Mark Garnier
MP for Wyre Forest · Conservative · United Kingdom
“Many commentators have commented about public sector productivity underperformance. EY tells us that the public sector has underperformed to the point where it has cut GDP growth by 3% since 2019. The Institute for Government highlights an average of nearly 1% underperformance every year for that same period.”
“My right hon. Friend raises another big argument that we could have on the issue of rural broadband, but it is worth making the point regarding internet connectivity that I was just coming on to. I know this is as painful in other constituencies as it is in Wyre Forest.”
“I remember the impact that was felt in 2015 when HSBC closed the last bank in Bewdley in my constituency; people were utterly dismayed. Happily, the post office stepped in and was able to help resolve the issues, but since then we have now discovered that that the post office is under threat.”
“As I say, I am not an apologist for banks, and I am keen to ensure that we get a balanced argument. The hon. Lady is absolutely right that that is an awful lot of money, but it all comes down to what should be the right and proportionate response.”
“If a branch is not viable, should the bank keep it open? We must look at the other opportunities. The last Conservative Government recognised that and were committed to retaining vital banking services.”
“New York is the biggest financial services centre in the world and London is the second biggest, but in New York, 80% of the turnover is driven by the domestic market of America, while just 20% is international; those numbers are reversed in the UK, where 80% of the activity is international.”
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“I can see the sense in what the Secretary of State is trying to achieve with this reorganisation, and the target of 500,000 people per unitary authority makes a lot of sense—it brings a lot of people together. But why, after Wyre Forest district council voted for the single unitary, did the Secretary of State deliver a two-unitary solution for Worcestershire? North Worcestershire, where Wyre Forest is, will consist of 293,000 people. We are now splitting up adult social care, children’s services, highways, education and refuse disposal. It does not make financial sense. Will the Secretary of State reconsider what is being proposed for Worcestershire, and go with a single unitary authority?”
“The reality is that at the moment we use about 36 GW of power, and during the winter we use about 45GW of power, and that is before we have electrified transportation and before we have invested a huge amount in data centres and artificial intelligence. Blackouts are indicators that the grid is not working. A small blackout in Tunbridge Wells is an indicator that there could be big blackouts in the future. What is the Minister doing to resolve these problems?”
“May I associate myself with the comments of my right hon. Friend the Member for New Forest East (Sir Julian Lewis) about the management of NESO creating a hostile environment for technicians in the distribution centres? Like the Minister, I have met the individuals in the control rooms, and I have nothing but admiration for them, so for them to be condemned as enemies of the company by being whistleblowers is profoundly wrong. We have heard Members raise other problems. In particular, the hon. Member for Tunbridge Wells (Mike Martin) spoke about small blackouts in his constituency, and the Minister brushed that off as a little local problem.”
“Can the Minister not understand that people out there, such as my constituent Leanne Vaughan—her daughter was killed by a hooligan driver, and she had to wait 28 months before he was sentenced to 66 months in prison, but then was released after 21 months—do not believe what he is saying? It is appalling. People are heartbroken by their losses, and this Government are not meeting their expectations or ours.”
“If we stay on this trajectory, the health and disability-related benefits bill could reach nearly £100 billion by the end of this Parliament. We should be acting now; instead, we are left with dither and delay. Finally, we need to talk about fraud, which is becoming ever more pervasive—the National Audit Office found that it cost the public sector between £55 billion and £81 billion in 2023-24. That figure continues to increase year on year, so there is a real need to tackle fraud and ensure that public money is allocated correctly.”
“As the Leader of the Opposition has said, if it is all fine, why is the Prime Minister resigning? When it comes to welfare specifically, we are at a point where more than half of all households are net beneficiaries of benefits. Again, that is unsustainable. The Government had the chance to reduce the benefits bill, and the Leader of the Opposition pledged our party’s support in doing that. However, the Government could not face down their own Back Benchers, so we are left waiting for the Timms review of PIP to report in the autumn, which may not even suggest making the necessary savings we should all make on PIP. In this year alone, PIP will cost the Department an extra £3.5 billion, and universal credit will cost nearly £9 billion extra.”
