Asked by: Stephen Timms (Labour - East Ham)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will take steps to amend the cooperation agreement between the Society of Lloyds and the Prudential Regulation Authority to place obligations on Lloyds of London to help meet the UK's climate targets.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The financial regulators’ primary focus must be to ensure the safety, soundness and integrity of the markets they regulate. While the government expects that the regulators will play a crucial role in supporting the achievement of the government’s net zero target, it is not their primary responsibility given many of the levers for change sit outside of financial services regulation.
However, the Financial Services and Markets Act 2023 introduced a new regulatory principle for the Financial Conduct Authority, Bank of England and Payment Systems Regulator to consider in their work. To further strengthen the UK’s regulatory regime relating to climate and the environment, the government has embedded the consideration of the UK’s climate and environmental targets across the full breadth of the regulators’ general functions on a statutory basis.
This regulatory principle seeks to cement the government’s long-term commitment to transform the economy in line with its target to reach net zero by 2050, and to make progress towards the government’s long-term environmental goals, by ensuring the regulators must have regard to the government’s commitment to achieve these targets when discharging their functions.
This principle does not create any specific requirements on firms. Rather, they are expected to inform the future work of the regulators.
Asked by: Stephen Timms (Labour - East Ham)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the potential merits of placing statutory duties on the (a) Financial Conduct Authority and (b) Prudential Regulation Authority to help meet the UK's climate targets.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The financial regulators’ primary focus must be to ensure the safety, soundness and integrity of the markets they regulate. While the government expects that the regulators will play a crucial role in supporting the achievement of the government’s net zero target, it is not their primary responsibility given many of the levers for change sit outside of financial services regulation.
However, the Financial Services and Markets Act 2023 introduced a new regulatory principle for the Financial Conduct Authority, Bank of England and Payment Systems Regulator to consider in their work. To further strengthen the UK’s regulatory regime relating to climate and the environment, the government has embedded the consideration of the UK’s climate and environmental targets across the full breadth of the regulators’ general functions on a statutory basis.
This regulatory principle seeks to cement the government’s long-term commitment to transform the economy in line with its target to reach net zero by 2050, and to make progress towards the government’s long-term environmental goals, by ensuring the regulators must have regard to the government’s commitment to achieve these targets when discharging their functions.
This principle does not create any specific requirements on firms. Rather, they are expected to inform the future work of the regulators.
Asked by: Tonia Antoniazzi (Labour - Gower)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the potential merits of reducing the level of ATM interchange fees in the context of trends in the level of the cost of (a) labour and (b) the distribution of non-branch ATMs.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The government recognises that cash continues to be used by millions of people across the UK, including those who may be in vulnerable groups.
The government legislated through the Financial Services and Markets Act 2023 to establish a new legislative framework to protect access to cash. This establishes the Financial Conduct Authority (FCA) as the lead regulator for access to cash and provides it with responsibility and powers to seek to ensure reasonable provision of cash withdrawal and deposit facilities. The FCA is currently holding a consultation on its proposed regulatory approach: FCA Access to Cash Consultation
Decisions regarding the funding arrangements of an ATM network are taken by the parties involved. LINK (the scheme that runs the UK's largest ATM network) has commitments to protect the broad geographic spread of free-to-use ATMs and is held to account against these commitments by the Payment Systems Regulator.
Asked by: Lord McNicol of West Kilbride (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government whether they consider that the Financial Ombudsman Service and Financial Services Compensation Scheme protections enacted under the Financial Services and Markets Act 2000, which underpin retail investor confidence in the UK financial industry, remain "an expression of UK national policy".
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The government believes that it is important that consumers of financial services have appropriate routes to seek redress without having to go through the court system. The Financial Services and Markets Act 2000 established both the Financial Ombudsman Service (FOS) and the Financial Services Compensation Scheme (FSCS) for this purpose.
The FOS provides consumers and small businesses with a free, independent service that enables the proportionate, prompt and informal resolution of disputes with financial services firms. It is designed as an alternative to resolution of cases through the courts, which can be expensive for both firms and consumers and delay redress.
The courts also continue to play an important role alongside the FOS in ensuring consumers have access to redress and in some cases may be a more appropriate route to ensuring effective resolution of disputes.
The FSCS is the UK’s compensation scheme of last resort and pays compensation to consumers when authorised financial services firms fail. However, the FSCS does not cover losses that arise purely from investment performance. The UK does not operate a zero-failure regime in financial services and individuals have responsibility for choosing investments that are suitable for their risk profile.
Asked by: Baroness Quin (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what plans they have, if any, to undertake a study of the impacts to date of Brexit on the London Stock Exchange.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The government does not intend to review the impacts of Brexit on the London Stock Exchange.
The UK is Europe’s leading hub for investment, and London continues to be the only European hub in the top ten of the Global Financial Centres Index. The government is committed to building on these strong foundations to make the UK the global capital for capital.
Leaving the EU provides the freedom for the UK to tailor financial services regulation to UK markets, including through the government’s Smarter Regulatory Framework programme. Under the programme, assimilated law is being replaced by a regulatory framework tailored to the UK that will benefit businesses and consumers alike.
The government is taking forward an ambitious programme of reform to improve the competitiveness of UK markets. This includes overhauling the UK’s Prospectus Regime to create a simpler and more effective regime than its EU predecessor, delivering on a key recommendation of Lord Hill’s Listing Review. Legislation to deliver this reform was laid on 27 November 2023.
