My Lords, I beg leave to ask the Question standing in my name on the Order Paper and declare my interests as set out in the register.
My Lords, fintech has a critical role to play in our Covid recovery, in enabling financial inclusion and in levelling up, not least through the nations’ and regions’ fintech clusters. Does my noble friend the Minister agree? What is the Government’s plan to make these criticalities a reality?
To ask Her Majesty’s Government what assessment they have made of the recommendations in the Kalifa Review of UK Fintech, published on 26 February.
To ask Her Majesty’s Government what steps they are taking to ensure financial technology solutions are considered as part of the Debt Resolution Services supplier roster being created by the Crown Commercial Service.
My Lords, I thank all noble Lords who have contributed to this debate on such an important issue. Cash still matters, and it matters materially to millions. I thank particularly my noble friend the Minister for the way in which he and all Treasury officials have engaged with this issue. It is a key part, but, as other noble Lords have rightly identified, only one part, of what it means to have a cash-enabled, easily accessed economy across the UK. It adds to financial inclusion. More than that, it adds to complete social inclusion.
We all need to think innovatively about how we can do more to enable, empower and unleash true financial inclusion across the UK. It matters economically, socially and psychologically. If we can enable it, it can address so many of the issues that have dogged our nations for decades.
Again, I thank all noble Lords who have contributed, and I thank particularly the Minister and Treasury officials.
Amendment 37D agreed.
Amendment 37E not moved.
My Lords, it is a pleasure to speak to these amendments, both of which are in my name. In doing so, I declare my financial services interests as set out in the register. I will move also Amendment 40A when we get to that stage.
I thank my noble friend the Minister for the way that he has engaged not just on this amendment but across the whole of the Financial Services Bill. Indeed, I thank the whole ministerial team and all Treasury officials for having numerous meetings with myself and other noble Lords. It has been the model of how to progress legislation through your Lordships’ House.
There is a very simple and, I hope, clear purpose at the heart of the amendments: to enable cashback without a purchase. As with so many other areas of our lives, Covid has had a dramatic impact on cash usage across the United Kingdom, which has been divergent across different nations, regions, socioeconomic groups and people with different protected characteristics. If cash is no longer king, to millions across the UK it is certainly still more than material. It is beholden on all of us to ensure that people have a right to rely on cash and that a network exists across the country where they can reasonably access it. ATM withdrawals have dropped by over 50% since 2019. We have to look to other resources, other things that we have across the country where individuals and small businesses can access cash. That is the purpose of my Amendment 37D.
Currently, it is possible to get cashback with a purchase and, under the Payment Services Regulations, it is not possible to get cashback without a purchase. This amendment would change that, enabling cashback without a purchase and taking it away from what would be considered a payment service under the PSR 2017. The amendment has wider implications, I hope, than just the ability to access cash. It speaks to well-being, social isolation and a real sense of community, and to using the resources that currently exist far more efficiently and effectively for the benefit of all. In 2019 there were 123 million cashback with purchase transactions. Clearly, there is huge potential for cashback without purchase if we pass the amendment this evening.
The amendment is drawn in a deliberately permissive way to enable innovation. For example, if a fintech wanted to offer a service across a number of locations on behalf of those locations, the amendment would enable it to. Similarly, if a rural café wanted to offer cashback without a purchase on its own behalf, the amendment would enable it to.
We have seen such dramatic changes in the use of cash in recent years, heavily accelerated by the Covid crisis, yet cash still matters. If we do not act, the network that supports cash could disappear in a trice, or become inordinately expensive and leave millions of people without access to cash and, through that, to social inclusion, financial inclusion and an ability to play the part that they have a right to in our society.
Amendment 40A merely enables the regulation to come in two months after the passage of the Bill to give a reasonable period post passage.
I hope that Amendment 37D is clear and that it achieves what it seeks to: enabling cashback without a transaction for millions across the country. I believe it is good for individuals, financial inclusion, business and the high street. Cashback without a transaction could enable part of our Covid build back. I beg to move.
My Lords, it is a pleasure to follow my noble friend Lady Neville-Rolfe; in doing so, I declare my financial services interests as set out in the register.
My noble friend and I came into the House in the same autumn and, since 2013, we have both talked very much about distributed digital ID. It was pressing in 2013, so it certainly is in 2021. I will speak to all the amendments in this group briefly. I had pleasure in adding my name to my noble friend Lady Neville-Rolfe’s amendments; they are clear, succinct, short and to the point, and do the job. Does my noble friend the Minister agree?
