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Clause 1 - Deputy Governors

Part of Financial Services Bill – in a Public Bill Committee at 11:00 am on 21st February 2012.

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Photo of Chris Leslie Chris Leslie Shadow Minister (Treasury) 11:00 am, 21st February 2012

The discussion has been very helpful. The hon. Member for Foyle—my hon. Friend—made a constructive suggestion to the Committee. If the Minister were to withdraw the clause and replace the wording with “a Governor of the Bank”, at least the ambiguity in the provision would be removed and the meaning would be put beyond doubt. I think it was the former United States President, Bill Clinton, who, in evidence given at his impeachment trials in Congress, spent a lot of time discussing the meaning of the word “is” and whether it applied to his predicament. We are not in quite the same situation in Committee—at least not that I know of at this stage. The word “a” or “the” can make a significant difference. Nevertheless, the Minister has a team—a phalanx—of very educated and worthy officials, who are able to advise on these elements of vocabulary and definition, so with great reluctance I would be prepared not to press amendment 2, although I reserve the right to bring it back at a later stage.

On amendment 1, I hear what the Minister says—that the court itself does not want to be renamed. That is not a massive surprise for a conservative institution; they tend to want to retain their traditions, even when quite palpably a name has expired as a modern and useful term in current parlance. I do not believe that the name “the court” should be retained simply because those who sit upon it do not particularly want to change it. It is a public body; it has ramifications for all our lives and the economy more widely, and it is important to have a simpler, more straightforward description. Setting aside for a minute the bigger issues about what the court—that supervisory board—ought to do, the Treasury Committee itself, in paragraph 41 of its 21st report, said:

“Whatever name is ultimately chosen, we strongly recommend that the term ‘Court’ is abolished.”

I agree with the Committee and its members, some of whom are with us in the Committee today, that that is an incredibly important point. Even if we take amendment 1 at face value, as it stands, simply to move away from the term “court”, I think it is an important amendment and I think we should make it.

I was hoping to hear the hon. Member for Hereford and South Herefordshire talk about his views, given that he has written so extensively on the subject, but maybe we shall still have an opportunity to hear from him on it beyond the intervention that he made.

I am not entirely convinced about the establishment of the oversight committee, given that we do not seem to know who will be on that sub-committee arrangement. The Minister said it would be a matter for the Bank to determine. That is not really good enough, given that this is supposed to be a check-and-balance process. At the very least, we should know now who will be on that oversight committee, to give us a sense of whether it will have teeth: whether it will be able properly to oversee some of those internal—what the Minister called policy-making—processes.

There is another discussion to be had, which we may have at a later stage of our scrutiny of the Bill, about what exactly the court—the supervisory board, as we would like to call it—ought to have the ability to look into. There is a debate about whether it should simply be looking at processology—minutes, matters arising, whether the agendas are in the right font and so on—or whether it can get its teeth into the effectiveness of policy, the activities of the Bank of England, the policy-making functions and the decisions that emerge from them. If there is to be a proper set of constitutional checks and balances, the court or supervisory board needs to be able to look at the latter and not restrict itself to the merely technical, functional elements of those arrangements.