The Parliamentary Secretary, HM Treasury (Lord Pitt-Watson) (Lab)

My Lords, it is a privilege to be here today to debate the Financial Services and Markets Bill. I put on record my thanks to my noble friend Lord Stockwood for leading the earlier stages of this debate and thank all noble Lords who have contributed to this debate in Committee and beyond. If noble Lords would allow me, I would like to say a few things about the Bill itself before moving on to address the amendments that have been put forward. The Bill has a purpose on which I think we are all agreed: to construct rules that help the financial services industry to serve its customers better and to prosper as a result of doing so. Noble Lords will therefore see that, in responding to the debate in Committee, the Government have been persuaded of some significant points made then and are proposing some significant amendments which I hope will be welcomed by the House. There are also amendments that will be suggested on Report where the Government disagree with the specific measure proposed but, in many cases, have great sympathy with the ultimate goals of the particular amendment. However, there are many amendments which we do not believe belong as part of the Bill, in part because they are complex and require consultation, and/or go beyond the scope of the Bill, and in part also because the aims of the amendment are not best served by changing primary legislation but where the Government often would want to help promote the goals of the amendment—indeed sometimes, they already are—and can perhaps seek to encourage better practice. Central to all this is accountability, which I will come to at beginning and end of this group and then again later today. To turn to these specific amendments, Amendments 1 and 6 would remove Clause 1 and Schedule 1 from the Bill and prevent the Government’s programme of Consumer Credit Act reform. Amendments 2 and 3 would ensure that the reforms do not diminish consumer protections, and Amendments 4 and 5 relate to the assignment of student loans and of mortgages. Similar amendments were debated in Committee, and the Government have carefully considered the concerns raised. However, we have concluded that we wish to press ahead with these much-needed reforms. I think that we all in this House agree that the FCA is the right body to take on the role of consumer protection, and Parliament has already given it the right powers and objectives to do so, including a consumer protection objective. Since the 2014 transfer of consumer credit to the FCA, important protections, including creditworthiness and affordability assessments, have successfully operated through the FCA framework. I recognise the concern, raised both in Committee and again today, that Parliament is being asked to approve reform before replacement FCA rules have been finalised. However, I emphasise that the FCA must consult on proposed rules and engage with parliamentary committees as part of an established statutory framework. This includes the Financial Services Regulation Committee, ably chaired by the noble Baroness, Lady Noakes. Both the FCA and the PRA are clearly aware of scrutiny. Last week, they sent me a letter, which I think has been circulated to all noble Lords, making a number of commitments further to enhance parliamentary scrutiny, and I have placed those letters in the Library. I expect to cover this information, including that in the letter, in detail in a later grouping today.