6 Financial services
| (31177)
15615/09
—
| Opinion of the European Central Bank of 26 October 2009 on a draft Regulation on Community macro-prudential oversight of the financial system and establishing a European Systemic Risk Board and a draft Council Decision entrusting the European Central Bank with specific tasks concerning the functioning of the European Systemic Risk Board
|
| Legal base | — |
| Deposited in Parliament | 27 November 2009
|
| Department | HM Treasury |
| Basis of consideration | EM of 10 December 2009
|
| Previous Committee Report | None
|
| To be discussed in Council | None planned
|
| Committee's assessment | Politically important
|
| Committee's decision | Not cleared, further information requested
|
Background
6.1 In September 2009 the Commission published proposals for a
system of Community regulation and supervision of financial services,
which included a draft Regulation to establish a European Systemic
Risk Board and a draft Council Decision to give the European Central
Bank some tasks in support of the proposed Board. The Commission
proposes that:
- the Bank would provide the resources for the Board's Secretariat;
- the Secretariat would assist in the preparation
of Board meetings and the collection and processing of information,
including statistical information; and
- it would prepare analysis necessary to carry
out the Board's tasks and support its Advisory Technical Committee.
6.2 We considered these legislative proposals on
a number of occasions and they were debated on the Floor of the
House on 1 December 2009.[26]
The Council has agreed a general approach on the proposals and
they are now to be considered by the European Parliament.
The document
6.3 This document is an Opinion by the European Central
Bank on the Commission's proposals to establish a European Systemic
Risk Board and to entrust the Bank with tasks in support of the
Board. In the Opinion the Bank broadly supports the draft Regulation
and the draft Council Decision, saying that "the ECB has
decided that it stands ready to ensure the Secretariat of the
ESRB and to support the ESRB".
6.4 The Bank proposes a total of 13 amendments to
the Commission's draft texts. It suggests:
- an additional provision to
ensure independence, with an amendment that the Bank stands ready
to support the Board, but that this support is "without prejudice
to the principle of the independence of the ECB in the performance
of its tasks pursuant to the Treaty";
- removing reference to ensuring "a sustainable
contribution of the financial sector to economic growth"
from the Board's objectives, as this is not considered to be the
motivation behind enhanced macro-prudential oversight;
- adding the Advisory Technical Committee to the
list of key institutional aspects of the Board;
- minor amendments to reflect past declarations
and decisions, including the Conclusions on the proposals at the
ECOFIN Council of 9 June 2009 and European Council of 18-19 June
2009;[27]
- an amendment to reflect the fact that the Advisory
Technical Committee will assist the Board on a permanent basis,
not just "where requested";
- adding extra provisions to ensure the Board's
independence from "Community institutions or any other public
or private body", rather than just Member States;
- a minor amendment to the terminology used, to
refer to stakeholder "views", rather than "advice";
- a new recital to clarify that macro-prudential
supervision covers the financial system "as a whole";
and
- an amendment relating to the statistical support
the Bank would be called upon to provide to the Board, enabling
the Secretariat to obtain confidential data collected by the Bank
or Board on behalf of and for the benefit of the latter.
The Government's view
6.5 The Financial Services Secretary to the Treasury
(Lord Myners), reminding us that the Government "has long
supported" establishment of the European Systemic Risk Board
and entrusting the Bank with specific tasks relating to the functioning
of the Board, including providing its Secretariat, says that the
Bank's Opinion does not have any policy implications for the UK.
Conclusion
6.6 We note the Minister's comment that this Opinion
from the European Central Bank has no policy implications for
the UK. Nevertheless, although we realise that the matter has
to a degree moved out of the hands of the Council, before considering
this document further we should like to hear from the Government
whether it supports or opposes the amendments suggested by the
Bank. Meanwhile the document remains under scrutiny.
26 (30950)-(30957) 13645/09, 13648/09, 13652/09-13654-09,
13656/09-13658/09: see HC 19-xxviii (2008-09), chapter 6 (21 October
2009), HC 19-xxx (2008-09), chapter 2 (4 November 2009) and HC
5-i (2009-2010), chapter 2 (19 November 2009) and HC Deb,
1 December 2009, cols. 989-1026. Back
27
See http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ecofin/108392.pdf
and http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/108622.pdf.
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