Commons Sense

Hansard-based summaries and metrics

<-- Back to proposed bills

Financial Services and Markets Bill - Sitting 10

03 November 2022

Proposing MP
Tulip Siddiq Lab
Hampstead and Highgate
Type
Public Bill Committee

At a Glance

Issue Summary

Tulip Siddiq proposes new clauses to require the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) to annually report on how they consider the specific needs of mutual and co-operative financial services providers. Tulip Siddiq is addressing the Financial Services and Markets Bill by proposing a new clause that would require the Treasury to publish an updated Green Finance Strategy including a Green Taxonomy and Sustainability Disclosure Requirements. The statement addresses concerns over the accessibility of green finance for SMEs and the need for the government to deliver on its pledges regarding green finance. Tulip Siddiq is addressing concerns about the Government's approach to green finance and the need for an updated strategy. The statement addresses the protection of freedom of expression by preventing payment service providers from demonetizing individuals or organizations for political reasons. The MP is discussing a proposed new clause that would allow regulators to face civil damages if they fail to prevent prohibited activities within their remit, causing financial loss to consumers. The statement discusses the proposal of New Clause 16 regarding recourse against the Financial Conduct Authority (FCA) for its actions. The statement addresses the proposed amendment to strengthen the Financial Services and Markets Bill by adding criteria for assessing regulatory performance. Craig Tracey is addressing the need for a more proportional approach in regulating financial services, particularly for sophisticated buyers in wholesale markets compared to individual retail consumers. Tulip Siddiq acknowledges the hard work and support received during the Financial Services and Markets Bill Committee stage.

Action Requested

The MP requests that regulators explicitly report on how they have considered mutuals and co-operatives in their regulatory functions to ensure parity with standard providers. She also highlights the importance of supporting the growth of the cooperative sector through modern legislative frameworks.

Key Facts

  • Britain has a long tradition of fostering principles of cooperation and mutual support.
  • Building societies provide low-risk, member-focused banking alternatives.
  • Credit unions serve over 1.9 million members with £1.7 billion in loans.
  • The number of credit unions has dropped by more than 20% since 2016.
  • New clauses would require annual reports from the FCA and PRA on mutuals and co-operatives.
  • The new clause requires the Treasury to publish an updated Green Finance Strategy within three months of the Act passing.
  • The strategy must include a Green Taxonomy and Sustainability Disclosure Requirements.
  • Siddiq proposes £28 billion annual green capital investment until 2030 under a Labour government.
  • The Government are committed to reaching net zero greenhouse gas emissions by 2050.
  • The UK ranked highest in the world for green finance according to the global green finance index for the third successive year.
  • In 2021, roughly 9% of all capital markets activity in the UK was green compared to 20% in the EU.
  • Tulip Siddiq is from Hampstead and Highgate constituency.
  • The Minister claims the Government are making progress on green finance strategy.
  • A new clause proposed by Tulip Siddiq regarding refusal to provide services for reasons connected with freedom of expression.
  • New clause 15 would protect freedom of expression by giving the FCA regulatory powers.
  • PayPal's decision to cancel online payment accounts of organizations like the Daily Sceptic and Free Speech Union is cited as an example.
  • The issue will be reviewed under the Payment Services Regulations 2017 in January 2023.
  • The FCA has enjoyed Crown immunity for nearly two decades.
  • NatWest was fined £265 million by the FCA in December.
  • In 2019, London Capital & Finance impacted over 11,000 bondholders who lost more than £200 million.
  • New Clause 16 aims to establish a right of recourse against the FCA.
  • It seeks to address situations where individuals have suffered significant financial losses due to the FCA's actions or lack thereof.
  • The Minister will take the proposal away for further examination and consultation.
  • New clause 18 sets out seven specific criteria for assessing regulatory performance.
  • The FCA's evidence stated that no other country has a competitiveness duty similar to what is proposed in this amendment.
  • Bermuda’s regulator’s mission statement is provided as an example of setting clear objectives.
  • New clause 19 proposes a more proportional approach in financial services regulation.
  • Sophisticated buyers in wholesale markets do not require the same level of consumer protection as individual retail consumers.
  • The current one-size-fits-all regulatory approach impacts London's global competitiveness.
  • Tulip Siddiq thanked Mark Hudson for his support.
  • The Association of British Insurers, UK Finance, and TheCityUK assisted in briefing for the Committee stage.
  • Fair by Design and Which? advised on Labour party amendments.
▸ Assessment & feedback
Summary accuracy