Baroness Neville-Rolfe (Con)

My Lords, I am grateful to the Minister for introducing the statutory instrument crisply and clearly. I am also grateful to the noble Baroness, Lady Kramer, for her usual well-informed comments, including those on the digital aspects of this proposal. I think that I am, however, more in favour of growth and competition than she is. I start by saying how important secondary legislation of this nature is. The topic of debate today is the modified reinstatement of legislation that we as a Parliament passed during the process of exiting the European Union. Now that we are able to table such legislation on our own terms, we can bring it fully in line with domestic regulations, to the benefit of British services. Cross-border financial services must be both secure and effective. This is why having similar regulatory frameworks to collaborative countries is so important. It is all well and good having an efficient domestic system, but if that system is not aligned with foreign trading partners, markets are likely to be boxed in and limited. Some form of alignment criteria must therefore be established to allow cross-border services to function. The outline measures aims to define the parameters within which an overseas jurisdiction may be recognised as equivalent to that of the United Kingdom. It is also welcome that His Majesty’s Treasury, in addition to the described powers of imposition or limitation of conditions on an overseas recognition regime, will now have the powers to require regulators to provide relevant information to support equivalence decisions, and will be required to co-ordinate with the relevant bodies when processing overseas recognition regime designation cases. This will help speed up and standardise the decision-making of such cases. Although the Minister said that these powers may not be used very often, I have two questions. First, the Treasury requires either information or advice from a regulator. If it needs that, it must, by notice, “specify a reasonable period within which the information or advice must be provided”. What would be considered “a reasonable period”? Perhaps the Minister could clarify the timescales. We want to see efficiency in the interests of stakeholders, and we sometimes seem to be rather slow in the financial services sector. That is one of the reasons I have four Questions for Written Answer tabled today about the progress of the post-Brexit changes in financial regulation, which we initiated and would like to see the Government complete. I would be very happy to hear today how the Treasury is getting on. Secondly, the Explanatory Memorandum states that the “advice that the Financial Services Regulators will be asked to provide” by the Treasury “will be agreed on a case-by-case basis”. The scope for this seems too wide. I am aware that it is specified in the legislation that advice may be given only in relation to an overseas recognition regime designation, or a proposal for one, but the breadth of these designations seems wide. Will the Minister consider issuing some further guidance on the extent of the information that the Treasury is able to ask for in the name of ORR designations? I look forward to the Minister’s response. In closing, I say that the Official Opposition support the statutory instrument and the measures to encourage a growing, healthy, open—in the Minister’s words—and competitive UK financial sector.