Sunday, September 28, 2008

Conference Diary: Sunday 1

The trouble with party conferences is that it is very difficult to keep tabs with the media narrative. Most of the journalists I have met so far seem completely knackered and willing the party conference season to be over. I suspect that the big story is not going to be here this week, it will be the unfurling economic situation. But that in itself represents a real opportunity for David Cameron and George Osborne to demonstrate that a Conservative government would have a well thought out approach to dealing with the crisis that is rapidly developing. I will be attending the session this afternoon and report back later.

16 comments:

Richard said...

They are showing no evidence of having a well-thought out economic policy. More like playing with fire as they ignore the "elephant in the room".

Martin Day said...

Labour have been an utter shambles in the credit crisis, they have failed to regulate Financial institutions corporate governance. Instead Labour have sort to inhibit and complicate the sales process whilst allowing vodoo Economics and complex financial jiggery pockery to go on in the board room.

Labour have failed the British people with their bankrupt regulatory structure authored by Gordon Brown and Edward Balls.

Labour seek to scapegoat other countries but British banks mean British regulation. The elephant in the room is Labour government incomptence and it has gone biserk.

Labour are an economically illiterate party. They only know Tax, Spend and waste! Labour are doomed at the next election DOOMED! Labour fhave repeatedly failed to govern in the national interest but take decisions on duplitous political grounds. First there was the misleading of the public Northern Rock, it was nationalised for political purposes not economic. Second came the sell out of West Yorkshire Jobs for the protection of Scottish jobs.

Labour are a vile, nasty, incomptent band of pass the blame to others politiicans. Labour need turfing out of office ASAP!

Steve Horgan said...

Richard, the blog post to which you refer is about as wrong as it can be. Basel II is not EU regulation, it is from the Bank of International Settlements, effectively a world-wide agreement. That it comes to us via an EU directive is neither here nor there as we would be implementing it whether or not we were in the EU. Using the Basel Accord to pretend that nothing can be done because it is all an EU plot is misleading garbage, it also gets Labour off the hook, which may be exactly what you want. They came up with a system of regulation that failed, and that runs from London, not Brussels and Gordon Brown designed it. Hold him to account or at least don't rubbish the people who are.

Anonymous said...

Quite. It was Labour, not the EU, that created the tripartite regulatory regime, which deprived the Bank of England of most of its powers. The previous system ensured that there was no failure of a high street bank for over a century. Labour's system has taken less than a decade to produce failure on an unprecedented scale and the demise of Northern Rock, Alliance & Leicester, Bradford & Bingley and HBOS.

Chris Paul said...

Asking their chuffing hedge fund shorters and campaign/office backers to stop ripping off the poor and their savings and pensions would be a bloody good start Iain.

Baited breath ...

Btw - none of the four institutions listed has demised. They have changed hands or are about to from arsehole speculative incompetents to we must all hope better, safer new leadership.

The demutualisation era has a lot to answer for. UK plc is building up quite a fair sozed building society and it would be a fantastic signal to REMUTUALISE this.

Richard said...

The "previous system" saw the stock market crash of 1973–4, following which there was a secondary banking crisis which forced the BoE to bail out a number of lenders.

Then there was the collapse of Johnson Matthey Bankers Ltd in 1984, followed by the British & Commonwealth Bank in 1990, the Bank of Credit and Commerce International (BCCI) failure in 1991 and then the Barings crisis in 1995.

Added to that, there were regulatory failures outside the banking system, including the Maxwell affair, the notorious problem of pensions mis-selling - centred around Equitable Life - which involved the selling of inappropriate pension investment products to investors, and the Lloyds scandal.

The "tripartite" system was thus introduced as a means of improving the regulatory system, one encouraged by the EU which effectively rules out independent central banks having a regulatory role. See here.

However, it is not actually a "tripartite" system - it is a "quadupartite" system, with the EU commission and other institutions as the fourth player. This is the invisible player which has essentially hijacked the regulatory system which is now principally devised to implement and enforce EU legislation.

When it comes to changing the regulatory system, therefore, the point stands. This is an "occupied field" where member states no longer have any legislative competence.

Tom FD said...

Monday???

Iain, it's Sunday.

verity's lovechild said...

I have yet to understand how giving MORE powers to a central bank (the Bank of England, in this case) is going to improve the present ecoomic situation. If Osborne & Co. were to read more Mises and Rothbard, and less trendy "Nudge"-type nonsense, they might actually have a clue about the causes of our present woes.

