Tulip Siddiq MP: speeches 2024

Speeches

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  We are looking at a diverse portfolio of assets, and the pension funds mentioned by the right hon. Gentleman have already pooled and are investing in the UK.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  My hon. Friend will know that I can never resist an ice cream, so I probably will visit after all. Places such as JP Morgan, which employs 4,000 people in the financial services industry, are vital to us. One of the things that the Chancellor’s speech built on was the significant steps that the Government are already taking to enhance the competitiveness of our financial services sector. We want to look at the biggest changes to the UK’s listings regime in more than three decades and—my hon. Friend will be familiar with this—deliver the final stages of the post-crisis capital reforms to banks. With our financial services growth and competitiveness strategy, which I hope my hon. Friend will write to us on, we want to give the industry certainty and the confidence to invest. That is the main thing that the financial services sector wants right now, and people in Bournemouth will probably agree with that. I look forward to that ice cream.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  I apologise on behalf of the Chancellor for the fact that she could not be here. If there are any specific questions for her, I will ensure that she knows what they are, and that she personally writes to Members. With permission, Madam Deputy Speaker, I will update the House on the Government’s work to support the growth of the UK economy. The financial services sector is the jewel in the crown of the UK economy, as I am sure everyone across the House will agree. It is one of our largest and most successful sectors, employing 1.2 million people and making up 9% of gross value added, and the UK is the second largest exporter of financial services in the G7. On Thursday night at Mansion House, the Chancellor placed the sector at the heart of the Government’s growth mission and, building on the economic stability and public investment that the Budget provided earlier this year, she set out a plan for investment and reform of the sector. The plan builds on the rapid work that the Government have already done to support the growth of the sector. One week into office, the Government welcomed the biggest changes in the UK’s listings regime in more than three decades; in our first month we launched the landmark pensions review and in September we delivered the final stage of the post-crisis capital reforms for banks, working closely with the Bank of England, strengthening our banking system while also protecting lending to the wider economy. The package that the Chancellor set out at Mansion House builds on those steps, beginning with a commitment to develop a comprehensive plan to grow our financial services sector. In spring next year, the Government will publish the first ever financial services growth and competitiveness strategy, giving the financial services sector the confidence it needs to invest in the long term by setting out our plans for the sector over the next 10 years. Published alongside our modern industrial strategy, it will be clear-eyed about our strengths, proposing five priority growth opportunities: fintech, sustainable finance, asset management and wholesale services, insurance and reinsurance markets, and capital markets, co-designed with voices across the financial services sector. From the base of long-term stability, the Chancellor also laid the foundations for getting even more investment into our country. The Government have already confirmed our plans to capitalise our flagship investment vehicle, the National Wealth Fund, to invest in the industries of the future. To support investment in our green industries, the Chancellor’s speech confirmed the Government’s next steps to deliver a world-leading sustainable finance framework. The Chancellor also set out our plans in another key area that I know has generated interest across the House: pension funds. The UK has one of the largest pension markets in the world, but pension capital is often not used enough to drive investment and growth in our economy. Thanks to the excellent work taken forward by the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Wycombe (Emma Reynolds), the Chancellor announced the interim report of the pensions investment review. The report sets out our plans to harness the collective size of our pension funds to create larger pools of capital for investment, supporting pension funds to invest at scale. To do that, we will deliver a significant consolidation of the defined contribution market and the Local Government Pension Scheme in England and Wales, providing better outcomes for savers while supporting investment for growth. Indeed, we could unlock around £80 billion-worth for investment in private equity and infrastructure through those actions alone, according to domestic and international comparisons. Alongside economic stability and higher levels of investment, the Chancellor’s Mansion House speech put reform at the heart of the Government’s growth agenda. The Government’s approach to regulation is a core part of that. Across our economy, we will upgrade our regulatory regime, reviewing the guidance we give to the Competition and Markets Authority and other major regulators to underline the importance of growth. That includes our financial services regulators. While it was right that successive Governments made regulatory changes after the global