Scottish and Northern Ireland Banknote Regulations 2009

My Lords, perhaps I may come in quickly, having experienced this amazing note of humility from an Ayrshire man. In backing up my noble friend’s concern about costs, I want to make a very simple point, which may have an explanation. The Explanatory Memorandum says that if a bank goes bust, its notes will be redeemed by the Bank of England at no cost. However, if a worthless piece of paper is replaced by a note issued by the Bank of England, how can that be said to be at no cost? It seems to me that the Bank of England will have to pick up the tab for reimbursing people who hold those other notes.