Thursday 26 April 2018
Contingent Liability Notification
I can today confirm that I have laid a Treasury Minute informing the House of the contingent liability that HM Treasury has taken on in authorising the sale of a portfolio of Bradford & Bingley loans acquired during the financial crisis under the last Labour Government.
On this occasion, due to the sensitivities surrounding the commercial negotiation of this sale, it has not been possible to notify Parliament of the particulars of the liability in advance of the sale announcement.
The contingent liability includes certain remote fundamental market-standard warranties which are capped at 100% of the final sale price. The maximum contingent liability arising from these remote warranties is capped at the total consideration received, giving a maximum contingent liability of £5.3 billion. A separate set of fundamental market-standard warranties is capped at 20% of the final sale price, giving a maximum contingent liability of £1.1 billion. The fundamental warranties are considered to be so remote that they do not meet the definition of a contingent liability requiring disclosure under international financial reporting standards. However, they are disclosed as remote contingent liabilities under principles of parliamentary accountability.
Further market-standard time and valued capped warranties and indemnities confirming regulatory, legislative and contractual compliance have been provided to the purchasers. The maximum contingent liability arising is approximately £0.3 billion.
I will update the House of any further changes to Bradford & Bingley as necessary.
Service Complaints Ombudsman
I am pleased to lay before Parliament today the service complaints ombudsman's annual report for 2017 on the fairness, effectiveness and efficiency of the service complaints system.
This report is published by Nicola Williams, and covers the second year of operation of the new service complaints system and the work of her office in 2017.
The report recognises the improvements and progress made by the services in 2017, including the reduction in the backlog of pre-2016 complaints from the old system and where the services have demonstrated a better quality of evidenced decision making.
It also highlights those areas of the system where the ombudsman judges further work is required to improve the way in which complaints are handled, and makes ten new recommendations.
The findings of the report and the recommendations made will now be fully considered by the Ministry of Defence, and a formal response to the ombudsman will follow once that work is complete.
Environment, Food and Rural Affairs
Agriculture and Fisheries Council
Agriculture and Fisheries Council took place in Luxembourg on 16 April. Counsellor Rory O’Donnell represented the UK.
The most substantive agricultural item was a presentation by the European Commission setting out a proposal for a directive on “unfair trading practices in business-to-business relationships in the food supply chain”. The Commission’s presentation highlighted the UK’s Groceries Code Adjudicator (GCA) as an example of best practice in this field. The UK outlined its agreement with member state action to tackle unfair trading practices, but stressed the need for any proposed EU-wide legislation to protect well-functioning existing national systems.
The Bulgarian presidency also provided the Council with an update on food losses and food waste, following the adoption of Council conclusions on tackling food waste in June 2016. The Council reaffirmed its commitment to meeting UN sustainable development goal 12.3 on food waste.
For fisheries, the focus of this Council was a presentation by the European Commission outlining a proposed multi-annual plan for fish stocks in western waters. The UK welcomed the proposal’s alignment of the western waters plan with the approach taken in the North sea plan, while reminding Council of the need to find solutions for by-catch stocks in the context of meeting the landing obligation.
Four further items were discussed under “any other business”:
the Spanish delegation requested clarification on interpreting the landing obligation in article 15 of the common fisheries policy
the presidency informed the Council of the outcomes of the TAIEX workshop on the role of wildlife in animal health management
the Polish and Danish delegations presented information on African swine fever
the European Commission informed Council about a proposed regulation on the transparency and sustainability of the EU risk assessment in the food chain.