financial crisis to ensure that regulation kept pace with the global economy of the time, it is also important that we learn lessons from the past. Those changes have resulted in a system that sought to eliminate risk taking, and in some cases they have had unintended consequences that we as a new Government must now address. Regulation has costs as well as benefits. It has costs for firms when they are spending large sums on compliance and not using that money to innovate and to grow, and it can have costs for consumers, for example by restricting access to financial advice that could help them to plan for the future. While maintaining important consumer protections and upholding international standards of regulation, we therefore feel that now is the moment to rebalance our approach and take forward the next stage of reforms needed to drive growth, competitiveness and investment. To support that aim, the Government issued new growth-focused remit letters to the financial services regulators to make clear that the Chancellor and I fully expect them to support the Government’s missions on economic growth. The Financial Ombudsman Service plays a vital role for consumers in getting redress. That will not change, but reform is needed to create a sure environment. We will work closely with the Financial Conduct Authority and the FOS to develop a new agreement between the two institutions, with clear expectations on how they co-operate, including on historic market practice and mass redress events. The Government welcome the call for input that asks for views on how to improve the rules governing how the FOS operates. The Government’s ambitions for reform are much wider than regulation. Building on our work to improve the UK’s listing regimes, we are unlocking funding for our capital markets and legislating to establish, by 2025, PISCES—the private intermittent securities and capital exchange system—which is an innovative new stock market to support companies to scale and grow. We are also supporting innovation in the financial services sector by launching a pilot to deliver a digital gilt instrument using distributed ledger technology, as my written statement sets out. Insurance markets are pivotal to supporting growth and creating resilience by helping us to manage risk. The Government have launched a consultation on captive insurance, where a new approach could cement the UK’s position as a leading financial services centre. As the House will know, this Government prioritise the growth of the mutuals sector. We have launched a call for evidence on the credit union common bond, asking regulators to report on their mutuals landscape to support their growth, and welcoming the establishment of an industry-led mutual and co-operative business council. The Chancellor also published the national payments vision to set out the Government’s ambition for this vital sector, ensuring that our approach to regulation allows firms to grow and innovate, and including decisive action to progress open banking and to support our fantastic fintech businesses. Finally, we are working with tech platforms and telco networks to reduce the scale of fraud originating on their platforms. The Chancellor, the Home Secretary, and the Secretary of State for Science, Innovation and Technology, have written to leading tech and telecom companies, calling on them to go further and faster, with clear action to reduce the level of fraudulent activity that exploits their platforms and networks. We will be monitoring that closely in the coming months. This is a significant package to support the growth of the financial services sector and invest in the wider economy. I have heard lots of murmuring from Opposition Members while I have been speaking, which I hope shows their approval for our overall package. I look forward to working across the House to deliver these important reforms from the first Labour Mansion House speech in 14 years.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  I reassure the hon. Gentleman that boosting return for savers is at the very heart of this agenda, which is why we are pursuing this pensions review. We want these reforms to increase security and boost people’s pension pots, and we want to unlock about £80 billion of productive investment. The Government’s reforms are already in the pension schemes Bill, and they could boost a typical defined contribution saver’s lifetime pension pot by £11,000. I do not want the hon. Gentleman to worry, because we have our eye on how to protect pensioners and savers.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  My hon. Friend knows this area well, having worked in the Treasury in a former life. We will absolutely make sure that we avoid the mistakes of a certain Liz Truss and work very closely with the TPR and the FCA to deliver all our reforms and ensure that we do not make any decisions that shake the stability of the economy, because we want to have a stable financial services sector and a stable economy to encourage investment and ultimately deliver on our growth mission.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  I know that the right hon. Member did a huge amount of work in the financial services sector while he was in office. The civil servants still talk about how amazing he was—much to my dismay sometimes! We agree that there needs to be a change in appetite in this place. Transparency is top of the list, as the Minister for Pensions just whispered in my ear. We thank the right hon. Member for his constructive approach on the review, and urge him to tell the people he knows in the sector to respond to and feed in to the consultation.