European Union Referendum Bill

Debate between Pat McFadden and Kelvin Hopkins

Thursday 18th June 2015 Commons Chamber

[Mr McFadden]

I take the hon. Lady’s point, but the issue of May 2016 has already been dealt with through amendment 55, and I am focused on May 2017, when local elections are taking place in various parts of the country.

[Kelvin Hopkins]

I strongly agree with my right hon. Friend that, when we are voting on whether to leave or stay in the European Union, it should not be confused or blurred with party allegiances and so forth; there should be a clear understanding that on that day we are voting on our membership of the European Union and nothing else. No other elections should be held on that day; we want a unique day for that vote.

[Mr McFadden]

On European matters, it is not always the case that I am in agreement with my hon. Friend, but this time on this point, I am. I entirely agree with his point.

The first reason, then, is that on such a major constitutional question about the country’s future, the focus should be entirely on that question, but there is a second reason why on this occasion it makes sense to separate this poll from other polls, which relates to the discussions we have had about purdah arrangements. Without re-running Tuesday’s debate, the Government’s argument is that there needs to be some qualification of the purdah arrangements that would normally apply. The jury is still out on what the eventual outcome of that argument will be, but we know from Tuesday that the Bill will be amended in one way or another on Report.

However, purdah arrangements also apply to a local election period, so combining the referendum with other elections could mean we had full purdah in place for some things and qualified purdah or no purdah in place for others. In such circumstances, what exactly would the role of Ministers and the civil service be? We could have one set of rules for one poll taking place on that day, and another set of rules for another poll taking place on the same day. We do not need to think long and hard to realise that that is not an ideal arrangement for clarity on the conduct of the poll.

Our point is that the Bill deals with a big constitutional issue, which deserves to be considered by the public on its own merits, not tacked on as an add-on to local elections in various parts of the country. For those reasons, we feel that there is unfinished business from Tuesday. Amendment 55 was not the end of the matter, and our amendment 3 would, if passed, make it clear that this has to be a stand-alone poll and not one combined with other elections—either next May or in May 2017. To conclude, if given an opportunity to do so this afternoon, we intend to press the amendment to the vote.

Commission Work Programme 2015

Debate between Pat McFadden and Kelvin Hopkins

Monday 9th March 2015 Commons Chamber

[Mr McFadden]

I thank the right hon. Gentleman for painting me as a fan of all the measures before I have even spoken about them. One measure that could help to create jobs would be a properly negotiated free trade agreement between the EU and the United States. That has the potential to help our exporters and create jobs.

[Kelvin Hopkins (Luton North) (Lab)]

I gently say to my right hon. Friend that there is a range of views in our party, as well as in the Conservative party, but I shall not dwell on that.

I heard Mr Timmermans speaking in Rome fairly recently, and to hear him one would have thought there were no problems at all. He was speaking in Italy, where unemployment is at horrendous levels—not as horrendous as in Spain or Greece, but still horrendous. He said that countries could not act on their own. The reason they cannot act on their own is that they are cemented into the euro and have no control over their exchange rates or interest rates. If they had control over macro-economic policy, they might be able to act on their own, but they cannot do so at the moment.

[Mr McFadden]

I thank my hon. Friend for his intervention. Certainly in the speech that I heard last Thursday, the commissioner was not saying that there were no problems at all. He acknowledged many of the problems and said that he was determined to take a different approach in responding to them from that taken in the past. It is perfectly fair for Members to say, “We’ll see how that works out. Let’s see if he’s serious about what he says.” However, that certainly is what he says, and that is reflected in the work programme.

There has been legitimate frustration about over-regulation in the past. If the Commission is serious about weeding out proposals that are not going to go anywhere, that have been lying on the table for years without prospect of agreement or that have been bypassed by events, we should welcome that. I welcome the emphasis on growth and jobs and on regulation in the work programme.

