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Clause 38

Banking Bill – in a Public Bill Committee at 12:00 pm on 11th November 2008.

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Question proposed, That the clause stand part of the Bill.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

I will raise two brief points on clause 38, which relates to the procedure followed after a property transfer is made. The Bank of England is required to send a copy to the relevant bank, the Treasury, the Financial Services Authority and any other person specified in the code of practice. I want to raise the issue of the role of Parliament. I am not suggesting that Parliament  can or should be included within that list, but I assume that the Treasury would make available a property transfer instrument to Parliament, or would that not be possible because it contained information of a sensitive commercial nature?

My second point confirms that that would not be confidential because a copy of the instrument will be placed on the Bank’s website and in two newspapers. I would be grateful if the Minister could provide some guidance on that. Clearly, putting something on the website is cheap, but placing a copy of it in two newspapers might be expensive. Is that what the Government normally do, and what newspapers do they have in mind? From my memory of legal practice I know that notices used to be published in the London Gazzette, but I do not know whether that is what the Government have in mind. Perhaps the Minister could elaborate on which newspapers the Government intend to publish a copy of the instrument in.

Photo of Ian Pearson Ian Pearson Parliamentary Under-Secretary (Economic and Business), Department for Business, Enterprise & Regulatory Reform, Economic Secretary (Economic and Business), HM Treasury

The clause sets out various procedural provisions in relation to property transfer instruments and is analogous to clause 23, which makes similar provisions for share transfer instruments. Naturally, the making of a property transfer instrument will follow a period of intensive consultation between the authorities, and that is required by the provisions of clauses 7, 8 and 9, which we have already considered. The Clause adds to that process by providing for a formal requirement for the Bank of England to send a copy of the instrument to the FSA and the Treasury.

As the hon. Member for South-West Hertfordshire suggests, the clause also provides that the Bank of England should publish a copy of the instrument on its website and in two newspapers. We think that that is a reasonable requirement, designed to ensure that an instrument producing legal effects is adequately publicised and that all appropriate parties are fully aware of the transfer. In practice, given the ubiquitous nature of modern media, it is difficult to imagine a transfer being carried out under the radar, but I confirm that it is not our intention to do so. That is why we make it explicitly clear in clause 38(2), which overall is a relatively uncontentious clause.

Photo of Peter Bone Peter Bone Conservative, Wellingborough

Other than not knowing which two newspapers, the contents of the clause are not contentious. That sort of detail has not been published on the current nationalisation of the three banks, although some draft memorandums of share transfers have been placed in the Library. Will the Government publish in that way the details of the current situation, even before the Bill goes through the House?

Photo of Ian Pearson Ian Pearson Parliamentary Under-Secretary (Economic and Business), Department for Business, Enterprise & Regulatory Reform, Economic Secretary (Economic and Business), HM Treasury

I shall confine my comments to the Bill. I stress again that we believe that it is right that the instrument is adequately publicised, because it alters legal rights. Publication in newspapers, in addition to on the Bank’s website, seems the most appropriate option. How much detail will be in the instrument will depend on the individual case. We have an appropriate procedure in the clause for the making of the property transfer instrument, and I urge that the clause stand part of the Bill.

Question put and agreed to.

Clause 38 ordered to stand part of the Bill.