Connect with us

News

UK Treasury under fire for lack of progress on post-Brexit financial reforms

Published

on

UK Treasury under fire for lack of progress on post-Brexit financial reforms

Stay informed with free updates

The government has exaggerated progress on its plan to reinvigorate the City of London, the chair of the Commons Treasury select committee said, as she called on the ministers to speed up delivery of the so-called Edinburgh reforms.

But City minister Bim Afolami rejected the criticism of the pace of implementing the policies and vowed to do everything in his power to deliver them in full before the next general election.

Last December, ministers unveiled a 31-point plan to boost the UK’s financial services sector in the wake of Brexit, as part of an initiative initially billed as Big Bang II.

Advertisement

Harriett Baldwin, head of the Treasury select committee which scrutinises the expenditure and policy of the department, told the Financial Times the package of reforms had not proved as “major as had been presented” and that headway had been slow.

She made the comments ahead of the release on Friday of a report by the committee into the government’s progress on delivering the full suite of the Edinburgh reforms.

While the government has repealed controversial rules to cap bankers’ bonuses, the reforms have failed to stem an exodus of companies from the London Stock Exchange. Most recently, Tui, Europe’s largest tour operator was considering delisting in the latest blow to the UK market.

Baldwin, Conservative MP for West Worcestershire and a former economic secretary to the Treasury, said six of the “achievements” claimed by the government were for things that had not yet been completed.

Another six related to pledges such as launching consultations rather than implementing reforms.

Advertisement

“We gave them [the Treasury] slightly lower marks than perhaps the chancellor marked himself in [an assessment] in September,” Baldwin said, referring to the committee’s findings.

“The overall impression I think one gets . . . is there have been some measures that have been completed but quite a lot of them have not been legislated for or implemented yet.”

She added that she would advise new City minister Afolami “to be absolutely relentless in . . . completing the things that were set out”. 

Afolami in turn stressed his huge respect for Baldwin, adding: “What I would say is that . . . we’ve done 22 of the 31 things we have promised. All of these things take time to really come to fruition and, to be honest, I don’t apologise for that.”

The City minister and economic secretary to the Treasury said: “We’re not saying that all of these reforms are going to absolutely fix everything in one year, but that these provide a key foundation for the medium- and long-term success of the City of London.”

Advertisement

Asked if he expected to deliver the full package within the term of this government, which has to call an election by January 2025, Afolami said: “That’s what we’re working to do, we are absolutely trying to deliver these as quickly as we possibly can.” 

Baldwin said listings reform was an “important piece of work” amid continuing losses to London’s equities markets, a situation she described as “worrying”.

The government has taken action including overhauling prospectus regulation, consulting on scrapping short selling bans on government debt, and taking steps to repeal regulations on packaged retail and insurance based investment products, known as PRIIPS.

Baldwin called out proposals to reform the UK’s post-crisis personal accountability regime, saying the process was “slowing the progress and growth of the [financial] sector”. Regulators have launched a discussion paper on the topic while the government has issued a call for evidence.

Baldwin also called for clarity “one way or another” on what the government is planning to do with the ringfencing regime that forced the separation of large banks’ retail and trading arms after the financial crisis.

Advertisement

A call for evidence was launched in May and the government has promised a response in the first half of 2024.

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

News

Trial begins for Vietnamese property tycoon accused of $12bn fraud

Published

on

Trial begins for Vietnamese property tycoon accused of $12bn fraud

Unlock the Editor’s Digest for free

The fraud trial of a Vietnamese real estate tycoon who allegedly misappropriated $12bn started on Tuesday, as part of the country’s largest corruption case that has also ensnared officials from the central bank and government.

Truong My Lan faces a death sentence or imprisonment if found guilty in the graft case, which has rocked the property and corporate bond markets of one of the world’s fastest-growing economies.

The graft case is part of a corruption crackdown launched by Vietnam’s Communist party that has resulted in the arrests of hundreds of senior government officials, including cabinet ministers. Lan, developer Van Thinh Phat Group’s chair, is the most prominent businessperson to face graft allegations.

Advertisement

Vietnam has been one of the biggest beneficiaries of manufacturers seeking to diversify their supply chains beyond China as geopolitical tensions between Washington and Beijing rise. However, the Vietnamese economy grew 5.05 per cent in 2023, missing the government’s official target, as overseas demand slowed.

The anti-corruption campaign has slowed down project approvals by the government, and more state scrutiny of private businesses could hurt investor confidence, analysts said.

Lan, 67, comes from one of Vietnam’s richest families who made their fortune in property. She has been charged with bribery, embezzlement, abuse of power and “lack of responsibility causing serious consequences”, according to state media.

She has denied wrongdoing, state media reported. Lawyers for Lan, who was arrested in 2022, did not respond to a request for comment.

Lan is accused by Vietnamese authorities of using Saigon Joint Stock Commercial Bank (SCB), in which she owns a controlling stake of about 90 per cent, to funnel 304tn dong ($12.3bn) to her real estate company Van Thinh Phat.

Advertisement

Loans worth more than $44bn were given by SCB to Van Thinh Phat and related companies between 2012 and 2022, accounting for 93 per cent of the total loans disbursed by the bank.

Authorities also said Van Thinh Phat used allegedly fake companies to sell corporate bonds through SCB to the bank’s depositors.

In addition to Lan, 85 people — including 15 officials from Vietnam’s central bank — are charged in connection with the case. The central bank officials are accused of receiving bribes from Lan to cover up the alleged fraud.

