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Banking Bill

I hope that we will not be detained as long with this amendment, which amends subsection (1) of Clause 200. This clause allows the Bank of England to raise fees for its regulatory activities, although I understand that it has no plans to change its current practice, which is not to charge for informal oversight. If Clause 200 is brought into effect, my amendment would ensure that the Bank would recover only its costs of operating the oversight of interbank payment systems and could not enforce some form of pricing which would leave it with a profit which could cross-subsidise its other activities. I am aware that the Treasury has to approve fees under subsection (2) but, if a move to charging fees were in the context of some broader changed financial system for the Bank, the Treasury might end up having to pay for some of the things that the Bank does and it may end up with costs on the Treasury’s vote. These things are conveniently bypassed at the moment with the Bank’s financing system by way of cash ratio deposits. If there were a change with the Treasury having to pay for some things on its own vote, it would have an incentive to ensure that the Bank made as much profit as possible to achieve cross-subsidy. I hope the Minister will therefore see this as a reasonable amendment to protect the financial interest of the interbank payment systems operators. I beg to move.