Draft Financial Services Bill (Joint Committee)

Kevan Jones Excerpts

Monday 18th July 2011 Commons Chamber

[Thomas Docherty (Dunfermline and West Fife) (Lab)]

I beg to move, amendment (a), in line 14, leave out ‘Mr David Laws’. [Hon. Members: “Shame!”] I hear cries of “shame” from the Chancellor’s former chief of staff, from the Liberal Democrat Whip and from many other members of the coalition Government. I took some advice this afternoon about the rules of this procedure because I wanted to be very clear about what I may or may not refer to. I have received clear advice that I may refer to the content of the recent report of the Standards and Privileges Committee and that I may make some general observations, but you will probably agree with me, Mr Deputy Speaker, that I would not be allowed to make accusations about an hon. Member that are not referred to in the report, and I will proceed on that basis.

The Bill is one of the most important Bills that the Government are introducing. I do not say that just because I have had a chance to glance through the weighty tome that the Government have introduced but because one of the great debates that the House will have in this Session is about how we can better regulate our financial industry. Without doubt there was a failure to regulate it in the previous Parliament—[Hon. Members: “Hear, hear!”] I am sure that the hon. Member for Devizes (Claire Perry) will nod away to that.

[Mr Kevan Jones (North Durham) (Lab)]

My hon. Friend says that regulation failed, and there were loud cheers from the Government Benches, but did not Members on the Government Benches call for less regulation of the financial services industry?

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[John Mann]

I am attempting simply to put across a few views that I believe would appropriately reflect the views of my constituents. I am putting no tone—high, low or otherwise—into this debate.

Members are elected to come and put forward in this House what we think appropriate. One thing that my constituents, and therefore I, would not regard as appropriate, and that the House overall should not regard as appropriate, is having a Joint Committee made up exclusively of English members. A Joint Committee on the draft Financial Services Bill that reflects this House, in the way that Select Committees do, ought to be more reflective of the entirety of the UK, and not just of England. I say that with some irony, because I am one of those who has argued that the English voice has been understated in this House.

[Mr Kevan Jones]

Does my hon. Friend agree that many financial services jobs are based in Edinburgh?

[John Mann]

Our colleagues from every corner of Scotland, not just Edinburgh, are always rightly happy to demonstrate the importance of financial services—

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[Mr Kevan Jones (North Durham) (Lab)]

It is an honour to follow my hon. Friend the Member for Bassetlaw (John Mann). As he knows, I was born in his constituency, so I have a fond spot for the area in north Nottinghamshire that he represents. I wish to oppose his amendment, but also to raise some concerns about the motion.

It is important that the work of the Committee focuses on getting this right. We all remember, certainly those of us from the north-east, that the first domino to fall in the financial crisis was Northern Rock. We saw people quite rightly queuing round the block, fearing for their savings and worrying what would come next. Getting regulation right will be very important, and therefore the work of the Committee will be very important not only for this generation, but for future generations.

It is clear that this Government, the previous Government and the previous Conservative Government grappled with getting the balance right between regulation and having a free market that allows markets to generate the capital and finance that industry and individuals require. Therefore, the Committee will be very important. The task we have set it, in quite a short time scale, which I will come on to in a minute, is rather intriguing. It is a little like the ark of the covenant, in the sense that I will be amazed if the Committee finds the perfect system for regulation.

The nature of the Committee was referred to earlier. The Government brought forward the White Paper setting out the draft regulation. I am a big supporter of draft legislation. I do not think that the press and public have quite got a handle on it yet, because when Governments change draft legislation it is seen as a defeat for them, and that should not be seen as the way forward.

[Kelvin Hopkins]

I very much agree with what my hon. Friend is saying. Does he not agree that more pre-legislative scrutiny would improve the quality of legislation and that we should have more of it?

[Mr Jones]

I agree. To be honest, my answer to the question of the second Chamber is ultimately to vote to abolish it. I have always been a unicameralist and think that if we did the job here better we would get legislation that was not only better, but more timely and well drafted, and we would not have the theatricals that we have to go through with the other place.