My Amendment 30 merely seeks to flesh out some of the elements which must be considered if we are to have a successful distributed digital ID—the issues around scalability, flexibility and, crucially, inclusion. Does my noble friend the Minister agree that not only are these three issues vital to any distributed digital ID but that any ID should be predicated on the 12 principles set out in self-sovereign identity? Does she also agree that, because of the nature of this issue—as my noble friend Lady Neville-Rolfe pointed out—including issues around ID cards and Covid passports, there is a pressing need not only to move forward with this work but to have a public engagement to enable people to understand the issues and really get to grips with a system that can work for all?
My Amendment 31 seeks only to push the opportunity for the UK around open finance. We have seen the advantages open banking has brought; does my noble friend the Minister agree that open finance could be a boon for the UK, and could she set out the Government’s plans to enable this? I brought Amendment 32 forward in Committee so I will not dwell on it, except to seek a specific answer on subsection (2)(a) of the proposed new clause. Does my noble friend the Minister agree that we need to seriously consider the dematerialisation of UK securities at least at the same speed as that proposed in the EU? This is a competitive market; it is a race.
Finally, my Amendment 37E was brought forward simply to push the need for a review of access to digital payments. Digital payments are the future, accelerated by Covid, but, crucially, huge swathes of the population rightly rely—and must be allowed to rely—on cash. Does my noble friend agree that we urgently need a review of access to digital payments?
My Lords, I congratulate my noble friend Lord Randall of Uxbridge and Chris Loder MP in another place for their sponsorship of this clear piece of legislation. I declare my interest as a guide dog owner. In 2013, I had the privilege not only of joining your Lordships’ House but of bringing in my then guide dog Lottie as the first guide dog ever in the history of the House of Lords.
I give this Bill my full-throated support. It is neither a dog’s dinner nor a pig’s breakfast but clear, concise and effective, if given effect. It is the natural follow-on to Finn’s law, which was so skilfully steered through your Lordships’ House by my noble friend Lord Trenchard.
I ask the Minister about education. What part does animal welfare play in the citizenship agenda? Will he meet with DfE colleagues to see what more can be done to have animal welfare in schools and animals visiting, for the difference that this can make? I also ask if he will be tempted out of his ministerial kennel to say whether there may be an animal welfare Bill coming through your Lordships’ House sometime soon, in the next Session.
Other noble Lords have commented on some of the adverse impacts of lockdown on animals and pets. I agree that one of the long negative effects of lockdown will be pets abandoned, abused and harmed. I ask the Minister what the Government will do to ensure that this is covered from a government and ministerial perspective.
The Parliamentary Under-Secretary in another place, Victoria Prentis, said that the Government fully support this Bill. Every noble Lord who has spoken fully supports this Bill, as do I, and I know that the Minister fully supports this Bill. I entreat him to use all of his good offices and best endeavours to ensure that it secures its place on the statute book, before the end of this Session. Echoing my noble friend Lord Naseby, if that requires us to sit on 30 April, that is the very least that we can do to make sure that this important Bill becomes legislation for the benefit of all our animals.
My Lords, it is a pleasure to take part on this group of amendments. I declare my financial services interests and say just this: the borrowers are not to blame, but they bear the burden. Does my noble friend the Minister agree?
In agreeing to a large extent with my noble friend Lady Noakes, with regret I am not convinced that these are necessarily the amendments to resolve the issue. Can the Minister set out what action he believes the Treasury and FCA are taking in this area? There clearly is an issue even if we accept that the numbers may be disputed, or that there are different categories and specific circumstances. These are all important points to be considered, but they still leave issues to be addressed. Will the Minister set out anything he can about what actions the Treasury will take and what the approach of the FCA will be to address these points?
My Lords, it is a pleasure to follow my noble friend Lady McIntosh, and to congratulate the noble Lord, Lord Stevenson of Balmacara, on all his efforts in this respect. The Law Commission’s recommendations seemed pertinent and on point in 2017; four years on, they seem similarly pertinent and on point. Will my noble friend the Minister set out the pathway and the timetable for consideration of those arcane statutes, and tell us what issues and other legislation, which he alluded to, may also be under consideration along that pathway?