FSM Bill Committee day 7

On the seventh day of debate in the Lords’ Grand Committee, the Committee:

• continued its debate on climate issues – including on PRA risk weightings and solvency capital requirements, and a ban on regulated firms carrying on regulated activities that may support forest risk commodities. Baroness Penn said the Government supported all the points made and that they would be addressed in the imminent refreshed Green Finance Strategy. The key proposed amendment was withdrawn;
• did not debate amendments on:
  • regulators’ treatment of applicants to the Tribunal;
  • a new Financial Services Chamber in the Tribunal and who may bring actions to it;
  • applications to quash PRA and FCA Rules;
  • a new adjudication scheme which FOS would have to apply;
  • making the Complaints Commissioner’s decisions legally binding on regulators;
  • an ability for senior managers to get a Tribunal declaration that they acted reasonably and in good faith; and
  • an ability for regulators’ decisions on EU to be scrutinised by a parliamentary committee before application;
• agreed Clause 51 and then debated changes to Schedule 8 on access to cash. The amendments focussed on the wider need for access to basic banking services, and the need for cash acceptance as well as accessibility. One proposal was that in every high street over a certain size, such facilities should be available. Others called for a digital financial services review – recognising the shift towards digital and encouraging banks to facilitate customers’ access, while others staunchly defended the absolute need for cash and the ability to use it. Baroness Penn noted the Government’s aims and its intention to publish a policy paper soon. She said it wanted to support access to cash, consumers and deposit facilities but did not see the need to be too prescriptive.  Ultimately, the key amendments were either withdrawn or not moved, and Schedule 8 (access to cash) was agreed;
• Clause 52 (wholesale cash distribution) and Schedule 9 were agreed without debate;
• Clause 53 (SMR for recognised bodies) and Schedule 10 were agreed without debate;
• Clause 54 (Central Counterparties in financial difficulties) and Schedule 11 including the Government amendments were agreed without debate;
• Clauses 55-65 (insurers in financial difficulties and various miscellaneous amendments including on powers over formerly authorised persons, conditions on change of control, unauthorised co-ownership AIFs and extension of the regulated activities and financial promotion perimeters to crypto-assets)  and Schedules 12 (write-down orders relating to insurers) and 13 (insurers in financial difficulties – enforcement of contracts) were agreed without debate.

The next date for debate has been set as 13 March, and the remaining clauses for debate include those on liability of payment services providers for fraudulent transactions and credit unions.