The other measure on growth and jobs, to which the Minister referred, is the Juncker package of investment. As the right hon. Member for Wokingham said, it is a combination of real new money and the encouragement of private sector investment and loan guarantees. If the Minister has a chance to respond to the debate, will he say what bids this Government have made for any proportion of that money? What investment projects have been brought forward and where are they in the country?

Specifically, will the Minister say how that proposal is to be organised in England? There has been concern among local authorities and local enterprise partnerships that they are not permitted to put in bids and that they all have to go through Whitehall. In an environment in which we are discussing devolution to various parts of the country, it is important that areas in England get a fair crack of the whip in terms of submitting bids to this fund for their projects. I hope he will say something about that.

The Minister said that the work of the UK’s commissioner, Lord Hill, on the capital markets union was important. It has long been said that SMEs are too reliant on bank finance and that we need to encourage more forms of finance. What input can this country, with its expertise in financial services, have in those proposals and in the development of the capital markets union, not only from a Government point of view but from a private sector industry point of view? Nowhere in Europe is better placed than the UK to contribute to ideas on financial innovation and financial services.

Of course, some of the work programme does not apply to us. There are measures that apply only to the eurozone. It is important that countries outside the eurozone, such as the UK, continue to play a full part in the EU.

If the Minister responds to the debate, will he update the House on progress on the Transatlantic Trade and Investment Partnership? In the question and answer session that followed Commissioner Timmermans’ speech last week, he was asked about TTIP. He said that if it was to be done, it would have to be done by the end of this year. He did not spell this out explicitly, but I think he meant that after that, the timetable of the American presidential election would make it more difficult to negotiate an agreement. Is it the Government’s view that if TTIP is to be done, it has to be done this year? If it is, what input are we having to ensure that that happens, provided that the important concerns about public services and investor-state dispute settlement procedures are worked through and considered properly?

This debate about the work programme reminds us of the way in which we debate these things. My right hon. Friend the Member for Leicester East (Keith Vaz) asked when the Government received the programme. It always strikes me that we debate these things after they have been adopted. Parliament’s method of scrutinising European affairs is not the subject for tonight, but this debate reminds me that these things can be overtaken by events.

There is reference in the work programme to security issues. Like the Minister, I do not agree with Mr Juncker’s suggestion for a European army. However, I do believe that the issue of security is becoming more, not less, relevant, to our European relations. One need only look at the situation in Ukraine. Since the work programme was published, we have had the shootings at Charlie Hebdo, which were a terrible reminder of the common threat we face from extremism. It is therefore important when debating the programme to realise that whatever was written last year has to keep up with the changing nature of events. When he sums up, will the Minister say a few words about what action is being taken on collective security, not of the kind that Mr Juncker referred to with the European army, but in terms of sanctions against the aggression that we have seen in Ukraine?

The work programme refers to migration—that is, migration from outwith the European Union into the European Union. Last week, I met Ministers in Rome. This Minister will be aware that migration is an issue of huge concern for the Government of Italy, given the steady flow of boats from the desperate situation in Libya. The Italian Government feel, with some justification, that they are dealing with a situation that affects all of Europe. We have seen the end of the Mare Nostrum programme and the adoption of the Triton programme. That does not resolve the intense humanitarian crisis nor the political problem in Libya, where there is no Government of any coherence.

Financial Services (Banking Reform) Bill

Debate between Pat McFadden and Kelvin Hopkins

Monday 11th March 2013 Commons Chamber

[Mr McFadden]

The hon. Gentleman neglects to mention RBS, a universal bank, which needed major intervention to bail it out.

The Minister has said that he does not want wider separation because the Bank of England does not want it. It is true that the Bank of England has expressed some reservations about the power if it were to be wielded by the regulator. I took the opportunity to ask the Governor about it last week when he appeared before the commission. He replied that

“a provision so important that it affects the entire sector is one that both de facto and de jure will and should be taken by Parliament.”

