Banking Bill

Part of Consolidated Fund Bill – in the House of Commons at 2:29 pm on 17th December 2008.

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Photo of Charles Walker Charles Walker Conservative, Broxbourne 2:29 pm, 17th December 2008

I am grateful for the opportunity to speak in the debate on the Third Reading of this important Bill, which comes at an important time in this country's financial history. I, too, am delighted that the Bill will put the Bank of England back at the centre of regulation. There is further to go, but I must confine my remarks to the contents of the Bill.

I note that the Bill proposes an increased regulatory role for the Financial Services Authority. There are still huge concerns among Conservative Members—and, I am sure, among Labour Members—about the suitability of the FSA to deliver on that enhanced role. The FSA seems to have missed all the warning signs leading up to the banking crisis and all the warning signs in the mortgage market, and there has been a simple loss of confidence in its ability to deliver on its important role. A few moments ago, I was talking to my hon. Friend Mr. Fallon about the need to restore confidence in the regulatory regime. What happened at Northern Rock must not be allowed to happen again, and the Bill goes some way towards ensuring that it will not. My hon. Friend pointed out that the run on the bank happened because, despite assurances from the Government, the FSA and the Bank of England that there was nothing to fear about losing deposits and that those deposits were safe, the public quickly worked out that no one was in charge. As we move forward, we need someone who is seen to be in charge of regulation, so that the buck stops with him or her. I hope that the Bill sets those wheels in motion; if it does not, I am sure that we will revisit the subject in the very near future.

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