Banks: Mutual Ownership

Lord McFall of Alcluith Excerpts

Wednesday 2nd March 2011 Lords Chamber

[Lord De Mauley]

No timetable has been set. UKFI does not think that it is possible or desirable to set firm targets, such as time or proceeds, that would drive the Government’s sale of shares. When UKFI has a proposal, it will offer it.

[Lord McFall of Alcluith]

My Lords, the Minister will be aware that all building societies that transferred into plcs in the 1990s are now no more. People realised that there was strength in the mutual principle and framework. Will he go further and assure the House that UKFI will engage with the Building Societies Association to ensure not just that there is a war on words but that there is a proposal on the table to ensure that we will have competition and diversity in the marketplace in the future?

[Lord De Mauley]

I think I can perhaps go a little further in saying that the Government are implementing a number of legislative reforms that will allow financial mutuals greater flexibility to develop and expand, and so promote mutual ownership in financial services. These include such things as completing the passage through Parliament of the Legislative Reform (Industrial and Provident Societies and Credit Unions) Order, commencing the Co-operative and Community Benefit Societies and Credit Unions Act 2010, and bringing Northern Ireland credit unions under FSA regulation. As I have said, the Independent Commission on Banking will also consider competition in the banking sector and make recommendations on this as part of its report.