“That is especially affecting young people, hence why we now have higher youth unemployment than the European average. That is not a good thing after 20 months in power. At the same time, the Government introduced the Employment Rights Act 2025, adding even more costs and complexities to businesses. These costs to businesses are estimated at £5 billion. When the Minister closes the debate, I am sure she will talk about the increased funding in apprenticeships, which is of course welcome. It is all well and good increasing funding for apprenticeships and employment, but it is ultimately pointless if there are no jobs available. That is what this Government seem to fail to understand. This is a crisis of their own making, and they are putting their head in the sand and pretending it is all fine.”
“Unemployment was at 4.1%, and youth unemployment was at 14%. Some 6.8 million people were claiming universal credit, and 3.5 million people were claiming personal independence payments. Twenty months later, after Labour came to power, inflation has risen to 2.8%. Unemployment has risen to 4.9%, and youth unemployment has risen to 16.2%. Some 7.9 million people are claiming universal credit, which is 1.1 million more people, and 3.9 million people are claiming PIP—that is 400,000 more people. That is unsustainable. How have we got to this position? Part of it is down to the Government’s policies around employment. The increase in employer national insurance contributions to 15% has added more costs to businesses. That means that many businesses have had to make redundancies and are hiring fewer people than before.”
“You will be hated.” That is why we offered our support to the previous Secretary of State, the right hon. Member for Leicester West (Liz Kendall), when she attempted to bring down the benefits bill, because it was the right thing to do. Everyone is paying more in tax to pay benefits to others. That is not fair, and it needs to change. When it comes to our welfare system, we need to be clear what we want from it. The system should be there to help people when they fall into difficulty; at the same time, it should help the most vulnerable people in our society. There are many people who simply cannot work, and they must be protected. However, we have got to a state in which too many people are reliant on the benefits system. Let us take a look at where we have got to today. When we left office, inflation was at 2%.”
“I thank the Chair of the Work and Pensions Committee, the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), for securing this debate. I offer my congratulations to my hon. Friend the Member for Aberdeen South (Douglas Lumsden) on a great Conservative gain and to the hon. Member for Arbroath and Broughty Ferry (Lara Bird) on an SNP hold, and I congratulate them both on their maiden speeches. I welcome the opportunity to challenge the Minister on her Department’s spending policies and performance. We cannot pretend that welfare reform is not difficult to achieve. As the shadow Secretary of State, my hon. Friend the Member for Faversham and Mid Kent (Helen Whately), said recently: “When I speak to former Welfare Secretaries, I hear the same thing again and again. Welfare reform is hard.”
“In his speech yesterday, he said that he would control the welfare bill, and told us to “imagine”. We on the Conservative Benches hope that his promises do not turn out to be imaginary.”
“Madam Deputy Speaker, you will be delighted to hear that I am coming to the end of my speech. Under this Government, hard-working taxpayers are being asked to pay more. Many people would hope that that money would be going towards—for example—increasing the defence budget, but as this estimates day debate has highlighted, it is going to the DWP budget instead. The Government know that this is not right; indeed, the previous Secretary of State for Work and Pensions was right when she said that the Government “must not…duck the big challenges facing this country”. —[ Official Report , 1 July 2025; Vol. 770, c. 164.] However, when it came to making the tough decisions, they bottled it every time. Maybe the next Government, led by the right hon. Member for Makerfield (Andy Burnham), will do better.”
“I am not going to give way, because I have very limited time—my apologies. When it comes to fraud and error in the DWP specifically, the Department’s own statistics estimate that around £9.9 billion is overpaid in benefits each year. Two thirds of those overpayments are for universal credit claims, so I hope the Minister will explain why fraud and error are particularly high for universal credit claims and what steps are being taken. In 2017, there were 7,840 convictions for benefit fraud; last year, there were 461. That is a 94% decline in convictions, and fewer than 600 individuals have been convicted in total since the general election. I agree with my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) that we should be making an example of benefit cheats in the courts to disincentivise others.”
