Lords to scrutinise 'rushed and defective' banking Bill

Reform meant to prevent another crisis may make Bank too powerful, say critics

Members of the House of Lords will today debate major amendments to the Government's far-reaching banking reforms after peers made an unprecedented request to fix what it called a "rushed and defective" piece of legislation.

It is understood that a group of cross-party peers asked the Treasury Select Committee for technical assistance to translate some of its proposals of changes to the Financial Services Bill into amendments in a bid to curb the power of the Bank of England. That's after the TSC first took the highly unusual move of publishing a special report into the legislation last month.

The Committee raised concerns that the Bill – which abolishes the Financial Services Authority and splits its powers between a new Financial Conduct Authority and the Bank of England – was being rushed through Parliament without adequate scrutiny. That's despite the TSC's chairman Andrew Tyrie describing it as "the most important overhaul of financial regulation ever undertaken in this country".

Most of the suggested amendments are aimed at stymying the reach of the Bank of England, which the Bill would make the most powerful unelected institution in Britain. It is believed a significant number of the changes had already been tabled at various stages of Commons scrutiny, but received little consideration due to the relatively short time provided for debate.

Mr Tyrie told The Independent: "It was an unusual step for the Committee to produce a report specifically designed to assist consideration in the Lords. But this crucial Bill warrants it. Despite being very complex, it has been rushed through, lacking clear lines of accountability to the respective roles of Parliament, the Government and the Bank.

"It was clear from the debate in the Lords at the Bill's second reading that many of those peers with most experience of the subject had similar concerns. Many people would not start from this point, but nonetheless there is still plenty of scope for improvement of what is at the moment a defective Bill."

The Committee hopes that the Lords will make changes to the Financial Services Bill before it comes into force next year. The amendments – tabled by peers including the Treasury minister Lord Sassoon, Baroness Wheatcroft, a former editor of the Wall Street Journal Europe, and the economist Lord Peston, propose that the Bank's governance not be left to Threadneedle Street.

They recommend that the Bank of England's court of directors undertake retrospective reviews of the Bank's performance, and that, when taxpayer money is at risk, the Chancellor should be given the power to take over control for regulation.

Another amendment, from the Labour peer Lord McFall, proposes that the Treasury Committee should have a role in the appointment and dismissal of the Bank's Governor. Currently, the post is appointed by the Treasury for up to two five-year terms.

"No explanation has been given for the rush to produce the Bill and place it on the Statute Book by the end of the year," Mr Tyrie said. "Better to take a little more time, and get it right."

Suggested Topics
Voices
On the last day of campaigning before the polling booths open, the SNP leader has written to voters in a final attempt to convince them to vote for independence
scotland decidesIs a huge gamble on oil keeping First Minister up at night?
Arts and Entertainment
Rosalind Buckland, the inspiration for Cider with Rosie died this week
booksBut what is it like to be the person who inspires a classic work of art?
Life and Style
techApple has just launched its latest mobile operating software – so what should you do first?
News
A male driver reverses his Vauxhall Astra from a tow truck
newsThe 'extremely dangerous' attempt to avoid being impounded has been heavily criticised
PROMOTED VIDEO
Arts and Entertainment
Lionel Messi in action for Barcelona
filmSo what makes the little man tick?
Arts and Entertainment
tvReview: An undercooked end (spoiler alert)
News
i100
News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Pharrell dismissed the controversy surrounding
musicThe singer said 'the last thing I want to do is degrade'
Sport
Cesc Fabregas celebrates his first Chelsea goal
footballChelsea vs Schalke match report
Arts and Entertainment
Toby Jones (left) and Mackenzie Crook in BBC4’s new comedy The Detectorists
tvMackenzie Crook's 'Detectorists' makes the hobby look 'dysfunctional', they say
Life and Style
fashion

Olympic diver has made his modelling debut for Adidas

News
i100
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant Birmingham

£18000 - £23000 per annum + Comission: SThree: The SThree group is a world lea...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Recruitment Consultant - Soho - IT, Pharma, Public Sector

£20000 - £25000 per annum + OTE £35,000 first year: SThree: The SThree group i...

Sales Executive

£20 - 24k (Uncapped Commission - £35k Year 1 OTE): Guru Careers: We are seekin...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week