The draft legislation is being put forward and I welcome that process. I sat on one of the very first Joint Committees in 2003—the Joint Committee on the draft Civil Contingencies Bill. For a new Member, that was a very good process and learning curve, because it included young and inexperienced Members of this House, such as the hon. Member for Newark (Patrick Mercer) and myself, and Members of the House of Lords, such as Lord Archer, a former Solicitor-General, and Lord Condon, who is a former Metropolitan Police Commissioner. They brought a wealth of experience to that process, which was a good one in that it could not be replicated by the usual way in which we conduct legislative scrutiny in this place. The most important thing was that out of the 130 amendments that were tabled, well over 100 were accepted. The important thing about this Committee will be whether it genuinely conducts pre-legislative scrutiny and whether the Government will really consider changing their proposals.

My hon. Friend the Member for Bassetlaw talked about the House of Lords. I feel uncomfortable not about joint legislative scrutiny with the House of Lords, which is a good process, but about having it for financial matters. That makes me a bit nervous. Not only the membership of the Committee from this House, but the selection process in the other place, which is nothing to do with us, as I well know, have not been thought through. Getting the balance right is a difficult job. The supremacy of this place in dealing with financial issues has to be maintained. I would not like, as my hon. Friend said, for this to be a chink in the armour that breaks the convention that this House, not the other place, deals with finance. Unfortunately, that point seems to have been glossed over in the way that the Government and the usual channels have put the process together. The Procedure Committee or others might want to look in detail at how such Joint Committees come into being. I would not want it to become a regular occurrence for Joint Committees, including those considering financial issues, to have Members of the other place sitting on them and determining what is taken forward.

It will be difficult to get the Bill right. It will be like finding the ark of the covenant to find a regulatory system that everyone agrees with and that protects the public from the scenes that we saw a few years ago. It is interesting that we hear the Conservatives say these days that they are now for more regulation, even though in the 1980s they deregulated the financial markets and then called for less regulation when the previous Labour Government of whom I was a member were bringing in legislation.

I am concerned about the short time scale that is being allowed for the Bill. The motion says that

“the Committee should report on the draft Bill by 1 December 2011.”

We are about to go into a long recess and the Committee will have to work through that to keep to that timetable. I wonder why that date was inserted. Getting this right is more important than any headlines the Government wish to create so that they can say they have solved the problem of the regulation of the banks. The date needs to be reconsidered and the timetable extended.

[Mr Jenkin]

If the date is so important, why did not the hon. Gentleman table his own amendment? Why does he think that the Committee that this House is about to appoint is incapable of reporting to the House if it feels that it has not completed its deliberations? Its members have a mind of their own—they do not need the supervision that he is attempting to give them.

[Mr Jones]

The hon. Gentleman is being a bit petulant—[Interruption.] Pedantic, even. I do not understand why. In my conversations with him, we have never agreed about anything, but we usually get on quite well.

[Mr Spellar]

My hon. Friend agrees with the hon. Gentleman about his Front Benchers’ defence policy.

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[Mr Jones]

Without wanting to be diverted by my right hon. Friend, I certainly do agree with the hon. Gentleman about defence expenditure and the shambles that this Government are making of defence, but I shall not digress to that.

It is important that we get this right, so I do not think that having 1 December is right. The hon. Gentleman is right to say that the Committee will change the date if it wishes.

We must look at what is being put forward. The motion states that the Committee shall have five powers:

“to send for persons, papers and records; to sit notwithstanding any adjournment of the House; to report from time to time; to appoint special advisers; and to adjourn from place to place within the United Kingdom.”

I will go through each of those because they are relevant to the work of the Committee. On the power to send for persons, papers and records—

[The Comptroller of Her Majesty's Household (Mr Alistair Carmichael)]

claimed to move the closure (Standing Order No. 36).

Question put forthwith, That the Question be now put.