Financial Services and Markets Bill [Lords]

Matt Rodda Excerpts

Tuesday 10th November 2026 Commons Chamber

[Lauren Edwards (Rochester and Strood) (Lab)]

I thank my right hon. and learned Friend the Minister for her work in bringing the Bill to Parliament, and the other place for its scrutiny to date. I should begin by making it clear that before being elected, I worked in supervision at both the Prudential Regulation Authority and the financial market infrastructure directorate at the Bank of England. I associate myself with some of the comments others have made about the importance of the financial services industry not just to London, but to the whole of the UK.

I would like to begin by welcoming the Government’s retention of the proportionality requirements, following debate in the House of Lords. Although I worked on the larger financial companies when I was a frontline supervisor, the proportionality lens was very important in day-to-day decision making, alongside a robust risk framework, not least because as the person who had to deliver a message to a firm, I needed to make sure that I could justify it. In line with that risk-based and proportionate approach to supervision, which I believe is the right one, I wonder if the Bill could make more of the opportunity to stimulate growth in the commercial and specialty insurance markets.

The London insurance market is a world leader, with annual income larger than its five closest competitors combined. It insures everything from planes to nuclear power stations, and has an important role to play in helping the Government to tackle climate change, protect against cyber-threats and unlock investment across the UK. As others have said, it competes internationally against markets in places such as New York, Singapore and Hong Kong. Its market is for sophisticated corporate clients, professional investors, insurance firms, banks and pension funds, rather than the individual purchasing travel insurance ahead of a holiday or pet insurance for the family dog, but currently the supervisory approach is rather similar for those very different types of customers.

Will the Minister and the Government consider whether more could be done in the Bill to differentiate the way we supervise wholesale insurance markets that have professional clients versus retail markets, where the focus, quite rightly, is on protecting the individual consumer? An obvious example to follow would be Australia, the country of my birth, which makes that distinction between wholesale and retail insurance through the Australian Corporations Act 2001, and tailors its supervision accordingly. There is scope in the Bill to consider what a UK version of that approach could look like to ensure that regulation is proportionate while maintaining strong protections where they are most needed.

I support the Government reintroducing the power to be able to act quickly after the access to banking services review reports, but hope that when it is reintroduced it will be narrower in scope to address the concerns raised in the other place that saw the original provision removed from the Bill. It is also important that any action that follows from that review is properly consulted on.

In my constituency, my initial efforts to get a banking hub were frustrated by the focus on access to cash under the current rules, when it is really access to face-to-face banking, advice and services that my constituents want to have, particularly on the Strood side of the River Medway and in the more rural populations on the Hoo peninsula. Digital inclusion is very important for people of all ages, but we know that the over-65s in particular place a lot of value on face-to-face banking services and it is important that they do not lose out. Age UK statistics from September suggest that 1.4 million over-65s are fully digitally excluded. Banking hubs can be part of the digital inclusion plan if we follow the example of places such as Singapore, which I know from a recent visit with the Public Administration and Constitutional Affairs Committee has very high levels of digital take-up and success using hubs to assist older citizens with building their confidence in using digital services for banking and public services.

[Matt Rodda (Reading Central) (Lab)]

My hon. Friend is making an excellent point, and I have a similar need in my constituency. Does she agree that the benefits of banking hubs extend to many disabled people, as well as to older residents?

[Lauren Edwards]

I absolutely agree with my hon. Friend that they should be part of our efforts to ensure that our services are as inclusive as possible.

Moving on to the Government’s aim to halve the burden of the senior managers and certification regime for firms, the cost saving is expected to be material. The Bank of England quotes an estimated £2 billion over a decade. It is important that those who present the biggest systemic risk to financial stability remain on the hook if things go wrong. There were very good reasons why the SMCR was introduced after the 2008 global financial crisis and there is scope for streamlining and shorter processes, but we must remember, as we do that, how few people were accountable for the risks that were run in the lead-up to the crisis and how the taxpayer was left to pick up the bill. Once again, it is a question of balance in proportionality and risk. We must always ensure that we maintain high standards of conduct and accountability.

Finally, on authorised push payment fraud, I believe that during debates in the other place the Minister said that there were other vehicles, such as the Government’s online safety legislation and fraud strategy, to address APP fraud and so provision was not needed in the Bill. However, we should consider whether the tech giants have been required to sufficiently take on their share of the responsibility for tackling this pervasive harm. The economic cost of APP fraud is significant. It was estimated at £450 million from UK businesses and individuals in 2024, although thankfully the Payment Systems Regulator reports that reductions have been achieved since then, thanks to the APP reimbursement policy. Call me cynical, but I think the only way that online tech giants will care about tackling APP fraud is if they also have some responsibility for reimbursement, rather than it all falling to the retail banks. They should also be held to higher standards for preventative measures, such as user identity verification and enhanced fraud monitoring.

To conclude, I welcome the Government’s approach and the progress being made through this legislation, but hope that Ministers will remain open to further refinement. Working in partnership with industry, regulators and Parliament, we have an opportunity to strengthen the UK’s position as a world-leading financial services centre, while maintaining the high standards and consumer protections for which our system is rightly respected.