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  The Government will consult on replacing the certification regime, and will seek the views of industry and all interested stakeholders in doing so. We are working closely with the PRA and the FCA on that. If the hon. Lady meant certification of the senior managers regime, we are keeping that under review at the moment, but it was not mentioned in the way that she thinks it was.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  Consumer protection is at the heart of anything that we do in financial services. As well as being a Minister, I am a constituency MP; every time I have one of my surgeries, I hear about people who have been either a victim of fraud or taken out a buy now, pay later product without realising the consequences. We want to give enhanced consumer protections to people through the Financial Ombudsman Service, but we are very aware that it needs to be reformed, which is why the Chancellor mentioned it over and over in her speech. We plan to introduce legislation on that as soon as possible, because we want to deliver better protection for millions of consumers after years of uncertainty. I am also making progress on financial inclusion at the moment, and I can send my hon. Friend more information on that if she wants. We are setting up a financial inclusion committee, which is meeting next week, and I am happy to let my hon. Friend know what we are doing in that to protect consumers.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  I thank my hon. Friend for her question. She has done an enormous amount of work in this area, and I applaud her for that. She was instrumental in the Government taking our initial steps to regulate the “buy now, pay later” sector. There is a need for “buy now, pay later” during a cost of living crisis, and people will access those companies’ products, but I have brought this under FCA control so far, and have regulated to ensure that it is safer, and that people do not store up a huge amount of debt that they cannot pay back. The consultation is open until 29 November, and I ask her to urge others to feed into it to ensure that we get this policy right; that was not done by the previous Government. I will bring forward legislation as quickly as possible, but I thought it was important to hear what people and the industry had to say, because we want to regulate properly. She is being patient, and I ask her to be a bit more patient; our intention is to make the sector as well regulated as possible under the FCA.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  I thank my hon. Friend for that question. On pension funds, we are not looking at taking that action right now, but I will let her know when we take further action. On the remit letters, we are committed to financial inclusion and to ensuring that consumers are looked after. That is why, in their remit letters, I have asked regulators to have regard to that, and why I have made it clear that our top priority is to promote growth and international competitiveness. The laser focus, in the remit letters, is on growth, but they are not intended to encompass the entire scope of the Government’s vision for the sector. She should be in no doubt that consumer outcomes are top of our agenda. I have made that clear in every meeting I have had with the regulators.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  As my hon. Friend knows, the Mansion House speech set out multiple new measures to unlock the full potential of the mutual sector. As he says, we welcome the establishment of an industry mutuals and co-operative business council, alongside our delivery of legislation to support the building societies sector last month. We want to ensure, through those measures, that the sector can grow, and to support inclusive growth across the UK. In the few months that I have held this position, the main complaint in the mutual and co-operative sector seems to be that it is difficult to operate within the current regulatory framework, as it is not set up to support mutuals and co-ops in the way it supports other businesses, so I am looking at that. I am very happy to continue that conversation, but this is about considering the regulatory framework to ensure that it is for fit for purpose in doubling the mutual sector, which was a commitment in our manifesto.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  I thank the hon. Lady for her comments. I will pass them on to the Financial Secretary to the Treasury, who will look into the matter. I am worried to hear what she says about SMEs; she is absolutely right that they are the heart and soul of our economy—we should be looking into that. I will ensure that he writes to her, but if she needs a further meeting, I am sure he will meet her.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  I absolutely share my hon. Friend’s enthusiasm for credit unions—I have visited those in my constituency several times and know what good work they do. We have made clear our strong support for the mutual sector. We recognise the value that credit unions bring to their members in local communities, including in her constituency. The Chancellor launched a call for evidence on reforming the credit union common bond during the Mansion House speech last week. We want to understand whether reform is needed in that space to help credit unions to grow substantially. Once we have completed the call for evidence, we will consider how much of that reform we can take forward as a Labour Government.

