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Banking Bill

I shall ask the noble Baroness to withdraw her amendment because we think that this is a case of overegging the pudding. The threshold conditions are regulatory conditions under the Financial Services and Markets Act 2000. The provisions about the determination of whether they are met or not are included in the source material specified under that legislation. The responsible body is the FSA and the requirements are in the FSA handbook. I do not see what the inclusion of this in the code would do except to supplement that which is already abundantly clear and the role of the FSA. The noble Baroness mentioned that the FSA should preserve flexibility in changing times, which is necessary. Since December, it has been in consultation on updating the handbook, particularly as regards these issues and its role under Clause 7, to which the noble Viscount, Lord Eccles, also referred. We have a clear specification of the role of the FSA. With regard to the conditions, the issue is straightforward. The FSA has to take into account all the conditions. Its final judgment, to which it will give greater significance, will depend inevitably on the circumstances at the time. The noble Viscount, Lord Eccles, will also appreciate how difficult it is to be explicit and public about issues which relate crucially to confidence in the market. On Bradford & Bingley, the noble Viscount will know that the public interest could be solved only by making sure that depositors were safeguarded and that the bank was able to continue to function, albeit under very different auspices. That is a reflection of the nature of the crisis to which the FSA is responding—we all recognise that the FSA is taking action in circumstances where there has been market failure. Given that, I ask the noble Baroness to accept that if what she has identified is a weakness in the process and the role of the FSA in it—we discussed this earlier and my noble friend Lord Myners was able to be clear and explicit about the roles of the different authorities—here it could not be clearer that the first responsibility and decision rests with the FSA. We have a framework which makes clear the basis on which the FSA would act. Furthermore, it is responsible for its own handbook, which is where the process is identified. I hope that the noble Baroness will appreciate that her amendment would not add significantly to the necessary arrangements that form part of this Bill, but would produce an extra reference point when surely for the sake of clarity and certainty for all the actors, the more limited the number of reference points to which they should identify who acts and when, the better. For that reason, I hope that she will withdraw the amendment.