Unsworth said...

Chris Paul

You need a hygenist? 'Baited breath ...'

And the only ones to benefit from 'shorting' are Conservatives? Don't be so silly. Take a close look at union funds.

Steve Horgan said...

So, Richard, having skated over that fact that Basel II had little to do with the EU as you claimed, we now move on to payments. It may surprise you know that payments services relates to many organisations, many of which are not banks. It is certainly not the main regulation that is specifically for banks, which is in UK competence for UK banks. Basically, you are wrong again and again it is not an EU plot. The line that nothing about the current system can be changed because of the EU is simply inaccurate. Again, that gives Labour a pass. Why are you so keen to do that?

Watervole said...

Never mind the elephant in the room Richard, there's a troll in this one. You!

Labour handed our autonomy on a plate to Brussels and any one else who wanted it - apart from the people of Britain. How can you possibly defend a party leader who refused us a referendum on the so-called "treaty".

Troll off!

Richard said...

Steve Horgan

The fact that the UK adopted the Basel II accord via a series of EU directives, and not through domestic legislation, proves my point. Banking (and financial services) regulation is an "occupied field". Member states have no legislative competence in this area.

Further, the EU directives included adaptations to the Basel 2 accord - see here - before which the EU had its own measures, namely the Solvency Ratio Directive of 1989 and the Codified Banking Directive of 2000.

Thus, the sector has been "occupied" for some considerable time, stretching back to the previous Conservative administration which as I recall, was enthusiastic about the programme, it being part of "completing the Single Market".

There is no "plot" here. The EU has been and is very open about its plans for integrating the banking system. The plot, such as it is, is with the current Conservative Party which seems unable to deal with the fact that powers in vital areas have been "delegated" to Brussels.

Steve Horgan said...

'Banking (and financial services) regulation is an "occupied field". Member states have no legislative competence in this area.'

Nonsense; if this were true please explain why a bill on banking regulation is due to be presented to the House by the government in November in response to the current crisis? The answer, by the way is that banking regulation with the two significant exceptions of the worldwide standards in banking capital adequacy and some of the operational processes of cross-border financial markets are a matter for national regulation.

If you are concerned about the encroachment of the EU into our nation's governance then you do your cause no favours by basically making stuff up.

Richard said...

Sigh!

Not having "legislative competence" does not mean we cannot legislate. The term means that the member states cannot initiate legislation on their own account.

The member state governments have to legislate in order to implement EU directives and any other instruments that do not have direct effect.

This can be by primary legislation or secondary legislation (SIs).

The member states must also pass minor and consequential legislation in pursuance of general treaty obligations which enable the implementation and enforcement of EU law - including administrative provisions, the collection of information and the setting of penalties.

If you look at the outline for the Banking Reform Bill you will find that it is a very slight Bill, with much of the detail encompassing "minor and consequential issues, which facilitate or enable the implementation or enforcement of law, or improve information collection. That the UK can do, in consulation with and with the permission of the commission.

Other aspects, you will find are implementing the latest round of directives to come through the system. See here.

And before you feel tempted again to dismiss what I write as "nonsense", will you please do me the courtesy of doing your own homework.

You could start with this.

Steve Horgan said...

Having been in banking for over 20 years, I'll pass on he 'homework' and instead rely on knowing what I am talking about.

Let us dissect the tactics here, because they are pretty much standard:

1. Labour government screws up.
2. Conservatives criticise Labour.
3. Supposedly eurosceptic individual claims that nothing can be done because it is all the fault of the EU. Suggests that it is actually all the fault of the Conservatives for being insufficiently eurosceptic.
4. When challenged posts links to dense primary documents without any analysis and suggests that the challenger do all the research.
5. Focus shifts away from Labour incompetence.
6. Derek Draper smiles.

So, Richard, if your position is that the EU is in control of Banking regulation, please prove it, don't ask me to prove you wrong. In particular, why don't you demonstrate that the origin of every aspect of the forthcoming regulatory instrument is based on an EU directive that is itself based on EU, not wider international, policy. If you can't, and you can't, then you will have shown that most banking regulation, including nearly everything that affects the consumer, originates in Westminster. Which makes the current breakdown Labour's fault, because they happen to be the government.

Richard said...

This must be the most interesting case of this condition that I have met. Fascinating – explains a great deal.