“The Pensions Minister likes to spend a lot of time criticising the previous Government for their actions on pensioners. He also spends an awful lot of time talking up his legacy on helping pensioners, but his actions simply do not reflect the narrative. So far, he has capped salary sacrifice, there have been delays to the pensions dashboards, we have had retrospective changes to inheritance tax on pension pots, and—as we have heard—the Government are chasing hard-up pensioners for their winter fuel allowance. All of this creates uncertainty among savers and pensioners alike, so I will repeat the question asked by the hon. Member for Romford (Andrew Rosindell): is the Pensions Minister hopeful that his successor will do a better job of looking after pensioners?”
“May I start by congratulating the former Economic Secretary, the right hon. and learned Member for Northampton North (Lucy Rigby), on her promotion to Chief Secretary? In the eight months that I shadowed her in her previous role, she made a strong impact and gained significant, well-deserved respect from those in the financial services industry. May I also welcome my fourth Economic Secretary, and wish her the very best of luck in the role? As the Leader of the Opposition said in a speech last week, tax and regulation is getting in the way of financial services lending and investing in the UK economy. Does the new Economic Secretary think that the next Chancellor will do a better job of ensuring growth for this country?”
“I was going to bang on with a very long and intelligent speech, but in the interests of brevity and keeping everybody happy, I will not. I am delighted that the Minister is introducing legislation relating to the glorious regime of the strong and stable Conservative Government of 2020 and the 2023 Budget. This policy was slightly bonkers. We need to do everything we can to encourage people to save and not put a cap on their savings. I am tempted to go on about salary sacrifice, but I will spare the Minister the embarrassment of reminding him about that. We will certainly not oppose these regulations.”
“After promising to not extend the freeze—something we would have supported —she went back on her word and chose not to protect hard-working people. That matters to pensioners, because the state pension will soon rise above the income tax threshold due to the triple lock, which we all agree is a good thing to remedy the ills that happened when the state pension fell to, I think, about 13% or 14% of average earnings. That means that pensioners will now have to start paying income tax on— [Interruption.] I am being heckled by the Minister.”
“That helped pensioners as well as lower-earning people, and over time it brought the state pension to a level below that of the tax-free threshold. That has two benefits: first, there is no tax for state pensioners, and secondly there is no tax return to be filled in by state pensioners. But now this Government are choosing to freeze income tax thresholds until 2031, and the Government have extended the freeze because of their economic mismanagement. The Chancellor, in her first Budget, stated: “From 2028-29, personal tax thresholds will be uprated in line with inflation once again. When it comes to choices on tax, this Government choose to protect working people every single time.” —[ Official Report , 30 October 2024; Vol. 755, c. 821.] As I say, that was her first Budget.”
“Prior to the last Budget, the Chancellor flew a few kites about reducing the tax-free lump sum. That resulted in pensioners withdrawing £3.9 billion in one-off lump sums from their pensions between October 2024 and October 2025. That was an increase of nearly 30% on the year before. When the Budget was actually announced, the Chancellor raided unused pensions in her inheritance tax calculations—a policy that will bring more families into paying inheritance tax and will mean that fewer people can pass money on to their loved ones when they die. However, this petition talks specifically about the personal allowance. The last Government made a decision to help those in the bottom decile of earnings by increasing the tax-free threshold at an accelerated rate.”
“That system has remained unchanged ever since. The simple contract between the state and the pensioner has not changed at all since 1921. It is important to underline this point. Successive Governments maintain that a pension, whether state or occupational, is a form of income. Specifically, it is treated as a replacement for earnings. However, there have been breaks for pensioners, most notably the exemption from paying national insurance contributions. Today, a pensioner will be asked to pay income tax above the tax-free threshold, but they will not be asked to pay national insurance, as the working population do. Where we can absolutely agree with the wider sentiment of the petition is that this Government are confusing the pension landscape. In their first 20 months, the Labour Government have not been the pensioner’s best friend.”
