Baroness Bowles of Berkhamsted (LD)

My Lords, I will speak briefly to Amendment 87, and I support the amendment in the name of the noble Baroness, Lady Altmann, on superfunds. These are two issues that need attention. My amendment is about one thing: tax certainty for insurance-linked securities. It would not weaken anti-avoidance rules and does not seek any advantage that Parliament never intended; it simply asks for clarity in a regime that Parliament created to attract ILS business to the UK. The problem is commercial. Rival jurisdictions give clear outcomes, but the UK does not. HMRC’s guidance leaves too much ambiguity and advisers reach conflicting conclusions on identical transactions, so, in a market where speed and predictability drive choice of domicile, capital goes elsewhere. The consequence is stark: London is the world’s largest commercial reinsurance centre, yet we have only 2% of global ILS activity. The catastrophe bond market is over $60 billion and the wider ILS market exceeds $140 billion. We could have a big chunk of that, but we are letting this substantial business, and indeed the tax revenue that would come from it, pass London by. The new PRA reforms in the Bill are welcome, and London Bridge 2 has brought in new capital, but even that structure repeatedly runs into HMRC uncertainty. If the Government want the market then the guidance has to be clearer. It is only the Government who can fix this if they want the business in the UK. I beg to move.