Lord Davies of Brixton (Lab)

I congratulate the noble Lord, Lord Sharkey, on making a very powerful case for keeping the existing system under which the FOS operates. The problem here, expressed in the considerable representations that we have received from consumer groups, is a lack of clarity about the problem that this is meant to address, coupled with clear concerns about the loss of the fair and reasonable requirement. That is the central point. We have a system that works, in which there is a degree of consumer confidence. The reason for interfering in that system is not clear to the bodies representing consumers, so my Government have to do more to justify these changes. Interestingly, I had some discussions with the previous Minister, who is now sharing the same Bench as me, and one of the points that came out is that it is quite difficult for the Government to point to cases in which they expect a different result following this change from what was happening before. It would be unreasonable for the Government to pick on individual cases and say, “Those people really should not have had that finding from the ombudsman”, but that is at the heart of what is being proposed here. Before my noble friend the Minister’s elevation, I discussed this with him at length. He assured me at the time that the impact on the consumer would not be material—that the way that the legislation is worded, in particular the rules that the FCA would have to interpret for the FOS, would embrace the concept of “fair and reasonable”. It would certainly help a great deal in allaying my concerns if those assurances could be given to the House. The Minister probably cannot express it in these terms, but it would help if he could say that these changes are contingent and will be reviewed and judged on their effect. That would allay my continued concerns about what is being proposed here.