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Banking Bill (Money)

I shall deal first with Lords amendment 58, which requires the Treasury to publish annually a report on banks that have been nationalised under clause 13(2). As the Minister said, the amendment was tabled in response to concerns expressed in the other place. My noble Friend Baroness Noakes tabled a much more extensive amendment, which specified the information to be published. It referred not just to those banks that are nationalised or taken into temporary public ownership under this Bill, but to those that were nationalised under the Banking (Special Provisions) Act 2008. That Act expires later this month, and the Bill will replace it. My noble Friend's amendment was much more specific than the Government amendment, in that it required the Government to publish a report covering the financial position of a nationalised bank and its plans and prospects, and any guarantees in respect of a bank that might need to call on Government funds. It also had a catch-all provision that required the Government to publish anything else that they thought was relevant. Where amendment 58 falls down is that it does not give much information on the type of report that we should expect the Treasury to lay before Parliament. Will the Minister be more explicit about what we will see in the annual report? I assume that it will be more than just the report and accounts that all companies are required to publish under the Companies Act 2006. Will it include a statement on the bank's business plan, and how it measures up against that plan? Will the Government commit to publishing the objectives that they set management, and what progress is made on them? Will the report deal with the impact that a nationalised bank has on competition in the financial sector? We touched on that point in Committee. A bank in temporary public ownership may be seen to have an advantage over banks that are free of Government control. The Government responded to the concerns that were expressed at the time about the way that Northern Rock could take advantage of the savings market. If comparable situations arise in the future, will the Government, under this requirement, produce a report setting out the impact that a nationalised bank has had on the market? The Minister said that reports can be produced on a more regular basis. That is indeed important. In that respect, Northern Rock is probably a better example because not only does it publish its annual report, but it produces a half-yearly statement, as well as quarterly trading updates. It therefore exceeds the minimum set out in amendment 58 and offers a template for the level of transparency that would be expected from a bank in state control. A similar level of transparency has not applied to Bradford & Bingley, however. We have heard nothing about its financial condition since it was nationalised at the end of September. There has been no quarterly statement or update about its trading, and nothing about the level of arrears on its mortgage portfolio. That was touched on in the earlier debate about the buy-to-let properties that form part of its portfolio. We see a distinct contrast between the transparency applied in the approach to Northern Rock, and the different standard applied to Bradford & Bingley.