Dec 23 2009
John Redwood criticises Government response to Parliamentary Questions on the UK’s exposure to Dubai debt
John Redwood has criticised the quality of answers given by Treasury Minister Sarah McCarthy-Fry in response to his questions about the UK’s exposure to Dubai’s debt crisis. When asked if UK Financial Investments is seeking representation on the Dubai World creditors’ committee, the Government refused to answer. When asked the likely level Dubai debt held by Royal Bank of Scotland and Lloyds Banking Group, which are largely owned by the taxpayer or receive significant Government support, the Government refused to answer.
The Government did confirm that UK Financial Investments did not undertake currency cover in respect of the £170 billion of foreign currency loans covered by its underwriting for RBS.
John Redwood said: “The Government’s response is wholly unsatisfactory and tells us that not only are they not taking the debt crisis seriously, they have no idea as to the level of exposure. It was wrong of them to take a huge stake in the banks, only to then show such little interest in how they operate”.
The full text of John Redwood’s Parliamentary Questions, taken from Hansard, follows:
Mr. Redwood: To ask the Chancellor of the Exchequer whether UK Financial Investments is seeking representation on the Dubai World creditors’ committee. [307159]
Sarah McCarthy-Fry: In line with its Investment Mandate, agreed with Treasury, and the Institutional Shareholders’ Committee Statement of Principles, UKFI acts as an engaged and informed institutional shareholder for the banks in which Government have shareholdings.
Day to day management of the banks’ business is a matter for the banks’ boards.
Mr. Redwood: To ask the Chancellor of the Exchequer what estimate he has made of the likely level of financial exposure of the Royal Bank of Scotland and Lloyds Banking Group to Dubai World debt. [307157]
Sarah McCarthy-Fry: The Treasury is unable to disclose such information as it is commercially sensitive.
Mr. Redwood: To ask the Chancellor of the Exchequer whether (a) UK Financial Investments and (b) HM Treasury is undertaking currency cover in respect of the £170 billion of foreign currency loans covered by its underwriting for Royal Bank of Scotland. [307151]
Sarah McCarthy-Fry: United Kingdom Financial Investments does not have the remit to undertake currency cover in respect of foreign currency loans.
The Treasury does not normally buy insurance against risk.
John Redwood has been the Member of Parliament for Wokingham since 1987. First attending Kent College, Canterbury, he graduated from Magdalen College...
