Financial Services (Banking Reform) Bill – in a Public Bill Committee at 2:45 pm on 26 March 2013.
Peter Bone
Conservative, Wellingborough
With this it will be convenient to discuss clauses 18 to 20 stand part.
Greg Clark
The Financial Secretary to the Treasury
Clause 17 is quickly dealt with. It defines key terms that are known to members of the Committee, such as the FCA and the PRA, and it defines enactment for the purposes of the Bill.
Clause 18 makes provision for the transitional arrangements to the new system. Members will agree that it is essential that the transition to ring-fencing be as seamless as possible to reduce uncertainty to firms in the financial services industry and their customers. The clause enables transitional orders to be made to provide, in particular, for the regulators to take such steps as are necessary in the lead-up to commencement, to enable them to exercise their powers on or after the day of commencement. The Delegated Powers and Regulatory Reform Committee is content with the provisions’ using the negative procedure.
Clause 19 sets out the territorial extent of the Bill; there was a conversation earlier with the hon. Member for Foyle. The provisions apply to England, Wales, Scotland and Northern Ireland—with the exception of making depositors preferred creditors, because the insolvency arrangements apply only to Great Britain and not to Northern Ireland; insolvency is not a reserved matter with respect to Northern Ireland. The Northern Ireland Assembly has indicated that it intends to introduce depositor preference through its own Bill on insolvency.
Clause 20 deals with the commencement of the Bill. It gives the Treasury the power to bring clauses 1 to 15 into force by commencement order and to specify different days for different provisions to come into force. Members will be aware that Sir John Vickers and the Independent Commission on Banking set the start of 2019 as the deadline by which their recommendations should be in place. That was because they recognised that there was a balance between the costs and the organisational complexity of introducing ring-fencing. [Interruption.]
Peter Bone
Conservative, Wellingborough
Order. There is a Division in the House. The sitting will be suspended for 15 minutes.
Greg Clark
The Financial Secretary to the Treasury
As I was saying, the Government agree with the timetable proposed by Sir John Vickers, which is in line with the Basel III timetable. Banks will be required to be ring-fenced no later than 2019. The provisions of the Bill relating to ring-fencing will be brought into force in sufficient time to allow that to happen. Depositor preference will be brought into force according to the same timetable.
Greg Clark
The Financial Secretary to the Treasury
The hon. Gentleman tempts me into territory into which I would be ill-advised to go, since Members of the House of Lords strongly guard their ability to scrutinise the legislation that comes before them and to take whatever time they need to scrutinise it. We certainly want to make important progress with the Bill, because everything needs to be in place by 2015, including the statutory instruments. The best I can do is remind the hon. Gentleman that this is a carry-over Bill, so the requirement is that it should be completed within a year of introduction, which is what the Chancellor said. That takes us to, at the latest, February 2014.
A parliamentary bill is divided into sections called clauses.
Printed in the margin next to each clause is a brief explanatory `side-note' giving details of what the effect of the clause will be.
During the committee stage of a bill, MPs examine these clauses in detail and may introduce new clauses of their own or table amendments to the existing clauses.
When a bill becomes an Act of Parliament, clauses become known as sections.
A parliamentary bill is divided into sections called clauses.
Printed in the margin next to each clause is a brief explanatory `side-note' giving details of what the effect of the clause will be.
During the committee stage of a bill, MPs examine these clauses in detail and may introduce new clauses of their own or table amendments to the existing clauses.
When a bill becomes an Act of Parliament, clauses become known as sections.
The House of Commons votes by dividing. Those voting Aye (yes) to any proposition walk through the division lobby to the right of the Speaker and those voting no through the lobby to the left. In each of the lobbies there are desks occupied by Clerks who tick Members' names off division lists as they pass through. Then at the exit doors the Members are counted by two Members acting as tellers. The Speaker calls for a vote by announcing "Clear the Lobbies". In the House of Lords "Clear the Bar" is called. Division Bells ring throughout the building and the police direct all Strangers to leave the vicinity of the Members’ Lobby. They also walk through the public rooms of the House shouting "division". MPs have eight minutes to get to the Division Lobby before the doors are closed. Members make their way to the Chamber, where Whips are on hand to remind the uncertain which way, if any, their party is voting. Meanwhile the Clerks who will take the names of those voting have taken their place at the high tables with the alphabetical lists of MPs' names on which ticks are made to record the vote. When the tellers are ready the counting process begins - the recording of names by the Clerk and the counting of heads by the tellers. When both lobbies have been counted and the figures entered on a card this is given to the Speaker who reads the figures and announces "So the Ayes [or Noes] have it". In the House of Lords the process is the same except that the Lobbies are called the Contents Lobby and the Not Contents Lobby. Unlike many other legislatures, the House of Commons and the House of Lords have not adopted a mechanical or electronic means of voting. This was considered in 1998 but rejected. Divisions rarely take less than ten minutes and those where most Members are voting usually take about fifteen. Further information can be obtained from factsheet P9 at the UK Parliament site.
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The Lords are not elected; they are appointed. Lords can take a "whip", that is to say, they can choose a party to represent. Currently, most Peers are Conservative.
The Chancellor - also known as "Chancellor of the Exchequer" is responsible as a Minister for the treasury, and for the country's economy. For Example, the Chancellor set taxes and tax rates. The Chancellor is the only MP allowed to drink Alcohol in the House of Commons; s/he is permitted an alcoholic drink while delivering the budget.
Chris Leslie
Shadow Minister (Treasury)