My Lords, I noticed that when the Bank of England consulted on this scheme it received only three responses. That highly recommends that I be brief in my response. Obviously, we as a party very much value the independence of the Bank of England. I am reminded that Vince Cable spoke of it
in his maiden speech in 1997, so we have a long history of wanting to see that independence firm and strong. Obviously, that means that the Bank of England needs the required resources to be able to function.
That is provided for under this statutory instrument, which permits both increases in the amount and indexation, which means that the amount can be reset according to shifts in the gilts on a six-monthly basis. That presumably reduces both volatility and risk to the Bank. The amount of money we are talking about is not particularly large. In most banking institutions it is somewhere lost well to the right-hand side of the decimal point.
As one of those who made the effort to respond noted, there is no assurance in any of the paperwork that we have seen that this is genuinely value for money and that the Bank has looked carefully at its expenditure. There appears to be no particular accountability for the way the money is spent. Will the Minister comment on that?
This also gives me the opportunity to raise a second level. Most of us here would agree that we are not really ready to see banks being let off the hook in terms of their contribution to the public purse. One could call this deposit scheme, in a strange way, a version of a hypothecated tax since it is a mechanism for providing funding to the Bank of England. I wonder whether the Government could provide clarity on their policy, because they are cutting the bank levy—a very significant amount of money—and raising this. Is there any relationship between the two? I hope that the Government will never pray in aid this particular increase as an argument that they are continuing to be tough on the banks.
I will make one last comment. This is exactly the kind of measure that should be dealt with through statutory instruments. It is exemplary. It is a relatively technical issue and relatively non-controversial. I hope that the Government will take on board that this is the kind of purpose for statutory instruments. They are not a mechanism for driving through policy, which we have seen in so many other areas.