Tag: Lord Myners

The below Parliamentary question was asked by Lord Myners on 2016-03-21.

To ask Her Majesty’s Government whether they plan to increase or reduce total taxation as a percentage of GDP over the remainder of this Parliament.

Lord O’Neill of Gatley

The Office for Budget Responsibility (OBR) forecast that public sector current receipts (PSCR) will be 36.3% of GDP in 2015-16. As a share of GDP, PSCR is forecast to increase over the remainder of the Parliament. The OBR forecast PSCR to be 36.9% of GDP in 2016-17 and 2017-18, 37% of GDP in 2018-19, and reaching 37.5% of GDP in the final year of this Parliament. However, the Budget represents a net tax cut, worth £3bn over the scorecard period (2016-17 to 2020-21). The Budget backs business with a major overhaul of corporation tax reliefs, a lower corporation tax rate and a big reduction in small business rates.

The below Parliamentary question was asked by Lord Myners on 2016-04-12.

To ask Her Majesty’s Government what assessment they have made of whether, in the event of the takeover of the London Stock Exchange by Deutsche Börse, LCH and Eurex will have a regulator in common, and if so, whether that regulator will be the Financial Conduct Authority.

Lord O’Neill of Gatley

I refer the noble Lord to the investor relations section of the London Stock Exchange Group website, which contains information about the proposed merger, including some information on the combined group’s proposed structure. I also refer the noble Lord to my previous written answer HL7153.

Once formally notified of the proposed merger, the Bank of England and the Financial Conduct Authority (as supervisors of the London Stock Exchange Group’s UK-authorised subsidiaries) must assess the proposal from a regulatory standpoint.

In addition the proposed merger must be approved by competition authorities and is subject to a range of other assessments including those of overseas regulators and shareholders.

European Regulation No 648/2012 (EMIR) sets out detailed standards on the quality of collateral that a central counterparty (CCP) can accept, and includes a general requirement that the CCP can demonstrate to its supervisor that the form of collateral in question does not present unmanageable risk to the CCP. Furthermore, CCPs are permitted under EMIR to invest their collateral “only in cash or in highly liquid financial instruments with minimal market and credit risk.”

Any proposals for inter-CCP links would need to be assessed against relevant parts of EMIR by the Bank of England, as supervisor of LCH. EMIR requires that models used to set CCP margin requirements (and any changes to them) are validated by the CCP’s supervisor. EMIR also requires that a CCP wishing to extend its business to additional products or services must obtain the authorisation of its supervisor.

The below Parliamentary question was asked by Lord Myners on 2016-04-21.

To ask Her Majesty’s Government what plans they have, if any, to review the competition implications for central counterparty clearing of the proposed takeover of the London Stock Exchange by Deutsche Bourse.

Lord O’Neill of Gatley

I refer the noble Lord to my written answer of 26 April (HL7583, HL7584, HL7585, and HL7586).

The below Parliamentary question was asked by Lord Myners on 2016-05-10.

To ask Her Majesty’s Government what assessment they have made of the growth in private sector credit; the use of lending strategies by banks; payday lenders and peer-to-peer lenders; and risks to family finances and financial stability.

Lord O’Neill of Gatley

Private credit growth grew at 3.7% in the year to March, below the 2003-08 average of 11.5%. Industry sources such as Nesta estimate that peer-to-peer lending for consumers and business facilitated £2.4 billion of gross lending in 2015, 85% higher than in 2014. The volume of payday lending fell 35% in the first six months after the government transferred regulatory responsibility of the consumer credit market to the Financial Conduct Authority in April 2014.

The government created the independent Financial Policy Committee (FPC) to ensure we don’t repeat the mistakes of the past, and they have judged that financial stability risks from domestic credit growth are not elevated. The FPC has already taken action on loan-to-income ratios and mortgage affordability to ensure against risks from indebted households, and interest payments as a proportion of household income have fallen to a record low of 4.7% in Q4 2015, compared to 10.6% in Q1 2008.

The below Parliamentary question was asked by Lord Myners on 2016-06-06.

To ask Her Majesty’s Government whether they will consider linking the interest rate on student loans to the Consumer Price Index rather than the Retail Price Index.

Baroness Neville-Rolfe

The Government has no plans to link the interest rate on student loans to the Consumer Prices Index, rather than the Retail Prices Index. The Retail Prices Index has been used as the basis for calculating the interest rates applied to income-contingent student loans since they were introduced in 1998.

The below Parliamentary question was asked by Lord Myners on 2016-07-20.

To ask Her Majesty’s Government what assessment they have made of the consequences for financial stability of combining four large central counterparties (CCPs), LCH.Clearnet Ltd, LCH.Clearnet SA, Eurex and CC&G, when the London Stock Exchange and Deutsche Borse merge; whether adequate recovery and resolution frameworks will be in place for each of these CCPs; and whether those frameworks will be ring-fenced from each other.