Asked by: Andrew Rosindell (Conservative - Romford)
Question to the Home Office:
To ask the Secretary of State for the Home Department, what steps he is taking to help tackle the sale of unlicensed drugs online.
Answered by Chris Philp - Minister of State (Home Office)
Drugs ruin lives and devastate communities. The Government is committed to driving down drugs supply in the UK through tough law enforcement against the sale of drugs online, including on the dark web.
We are clear that tech companies must take responsibility for embedding public safety in their system designs in order to prevent harmful material on their platforms. We expect tech companies to have robust processes in place to swiftly remove illegal content.
Our Online Safety Act will introduce measures requiring platforms to remove content relating to the sale of drugs online. This ground-breaking piece of legislation will compel tech companies to consider the risks associated with all elements of their services and take action to keep users safe. This means that tech companies must proactively tackle this type of content from their platforms and prevent users from being exposed to it. If they fail to comply, they risk stiff financial penalties or in the most serious cases, having their sites blocked by the independent regulator, Ofcom. The Online Safety Act delivers the government’s manifesto commitment to make the UK the safest place in the world to be online. The Act is a vital piece of legislation, designed to ensure that tech companies take more responsibility for the safety of their users, particularly children.
We work closely with the National Crime Agency, which in partnership with policing colleagues across the UK and internationally is mapping and targeting key offenders operating online, including the dark net markets. Dedicated teams use a range of tools and techniques generally unavailable to most investigators and we make sure they have the resources and powers they need to keep our country safe.
Law enforcement agencies continue to work with internet service providers to shut down UK-based websites found to be committing offences such as selling drugs controlled under the Misuse of Drugs Act 1971.
We recognise that gangs are increasingly using social media to sell drugs and exploit vulnerable people to help move their illicit commodities. Through the County Lines Programme, we are developing a better understanding of how these platforms are being used and how to disrupt them.
Asked by: Claire Hanna (Social Democratic & Labour Party - Belfast South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has had recent discussions with the FCA on the effectiveness of its consumer duty in upholding standards of financial services for customers.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The Government is committed to ensuring the UK has world-leading levels of regulatory operational effectiveness and to ensuring that consumers of financial services have appropriate protections in place. The Consumer Duty aims to ensure that firms act to deliver good outcomes and seeks to set a higher and clearer standard of care that firms owe their customers.
Treasury ministers meet regularly with the FCA to discuss a range of topics including the Consumer Duty.
With any new policy intervention, it is appropriate to consider how effective it has been in meeting its objectives, once such an assessment can be made. The Financial Services and Markets Act 2023 introduced a new requirement on the financial services regulators to keep their rules under review, and to publish a statement of policy for how they conduct rule reviews. The FCA’s rule review framework can be found at https://www.fca.org.uk/publications/corporate-documents/our-rule-review-framework.
Asked by: Lord Hodgson of Astley Abbotts (Conservative - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government, further to the letter from Baroness Penn to Lord Hodgson of Astley Abbotts on 22 August 2023, when they expect to publish the interim report on the review of treatment of Politically Exposed Persons by financial institutions.
Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)
The Financial Services and Markets Act 2023 committed the Financial Conduct Authority to conduct, and publish the conclusions of, a review into how financial institutions are following its guidance on politically exposed persons (PEPs) by the end of June 2024. As set out in the Written Statement on the treatment of PEPs published on 14 December 2023, given the strength of concern on this issue, the Government expects that the FCA will prioritise this review over the coming months.
Asked by: Giles Watling (Conservative - Clacton)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he is taking steps to prevent banks from providing (a) financial and (b) investment support to industrial livestock companies that contribute to deforestation.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The Government is committed to working with UK financial institutions to further tackle deforestation-linked finance. As we set out in the updated Green Finance Strategy, we have begun this work with Government-convened roundtables having commenced in Summer 2023.
The global approach on disclosure standards, such as the International Sustainability Standards Board (ISSB) or the Taskforce on Nature-related Financial Disclosures (TNFD) is a vital condition for success in improving nature-related disclosure.
Following the making of the first relevant regulations under paragraph 1 of Schedule 17 of the Environment Act and as set out in the Financial Services and Markets Act 2023, HM Treasury will conduct a review to assess the extent to which regulation of the UK financial system is adequate for the purpose of eliminating the financing of illegal deforestation, and to consider what, if any, changes to the regulatory framework may be appropriate.
Asked by: Andrew Bridgen (Independent - North West Leicestershire)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the potential merits of bringing (a) social media and (b) telecoms firms into the scope of the mandatory advanced push payment reimbursement regime.
Answered by Bim Afolami - Economic Secretary (HM Treasury)
The government takes the issue of Authorised Push Payment (APP) fraud very seriously and is dedicated to protecting the public from this devastating crime. That is why the government legislated in the Financial Services & Markets Act 2023 to enable the Payment Systems Regulator (PSR) to require banks and other payment service providers to reimburse APP fraud victims.
The Online Safety Act introduces duties on platforms and services for having processes to remove illegal content, such as fraud. Companies found in breach will face a penalty of up to £18 million or ten per cent of their annual global turnover. The government has also recently agreed an online fraud charter with the world’s biggest tech companies, who have pledged to take additional action to block and remove fraudulent content from their sites.