• 18 Nov 2024 · Financial Services: Mansion House Speech · Hansard source

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  The consultation is ongoing, but I repeat that each administering authority will retain control over impactful decisions by setting out investment objectives and strategic asset allocation, and they will have control over their pooled assets. The Minister for Pensions will be happy to meet the hon. Lady should she wish to discuss that further. As the hon. Lady said herself, the consultation is ongoing, so she may wish to wait until after it is complete.

• 12 Nov 2024 · Draft European Bank for Reconstruction and Development (Further Payments to Capital Stock) Order 2024 · Hansard source

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  I beg to move, That the Committee has considered the draft European Bank for Reconstruction and Development (Further Payments to Capital Stock) Order 2024. It is a pleasure to serve under your chairmanship, Sir Roger. Allow me briefly to take the Committee through the background and purpose of the draft order. The European Bank for Reconstruction and Development is a multilateral development bank headquartered in London. It provides high-quality project financing to support economic and private sector development in 40 different countries. The UK is the bank’s joint second-largest shareholder and hosts the EBRD’s headquarters in Canary Wharf, London. The UK engages with the EBRD on several UK foreign, development and economic policy priorities across its countries of operation, including assistance for Ukraine, supporting the transition to a green, low-carbon economy, and promoting equality of opportunity for women, young people and other underserved communities. The EBRD has been a long-standing partner to Ukraine. Over the past 30 years, it has been the largest institutional investor in Ukraine, with more than €20 billion invested in almost 600 projects. The bank provides technical assistance, lending, guarantees and grants to support policy reform and financial assistance in key sectors including energy, infrastructure and agribusiness. The UK welcomes the EBRD’s distinctive contribution to supporting Ukraine’s resilience and recovery in the face of Russia’s illegal invasion. The EBRD’s support since 2022 has amounted to over €4.5 billion for essential priorities, including supporting Ukraine’s critical national infrastructure against deliberate and repeated attacks by Russian forces. The UK and other shareholders have agreed that the EBRD should continue its operations to support Ukraine, and that this support should be long-term and predictable. Given the exceptional circumstances in Ukraine and the EBRD’s commitment to sound banking principles, continued financial support was not possible without additional shareholder support. Last year, shareholders concluded that a paid-in capital increase is the most effective, efficient and broad-based means of enabling the EBRD to continue to finance Ukraine. Accordingly, in December 2023, the UK and other shareholders agreed to increase the EBRD’s paid-in capital by €4 billion. The draft order is being made to enable the Government to participate in the capital increase in proportion to its current shareholding, with a contribution of €343.6 million paid in five equal annual instalments between 30 April next year and 30 April 2029. As determined by the OECD’s Development Assistance Committee, 71% of that contribution will be classified as official development assistance. The capital increase enables the EBRD to continue to support Ukraine’s resilience and recovery during wartime and in reconstruction through the provision of high-quality project financing, while securing the EBRD’s financial standing and its ability to maintain support to its other countries of operation. With the additional capital, the EBRD plans to provide a sustained level of annual investment to Ukraine of about €1.5 billion during wartime, increasing to €3 billion annually once reconstruction begins. Over the course of a decade, that will result in tens of billions of euros of financing for Ukraine as the EBRD leverages the paid-in capital on the financial markets. I hope the Committee will agree that this complements the UK’s military and fiscal support for Ukraine and enables the EBRD to continue providing financing in support of the sustainable development goals across its countries of operation. This is a topic that all parts of the House have been united on in support of Ukraine. I therefore recommend the draft order to the Committee.

• 12 Nov 2024 · Draft European Bank for Reconstruction and Development (Further Payments to Capital Stock) Order 2024 · Hansard source

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  It is always a pleasure to see the hon. Member for Grantham and Bourne in his place. I thank him for his support for the measure, and he is right to ask those questions. The other shareholders of the bank have confirmed their intention to participate in the capital increases. That includes other members of the G7. I am happy to write to the hon. Member with specifics if that would be helpful. The capital increase will ensure that the EBRD can increase lending to support Ukraine’s resilience, while maintaining activity in all its countries of operation; it is not dependent on other factors. In 2023, the EBRD’s total investment in Ukraine was €2.1 billion, compared with a total investment of €13.1 billion across all countries of operation. The hon. Member also asked about climate change. The EBRD’s aim is for more than 50% of its total investment in 2025 to be towards green projects, reducing net annual greenhouse gas emissions by at least 25 million tonnes. Since 2006, the EBRD has invested €49 billion in more than 2,600 green projects, which are expected to reduce carbon emissions by 124 million tonnes yearly. I thank the hon. Member for his constructive comments and his questions. The draft order will enable the UK to participate in a capital increase for the EBRD, which will improve the bank’s financial capacity to increase lending to support Ukraine’s resilience while maintaining activity in all countries of operation. I am happy to write to the hon. Member on the point about the G7 countries. I hope the Committee will join me in supporting the draft order. Question put and agreed to.