“That context goes back over a century to 1921, when the Government of the time struck a deal with future pensioners. The basis of that deal was that people could save money into a fund from untaxed earnings; the Treasury would contribute to that fund the tax that would otherwise have been paid. Then the fund would be allowed to grow without being subject to any tax during its lifetime. At the time of retirement, the fund would be used to provide an income for the pensioner but, importantly, that income would be treated as taxable income. It would be replacing the earnings that that individual would have been generating, had they still been in work. In 1946, when the state pension was introduced, that pension payout was to be subject to tax in exactly the same way that private pensions were back in 1921.”
“We are all facing a higher tax burden thanks to this Government’s choices and policies, and we are all really struggling with cost of living rises—again, thanks to this Government’s tax choices on employment. Pensioners, instead of living with the dignity in retirement that they have worked so hard for and deserve, have a greater financial burden placed on them. Now we have the prospect of the Chancellor of the Exchequer floating more tax rises in the next Budget. That is deeply concerning for all of us, but especially for those on low incomes. I hope that this Minister, who played a key role in the last Budget, will be able to rule out tax rises in the next Budget at the Dispatch Box here today. The thrust behind the petition is very clear, but first we must understand the historical context of how the pension system works.”
“Thank you, Dr Huq, for your stewardship of this important debate. I also thank my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont) for introducing the debate. Most importantly, I thank the 119,000 people who signed this petition, 247 of whom are from my constituency of Wyre Forest. I thank my hon. Friend the Member for Bognor Regis and Littlehampton (Alison Griffiths) for also raising this issue, my right hon. Friend the Member for South Holland and The Deepings (Sir John Hayes) for bringing up the WASPI women, and the Liberal Democrat spokesman, the hon. Member for Witney (Charlie Maynard), who needs hearty congratulations on getting Brexit into this debate—well done to him. This is a timely debate, and I agree with the wider point at the heart of the proposal that the petition seeks to address.”
“I look forward to hearing from the Minister whether he is willing to raise the tax-free threshold, as identified in this petition, from £12,500 or thereabouts to £25,140, and will then maintain it at 200% of the working person’s tax-free threshold. Will he agree with the petition, or will he rule out that proposal today? Finally, I have been shadowing the Minister for about 18 months now. He is a very decent gentleman and I enjoy shadowing him. I wish him the very best of luck in the upcoming reshuffle after the by-election on Thursday.”
“I am pleased that HMRC is putting that right and that the fix should be finalised in the summer, but it has been working on this for a year. It is taking far too long. Will the Minister set out what he will do to resolve the situation and confirm to the House when it is fixed? This petition is well-intentioned and it is correct that we are all facing a higher tax burden than ever before. As has been reported, many pensioners are being overcharged on their tax bill. The Government need to get a hold of this situation and do more to reduce the tax burden on pensioners, because, as we have heard from many Members today, they deserve dignity and security in their retirement, but they have been left wanting by this Government.”
“She said: “We will be working with the Treasury and Ministers to bring forward legislation to support the policy intent in the next Finance Bill.” Of course, we welcome the Government effectively taking our policy and exempting those who are on a state pension, but we do not have any detail as to how this plan will work. Pensioners deserve clarity. Perhaps the Minister could confirm today that the proposals to which Cerys McDonald referred will be introduced. It is not just policy that is blighting pensioners. The Sunday Times has highlighted that up to 8.7 million pensioners have been overcharged on their tax bill by an apparently careless taxman. That means that as much as £43.5 million was collected in error last year.”
“I am sure that the Minister will chunter intelligently at some point. In our 2024 manifesto, the Conservative party proposed the triple lock plus to stop this problem happening. It would have exempted the state pension from income tax, as the threshold would have risen at the same rate as the triple lock. Now it seems that this Government might be considering using our policy, albeit in a slightly cack-handed way. The Government have proposed that basic-rate state pensioners will not have to fill in a tax return, although this seems to be a specific sort of form-filling break for the over-67s rather than an actual hiking of the allowance. However, in a Treasury Committee hearing recently, a director at His Majesty’s Revenue and Customs, Cerys McDonald, stated that the policy would be included in the next Finance Bill.”
