Contribution
With all these examples, I will have to come back in some detail at a later stage. The idea of narrowing the powers means that we can take into consideration the conversation and debate, while acknowledging that there will be some work to do in the intervening period. We believe we have the time to do that before the Lloyd review comes into play, allowing us to make the amendments necessary.
On Amendment 18, from the noble Baroness, Lady Noakes, I reassure noble Lords that the Treasury engages very regularly with the retail banking sector as part of its policy-making process. In addition to the Treasury’s ongoing regular engagement, the Access to Banking Services review will engage closely with as wide a range of stakeholders as possible, including the industry, consumers, local authorities, small and medium-sized businesses, and trade bodies. Furthermore, if regulations are made under this power to confer functions on the FCA, the Government would expect the regulator to follow its usual processes and to fulfil its statutory duty to consult before it imposes any new requirements.
Amendment 21, in the name of the noble Baroness, Lady Neville-Rolfe, contains a similar requirement for the Treasury to consult before making any regulations. It would require the Treasury to have regard to other sources of evidence, including the burdens that any regulations would place on banks, and for the Treasury to publish a statement alongside any draft regulation summarising its consideration of the evidence. The review will consider these sources of evidence, and, in considering the review’s recommendations, the Treasury will naturally take into account the impacts on banks and other relevant businesses. If the Treasury brings forward regulations under this clause, it will publish an impact assessment that will consider the impact on firms, as well as the proportionality of regulation.
Similarly, Amendment 23—in the name of my noble friend Lord Sikka and spoken to by my noble friend Lord Davies of Brixton—would require the Treasury to have regard to the need for local banking services when making regulations under Clause 3. I reassure my noble friends that the review will consider the need for in-person banking services and the impact on any specific cohorts or demographics. Funding will be considered once the review has identified the scale and nature of the consumer detriment and once the Government have considered how to respond.
Likewise, Amendment 22, in the name of the noble Baroness, Lady Tyler of Enfield, seeks to require the Treasury to have regard to several matters relating to the existing provision of banking services, including through banking hubs and the Post Office. The review will consider these sources of evidence when forming its recommendations. On her specific point on the time between bank branch closures and the opening of a banking hub, I reassure her that, if a banking hub is recommended, FCA rules already require banks not to close existing cash-access services, such as branches, until the recommended solution is in place.
Amendments 20 and 25 would require the Treasury to commission further independent reviews if it wishes to make subsequent regulations after first exercising the power in this clause. There is an existing requirement in Clause 3 for the Treasury to have regard to the recommendations of the current review when making regulations. The review was commissioned to bring together proactively the evidence from across the UK and to look at the trajectory for access to in-person banking services, not just the position as it currently stands. If the Government consider it necessary to make further provision in future, they would envisage this to follow the usual process of consultation and impact assessment, beginning from the baseline of evidence provided by the ongoing review. Further wide-ranging independent reviews are likely to be disproportionate.
Amendment 24, in the name of the noble Baroness, Lady Bowles of Berkhamsted, is similar: it would limit the power to be used only to implement matters arising directly from the independent Access to Banking Services review. As I have made clear, the Government’s intention is for the power to be used to implement the recommendations of the review. However, it is important that the power is not limited solely for this purpose, in case further relevant evidence outside the scope of the review comes to light as Ministers consider the review’s recommendations. The Government should be able to consider all relevant evidence, not just the review itself, before making any regulations.
Amendment 19 would require the power to be used to make regulations only if the relevant banking services would not be provided on a voluntary basis. The Treasury welcomes action taken by industry to support customers and welcomes the voluntary commitments, such as services provided in banking hubs, that the industry has taken forward. The Treasury will consider relevant information in determining any regulations to take forward following this Bill, including any relevant voluntary arrangements already in place.