The Chancellor of the Exchequer (Mr. Alistair Darling): I am today laying before Parliament Financial Stability and Depositor Protection: Strengthening the Framework (Cm 7308). This consultation document sets out the views of the Government, the Financial Services Authority (FSA) and the Bank of England, building on responses to the joint discussion paper, Banking ReformProtecting Depositors published in October 2007. The Treasury Select Committees report published on 26 January has informed the consultation document published today and I am grateful for its positive contribution.
Recent months have seen a period of sustained turbulence and instability in global financial markets, with financial firms across the world affected. A response to these episodes requires action, not only from the UK authorities, but also from international firms and institutions. The Government propose to bring forward legislation after consultation, alongside actions by the FSA and the Bank of England, to address five key objectives:
improving and strengthening risk management by banks, including stress testing and liquidity management; and
improving the functioning of securitisation markets including valuation and credit rating agencies.
strengthen the regulatory and supervisory framework, including requirements for banks to provide information to the FSA at short notice and more formal regulation of payment systems;
change the framework for provision and disclosure of liquidity assistance.
It is neither possible nor desirable to prevent banks from failing in all circumstances. However, important new arrangements are proposed to enable failing banks to be dealt with in a way that minimises the potential impact on financial stability. These include:
the introduction of a special resolution regime within which there would be a range of tools to resolve a failing bank in a more orderly manner, including an accelerated method to transfer its business to a healthy banka bridge bank, deployment of a restructuring officer and a bespoke bank insolvency procedure; and
proposals to ensure that banks have in place practical arrangements to lessen the impact of any failure.
a potential increase to the compensation limit for deposits, and the coverage of certain balances above the limit;
making changes to enable the financial services compensation scheme to make payments within one week of a bank failing; and
ways to increase consumer awareness of the scope and operation of the compensation scheme.
The current tripartite arrangements provide the appropriate framework for managing financial difficulties and crises. However, improvements to how these arrangements work in practice are required. Important changes will be made, including:
providing the Bank of Englands role in financial stability with a statutory footing and better governance arrangements in the Bank to support new statutory obligation; and
strengthening the memorandum of understanding, applying lessons from the operation of COBR during crisis conditions, and improving external communications.
In addition, it is vital that co-operation across borders works effectively. Current market events have demonstrated both the benefits and the difficulties of achieving this. Work with international partners will continue to:
improve co-ordination of approaches to international financial stability issues; and
introduce early warning system on global financial risks, improve cross-border crisis management.
The Government are determined that their response is proportionate and appropriate, and will therefore consult actively on these proposals, seeking discussions with financial institutions, consumer representatives and counterparts from across the world to ensure that the final arrangements are effective and deliver the five objectives set out here.
I am also announcing today that the Queen has been pleased to approve, under the Bank of England Act 1998, that Mervyn King be reappointed Governor of the Bank of England for a period of five years when his present term of office expires on 30 June 2008. His leadership and experience will continue to prove invaluable to the Bank of England.
The Minister of State, Department of Health (Dawn Primarolo): I regret that the answer given to the hon. Member for North-West Cambridgeshire (Shailesh Vara) on 13 December 2007 (Official Report, columns 891w-892w) was incorrect.
The Health Protection Agency has confirmed that the data they supplied on the numbers of individuals diagnosed with chlamydia within the national chlamydia screening programme in tables 7 to10 were incorrect and reflected the total number of screens undertaken rather than the total number of people diagnosed with chlamydia.
The Parliamentary Under-Secretary of State for Health (Mr. Ivan Lewis): The Commission for Social Care Inspection (CSCI) report laid before Parliament on 29 January highlighted inconsistencies in how eligibility criteria are being applied. In response I have asked CSCI to conduct a review.
The Minister for Borders and Immigration (Mr. Liam Byrne): Last year the Government introduced a new strategic approach to charging for immigration and nationality services. This meant that we moved away from simple cost recovery fees in a number of areas, setting fees at levels that reflect the value of the service to the would-be migrant. Certain fees saw increases which will help contribute to the doubling of resource for enforcement activity over the next few years. As set out in the Enforcement Strategy published in March 2007, this resource will help to continue building on our success in strengthening our borders and to ensure and enforce compliance with the immigration laws by those who we allow to come to the UK.
The Government review fees for immigration and nationality services on a regular basis and make appropriate changes as necessary. We believe that significant increases are not necessary for 2008-09 but that we should continue to develop the strategic approach of setting fees on the basis of the value of the service.
Some fees will continue to be set at or below levels that reflect the administrative costs of the service. These fees must be set out in regulations before both Houses of Parliament and are subject to the negative procedure. Those fees that are set at levels above the normal administrative costs of the serviceeither to allow us to set certain fees below cost recovery or to contribute to the true end-to-end costs of the immigration systemmust also be specified in regulations before both Houses, but are subject to the affirmative process.
Tier 1- General leave to remain;
A licence to sponsor prospective migrants who will apply to come to the UK under Tier 2;
Certain existing entry clearance routes;
Certificates of entitlement of right of abode.
These fees are set above normal cost recovery levels.
We will make regulations setting out other proposed fees for appropriate scrutiny by Parliament shortly before implementation, including for the rest of the Points Based System and for biometric ID cards.
Fees for new services under the Points Based System are proposed at broadly the same level as their existing comparator services. We do not intend to make further changes in 2008-09 to fees charged for applications made in the UK, including where a biometric ID card is to be issued to a successful applicant.
|SERVICE||2007-08 fee £||Proposed fee £|
|NBThese are indicative fees that we propose to charge but are subject to change until they are approved by Parliament.|
|Fee Levels for other Applications that will Remain the Same|
|SERVICE||2008-09 fee £|
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