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Banking Bill

My Amendment 80 is grouped with that moved by the noble Baroness, Lady Noakes. The dilemma we face here is that the Government have two good policies that they are trying to pursue at the same time but which have contradictory effects. One of the good policies is the ability to pursue partial transfers, which may be very important if a bank is in crisis, while the other is the Government’s declared intention to promote netting and set-off arrangements. My amendment is designed to protect such netting and set-off arrangements by using the relatively strong but not decisive expression: "““A partial transfer … shall not undermine any … arrangements””." I have chosen this form of words because while close attention will need to be paid to the nature of such arrangements, it should not be absolutely prescriptive. The amendment attempts to sustain the arrangements and provide a degree of legal certainty while not being totally prescriptive with respect to the Government’s actions. I am afraid that the subsections in Clauses 47 and 48 that attempt to provide some degree of legal certainty and to protect netting arrangements are quite unsatisfactory because they are all conditional on whether the Treasury ““may”” by order do something rather than that it ““will”” do something. The amendment would provide the degree of legal certainty necessary to protect set-off and netting arrangements without in turn limiting the Government’s ability to pursue partial transfers, which may also be valuable. It may be that I am trying to square a circle and we might end up with two desirable policies that unfortunately conflict with one another, and therefore I am interested to learn how the Minister will deal with the potential conflict between these two dimensions of policy.