“It is interesting that the Minister raises that point. He will no doubt remember that Chancellor Gordon Brown raised the state pension by, I think, 50p a week. Did he support that policy by one of his predecessor Chancellors?”
“The Economic Secretary to the Treasury will know that our financial services industry is a shining example of our international economic might. However, overinterpretation of rules and regulations has led to banks being nervous of taking risks, and that has slowed growth in the City and holds up international trade. For example, overinterpretation of anti-money laundering rules means that foreign inward remittances can take up to two weeks to clear into a UK bank account, while poor classification of risk-rated assets potentially starves businesses of growth debt capital. Will the Economic Secretary please assure the House that this ever-unnecessary tightening of the rules will be addressed in the financial services Bill, due to be announced in the King’s Speech?”
“The hon. Gentleman makes an incredibly important point about crossing the Rubicon, given that the Government are taking mandation powers to interfere in people’s savings and assets. We are talking about pension funds here, but once that Rubicon is crossed, there is no reason why the Government would not feel that they could start mandating how investment trusts or other types of savings schemes invest. This issue is not just about pensions; it is about the fundamental relationship between the state and private individuals.”
“When his party was in opposition, the Prime Minister promised compensation for WASPI women, but when faced with the economic reality of the costs, he and the Secretary of State chose common sense over ideology. In the spirit of that pragmatism, may I ask the Pensions Minister also to take a sensible, thoughtful approach to mandation powers in the Pension Schemes Bill, and to remove clause 40 altogether?”
“With the greatest respect, the Minister is talking nonsense. At the end of the day, every trustee has a fiduciary duty to get the best return for their members. By putting in these mandation powers, the Government are fundamentally going against the most basic principle of the City of London, which is dictum meum pactum—my word is my bond. The Government entered into a pact with the industry, and they are now reneging on that pact by introducing mandation and not allowing the industry to move things forward. The Government are so wrong on this whole point. The Minister should withdraw the mandation powers and get rid of clause 40.”
“I conclude by flagging to my constituents in Wyre Forest the current advice on how to avoid paid ad spoofing. First, people need to check the website’s URL to ensure that it is their legitimate insurer. Secondly, they should save the phone number on their insurance policy document to their telephone. Thirdly, if people are unsure about who they are speaking to, they should hang up and check their insurance details—caveat emptor.”
“The Government’s fraud strategy was an opportunity to do that. Although it is broadly welcome and recognises the role of technology firms in tackling fraud, not one of its action points requires change from them. Could the Minister set out why that decision was taken and what steps she is taking to ensure that responsibility is correctly allocated when it comes to fraud? Fraud in the car insurance industry is a serious issue, and I am grateful to the hon. Member for North Shropshire for bringing it up. Fraud in general is becoming an issue of national security, and we need to get a handle on it. The Government should continue working with all actors to stop these practices, and we will support them when they try to do so. Consumers also need to remain vigilant to these practices.”
“I would also be grateful if she could provide an assessment of the resolution process for customers, and whether she thinks improvements need to be made. The other central issue is how these practices are allowed in the first place. Fraud is often complicated and involves many different actors. Consumers and insurers have a part to play in tackling it, but the actors, such as technology firms and social media platforms, should also bear responsibility; after all, they are the delivery mechanism for this fraud. We should acknowledge that some technology firms have taken action, and Google is a good example. In 2021, it required companies advertising financial services to demonstrate that they are authorised by the Financial Conduct Authority, which is a positive step. But more needs to be done, and we need a joined-up approach.”
