House of Commons Public Bill Committee Proceedings

Session 2012 - 13
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Other Bills before Parliament

21

House of Commons

Tuesday 16 April 2013

Public Bill Committee Proceedings

Financial Services (Banking Reform) Bill

[Seventh and Eighth Sittings]

New Clauses

FSCS review of company savings schemes

Chris Leslie

Cathy Jamieson

Withdrawn  NC2

To move the following Clause:—

‘(1)
The Chief Executive of the Financial Services Compensation Scheme shall,

within six months of Royal Assent of this Act, publish a review of the protections

necessary for customers who make payments to any bodies corporate on the

understanding that such payments are deposits in a saving scheme.

(2)
The review in subsection (1) shall include consideration of any consequential

reform to creditor preference arrangements so that any payments made in advance

as part of a contract for the receipt of goods or services (such as gift vouchers,

certificates or other forms of pre-payment) in expectation that those sums would

be redeemable in a future exchange for such goods or services might be

considered as preferential debts in the event of insolvency.’.

Professional standards

Chris Leslie

Cathy Jamieson

Negatived on division  NC3

To move the following Clause:—

‘After section 65 of FSMA 2000 insert—

Public Bill Committee Proceedings: 16 April 2013
22

Financial Services (Banking Reform) Bill, continued

“Section 65A

Professional Standards

(1)
The regulator will raise standards of professionalism in financial services

by mandating a licensing regime based on training and competence. This

must—

(a)
apply to all approved persons exercising controlled functions,

regardless of financial sector;

(b)
specify minimum thresholds of competence including integrity,

professional qualifications, continuous professional

development and adherence to a recognised code of conduct;

(c)
make provisions in connection with—

(i)
the granting of a licence;

(ii)
the refusal of a licence;

(iii)
the withdrawal of a licence; and

(iv)
the revalidation of a licensed person of a prescribed

description whenever the appropriate regulator sees fit,

either as a condition of the person’s continuing to hold a

licence or of the person’s licence being restored.

(d)
be evidenced by individuals holding an annual validation of

competence.

(2)
In the Financial Services and Markets Act 2000, section 59, remove

“authorised” and insert “licensed” throughout the section.’.

Code of conduct

Chris Leslie

Cathy Jamieson

Not called  NC4

To move the following Clause:—

‘After section 64(6) of FSMA 2000 insert—

“(6A)
A code issued under subsection (2) shall—

(a)
apply to all approved persons exercising controlled functions in

the financial sector;

(b)
specify a framework of certain permitted and prohibited actions

with which approved persons must agree in writing to comply;

(c)
mandate individual financial penalties, and the terms of

temporary and permanent suspension of persons’ licence to

operate, which can be issued by the appropriate regulator if it

determines that an approved person has broken the code;

(d)
specify the training, including both practical and ethical, which

approved persons must undergo before practising controlled

functions; and

Public Bill Committee Proceedings: 16 April 2013
23

Financial Services (Banking Reform) Bill, continued

(e)
specify the additional training to be provided by institutions for

their staff and set out the system by which institutions will

monitor and enforce such a code.”.’.

Duty of care

Chris Leslie

Cathy Jamieson

Withdrawn  NC5

To move the following Clause:—

‘At all times when carrying out core activities a ring-fenced body shall—

(a)
be subject to a fiduciary duty towards its customers in the operation of

core services; and

(b)
be subject to a duty of care towards its customers across the financial

services sector.’.

Remuneration consultants

Chris Leslie

Cathy Jamieson

Withdrawn  NC6

To move the following Clause:—

‘The Secretary of State will by regulations provide for a requirement that the

remuneration consultants advising on remuneration policy shall be appointed by

the shareholders of a relevant financial institution.’.

Remuneration committee

Chris Leslie

Cathy Jamieson

Not called  NC7

To move the following Clause:—

‘The Secretary of State will provide for a requirement that an employee

representative should be a member of the remuneration committee of a relevant

financial institution.’.

Public Bill Committee Proceedings: 16 April 2013
24

Financial Services (Banking Reform) Bill, continued

Financial Crime Unit

Chris Leslie

Cathy Jamieson

Withdrawn  NC8

To move the following Clause:—

‘(1)
The Secretary of State shall by order create a new Financial Crime Unit as part of

the Serious Fraud Office for the purpose of tackling financial crime, using

resources from the proceeds of penalties paid to the FCA.

(2)
The Treasury shall conduct a review into the creation of the Financial Crime Unit

and consult on its proposals for the Financial Crime Unit’s powers and

responsibilities.

(3)
The Treasury shall lay its proposals before both Houses of Parliament no later

than six months after this Act comes into force.

(4)
The orders under subsection (1) may make such amendments to legislation as

appear to the Treasury to be necessary or expedient for the purpose of creating the

Financial Crime Unit.

(5)
The orders under subsection (1) may only be made if they have been laid before

and approved by a resolution of each House of Parliament.’.