“The trial is important in terms of scale and because it signals that the [Communist] party is willing to expand its anti-corruption campaign to the private sector despite potential risks that it might have on the economy,” said Nguyen Khac Giang, a visiting fellow at Singapore’s Iseas-Yusof Ishak Institute.

He said Lan’s corruption case had dented the confidence of some private businesses in Vietnam worried about the risks of operating in the country and the state companies they work with.

Advertisement

The anti-corruption campaign has also made government officials hesitant to approve projects, he added, out of fear that they could be implicated in graft.

Continue Reading

News

FAA audit faults Boeing for 'multiple instances' of quality control shortcomings

Published

on

FAA audit faults Boeing for 'multiple instances' of quality control shortcomings

Boeing workers at the Renton Municipal Airport in Washington finalize assembly of an Alaska Airlines Boeing 737 Max jet on Feb. 27. An FAA audit faulted Boeing for “multiple instances” of quality control shortcomings.

Jovelle Tamayo for NPR


hide caption

toggle caption

Advertisement

Jovelle Tamayo for NPR


Boeing workers at the Renton Municipal Airport in Washington finalize assembly of an Alaska Airlines Boeing 737 Max jet on Feb. 27. An FAA audit faulted Boeing for “multiple instances” of quality control shortcomings.

Jovelle Tamayo for NPR

WASHINGTON — After a six-week audit of Boeing, federal regulators say they found quality control problems at Boeing and Spirit AeroSystems, one of its top suppliers.

The Federal Aviation Administration says it found “multiple instances” of Boeing and Spirit failing to “comply with manufacturing quality control requirements.”

Advertisement

The FAA launched the audit of Boeing and Spirit AeroSystems, which builds the fuselage for the Boeing 737 Max, after a door plug panel blew out in midair during an Alaska Airlines flight on Jan. 5.

No one was seriously hurt when the plug came off as the new jet climbed through 14,000 feet after departing Portland, Ore. It returned to make an emergency landing as winds whipped through a hole in the fuselage.

A preliminary investigation by the National Transportation Safety Board determined that four key bolts that were supposed to hold the door plug in place were missing when the plane left Boeing’s factory.

The audit found problems in “Boeing’s manufacturing process control, parts handling and storage, and product control,” the FAA said in a statement.

The agency says FAA administrator Mike Whitaker discussed the findings with Boeing CEO Dave Calhoun last week, when the agency gave Boeing 90 days to come up with a plan of action to address its quality control problems.

Advertisement

The FAA says it provided both companies with a summary of the audit findings. But the agency declined to share those details with NPR, citing its ongoing investigation.

Auditors visited Boeing’s factory in Renton, Wash., and Spirit’s plant in Wichita, Kan.

Boeing confirmed Friday that it is in talks to buy Spirit AeroSystems.

“We believe that the reintegration of Boeing and Spirit AeroSystems’ manufacturing operations would further strengthen aviation safety, improve quality and serve the interests of our customers, employees, and shareholders,” said Jessica Kowal, Boeing’s director of media relations, in a statement.

That would be a change of strategy for Boeing, which nearly two decades ago sold off the assets that are now part of Spirit.

Advertisement

But the supplier has had several costly and embarrassing problems with quality control in recent years as it pushed to keep up with Boeing’s ambitious production schedule.

NPR’s Joel Rose reported from Washington, D.C., and Russell Lewis from Birmingham, Ala.

Continue Reading

News

Read the Decision in the Trump Colorado Ballot Case

Published

on

Read the Decision in the Trump Colorado Ballot Case

Cite as: 601 U. S.

Per Curiam

(2024)

5

a wide array of offices-rather than by granting rights to all. It is therefore necessary, as Chief Justice Chase concluded and the Colorado Supreme Court itself recognized, to “ascertain[] what particular individuals are embraced”” by the provision. App. to Pet. for Cert. 53a (quoting Griffin’s Case, 11 F. Cas. 7, 26 (No. 5,815) (CC Va. 1869) (Chase, Circuit Justice)). Chase went on to explain that “[t]o accomplish this ascertainment and ensure effective results, proceedings, evidence, decisions, and enforcements of decisions, more or less formal, are indispensable.” Id., at 26. For its part, the Colorado Supreme Court also concluded that there must be some kind of “determination” that Section 3 applies to a particular person “before the disqualification holds meaning.” App. to Pet. for Cert. 53a.

The Constitution empowers Congress to prescribe how those determinations should be made. The relevant provision is Section 5, which enables Congress, subject of course to judicial review, to pass “appropriate legislation” to “enforce” the Fourteenth Amendment. See City of Boerne v. Flores, 521 U. S. 507, 536 (1997). Or as Senator Howard put it at the time the Amendment was framed, Section 5 “casts upon Congress the responsibility of seeing to it, for the future, that all the sections of the amendment are carried out in good faith.” Cong. Globe, 39th Cong., 1st Sess., at 2768.

Congress’s Section 5 power is critical when it comes to Section 3. Indeed, during a debate on enforcement legislation less than a year after ratification, Sen. Trumbull noted that “notwithstanding [Section 3] … hundreds of men [were] holding office” in violation of its terms. Cong. Globe, 41st Cong., 1st Sess., at 626. The Constitution, Trumbull noted, “provide[d] no means for enforcing” the disqualification, necessitating a “bill to give effect to the fundamental law embraced in the Constitution.” Ibid. The enforcement mechanism Trumbull championed was later enacted as part of the Enforcement Act of 1870, “pursuant to the power

Continue Reading

Trending