I beg to move,
That the Order of 16 July 2012 relating to the establishment of the Parliamentary Commission on Banking Standards shall have effect in the next Session until the day on which the Commission makes its report on standards and culture of the UK banking sector.
That a message be sent to the House of Lords to desire their concurrence.
This motion is to allow the Parliamentary Commission on Banking Standards to continue its work in the new Session of Parliament, and to give it time to publish its final report on standards and culture in the banking sector. The Commission was established in July last year following the LIBOR rate-setting revelations, and it had a dual remit. First, it was to report on the lessons to be learned about corporate governance, transparency, conflicts of interest and their implications for regulation and Government policy. Secondly, it was given the role of looking more broadly at standards and culture in the UK banking sector, taking into account regulatory and competitions investigations into the LIBOR rate-setting process.
The Commission reported on the first part of its remit on 21 December last year in its report on banking standards. It has subsequently published three further reports on structural reform of the banking sector, proprietary trading, and the failure of HBOS. Its final report is now awaited, and I understand that it is hoping to report early in the new Session. That would allow its conclusions to be taken into account in the House’s scrutiny of the Financial Services (Banking Reform) Bill, which has completed its Committee stage in the House and is awaiting Report.
The motion is required because under the rules of both Houses of Parliament, Joint Committees cease to exist at the end of the Session in which they were established—unless specific provision is made for reporting by a specified date—or when they have reported on the matter entrusted to them. The motion does not specify a particular date by which the Committee must report, in order to provide the Commission with flexibility to complete its work on its own terms.
The motion makes clear that the Commission will cease to exist when it produces its main report. Of course it is important to ensure that change in the banking sector is carried through, both through the Government’s commitment to introduce any necessary amendments to legislation arising out of the Commission’s work, and through appropriate parliamentary scrutiny of progress in the banking sector and its regulation after the Commission ceases. The Government welcome the valuable work the Commission has already done in examining the banking sector, and look forward to the publication of its final report in the near future. I commend the motion to the House.
It is a pleasure to speak in this—hopefully short—debate on behalf of Her Majesty’s Opposition, and I congratulate the Banking Commission on its work to date. Its reports so far have won cross-party support, which I am sure is in no small part due to the chairmanship of the hon. Member for Chichester (Mr Tyrie).
There can be no doubt that the Banking Commission’s inquiry into malpractices at HBOS, which received so much merited attention recently, was the direct cause of James Crosby’s correct decision to return his knighthood. However, the success of the Banking Commission should not be measured by whether it generates headlines or compels one or two of the banking executives who caused the financial crash to apologise. It has made—and I am sure it will continue to make—a thoughtful and important contribution to the debate about the future of the UK banking industry.
The Commission’s contribution will be best measured by how Parliament reforms the banking industry. It is therefore disappointing that the Treasury seems intent on pressing ahead with its plans, without awaiting the full conclusions of the Banking Commission’s deliberations. I therefore urge the Government to reconsider their timetable for future legislation to allow the Commission to finish its important work.
I confess that I was not always the most diligent of students, and from time to time I had to ask for an extension to complete my work. The Opposition are clear, however, that that is not the reason for the sensible request for the life of the Commission to be extended. I understand that the Commission has worked tirelessly in recent months, and has met on many occasions a week in order to make progress. We see the short extension into the next Session of Parliament as a sensible and pragmatic step to ensure that the Commission is able to complete its work, and we commend the motion to the House.
Does the Deputy Leader of the House wish to respond? I do not think he needs to do so—he has moved the motion. If he is desirous of doing so, he can. He does not appear to be especially desirous. This is decision time! Does the Deputy Leader of the House wish further to favour the House with his thoughts?
Thank you, Mr Speaker. I do want to share my thoughts with the House, but they will be pleasingly brief.
I welcome my Opposition counterpart back to the Dispatch Box after his thoughtful contribution to the tributes to Baroness Thatcher. I wish to respond to one of his points. I do not share the pessimism he displayed on the timetable or timing. I am confident that, if the Commission reports promptly, there will be time for its recommendations to be taken fully into account in the Financial Services (Banking Reform) Bill.
With those brief points, I commend the motion to the House.
Question put and agreed to.