend to my noble friend the Minister the initiatives from GRiD, the Group Risk Development organisation, set up by the insurance sector to address these challenges.

Of course, free enterprise will have to be the principal driver of recovery, but it is none the less incumbent on all one-nation Conservatives to ensure that the public and private sectors now work together in partnership to build the necessary foundations for a stronger economy and a stronger society in the post-pandemic world.

Budget Statement

Lord Hunt of Wirral Excerpts

Wednesday 18th March 2020 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I first declare my interests as set out in the register. As many have observed, this debate is taking place during the greatest crisis our nation has faced since the Second World War. Our principal concern must be the health of our people, but the state of the economy will be critical too. I gladly join the many tributes paid to our heroic staff in the National Health Service, but there are many other heroes too—in pharmacies, supermarkets and right through all those vital supply chains, ensuring that life can go on at all.

The measures announced by the Chancellor yesterday were very welcome, but more will surely be needed and many colleagues have already put forward some persuasive proposals in this debate. Even as the latest measures were being immediately digested, it became clear—as the noble Lord, Lord Adonis, just pointed out—that millions of our fellow citizens are still trapped in potentially untenable situations, such as people living in rented accommodation, whose sources of income in many thousands of cases have suddenly dried up. I think, too, of those who work in bars, restaurants and theatres—sectors that usually provide and enable so much of the joy of life, all suddenly come to a standstill. Of course, much of their work is casual, short-term, fixed-contract or zero-hours in nature and it has suddenly vanished, literally overnight. Think of those actors who rely on bar work, restaurant shifts and front-of-house work between times, or supply teachers contemplating imminent school closures.

Of course our great nation will survive this shattering blow, but we must ameliorate urgently now, as well as rethinking things for the future. As noble Lords will know, I believe we shall succeed only if we come together as one nation.

When we debate economic matters in what we might think of as normal times—and that normality may never fully return—we tend to emphasise the need to innovate, to compete, to outrun and outshine the competition. As we strive to build social and economic resilience in the face of this terrible pandemic, it is only natural that our focus should shift towards notions of solidarity, co-operation and social cohesion.

I know this is ancient history, but when I made my maiden speech from the green Benches in the other place in April 1976, the great fear of the land was the inexorable decline of our great industries and consequent unemployment and social disenchantment. The unemployment rate was around 5%, above where we were last month, but I fear somewhere below where we will shortly find ourselves. I said in that speech:

“It is very worrying to contemplate the amount of social and economic damage done by such widespread unemployment. To be without the opportunity of work is an affront to human dignity.”—[Official Report, Commons, 12/4/1976; cols. 969-70.]


Just a few short weeks ago, both the employment rate and the number of people in full-time work were at record highs. Wages have been rising ahead of prices month after month after month. How quickly a situation like that can crumble.

The One Nation group of MPs came into being in 1950 after the Conservative resurgence in that year’s general election swept in one of the most talented intakes in history. To most economists and politicians back then, full employment was generally seen as something that could and should be achieved through government intervention, job creation schemes, state enterprises and so forth. Since the 1970s, that outlook has seemed old-fashioned and discredited. In this situation, however, the current replacement of ideology with pragmatism is not only welcome but, I believe, essential for our survival. It is said that in times of national crisis no one claims to be small-government Conservative, so I warmly applaud the swift and decisive action taken by the Chancellor to underpin small businesses in particular. He deserves all our support, and I believe that he is the right man at the right time.

I mentioned theatres and actors. Just last week, although it seems a lifetime ago now, my wife and I attended the first anniversary performance of the West End show “Come from Away”. The show tells the true story of how the population of Gander, a small town in Newfoundland, welcomed thousands of unexpected visitors when 38 passenger planes were grounded at their local airport in the wake of the 9/11 attacks. The people of Gander famously came together and showed us the best of humanity. That powerful, timeless message of social solidarity and generosity of spirit must infuse not only our social policies but our economic policy too.

As one nation we shall survive this crisis, but only as one nation shall we then successfully rebuild our economy and our society.