“Understandably, those affected—such as the constituents of the hon. Member for North Shropshire—feel ripped off, and the companies that pretend to support them are actually exploiting them. The last Conservative Government understood that, which is why we instructed the Financial Conduct Authority to become responsible for claims management companies in 2019. As a result, firms must be authorised by the FCA to carry out their activities, and repeated violations will result in their authorisation being removed. It also means that customers can escalate complaints to the financial services ombudsman. However, I understand that accident management activities are currently unregulated, so will the Minister outline whether the Government are considering regulating those activities of claims management companies?”
“In the context of car insurance, the ads usually refer to unscrupulous claims and accident management businesses, and tend to relate to those who have been involved in an accident. As Direct Line states, the practice relies on “the fact that in the aftermath of an accident, you might not be as vigilant as you’d otherwise be, searching quickly on your mobile and clicking on the first option you see.” Fundamentally, these organisations are relying on a consumer believing they are dealing with their own insurer. They then arrange various services that the consumer’s insurer would provide, adding more cost to the process. This is all done with the aim of recovering costs from the insurer, but if the insurer challenges the charges, the drivers are the ones left to pick up the bill.”
“It is safe to say that there is an issue that needs to be rectified, that we need to do more to protect our constituents and that we need to work closely with the industry to resolve this issue. The thrust of this debate is paid ad spoofing, which is a very problematic but less well-known practice affecting the car insurance industry. According to the ABI, four in five people have never heard of it, so it is welcome that we have the opportunity to discuss it and raise its profile today. As the hon. Member for North Shropshire set out, paid ad spoofing is when fraudsters mimic legitimate businesses. They pay for ads to appear in search results when a customer searches for a legitimate service.”
“The Minister will therefore agree with everyone in the room that more needs to be done to tackle this problem, but I hope she will reflect on colleagues’ comments about whether the Government are actually going far enough to tackle it. To give some context, fraud is a threat that is becoming more prevalent every year. In 2024, fraud accounted for 44% of all crime reported in England and Wales, with about £1.16 billion of fraudulent general insurance claims identified. On the car insurance industry specifically, a 2024 report from the Association of British Insurers said: “Motor insurance continues to be the area where insurers see the most illicit claims occurring, and they detected 51,700 motor scams worth £576 million.” The ABI’s data suggested that that accounted for 53% of all fraudulent claims that year.”
“It is a great pleasure to serve under you this afternoon, Ms Lewell, and I thank the hon. Member for North Shropshire (Helen Morgan) for securing this important debate. We have heard quite a lot of depressing stories about how people have been scammed and ripped off, and all colleagues will agree that more needs to be done to tackle fraud and spoofing in the car insurance industry. Whether it is crash-for-cash scams, ghost broking or paid ad spoofing, our constituents are all being ripped off on so many levels; not just the cost itself, but the increase in insurance premiums. These practices are also harming the insurers and our wider financial services industry.”
“The right hon. Member raises many really important points, much of which we agree with. That is why, I think on Report, the Opposition tabled an amendment to try to understand what the problem was. It specifically asked, “Why are these pension funds not investing in the UK? Is it legislative, is it regulatory or is it cultural?” The Government voted against that. They voted against exactly the work we need to do to understand what the problem is. Could he possibly explain why?”
“Both sides of this House are going with the grain of what is intended on this. There is a fundamental problem—we all agree on that—but let us get the issues out of the way that are blocking it. We cannot force people into a minefield if the mines are still there; we have to clear the mines and allow them do it. This is the most fundamental point. The Government should not be telling pension fund managers how and where to invest their money. If there is a problem that they are going to encounter, we should get those problems out of the way and managers will go into those assets.”
“Secondly, the draft regulations allow the Treasury to extend the delay beyond 1 January 2028, which is absolutely fine—we completely understand why that might need to be the case. That will also be subject to the affirmative procedure. However, there are one or two concerns within the industry that this provision might create uncertainty about when the rules will actually be brought in. It would be very helpful if the Minister gave some idea about what internal tests the Treasury will use to decide whether to pursue such an extension. As I said, the Opposition support the intention behind the draft regulations, and we will certainly not be pressing them to a vote.”
