Banking (Special Provisions) Bill — Independence while under nationalization — 19 Feb 2008 at 21:00

The majority voted against the insertion of a specific paragraph[1] into Banking (Special Provisions) Bill[2] requiring the Treasury to state its strategic objectives and an outline of how it would provide for independent day-to-day management of a bank before it could order its nationalization.

The current plan enables the Treasury to order the transfer of securities, property, rights and liabilities from an "authorised UK deposit-taker" to another corporate body "if (and only if) it appears to the Treasury to be desirable to make the order for

"(a) maintaining the stability of the UK financial system in circumstances where the Treasury consider that there would be a serious threat to its stability if the order were not made;

"(b) protecting the public interest in circumstances where financial assistance has been provided by the Treasury to the deposit-taker for the purpose of maintaining the stability of the UK financial system."[3]

The proposal, which only had minority support according to this vote, would have required the Treasury to lay before both Houses of Parliament

"a Minute setting out a scheme for the management of the authorised UK deposit-taker following the exercise of this power, including provisions setting out the strategic objectives for the business as determined by the Treasury and further provisions to ensure the independent day-to-day management of the business of the authorised UK deposit-taker to achieve these objectives."

• [1] The Second Deputy Chairman, House of Commons, 19 February 2008.
• [2] Banking (Special Provisions) Bill
• [3] Cases where the Treasury's powers are exercisable, Clause 2 , Banking (Special Provisions) Bill

Debate in Parliament | Source |