Banking (Responsibility and Reform)

Rosie Winterton Excerpts

Tuesday 7th February 2012 Commons Chamber

[Mr Prisk]

No, I will not give way to the hon. Lady. We heard a diatribe of clichés from her, but we heard no policy, no original ideas and no original thoughts.

We are also making available an initial £1 billion through a business finance partnership that will allow small businesses to invest through non-bank channels. My hon. Friend the Member for Bedford was absolutely right to say that we should not just consider the bank channels, but should ensure that other players in the market can come forward. My hon. Friend the Member for Halesowen and Rowley Regis—who, unlike many Opposition Members, has actually run a business—was also right to draw attention to the importance of choice and competition. I agreed with the shadow Business Secretary when he said that we should think about the business model and the return of relationship management. I hope that we shall hear some positive contributions about that from Labour, and not just the usual flannel.

The Opposition motion refers to the need for a reform of banking, and to the need for more regulation and responsibility. The motion is right to refer to responsibility; it is just a shame that that was not one of Labour’s policies when it was in government. However, I suppose that it is nice to have a convert, even if the conversion is late in coming.

Yesterday the Chancellor introduced the Financial Services Bill, demonstrating that we would overhaul the regulatory environment that we had inherited. The Bill’s principles are important: responsibility, prudence—I think we may remember that word—and sustainability. That means addressing the old system of excessive and irresponsible levels of pay.

As we have heard this evening, under the new FSA remuneration code we have ensured that bonuses will be deferred by at least three years and linked to the performance of employees and companies. Through the disclosure regime, we are providing more transparency than we ever saw from the Labour party when it was in government. Bonus levels are already starting to fall. As we heard earlier, last year they stood at £6.7 billion, just half as much as when the shadow Chancellor was the City Minister in the last Government.

This evening’s debate has also dealt with the wider issue of executive remuneration. The Government strongly believe that successful people who work hard should be properly rewarded. It is vital that, in a debate about the excesses of a few, we do not give the impression that enterprise and endeavour are unwelcome in Britain; but, sadly, quite a few Opposition Members simply do not understand that. We need to make our message clear. The Government are determined to work with businesses to reform executive pay, and to do so in a way that strengthens business in Britain in the long term. As was alluded to but never actually examined by the hon. Member for—

[Ms Rosie Winterton (Doncaster Central) (Lab)]

claimed to move the closure (Standing Order No. 36).

Question put forthwith, That the Question be now put.

Question agreed to.

Main Question put accordingly.