“It is a great pleasure to serve under your chairmanship, Mrs Hobhouse. As the Minister has said, the draft regulations are pretty uncontroversial, and the Opposition will certainly not oppose them. I have a couple of questions on the draft Capital Requirements Regulation (Market Risk Transitional Provision) Regulations 2026. The Minister has quite rightly said that they have been introduced in response to delays in other jurisdictions, including the US and the EU. Of course, it is very important that we remain globally competitive and do not cause any self-inflicted harm. However, can the Minister provide some more detail on why other jurisdictions are delaying the implementation of these rules? Is it procedural, or is it because they have some concerns about the rules that they are being asked to implement?”
“The decision on whether to undertake one, however, is ultimately for the Government. I look forward to the Minister’s remarks.”
“It is up to the Minister to come up with a solution, but does she agree with that, or has the FCA got this fundamentally wrong? If so, what line will the Government take? Will they deliver the judge-led judicial review that people are looking for? I hope she will be able to answer that. In closing, I want to return to those who have been affected. SMEs make up 99% of all businesses in the UK, so it is not an exaggeration that they are the lifeblood of our economy. When they succeed, we all benefit. They need confidence that institutions and financial services are backing them and are there to serve them and to make their businesses work. This issue has damaged that trust, and many have experienced painful losses. We need to rebuild that trust. I am not sure whether a judge-led inquiry is the right step, but I am open to it.”
“I recognise that many colleagues will feel that process has not happened, particularly in the case we are talking about, but we have to accept that the FCA is an independent body. As I say, it is accountable to Parliament through the Treasury Committee, but it is an independent body. In a similar debate in 2018, my right hon. Friend the Member for Salisbury (John Glen), when he was Economic Secretary to the Treasury, said: “We can set the law, but we then must be bound by it and respect the judgment and independence of the FCA.” —[ Official Report , 18 January 2018; Vol. 634, c. 1127.] To the extent of the law we created, he is absolutely right. In the same way that we respect the judgment of the Supreme Court, even if we disagree with it, we should respect the judgments of the Financial Conduct Authority.”
“Member for Liverpool West Derby (Ian Byrne) said that the FCA is not accountable, but actually, it is accountable to Parliament through the Treasury Committee, and it is the job of Members on the Committee to ensure that the FCA does the job that we want it to. When we created the FCA in 2012, the idea was that there would be greater focus on consumer protection. The Financial Services Authority was set up to do the prudential regulation and the conduct regulation. The FCA was set up purely to do the financial conduct regulation, which is looking at how people are looked after. The Prudential Regulation Authority was then set up to do the nuts and bolts of the financial system—to make sure that we did not see a failing in the banking system rather like we had during the great financial crisis.”
“The allegation is that the banks took out their own interest rate swaps, booking them in customers’ names and adding a related credit bump. That is a serious allegation, suggesting that the bank staff recorded up-front profits for those swaps and earned personal commissions. The FCA was absolutely right to investigate it, but following its investigation, it said: “We have seen no evidence that would lead us to conclude that further supervisory work and/or intervention with Ulster Bank/NatWest was required.” I recognise that many will disagree with that conclusion, but even so, it cannot be argued that the FCA did not look into it. This comes down to what we want the FCA to achieve. The hon.”
“Members, but one of the great discussions we had on the Treasury Committee was about the surprisingly small number of businesses that had gone bust. There was an argument at the time that banks were artificially supporting businesses while they had bad cash flow and damaged balance sheets, and that forcing companies into liquidation would crystallise the deficit of the loan on to the banks’ balance sheets. There was an argument that they were doing the wrong thing by keeping alive what were then referred to as zombie businesses. This whole issue was incredibly complicated after the financial crisis, and there was an awful lot going on in various different parts of all this. I want finally to turn to the fixed-rate loans, which are mostly the ones used by Ulster Bank in Northern Ireland, which again is a subsidiary of NatWest.”