Financial Services Reforms

Debate between Sarah Olney and Andrew Griffith

Tuesday 11th July 2023 Commons Chamber

[Andrew Griffith]

I absolutely agree with my hon. Friend. The local government pension scheme is a huge opportunity for this country. In many cases, it is already very progressive. It is investing in local opportunities and allocating its capital to the sort of private growth assets that we wish to seek. With £365 billion under management, an increased rate of progress towards asset pooling, which, as the Government have made clear, should attract at least £50 billion, will provide the scale to invest well on behalf of beneficiaries. That is a great opportunity for us all.

[Sarah Olney (Richmond Park) (LD)]

The number of companies listed on the London stock exchange has plummeted to such an extent that the market value of Apple is now greater than the entire FTSE 100. Recently, Cambridge-based chip giant Arm decided to list in New York rather than in London. Does the Minister think that the Mansion House compact will reverse the trend of British-based companies deciding to list elsewhere?

[Andrew Griffith]

Yes.

Mortgage Market

Debate between Sarah Olney and Andrew Griffith

Tuesday 13th June 2023 Commons Chamber

[Andrew Griffith]

I thank my hon. Friend who does a wonderful job of advocacy for her constituents, including those who seek to buy their first home. This Government, through a variety of measures to support householders in general, have helped more than 800,000 people, of all types, to purchase a property since 2010. That represents a city of approximately the size of Liverpool, such is the scale of the endeavours. It is of course important that we get the nation building, and part of that is about providing the economic stability whereby people are willing to make investments for the longer term.

[Sarah Olney (Richmond Park) (LD)]

The Government’s economic mismanagement has caused low growth, soaring food bills and record mortgage costs. Millions of hard-working people are being penalised for getting a foot on the housing ladder, in places such as Mid Bedfordshire, the area with the third highest share of mortgage holders in the country. The Minister mentioned the support from the mortgage interest scheme. [Interruption.] In this time of hard-pressed families, will his Government commit to converting that from a loan to a grant?

Silicon Valley Bank

Debate between Sarah Olney and Andrew Griffith

Monday 13th March 2023 Commons Chamber

[Andrew Griffith]

I am not going to offer my hon. Friend that guarantee, as that would not be prudent or the right thing to do. I can guarantee that this Government will do everything possible to reconcile the needs of protecting customers, protecting financial stability and protecting the taxpayer. It is of great note that we were able to do that in this transaction, and if such an issue were ever unfortunately to reoccur, all our energy would be devoted to precisely the same ends.

[Sarah Olney (Richmond Park) (LD)]

I very much welcome the purchase of Silicon Valley Bank UK by HSBC this morning, not least because I am a former employee of a company that had exposure to the bank on both sides of the Atlantic and whose chief executive officer was one of the signatories to the letter sent to the Chancellor on Saturday. Statements were made by the UK bank on Thursday and Friday, and if depositors had relied on the assertions made in those statements, and if the purchase had not gone through this morning, those depositors would have incurred losses. Will the Minister confirm whether that constitutes a breach of the regulations? If it does, will there be any sanctions for people identified as having committed those breaches?

[Andrew Griffith]

I am delighted that the hon. Lady’s constituents benefit from the certainty. It was a terrible weekend for everybody who was a depositor or who was in some way dependent on SVB UK. That is why it was so important that we not just achieved this outcome and that the regulatory structure and laws laid down by Parliament allowed us to do so, but that we were able to act decisively. I welcome the fact that another great British bank, HSBC, has stepped in, and I wish it and all the employees well.

It would be inappropriate for me to comment on particular things that were said. Fortunately, we are in the position that every depositor has been made whole, and therefore that issue does not arise.

Financial Services and Markets Bill

Debate between Sarah Olney and Andrew Griffith

Report stage
Wednesday 7th December 2022 Commons Chamber

[Sarah Olney (Richmond Park) (LD)]

The Liberal Democrats recognise the importance of good regulation. Well-designed, effectively administered, properly enforced regulation creates a level playing between competitors and instils confidence in consumers and players in all markets. As the Liberal Democrats’ Treasury and business spokesperson, I have spoken to many businesses in many sectors, including in the City, and I have not found anywhere an appetite for the sweeping away of regulations often advocated by Members on the Conservative Benches. Everywhere I hear calls for effective regulation, properly administered.

[Andrew Griffith]

Would the hon. Lady be able to identify any Member of this House who has talked about the merits of sweeping away regulation? That is not the position of the Government.

[Sarah Olney]

With respect, I did not say it was the position of the Government, but the Minister cannot deny that it has been advocated for on many occasions during the referendum campaign and on many occasions since. I think he is being disingenuous.

Although the Liberal Democrats welcome some aspects of the Bill that will update the regulatory framework for financial services, we remain concerned by the lack of accountability of the regulators to Parliament and by the potential impact of this Bill on financial stability. The Government have described this Bill as a once-in-a-generation opportunity to reshape financial regulation, but as currently written the Bill lacks ambition and inspiration. In particular, it is a missed opportunity to create a regulatory framework that turbocharges the green agenda and strengthens protections for victims of fraud.

My fundamental concern with the drafting of the Bill is how it undermines the role of Parliament while extending significant new powers to both regulators and the Treasury. As ever, the devil is in the detail, which will be largely hidden within secondary legislation that will not receive parliamentary scrutiny or oversight. Accountability and transparency are the cornerstone of effective regulation. It is vital that those principles are upheld to maintain national and international confidence in the UK’s financial services sector and to improve the operational performance of regulators.

The Bill did not previously contain sufficient powers to require the regulators to report on their performance against their objectives. I am therefore pleased that the Government have made some steps towards improving accountability and transparency though the addition of new clause 17. However, the new clause still does not go far enough in establishing parliamentary oversight of the regulators. Regulators’ powers are granted by Parliament, and that is who they should be accountable to—not to a Minister who may only be in place for a matter of weeks.

I remain concerned that the new statutory objective on international competitiveness could increase risk-taking in the financial services sector. We do not need to be reminded of just how damaging that sort of behaviour can be. I am particularly concerned that the secondary objective of competitiveness will negatively impact the regulator’s delivery of its primary objective of ensuring financial stability.

Our amendments (a) and (b) to new clause 17 would place additional requirements on the regulators to report on the delivery of their objectives, including with an assessment of the impact of the Bill on financial stability. If the last few months have proved anything, it is that volatility in financial markets has a very real and direct impact on households, so I urge the Government to think about how the Bill can be strengthened to ensure that financial stability remains at the forefront of regulators’ activities.

I am pleased to see that a number of amendments on green finance have been tabled, but it is disappointing to see the Conservatives’ lack of ambition in that area. We have such an opportunity to be a leading global centre for green finance, but the Bill does nothing to facilitate that. There is an increasing appetite among investors to support the green transition, but British businesses often struggle to access the green capital they need. New clause 33, tabled in my name, would place a requirement on the regulators to report on ways in which they have promoted and incentivised green finance and green investment. Time is running out for us to lead the world on this, and I urge the Government to commit to a green finance strategy and to start thinking seriously about how a regulatory framework can mobilise green finance.