• 6 Nov 2024 · Draft Packaged Retail and Insurance-based Investment Products (Retail Disclosure) (Amendment) Regulations 2024 Draft Consumer Composite Investments (Designated Activities) Regulations 2024 Draft Securitisation (Amendment) (No. 2) Regulations 2024 Draft Prudential Regulation of Credit Institutions (Meaning of CRR Rules and Recognised Exchange) (Amendment) Regulations 2024 · Hansard source

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  It is a pleasure to serve under your chairmanship, Mr Efford. The regulations that we are introducing today will ensure effective, proportionate regulation for the financial sector by laying the groundwork for wholesale reform of consumer disclosure for financial services, and for effective prudential arrangements. Let me turn first to the draft Consumer Composite Investments (Designated Activities) Regulations 2024. The packaged retail and insurance-based investment products regulation, or PRIIPs regulation, was designed to standardise disclosure across a wide range of financial instruments and across the EU in an attempt to improve transparency and enable comparison between products for retail investors. However, as many Members will be aware, the regime was overly prescriptive and burdensome with the one-size-fits-all template of the key information document, or KID, resulting in the presentation of misleading information to consumers on potential risks and returns. The previous Government took urgent action to address the most pressing issues with the KID in the Financial Services Act 2021, and the draft statutory instrument will deliver on this Government’s commitment to wholesale reform of these EU-inherited rules, with a new regime tailored to UK markets and firms. The SI provides the Financial Conduct Authority with tailored rule-making and enforcement powers to deliver this long-called-for reform and to ensure its effective implementation. The new regime for CCIs will have tailored and flexible rules that address the key issues with PRIIPs and will support investors to better understand what they are paying for. The FCA’s consultation later this year will provide an opportunity for a full range of stakeholders to provide feedback on the new regime to ensure that it works as intended. I return to the draft Packaged Retail and Insurance-based Investment Products (Retail Disclosure) (Amendment) Regulations 2024. I have heard concerns from industry about PRIIPs. The current disclosure requirements have had unintended consequences on the investment trust sector specifically. Listed investment trusts are a British invention dating back 150 years, and they are unique to our country. Representing over 30% of the FTSE 250, and predominantly investing in illiquid assets—including infrastructure projects and renewables—they play an active role in supporting the Government’s growth agenda. Investment trusts are a unique and well established type of closed-ended investment vehicle, and the Government recognise that the prescriptive cost disclosure methodology required by the PRIIPs regulation does not reflect the actual cost of investing in these close-ended funds. The industry has told us again and again that the methodology is negatively impacting its ability to fundraise, and competitiveness. Therefore, this instrument will immediately exempt listed investment trusts from the current PRIIPs regulation and other relevant assimilated law as we finalise the replacement CCI regime, delivering on a key industry ask. We have worked quickly to deliver these changes and firms are able to take advantage of this provision immediately, before the legislation takes effect, due to the FCA’s regulatory forbearance. This approach is intended as an interim measure, and investment trusts will be included within the scope of the new CCI regime, once it is in place. The FCA, recognising that the pace of legislative reform can be slow, has already implemented regulatory forbearance so that firms can take advantage of the provision immediately, before the instrument takes effect. In the long term, investment trusts will follow bespoke and tailored rules befitting the industry, and I encourage all sides to come together to find a sensible solution under the CCI regime. Let me now turn to the draft Prudential Regulation of Credit Institutions (Meaning of CRR Rules and Recognised Exchange) (Amendment) Regulations 2024, which make two amendments. The first is a technical change supporting the implementation of Basel 3.1, the final round of bank capital reforms following the global financial crisis. Bank capital rules are contained in the capital requirements regulation, part of assimilated law on financial services. This SI will enable revocations of these regulations, allowing the Prudential Regulation Authority to replace those rules in its rulebook, while ensuring that the PRA’s rule making remains subject to appropriate accountability and scrutiny. The second amendment will expand the definition of a “recognised exchange”, from referring only to domestic investment exchanges to include those from overseas. This will enable stocks and shares from qualifying overseas exchanges to receive preferential prudential treatment when used as collateral to secure financial services, and will broaden our definition, making the UK comparable with international counterparts and ensuring that we are competitive. Finally, the draft Securitisation (Amendment) (No. 2) Regulations 2024 extend a temporary arrangement allowing UK banks to treat EU securitisation products as though they originate from the UK, providing that they meet the standards of the “simple, transparent and standardised” framework. This means that banks and insurance firms holding such products may be able to benefit from preferential capital treatment. The current arrangement is due to expire at the end of December 2024, which would mean that no additional EU STS securitisations would be able to enter the temporary arrangement after that date. As that could impact the range of investment options for UK market participants, the Government are legislating to extend this arrangement to June 2026. The EU securitisation regulation was recently incorporated into the European economic area agreement, and the EEA-European Free Trade Association states have indicated their intention to align themselves with the EU securitisation regulations over the course of 2025. The extension granted by this instrument will allow time for the EEA-EFTA states to implement these changes and for UK authorities to make a more informed decision about the non-time limited designation of EU STS securitisation products by June 2026. These SIs will empower regulators to ensure that our financial services industry is subject to a rulebook that is fit for purpose, more proportionate, and tailored to UK markets. I know that the hon. Member for Grantham and Bourne is familiar with the regulations, as I have debated with him several times in Committee. I hope that he and the Committee will join me in supporting the regulations, which I commend to them.