Protection for whistleblowers

Chris Leslie

Cathy Jamieson

Withdrawn  NC9

To move the following Clause:—

‘After Part IVA (43B)(f) of the Employment Rights Act 1996 there is inserted—

“(g)
that a breach of regulated activities under FSMA 2000 or the

Financial Services Act 2012 has been committed, is being

committed, or is likely to be committed.”.’.

Remuneration reform

Chris Leslie

Cathy Jamieson

Not called  NC10

To move the following Clause:—

‘Within six months of Royal Assent of this Act the Chancellor of the Exchequer

shall lay before Parliament proposals on reform of remuneration at UK financial

Public Bill Committee Proceedings: 16 April 2013
25

Financial Services (Banking Reform) Bill, continued

institutions which shall include incentives to take account of the performance and

stability of a UK financial institution over a five- to 10-year period.’.

Review into competitiveness

Chris Leslie

Cathy Jamieson

Withdrawn  NC11

To move the following Clause:—

‘(1)
The Treasury shall arrange for a review of the obstacles to increasing competition

for UK institutions involved in the provision of core services.

(2)
The review must be completed during the period of six months beginning with

the date on which this Act comes into force.
5
(3)
The review must consider, in particular—

(a)
the major obstacle to new UK institutions emerging as competitors in the

provision of core services, and

(b)
possible actions that could be taken to facilitate new UK institutions

being competitive in the provision of core services.
10
(4)
The review must result in a report to the Treasury.

(5)
The Treasury shall lay a copy of the report before Parliament.’.

As an Amendment to Chris Leslie’s proposed New Clause (Review into

competitiveness) (NC11):—

Mark Durkan

Not called  (a)

Line  9,  at end insert—

‘(c)
any evidence of impaired access to competitive core services in

identifiable regions of the UK or for particular classes of consumers.’.

Bank account portability

Chris Leslie

Cathy Jamieson

Withdrawn  NC12

To move the following Clause:—

‘(1)
Within six months of Royal Assent of this Act the Chancellor of the Exchequer

shall lay before Parliament a report considering—

(a)
the adequacy of the current account redirection service,

Public Bill Committee Proceedings: 16 April 2013
26

Financial Services (Banking Reform) Bill, continued

(b)
legislative options for mandating the provision of a current account

redirection service by UK ring-fenced bodies.’.

Financial inclusion

Chris Leslie

Cathy Jamieson

Not called  NC13

To move the following Clause:—

‘(1)
In the Financial Services Act 2012 section 6 which inserts section 1B into FSMA

2000 after subsection (5)(b) insert—

“(c)
the ease with which consumers can have access to financial

services and products which are affordable and appropriate to

their needs.”.’.

Publication of trends in bank lending

Chris Leslie

Cathy Jamieson

Withdrawn  NC14

To move the following Clause:—

‘(1)
After section 1E(2) of chapter 1 of Part 1A of FSMA 2000 insert—

“(3)
The FCA shall collate and publish anonymised consumer and business

lending data disaggregated by UK financial institution and presented on

a postcode-level basis.”.’.

Basic bank account guarantee

Chris Leslie

Cathy Jamieson

Not called  NC15

To move the following Clause:—

‘(1)
All UK institutions providing the regulated activity of accepting deposits must—

(a)
make a “basic bank account” available to all who request it, and

(b)
offer a “basic bank account” to people denied access to a current account

due to a poor credit score.

(2)
The requirements in subsection (1) do not apply to people with a record of fraud.

(3)
In this section “basic bank account” means a current account which—

(a)
provides customers with a debit or ATM card,

Public Bill Committee Proceedings: 16 April 2013
27

Financial Services (Banking Reform) Bill, continued

(b)
does not have an overdraft function,

(c)
does not pay interest on deposits, and

(d)
does not incur periodic fees.’.

Review into extending the Financial Services Compensation Scheme to cover Small and

Medium enterprises

Chris Leslie

Cathy Jamieson

Not called  NC16

To move the following Clause:—

‘(1)
The Treasury shall arrange for a review of the impact of extending the Financial

Services Compensation Scheme to cover deposits of private non-financial

corporations with an annual revenue of less than £20 million.

(2)
The review must consider in particular—

(a)
the impact on the Financial Services Compensation Scheme in the event

of a bank’s insolvency,

(b)
the impact on the British economy of extending the scheme,

(c)
the impact of protecting different percentages of private non-financial

corporations’ deposits.

(3)
The review must be completed during the period of six months beginning with

the date on which this Act comes into force.

(4)
The review must result in a report to the Treasury.

(5)
The Treasury shall lay a copy of the report before Parliament.

(6)
If the review recommends further reviews the Treasury may arrange for the

further reviews.’.

Bank of England scheme to boost lending

Chris Leslie

Cathy Jamieson

Not selected  NC17

To move the following Clause:—

‘(1)
The Chancellor of the Exchequer shall bring forward proposals within one month

of Royal Assent of this Act to reform the Bank of England Funding for Lending

Scheme so that—

(a)
the period under which drawdown requests may be made by UK financial

institutions shall be extended until 31 January 2015,

(b)
the determination of fees for the facility shall be based not only on total

net lending during the reference period, but also determined according to



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