Lord Wilson of Sedgefield (Lab)

I thank both noble Baronesses for their comments on this SI, which were gratefully received. This is an important SI because it is all about growth and building a relationship with a trusted trader in Switzerland that we can build on into the future. On security and trust, the UK and Switzerland have a strong and established relationship in financial services, and last year we increased the number of transactions et cetera by 27%, and the amount by £4.9 billion. I cannot give a figure for how that is going to extrapolate into the future, but we are doing this to make it easier to have growth. Those figures will hopefully improve—they will improve, in my view—over the coming years. In response to the noble Baroness, Lady Bennett, the agreement includes, for us, robust safeguards. Swiss firms must be authorised and supervised by FINMA, and the UK regulators retain powers to intervene if risks arise, including restricting activities and managing wind-downs, which both noble Baronesses raised. The FCA and the PRA act swiftly in urgent cases and collaborate closely with Swiss authorities. These measures ensure that, for UK consumers, market integrity and financial stability remain protected, while enabling the benefits of cross-border market access. How they will be held to account was another issue raised by both noble Baronesses. Regulators will be held to account through clear statutory duties set out in regulations requiring transparency in their actions and co-operation with His Majesty’s Treasury. Their decisions, such as interventions against Swiss firms, are subject to oversight and include the right of affected firms to refer matters to an independent tribunal. The FCA public register will provide visibility of Swiss firms’ activity, supporting scrutiny by clients and stakeholders. Regular engagement with industry and reporting to the joint committee further ensures regulators’ accountability in implementing and managing the agreement. On the anti-money laundering aspect that was raised, Swiss firms will still need to comply with the UK anti-money laundering regime that we have in place. On timing, it has taken two years—longer than that, actually, because the negotiations have been going on for a few years. Ultimately, we want to get this right. It is not just us but Switzerland that wants to get this right. There are two different kinds of regimes that have to agree this. After it was agreed by the Swiss Parliament, they had to allow 100 days for a potential referendum to be held. It was not held—it was not called for, so it did not take place—but that is 100 days of that two year period that the noble Baroness mentioned. International agreements often take time. We have to get it right.