Clause 160
Banking Bill
3:00 pm
Mark Hoban (Shadow Minister, Treasury; Fareham, Conservative)
Will the Minister expand on proposed new section 214(1C) of this clause? It enables
“the scheme manager to settle a class of claim by payment of sums fixed without reference to, or by modification of, the normal rules for calculation of maximum entitlement for individual claims.”
When I read that, I wondered whether it meant that the FSCS could make an interim payment to a certain class of depositor. It could say that, rather than go through the full rigmarole of calculating exactly the deposit balance, people who usually have more than £10,000 in their accounts could have £5,000 as an interim payment. That would be a pragmatic way in which to deal with the problems of eligibility, simplifying criteria and that sort of stuff, or does it mean something completely different? If it is intended to make an interim payment, how would the FSCS recover any surplus or excess of payment made above the level of entitlement of someone in the scheme? It is not clear what the scheme would do in practice. The explanatory note is not much clearer either, particularly given that it is shorter than the clause to which it refers.