Lord O’Neill of Gatley

LCH.Clearnet Ltd, LCH.Clearnet SA, Eurex Clearing and CC&G are separate CCPs regulated under European Regulation No 648/2012 (EMIR) by their respective regulators. The London Stock Exchange Group and Deutsche Borse have publicly stated their intention that “[t]he existing regulatory framework of all regulated entities within the Combined Group would remain unchanged” following the merger. Once notified by the companies of their proposal to merge, the Bank of England will assess the proposal for a change in control of LCH.Clearnet Ltd in line with the criteria set out in EMIR.

The below Parliamentary question was asked by Lord Myners on 2015-02-11.

To ask Her Majesty’s Government whether it is routine policy for the Cabinet Office to contact HM Revenue and Customs to consult it prior to the appointment of a non-elected Minister.

Baroness Stowell of Beeston

As was the case under previous administrations, ministerial appointments are a matter for the Prime Minister, in line with the Ministerial Code.

For those individuals upon whom the Prime Minister wishes to confer a life peerage, the independent House of Lords Appointments Commission vets nominations. For those individuals upon whom the Prime Minister wishes to confer a peerage in order that they might sit in the House of Lords to take up a ministerial role, the Commission consults the main regulatory authorities, including HMRC, before giving advice.

The below Parliamentary question was asked by Lord Myners on 2015-02-11.

To ask Her Majesty’s Government whether they still consider it appropriate to allow Chinese banks to open branches in the United Kingdom.

Lord Deighton

The decision-making on applications from Chinese banks to establish branches in the United Kingdom is a matter for the independent Prudential Regulation Authority, consistent with its broader policy on the regulation of non-European Economic Area banks.

The below Parliamentary question was asked by Lord Myners on 2015-02-10.

To ask Her Majesty’s Government which were the 10 jurisdictions into which closed bank accounts held in Switzerland by United Kingdom residents were transferred according to information provided to them by the Swiss National Bank.

Lord Deighton

HL4893

Under the Swiss Agreement HMRC received a list of the top 10 destinations to where funds were moved in the period before the Agreement came into force. They are using this information together with information from compliance work to follow the proceeds of tax evasion.

As with Lichtenstein agreement signed in 2009, HMRC is legally restricted by the Agreement’s terms from publishing the information provided.

HL4896

Where there is evidence of collusion in tax evasion or other wrongdoing, the relevant law enforcement agency would assess that evidence and decide whether to pursue an investigation.

HMRC received the data from the French in April 2010 under very strict international treaty conditions, which limited its use to tax purposes only and prevented HMRC from sharing the data with other law enforcement authorities for investigating other potential offences.

HMRC first asked for the conditions to be relaxed in August 2010. Following a number of more recent representations, the French authorities gave written confirmation on 23 February 2015 that they were lifting restrictions on the use and sharing of the data with other law enforcement agencies and regulators for the purpose of investigating criminal offences.

As a result, HMRC has recently held a multi-agency meeting to discuss how the stolen HSBC Suisse data can be shared with them.

The below Parliamentary question was asked by Lord Myners on 2015-02-10.

To ask Her Majesty’s Government what regulatory actions were taken in the United Kingdom in connection with HSBC as a consequence of the fines imposed in the United States in response to its involvement in money laundering on behalf of Mexican drug cartels.

Lord Deighton

I can confirm to the Noble Lord that the information I provided him in response to his written question answered on 17th June 2013 remains accurate:

US investigations and enforcement action on HSBC focused on their subsidiaries in the US. The Financial Conduct Authority (FCA) has no direct supervisory remit over these HSBC entities.

However, in conjunction with the action taken by the US, the (then) FSA, as lead regulator for the HSBC Group globally, made a number of requirements of HSBC Holdings plc, designed to ensure that all parts of the HSBC Group are compliant with the relevant legal and regulatory requirements across the Group to prevent similar failings occurring in future.

This included requiring a committee of the HSBC Board to oversee matters relating to anti-money laundering, sanctions, terrorist financing and proliferation financing; requiring the Group to revise its policies and procedures to ensure that all parts of the HSBC Group are subject to standards equivalent to those required under UK requirements; HSBC employing an independent monitor to oversee the Group’s compliance with UK anti-money laundering, sanctions, terrorist financing and proliferation financing requirements and to provide independent reporting to the HSBC Board committee and regulators. HSBC Holdings was also required to appoint a Group Money Laundering Reporting Officer (MLRO), with responsibility for ensuring that systems and controls are in place across the Group.

The FCA is closely monitoring the implementation of these requirements by HSBC.