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Banking Bill (Money)

Any parliamentarian worth his salt will immediately be concerned about the potential for Henry VIII clauses and retrospective legislation; it is absolutely right that both this place and the other place have seen extensive scrutiny of the Government's proposals. I have to say that I believe we have won the intellectual argument about why these powers are necessary and why they need to be retrospective. Let me make it absolutely clear: I believe we have not only won the argument but built a consensus around the approach to be adopted. That is seen in a clause that is now tightly defined and limited. We are absolutely certain that, as a result, we will not need to amend the Bill or propose any secondary legislation. That is absolutely clear. As for retrospection, I acknowledge that it is always controversial, but hon. Members need to recognise that, in the context of a failing bank, we may need the flexibility to deal with all possible contingencies. There could have been a major fraud in the run-up to a bank's failure and, in that context, the authorities may need the flexibility to be able to make provision regarding events that happened before the making of the order—for example, to siphon moneys away from the company in a wholly uncommercial and illegal way. The hon. Member for South-West Hertfordshire (Mr. Gauke) talked about the impact of the wording on retrospection. The wording explicitly provides that the Government cannot use the power on a whim; they will have to demonstrate—for example, through a judicial review—that they took account of the public interest not to use retrospective powers before they actually use this power. In response to the question put to the hon. Member for South-West Hertfordshire in an intervention by the hon. Member for Wellingborough (Mr. Bone)—about whether it really matters that Parliament has to use a materially different form of words—I would argue that it would be for the Government to demonstrate to Parliament that there was a material difference and Parliament would have to be convinced of it. Indeed, the Government's action could also be subject to judicial review, if that were appropriate.