Following the Prime Minister’s speech on Britain’s future in the EU, the House of Lords will tomorrow debate a report from the Lords EU Committee on the European Commission’s important proposals for a European Banking Union, which have vital implications for the future shape of the EU and its single market.
Speaking ahead of the debate, Lord Harrison, who is Chairman of the Lords EU Sub-Committee on Economic and Financial Affairs, and will open tomorrow’s debate, said:
“While my Committee found that moves to introduce a European Banking Union were urgently required, we had concerns about what the proposals might mean for the City of London’s position as a global financial centre.
“In his speech today, the Prime Minister highlighted the safeguards on banking union that he believed had been secured at the December European summit as an illustration of the Government’s efforts to protect the integrity and fairness of the single market. Yet the devil is in the detail. The Government must continue to do all in their power to ensure that London’s pre-eminence as a financial market is not imperilled and that the integrity of the single market is retained.”
“There have been suggestions that the financial services sector may be a potential area where the UK will seek to repatriate powers ahead of a referendum. But this could throw into doubt the deal reached by all parties in December on banking union, and could itself imperil the single market in financial services. We fear that the Prime Minister may be seeking to have his cake and eat it.”
The Committee’s report European Banking Union: Key Issues and Challenges (PDF) was published on 12 December 2012 and called on the Government to ‘do all it can’ to ensure the proposed banking union did not threaten the City of London’s position as global financial leader. The report raised particular concerns in a number of areas including:
- the threat of UK marginalisation as banking union participants move towards closer integration, threatening to fracture the single market
- the need for the European Central Bank (ECB) to be accountable both to European and to national Parliaments for its supervision of European banks
- the need to ensure that the role of the European Banking Authority (EBA) in representing all 27 Member States must not be undermined.
Following the publication of the report an agreement was reached at a meeting of the European Council on 13 December which dealt with some of these concerns with, for example, a ‘double majority’ voting mechanism introduced for EBA votes which requires a majority of both banking union participants and non-participants, and a ‘non-discrimination clause’ that no action, proposal or policy of the ECB shall discriminate against any Member State as a venue for the provision of banking or financial services.
Lord Harrison will open the debate with Lord Newby responding for the Government. Other Members due to speak in the debate include:
Lord Liddle Lord Hamilton of Epsom
Lord Davies of Stamford
Lord Desai Lord Kerr of Kinlochard
Lord Dykes Lord Sheikh
Lord Flight Lord Trimble
The debate is scheduled to start after 4pm. Members of the media and public are welcome to attend.