When I explained to him that it had never been the commission’s recommendation that this be a policy decision taken purely by the regulator, and that all along we had been clear that it was a decision for Government, he said:

“As long as the decision is taken by Government, we would have no objection to that.”

I hope that we will no longer hear Ministers saying that they are rejecting this power because the Bank of England is opposed to it. This should of course be a decision taken by Government. As for the Chancellor’s point that it would be “undemocratic”, what is undemocratic about holding a proper review into legislation passed by this House as the Banking Commission suggests, or about taking a reserve power the exercise of which would involve the parliamentary process of debate and approval? The truth is that it would not be undemocratic at all.

[Kelvin Hopkins]

Will my right hon. Friend give way?

[Mr McFadden]

I am afraid that I want to make some more progress.

This is not, as the Minister argued, about introducing two policies at once; it is about introducing a policy and making sure that it is adhered to. As the hon. Member for Wyre Forest (Mark Garnier) said in this House a few weeks ago, the banks have nothing to fear if they adhere to the spirit and letter of the Bill. It need not introduce uncertainty, as some have argued; in fact, it ought to provide certainty that we are serious about the ring fence.

On capital and leverage, it is absolutely true that in the run-up to the crisis banks were over-leveraged, and that is because they held too little capital against the risks that they had. The Vickers commission was very clear about that. It recommended a future leverage ratio of 25:1, which is still quite high in historical terms, while the Government are recommending 33:1 because that is the internationally accepted Basel outcome. Without going into any more detail, I just say to the Minister that this goes back to the one-way trade to which I referred. It is a really important question running through all these reforms. If, every time we rub up against an issue, we say that we cannot damage the industry because it is so big here in the UK and we therefore have to stick to the lowest common denominator of international reforms, we will not be doing our duty to the UK economy or to UK taxpayers. If we have learned anything from the crisis of 2007 and 2008, it ought to be that there is a case for taking particular measures here in the UK precisely because of the size of the sector in relation to our wider economy. That is the basis on which we should judge the correct degree of leverage for the banks that operate in the UK.

Then there is the question of resolution and bail-in: in other words, what happens when a bank fails, and who is on the hook for that failure? In 2008, it was the taxpayers, not the bondholders, because a resolution mechanism was not in place in law that could allow for normal insolvency procedures were those to whom the banks owed money to take the risk. A very important part of the reforms is to change that situation. Bail-in is signed up to by the Government, but, like my hon. Friend the Member for Nottingham East (Chris Leslie), I am very curious as to why the Government are pursuing this through the European resolution and recovery directive. I would have thought, particularly after last week, that the Government might be somewhat nervous about pursuing a major financial services reform through a European directive. I return again to the one-way trade argument. Surely, because of the importance of this industry here in the UK, we should legislate to make sure that bondholders take a future risk and not UK taxpayers, and we should not leave it to the very uncertain process of a European directive negotiation. That might work out fine; there might be spontaneous agreement among the 27 member states. However, I am sure that the Minister agrees that that there is a very real possibility—this is not uncommon—that that would not be the case. I ask him to think again on the bail-in regime and to ensure that a proper UK decision is taken rather than leaving it all to a European directive. I would have thought that Government Members would support such a suggestion.

In conclusion, I want to reiterate the point about time. The parliamentary commission, which was set up by the Chancellor, has spent six months taking in—the chairman, the hon. Member for Chichester has done more totting up than me—60-odd oral evidence sessions and much written evidence. It is simply not good enough for the Minister to say that he will take the Bill out of Committee by the end of April, before we issue our final report. The Opposition supported the establishment of the parliamentary commission after the House had voted on the issue. We expect its recommendations to be properly considered by the Government, not swept out of the way by the timetable. I hope that the Minister will think again, because the structural issues under discussion are not the only issues. Important changes still need to be made to banking culture, standards and corporate governance, so that this very important industry contributes positively to the UK and does not put the economy and taxpayers at risk.