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Banking Bill

My Lords, I welcome the constructive opening comments made by the noble Baroness, Lady Noakes, and I will do my best to ensure that we comply with the spirit that she evidences and that she says she expects from us. I agree with her that it may be necessary to return to some of the issues of substance at Third Reading, including, where that would be helpful, through the tabling of further opposition amendments. Of course, this will need to have been agreed through the usual channels. In particular, we have agreed through the usual channels that it would be helpful to further consider issues around Clauses 22, 34, 38 and 48, including with external stakeholders. I would like to inform your Lordships’ House that the noble Baroness and I will not move the following amendments today: 21 to 23, 27 to 30 and 34 to 38. We will instead return to address these amendments at Third Reading. Amendment 1 would change Clause 1 so that the private sector purchaser stabilisation option is referred to instead as commercial purchaser. This is similar to an amendment that the noble Baroness tabled in Committee. Following that debate and her comments now, I believe I understand her main concern on this. It is not, as I had previously thought, a concern about discrepancy, but rather that, in presenting this stabilisation option, both in the title to Clause 11 and in Clause 1, as one involving a private sector purchaser, the Government are not accurately representing what may be allowed under these powers. I do not agree with the noble Baroness on this point and I believe the Government have been open on this matter. Clause 11, which describes the effect of the powers, clearly states that a transfer of a bank or its business may be made to a ““commercial purchaser””. As I stated in Committee, it may be the case that a healthy deposit-taker in which the Government are a shareholder may be in a position to take on the business of a failing bank. The wording of Clause 11 clearly permits this. This is not something about which the Government are trying to keep quiet. I wish to be very clear that we must use these powers in whatever way meets the special resolution objectives. Thus, the text of Clause 11 refers to a commercial purchaser to take account of situations in which the transferee may not be entirely privately owned. Given this, one may argue that the heading of that clause and the title ““The stabilisation options”” for these clauses should change to reflect this. The Bill has, however, been drafted with a number of main headings which use terms to reflect the main purpose behind the powers. The stabilisation options have been labelled ““private sector purchaser””, ““bridge bank”” and ““temporary public ownership””. None of those terms has precise meaning unless given so under the clauses that provide for them. In each case the clauses are clear. Furthermore, we have been clear in our presentation of the clauses how the powers can be used. The principal purpose of the stabilisation option in question is to achieve a transfer of the shares or property of a failing bank to a private sector purchaser, which is why the option is labelled, and why Clause 11 is titled, thus. For that reason, I invite the noble Baroness to withdraw her amendment.