• 6 Nov 2024 · Draft Packaged Retail and Insurance-based Investment Products (Retail Disclosure) (Amendment) Regulations 2024 Draft Consumer Composite Investments (Designated Activities) Regulations 2024 Draft Securitisation (Amendment) (No. 2) Regulations 2024 Draft Prudential Regulation of Credit Institutions (Meaning of CRR Rules and Recognised Exchange) (Amendment) Regulations 2024 · Hansard source

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  I beg to move, That the Committee has considered the draft Packaged Retail and Insurance-based Investment Products (Retail Disclosure) (Amendment) Regulations 2024.

• 6 Nov 2024 · Draft Packaged Retail and Insurance-based Investment Products (Retail Disclosure) (Amendment) Regulations 2024 Draft Consumer Composite Investments (Designated Activities) Regulations 2024 Draft Securitisation (Amendment) (No. 2) Regulations 2024 Draft Prudential Regulation of Credit Institutions (Meaning of CRR Rules and Recognised Exchange) (Amendment) Regulations 2024 · Hansard source

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  I thank the shadow Minister—or perhaps temporary shadow Minister—for his support and associate myself with his comments about the financial services sector. It is a success story of our country. During the passage of the legislation that is now the Financial Services and Markets Act, he and I talked often about the importance of the financial services sector to the overall economy, but I will not associate myself with his comments on the Budget or rise to anything he says in that regard! These SIs represents an important step in our approach to regulation for financial services, which we want to be proportionate, effective and tailored to the UK. We want to get the best out of our financial services sector. I encourage all interested parties to engage with the FCA as it consults on the proposed CCI regime later this year, because it is important to hear from the industry and ensure that we make regulation according to what it will thrive on. I thank the Committee for listening to me speak for quite a long time. If Members have any questions, I would be happy to answer them. I thank the shadow Minister, and I thank the Whips for organising us today. Question put and agreed to. DRAFT CONSUMER COMPOSITE INVESTMENTS (DESIGNATED ACTIVITIES) REGULATIONS 2024 Resolved , That the Committee has considered the draft Consumer Composite Investments (Designated Activities) Regulations 2024. —(Tulip Siddiq.) DRAFT SECURITISATION (AMENDMENT) (NO. 2) REGULATIONS 2024 Resolved , That the Committee has considered the draft Securitisation (Amendment) (No. 2) Regulations 2024. —(Tulip Siddiq.) DRAFT PRUDENTIAL REGULATION OF CREDIT INSTITUTIONS (MEANING OF CRR RULES AND RECOGNISED EXCHANGE) (AMENDMENT) REGULATIONS 2024 Resolved , That the Committee has considered the draft Prudential Regulation of Credit Institutions (Meaning of CRR Rules and Recognised Exchange) (Amendment) Regulations 2024. —(Tulip Siddiq.)

