Asked by: Daniel Kawczynski (Conservative - Shrewsbury and Atcham)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what comparative assessment he has made of the Financial Conduct Authority's regulatory approach to (a) digital and (b) currencies; what recent assessment he has made of the potential effect of UK financial regulation of digital currencies on their development; what assessment he had made of the adequacy of the steps being taken to support new business and innovation in this area in the UK; and if he will make a statement.
Answered by John Glen
The Government is committed to retaining its global leadership position in fintech and fully recognises its important role in delivering better financial services for people and businesses. The Government also believes that, in practice, this means creating a regulatory environment in which firms can innovate, while crucially maintaining the highest regulatory standards so that people can use new technologies both reliably and safely. This is essential for continuing confidence in the financial system more broadly.
On 10 January 2020, the FCA became the anti-money laundering and counter terrorist financing (AML/CTF) supervisor for cryptoassets firms. A robust AML regime for cryptoassets will help to bolster confidence in the UK as a safe and reputable place to start and grow a cryptoasset business.
To further protect consumers, the FCA has banned the sale of cryptoasset derivatives to retail consumers, and recently issued a warning stating that consumers who invest in cryptoassets should be prepared to lose their money.
The Government has also proposed several further changes to respond to cryptoassets. On 7 January launched a consultation on its regulatory approach to cryptoassets and stablecoins. This set out the view that new and emerging forms of cryptoassets, known as stablecoins, which seek to stabilise their value, could be used as widespread means of payment and potentially deliver improvements in cross-border transactions. At the same time, depending on scale and nature of use, these developments could pose similar financial stability and consumer risks as traditional regulated payment systems.
The Government is considering responses and will outline next steps in due course. Any steps taken in light of this consultation will aim to balance the potential risk to consumers with the ambition to foster competition and innovation in the sector.
This measure is being consider alongside a proposal to bring certain cryptoassets, including Bitcoin, into the scope of financial promotions regulation. This would ensure that relevant cryptoasset promotions are held to the same high standards for fairness, clarity, and accuracy that pertain in the financial services industry. The Government will be publishing its response in due course.
Asked by: Daniel Kawczynski (Conservative - Shrewsbury and Atcham)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps he is taking to safeguard the public finances in response to the Bank of England's Monetary Policy Committee's expectation that inflation will rise above 3 per cent.
Answered by John Glen
The UK has a strong monetary policy framework and the operationally independent Bank of England is responsible for inflation meeting its 2% target. The Bank of England expects the rise in inflation to be temporary, as they set out in the latest minutes of the Monetary Policy Committee, and expect it to return to its 2% target over their latest forecast.
The government’s priority is to continue to invest in the economy to support recovery from the pandemic, whilst also returning the public finances to a sustainable path once the economic recovery is durably underway. The Chancellor has highlighted that at our higher level of debt, the public finances are more vulnerable to changes in inflation and interest rates. That is why at the Budget in March, the government announced fiscal repair measures that take the public finances back toward a sustainable path in the medium term with debt broadly stable and the current budget moving close to balance.
Asked by: Daniel Kawczynski (Conservative - Shrewsbury and Atcham)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps an employee can take when they have not been paid furlough by their employer, when that employer has received the Government payment under the Coronavirus Job Retention Scheme.
Answered by Jesse Norman - Shadow Leader of the House of Commons
The scheme rules make it clear that no grant is payable if the employer is not going to abide by the requirement to pay the furloughed employee 80% of their usual monthly wage (up to a cap of £2,500). HMRC have powers to check and recover any amounts claimed where the employee has not been paid enough.
If workers are concerned they are not receiving this, they should report their employer to HMRC via the online fraud reporting tool on the Government’s website, or use HMRC’s telephone-based fraud hotline. HMRC will continue to monitor claim data, compare against records of earnings and review reports to their fraud hotline.
The Government retains the right to audit retrospectively all aspects of the scheme with scope to claw back fraudulent claims.
Asked by: Daniel Kawczynski (Conservative - Shrewsbury and Atcham)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has plans to extend business rates relief to food and drink wholesalers who supply to (a) schools, (b) hospitals, (c) care homes and the hospitality industry to mitigate against (i) businesses in that sector closing and (ii) jobs being lost as a result of the covid-19 outbreak.
Answered by Jesse Norman - Shadow Leader of the House of Commons
The Government has provided enhanced support through business rates relief to businesses occupying properties used for retail, hospitality and leisure given the direct and acute impacts of the COVID-19 pandemic on those sectors.
A range of other measures to support all businesses, including those not eligible for the business rates holiday, such as wholesalers, has also been made available. On 8 July the Chancellor set out a package of measures to support jobs across the UK, including a Job Retention Bonus to help firms keep furloughed workers, and a new £2 billion Kickstart Scheme to create hundreds of thousands of new, fully subsidised jobs for young people. The Chancellor has also announced a cut in VAT to 5% for accommodation, attractions and the hospitality sector.