Lord Livermore (Lab)

My Lords, I am grateful to both noble Baronesses for their detailed comments and scrutiny, as well as for their support for this secondary legislation. The noble Baroness, Lady Kramer, asked a number of questions, which I will seek to address. First, she initially expressed her surprise that the Treasury required these new powers. I am told that this instrument replaces a similar instrument: the Equivalence Determinations for Financial Services and Miscellaneous Provisions (Amendment etc) (EU Exit) Regulations 2019, which gave the Treasury the power to request information from the regulators when considering decisions under assimilated equivalence regimes. The Treasury has exercised the powers contained in the 2019 regulations in support of equivalence decisions made since our EU exit. To date, no new decisions have been taken under any ORR, meaning that the powers in this instrument being introduced today have not yet been required. The noble Baroness, Lady Kramer, also spoke about her concerns—we have discussed them before in the main Chamber—around the Government’s overall agenda of rebalancing from risk towards growth and competitiveness. As the noble Baroness knows, the Chancellor has expressed her clear view that she wants to see greater emphasis on growth and competitiveness, but she has absolutely discussed how central the financial services sector is to the Government’s modern industrial strategy and the key role that it plays in financing growth across the economy. She remains committed to the highest standards of regulation and does not see those things as being in tension—the noble Baroness knows that; we have discussed it before. I do not necessarily agree with the noble Baroness’s concerns, in that there is absolutely no question of a race to the bottom on regulation. The UK will remain a global leader in promoting the highest standards that deliver for businesses and consumers across the UK. The noble Baroness, Lady Kramer, asked a specific question about how the process will work and whether it is becoming too politicised. I do not think that that is the case. Many other countries have similar regimes; for example, the US makes comparability assessments. As I said in my opening remarks, the EU has equivalence, and our recognition process is consistent with international norms. Our guidance document sets out our approach. We have been clear that robust standards, safeguarding outcomes and technical advice from our expert regulators are all key factors in decisions on whether to designate another jurisdiction. The noble Baroness, Lady Kramer, also asked about publishing regulator advice. The Treasury will always, as part of its designation process, summarise the evidence that it has received and considered in relation to the other jurisdictions’ regulatory frameworks. I am grateful to the noble Baroness, Lady Neville-Rolfe, for her support for this statutory instrument. The drive towards growth and competitiveness, and the importance of this sector in doing that, is one of the rare areas on which we agree. I am also grateful for the noble Baroness’s support for the Mansion House announcements that the Chancellor made, building, as all Chancellors do, on the previous Chancellor’s work in this area. The noble Baroness, Lady Neville-Rolfe, she asked two questions: one about timescales and another about speed. Unfortunately, I cannot read the answer that has been given to me. I will ask my team whether we have an answer on the scope of the designations. I will write to the noble Baroness on the two points that she made, if she does not mind.