• 6 Nov 2024 · Budget Resolutions · Hansard source

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  I thank my hon. Friend for her intervention. I know that she is a doughty champion of the pubs in Carlisle. The pubs in my constituency are celebrating the penny off pints. Let me get back to the previous Government, who were wrong when they claimed that they would fix the roof while the sun was shining. While chasing a budget surplus— for which, 14 years later, all they had to show was catastrophic public finances—they merely painted over the ever-growing cracks in the bedrock of our society and our country. That is why this Government are right to focus on fixing the foundations of our economy, because that is the only way that we can change the country, deliver for working people and rebuild Britain. Of course, buying a home is harder if the seller has misled us about its true condition by underestimating the size and cost of any required repairs. In that sense, rebuilding our economy is no different, because the previous Government’s public spending plans existed only on paper; there was no real allocation of money to back up any of the spending plans. They behaved no better than some huckster trying desperately to sell a flat that they know will never be built. That is why the OBR has said that, had it been made aware of the scale of the spending pressures during the spring 2024 Budget, its assessment of the previous Government’s spending plans would have been “materially different”. That is why it was right that we took our time to conduct a full survey of the economic inheritance that they left us.

• 6 Nov 2024 · Budget Resolutions · Hansard source

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  It is an absolute honour to make the closing speech on this historic Budget. It is historic for two reasons. First, it is the first ever Budget to be delivered by a woman—the first female Chancellor of the Exchequer after 800 years. She has smashed the glass ceiling, and I hope all the women and young girls watching know that they can be in the driving seat of a Labour Government. Secondly, it is historic because we are finally wiping the slate clean and turning the page on 14 years of Tory incompetence, chaos and outright instability. This Budget will make meaningful change by focusing on the fundamentals.

• 6 Nov 2024 · Budget Resolutions · Hansard source

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  The right hon. Gentleman has intervened 18 times. I shall not give him another chance. Let me continue. That is the only way that we can really fix the foundations. Of course, that involves taking tough decisions, particularly on spending and taxation, but I will take no lectures from those who were content to levy a £22 billion pound tax on this country’s future, and, through their unfunded spending commitments, attempt to undemocratically bind the hands of a future Government. Well, guess what? This Government will do things differently. While the previous Government allowed investment in our country to fall to its lowest level on record, this Government will put investment at the heart of everything that we do. That is why we held the international investment summit in October—to show firms at home and abroad that Britain is open for business once more. That is why we have introduced a new fiscal rule—the investment rule—which, alongside appropriate guardrails provided by the OBR and our new stability rule, means that this Government can meaningfully invest in our country’s future. Of course, investment means taking a long-term view. As anyone who has bought a property, built a business or raised a family will know, the early days are always the hardest. But if they take the hard calls now, in time they will get back far more than they put in. I pick those examples deliberately, but with regret. The sad truth is that, for working people—particularly young people—up and down the country, home ownership, entrepreneurship and starting a family have never been more distant. This Budget will start to change that. Our manifesto made a clear commitment to get Britain building again. This Budget puts the first shovels in the ground, with a commitment to spend an average of 2.6% of GDP on public sector net investment over the course of this Parliament. This will include an additional £500 million in new funding for social and affordable homes, which brings total investment in housing supply to more than £5 billion and supports the delivery of tens of thousands of new homes. We will build more than just homes; we need to build communities. Infrastructure is key to tying those communities together while ensuring that they plug into the wider economy. [Interruption.] The shadow Foreign Secretary asks how. If she listens, she will learn, so she should pay attention. Getting our country moving again will be key to growing the economy. [Interruption.] She should not chunter from the Front Bench. She needs to listen, because our commitment to infrastructure investment will help us to do so—by, for instance, increasing local roads investment by £500 million in 2024-25. These are the things that the previous Government failed to do, but we will deliver for our country. For working families, that means less time wasted dodging potholes and more time for the things that actually matter. Of course, infrastructure helps not just families but firms. In an increasingly volatile world, Government should play an important role in securing our energy supply so that firms can price that into their business plan. We heard powerful and authentic maiden speeches today from my hon. Friends the Members for North Ayrshire and Arran (Irene Campbell), for Stoke-on-Trent North (David Williams) and for Sherwood Forest (Michelle Welsh). We will see them as huge assets to Parliament. Some of them mentioned that their families did not think that they would get here; I am really pleased that their families were wrong. I will finish by echoing something that the shadow Minister, the hon. Member for North Bedfordshire (Richard Fuller), said. It is not often that I agree with him, but he said that we had choices. The truth is that we did have choices, and guess what? We chose to act. In 10 years’ time, the country will look back on this Budget as the moment when we got Britain’s future back. In the future, the economy will have grown because at this moment we chose to prioritise a healthy workforce; we will have record levels of investment because we prioritised fiscal and economic responsibility; and people will have more money in their pockets because we prioritised protecting hard-working people’s payslips. The merry-go-round of austerity and economic irresponsibility is over. We made a choice—a choice to rebuild Britain. Question put and agreed to. Resolved, That income tax is charged for the tax year 2025-26. And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

