I would be happy to seek solutions for those mortgage holders of active and inactive lenders, but my hon. Friend must recognise that different individuals have different characteristics: different loan-to-valuation ratios; different credit histories; different income flows; and different histories in their financial situation. Those characteristics cannot be factored out. None the less, I am absolutely committed to this issue and it is in that spirit that I announce today that the Treasury will work with the FCA—that means work with it on a review to its existing data on mortgage prisoners—to ensure that we have further detail on the characteristics of those borrowers who have mortgages with inactive firms and are unable to switch despite being up to date with their mortgage payments.
The FCA will also review the effect of its recent interventions to remove regulatory barriers to switching for mortgage prisoners and will report on this by the end of November, and I will lay a copy of that review before Parliament. I know that my hon. Friend the Member for Thirsk and Malton, who has done so much excellent work in this area and who champions the cause of mortgage prisoners, may wish to bring proposals sooner than that, and, of course, I have always made myself available to Members across the House to look constructively at any solution that has merit.
The Treasury will use the results of the review that I have set out to establish whether further solutions can be found for such borrowers that are practical and proportionate. Recognising the significant constraints that I have noted, I assure the House and the other place that the Government will continue urgently to seek any further solutions that may provide support to borrowers with inactive lenders who are unable to switch, but, as I have said, those solutions must be practical and proportionate.
In addition, I am grateful to the active lenders who have come forward to offer options to these borrowers. I am also committing today to write to active lenders to urge them and the wider industry to go even further and look at what more they can do to ensure that as many borrowers as possible benefit from these options.
I hope that I have convinced the House that this amendment, in this form, is not the right solution to such a complex issue. I also hope that I have demonstrated my personal commitment, and the Government’s commitment, to continuing to seek sensible and workable solutions.
7.30 pm
I turn to two Lords amendments, tabled by Lord Holmes of Richmond, that the Government were pleased to support. Lords amendments 9 and 13 introduce an exemption for cashback without a purchase so that it will no longer be a regulated payment service. This means that it will be brought into line with the regulatory treatment of cashback with a purchase. This removes a significant burden for firms that want to offer this service. Where the service is offered, a local business, such as a corner shop, café or pub, will be able to provide cash to a customer without their having to make an accompanying purchase. This change will take effect two months after Royal Assent. I am very happy to take this opportunity to deliver this change through the Bill—a change that has become possible only as a result of leaving the EU.
However, Lords amendments 9 and 13 are only one of the steps required to protect access to cash and ensure that cash infrastructure is available long term for the millions of people across this country for whom this access remains important every day. The Government are committed to legislating and will continue our work on this important issue.
I turn to the remainder of the Lords amendments, which were tabled by the Government. Members of this House will recall my commitment in Committee to act quickly following the publication of the Woolard review, to enable “buy now, pay later” products to be brought into the scope of regulation if that was what the review recommended. That review has now concluded, so Lords amendment 6 provides the necessary powers to bring “buy now, pay later” products into Financial Conduct Authority regulation in a proportionate manner. As I said, this was discussed extensively during our earlier consideration of the Bill, and I hope that the hon. Member for Walthamstow (Stella Creasy) will be pleased to see that the Government are acting.
The role of the financial services sector in tackling climate change was the subject of significant and passionate debate in both Houses. As I have detailed previously, the Government and regulators are both committed to ensuring that the sector plays its part. Lords amendments 16, 17, 18 and 19 require the Prudential Regulation Authority and the FCA to consider the 2050 carbon target in relation to the Climate Change Act 2008 when making prudential rules under the accountability framework set out in the Bill. The Lords amendments also delay this application of mandatory climate change considerations to 1 January 2022 to avoid any delay in implementing these vital prudential regimes. Lords amendment 7 makes a minor change to the market abuse regulation to ensure that personal data collected for the purposes this regulation can be retained for longer than five years, where appropriate. Without this action, the FCA would have had to begin deleting vital data from July this year, posing risks to the ability of the FCA to investigate and prosecute complex cases of market abuse. The GDPR’s protections for personal data will still apply.
Lords amendments 2 to 5, 10 to 12, 14, 15, 20 and 21 remove Northern Ireland from the scope of the relevant parts of clause 34 and schedule 12, and make changes to clauses 44 and 45 to help give effect to this. During the passage of the Bill, it became clear that, despite the best efforts of Ministers and officials from the Treasury and the Northern Ireland Executive, legislative consent motions for the relevant parts of this Bill would not be completed in time. Therefore, in line with the Sewel convention, the Government tabled these Lords amendments to ensure that the Government are not legislating for Northern Ireland without its consent. I am grateful to the Lords for the improvements made to the Bill but hope that this House will approve the Government’s motions in relation to Lords amendments 1 and 8.