My Lords, it is a pleasure to follow the noble Lord, Lord Holmes of Richmond. He is, without a doubt, the House’s expert, and indeed enthusiast, on all these issues. In this large group of amendments, he has covered a broad range of issues of what is a huge area of the future of finance. He and I might differ somewhat in our balance between enthusiasm and concern about the risks, but it is really important that we are able to debate this. It is disappointing, however, to see the very small number of participants on this group, which brings up an issue that I will raise later, about the capacity of this Committee of your Lordships’ House to fulfil the role laid on us to scrutinise such large, complex, new and fast-moving areas.
Given the pressure of time, I will restrict myself to commenting on three amendments in this group. I start with Amendment 112, to which the noble Baroness, Lady McIntosh of Pickering, has also added her name. It calls for an artificial intelligence officer in companies—someone such as, I should imagine, a chief financial officer. I did a master’s thesis partly on artificial intelligence 20 years ago; I was then and remain an AI sceptic. After 20 years, we seem to be at the same point that we were then, which is “We are about to get to AI really soon, now, yes, it’s going to work”. In those 20 years, however, there has been massive progress in what is known in shorthand as “big data”, or the ability to crunch truly astonishing quantities of data and to manipulate and use it. So I suggest to the noble Lord, Lord Holmes, that perhaps what is needed is some kind of title or combination of roles that takes in both data and AI together.
On Amendment 118, the ethical use of artificial intelligence, the noble Lord has already covered this quite well, but it is important to stress that, in recent years, we have seen huge exposure of the difficulties of a sector that is profoundly unrepresentative of people whose lives it increasingly impacts. The noble Lord gave the example of soap dispensers which, in these days of Covid-19, is a potential matter of life and death; but we also need to think about access to your finances and being able to manage your finances, and even simply being able to manage them without having to take vastly more time and effort than some other person just because the AI mechanisms are discriminatory. These are all issues that need to be engaged with. I note, for example, that some of the events that have been happening recently at Google do not fill one with confidence about the ways in which the culture of the entire artificial intelligence community is moving—certainly in some areas.
I will comment finally on Amendment 119, about digital resilience. This is one of the most important factors of all. We increasingly hear talk of the internet of things, and of tying together the internet of things and fintech. I think particularly of the recent opening of a store in which there are no checkout people and no scanning and where lots of cameras watch and monitor everything that happens in that store and then a bill appears in your email later. This relates to an earlier group and our discussion on the nature of work and good work, but it also relates very much to the issues of discrimination and resilience.
I was in Lancaster a few years ago, after it had suffered an enormous flood. For several days, the city was without power and it was clear that things very nearly fell apart, due in large part to our reliance already on technology and fintech—that was how people paid for things. We need to think hard about issues of resilience in our age of shocks and how we build systems that will not be at risk of profoundly falling apart—not just the cash machines falling apart, but an inability to even obtain food.
I also need to mention the issues around bitcoin and other digital currencies. There are huge and growing concerns about their environmental impacts and indeed the sustainability of those impacts. Bitcoin and other such currencies are extremely energy-hungry by design.
A single bitcoin transaction uses 707 kilowatt hours of electricity, which is the equivalent of 24 days of use by a single average US household. On an annual basis, were bitcoin alone to be a country, it would be 39th in the world in its energy consumption. These are massive changes that need to be considered in the round—the kind of triple accounting that the noble Baroness, Lady Kramer, talked about before. They are issues that deserve far more time and focus than we can give them today, but they really do need to be tackled.
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