• 5 Nov 2024 · Draft Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 · Hansard source

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  I thank the Opposition spokesperson for supporting the draft regulations. The Government announced in August, through an HMRC pension schemes newsletter, that we would make the legislative changes needed to complete the abolition of the lifetime allowance. That is what we are doing in the draft regulations, which will come into force on 18 November and will have retrospective effect from 6 April 2024. We have no plans to reintroduce the lifetime allowance, but we keep all taxes under review as part of our process. The draft regulations will conclude the work to abolish the lifetime allowance, addressing issues raised by the industry and providing certainty to pension schemes, administrators and pension savers. I hope that the Committee will join me in supporting them. I know that they are highly technical, so I thank the Committee for putting up with me talking for a long time. Question put and agreed to.

• 5 Nov 2024 · Draft Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 · Hansard source

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  I beg to move, That the Committee has considered the draft Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024. As always, Mrs Harris, it is a pleasure to serve under your chairmanship. I will take the Committee briefly through the background and the purpose of the draft regulations, which relate to the abolition of the pensions lifetime allowance. The lifetime allowance was introduced to limit tax-favoured pension savings in registered pension schemes: it was the maximum amount of tax-relievable pension savings from which an individual could benefit over the course of their lifetime. At spring Budget 2023, the then Government announced that they would abolish the lifetime allowance. The Finance (No. 2) Act 2023 removed the lifetime allowance charge; this was done to incentivise those considering retirement to remain in employment, and to encourage those who had already left the workplace to return. The Finance Act 2024 removed the other elements of the lifetime allowance from the pensions tax regime, from 6 April 2024. This was an enormous task: the entire pensions tax regime was structured around the existence of a lifetime allowance. Many other aspects of the regime, such as allowable pension and lump sum benefits, were calculated by reference to the lifetime allowance. It took over 100 pages of primary legislation to remove the lifetime allowance and replace it with other rules to make the pensions tax regime operate correctly in its absence. That included the introduction of new allowances. Additional secondary legislation was then needed to provide further administrative and technical detail. Since the Finance Act 2024 and the regulations that followed it, His Majesty’s Revenue and Customs has continued to work with industry representatives to ensure that the legislation operates correctly. In doing so, HMRC has identified some errors that need to be corrected. The draft regulations will amend schedule 29 to the Finance Act 2004 to facilitate the correct calculation of crystallised pension rights for the purposes of the trivial commutation lump sum. They will amend schedule 36 to the 2004 Act so that the calculation of the pension credit factor is dependent on the standard lifetime allowance at the time the rights were acquired. They will correct the calculation of the additional lump sum amount in respect of scheme-specific lump sums and will modify the availability of a member’s overseas transfer allowance where a member has a pre-commencement pension in payment. They will also amend subordinate legislation to ensure that a lump sum paid in reliance on an erroneous transitional tax-free amount certificate remains an authorised payment, with any excess subject to marginal rate taxation. The draft regulations are necessary to ensure that pension tax legislation can operate as intended. Without them, pension scheme administrators face uncertainty, and some taxpayers could receive an unintentionally more advantageous outcome than they would have if the lifetime allowance had remained in place. I hope you are with me, Mrs Harris! These changes will put certain members in a less advantageous position. To mitigate the impact, HMRC has engaged with the pensions industry to suggest that affected payments be delayed until the regulations are in place. Most pension providers have followed that advice. The majority of pension scheme members have been able to access the correct benefits since the lifetime allowance abolition legislation was completed earlier this year. A very small number of individuals, mainly those with large pension pots, have been inconvenienced; in some cases they have been unable to access their benefits because of some technical flaws in the legislation. The draft regulations will correct the tax position for those individuals and will allow the pensions tax regime to operate as intended. I commend them to the Committee.

• 31 Oct 2024 · Income tax (charge) · Hansard source

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  For about 14 years.