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Banking Bill

I also speak to Amendment 180, Amendment 183 and Amendment 191. With these amendments I return to the theme that the Bill should reflect as far as possible the workings of the tripartite authorities. Since the FSA was set up, there has been cross-membership between it and the Bank of England, although one would not find it mentioned anywhere in either of the relevant governing Acts. The chairman of the FSA has been a member of the Court of Directors of the Bank of England, and one of the deputy governors of the Bank of England has been on the FSA board. The purpose of my amendment is to ensure transparency and clarity in relation to the membership of the bodies, and, if it is the custom to achieve cross-membership, that should be laid out for all to see. Given the ever closer working that we are promised by the tripartite authorities, it seems right and proper that what might have been an experiment in the late 1990s is now reflected in the appropriate statutes. Therefore, I hope that this amendment simply reflects the practice but, if the Government intend to change that practice, I am sure that the Committee will welcome hearing from the Minister. The other amendments in this group relate to the Financial Stability Committee, which we will continue to deal with in detail in later amendments. For the purposes of this group, I have tabled Amendment 180 to ensure that the court member who comes from the Financial Services Authority sits on the Financial Stability Committee. The Financial Stability Committee has a Treasury quasi-member by virtue of subsection (3) of the new Section 2B inserted by Clause 228. It seems odd at the very least that, if the Treasury is to be at the table, the FSA will have no role in the Financial Stability Committee. Amendment 183 is consequential, reducing the balance of the directors on the FSC to allow for the place taken by the FSA. I have also tabled Amendment 191, which proposes the deletion of subsection (3) of new Section 2B on a probing basis. I had assumed that the Treasury would want one of its men sitting on the Financial Stability Committee to ensure proper Treasury involvement in financial stability matters. However, the absence of the FSA from the FSC has made me doubt this. Perhaps the Treasury is there to oversee the Bank. We may need a clearer understanding of what new subsection (3) does in giving the Treasury a quasi-seat. If the Government do not want an FSA man on the Financial Stability Committee, I hope that the Minister will explain how the FSA is to be involved in the work of the FSC. If it does not have a formal seat, perhaps it should have a quasi-member in the same way as the Treasury has; alternatively, perhaps neither of them should be there. The noble Lord, Lord Eatwell, has some more radical proposals about the role of the FSA in his amendments in this group, and I look forward to him speaking to them. I know that the noble Lord, Lord Turnbull, wished to be with us for this group of amendments and he has passed a copy of his speaking notes to me and to the noble Lords, Lord Myners and Lord Eatwell. Suffice it to say that the noble Lord, Lord Turnbull, is strongly in favour of the amendments in the name of the noble Lord, Lord Eatwell, which bring together more formally the Bank and the FSA in the context of these new financial stability arrangements. I beg to move.