A Labour spokesperson responded to your questions to the Party.
Q1. ‘Given that all three parties are preaching ‘tough love’ in terms of increased taxation for banker bonuses, and increased regulation for the City, what incentive is there for bankers to vote for you ?’
Response: ‘Over 1 million people work in financial services, most of them outside London, and the vast majority do not enjoy the high bonuses paid to comparatively few in certain jobs in the City of London. It’s important for these employees, as for the rest of the UK electorate, that the rules governing banks are changed to ensure we do not face a repeat of this crisis. Its important because this will increase job security within the sector and avoid a repeat of the hard choices now facing our country as we reduce the fiscal deficit.
This crisis did not happen because banks were over regulated – rather the opposite. New Labour has a credible plan to reduce the deficit and fix the banking system to avoid future crises, but a plan that also seeks to protect the competitiveness of the City by refusing to act unilaterally on a global bank levy’.
Q2. ‘EC legislation already accounts for a substantial amount of law passing through the UK parliament. What are your proposals to ensure that your government wouldn’t merely serve as a rubber stamp for the EU ?’
Response: ‘European legislation is developed over many months through a series of negotiations, consultations and drafting that involves the governments of the EU member states at each stage. The key to protecting the UK interests is to be able to negotiate effectively with its partners, the Commission and increasingly the European Parliament. New Labour has been able to effectively protect British interests in the case of Solvency 2 and the AIFM Directive as they have proceeded through this process because partners respect its commitment to the EU and we are aligned with a broad grouping within the European Parliament’.
Q3. ‘How to you intend to protect the City’s position as a main financial centre for hedge funds, given the EU’s proposals for regulation that many feel will result in the industry relocating outside Europe ?’
Response: ‘The UK Government is committed to ensure that the AIFM directive protects the single market for hedge funds and permits funds which comply with UK regulations to trade throughout Europe and will continue to negotiate to protect these rights as the AIFM Directive is finalised in June. However, it is right that there should be closer regulation of hedge funds in future to avoid the risk of regulatory arbitrage. as we make banks safer, we do not want risky activities that put the taxpayer ultimately at risk transferring unseen to hedge funds . The recent credit crunch was in part caused by the development of conduits which banks used to circumvent capital adequacy rules. Better regulation of hedge funds will prevent a similar arbitrage happening in future’.