The House of Lords, unlike the House of Commons, is still sitting and this afternoon Baroness Jan Royall, Leader of the Opposition, asked a Private Notice Question of the Leader of the House, Lord Strathclyde, about the position of the Trade Minister, Lord Green of Hurstpierpoint.

 

As the Daily Telegraph has pointed out, allegations that HSBC, while Lord Green was its Chairman, allowed money laundering on a huge scale to take place are now casting a cloud over his current role as a Trade Minister.  Their report says:

 

“The US Senate has launched a coruscating attack on HSBC for its slapdash approach to money-laundering regulations. The bank could face a $1 billion fine.

 

According to Senator Carl Levin, chairman of the US Senate Permanent Subcommittee on Investigations, “the culture at HSBC was pervasively polluted for a long time.” Just how polluted was revealed in the Senate report into the scandal. For example, between 2007 and 2008, HSBC’s Mexican operations moved $7bn into the bank’s US operations. According to the report, both Mexican and US authorities warned HSBC that the amount of money could only have reached such a level if it was tied to illegal narcotics proceeds.”

 

The Government’s answer boils down to saying that there is nothing that casts doubt on Lord Green’s integrity and that there is no reason that he should be held responsible for everything that the organisation of which he was chairman was doing.

 

However, what was he doing as Chairman of the Bank during this time? If the Bank were warned by both the Mexican and US authorities that transactions of $7 billion were tied to the illegal drugs trade, shouldn’t he have been told of the warnings.  If he wasn’t, why wasn’t he and what sort of system of corporate governance was he presiding over if it was not felt that such warnings should be conveyed to the Board? Is $7 billion too small a sum for him to worry about?  And if he was told, what did he do about it?

 

I tried unsuccessfully to get in and put a this question to the Leader of the House:

 

“How bad does the stench of money laundering have to be around its Trade Minister before it impacts on the reputation of the United Kingdom?  And why – if his integrity is as great as we are told it is – are they so reluctant to have him come to the House and dispel that stench by setting the record straight?”

 

The BBC captures the full exchange here and the Hansard test is as follows:

HSBC

Private Notice Question

3.07 pm

Tabled By

To ask Her Majesty’s Government what assessment they have made of the impact of the allegations about HSBC made by the Permanent Subcommittee on Investigations of the United States Senate Committee on Homeland Security and Governmental Affairs on the ability of Lord Green of Hurstpierpoint to fulfil his ministerial duties.

Baroness Royall of Blaisdon:My Lords, I beg leave to ask a Question of which I have given private notice.

The Chancellor of the Duchy of Lancaster (Lord Strathclyde):My Lords, Her Majesty’s Government have every confidence in my noble friend Lord Green’s ability to fulfil his ministerial duties. His experience, expertise and enthusiasm provide great benefit to the UK’s international profile and to the support that UK Trade and Investment provides to British businesses.

Baroness Royall of Blaisdon:My Lords, I am grateful to the Leader of the House for that Answer. However, as the noble Lord will be aware, questions have been asked about the present ministerial role of the noble Lord, Lord Green, following the US Senate committee’s findings.

Paragraph 1.2 of the Ministerial Code, which sets out the responsibility of Ministers to Parliament, says that:

“Ministers should be as open as possible with Parliament and the public, refusing to provide information only when disclosure would not be in the public interest”.

Given that obligation, will the Leader of the House ask the noble Lord, Lord Green of Hurstpierpoint, to come to your Lordships’ House to place on record what he knew and when about the matters investigated by the US Senate committee, including what steps he took to deal with them? Would such a move not give the noble Lord, Lord Green, the opportunity to dispel once and for all the questions being asked about his present ministerial role?

Lord Strathclyde:My Lords, I congratulate the Leader of the Opposition. I know that she has been trying to find a PNQ to put to the House and she has managed to do so. I am very glad to be able to respond on behalf of Her Majesty’s Government.

There is no urgency in this matter. The investigation started more than two years ago. The report in question was published two weeks ago. There was no evidence of personal wrongdoing of my noble friend; indeed, there was no personal criticism whatever of my noble friend. The investigation is ongoing. As for ministerial accountability, my noble friend Lord Green is accountable to this House—to Parliament—for the work he does as a Minister. However, many Ministers have had previous careers. No Minister needs to be accountable to Parliament for their previous career, only for what they are doing as a Minister.

Lord Butler of Brockwell:My Lords, I declare an interest as a non-executive director of HSBC during the time when the noble Lord, Lord Green, was chief executive officer and chairman. Is the Leader aware that when I was advising the Prime Minister on calls for ministerial resignations, I drew a distinction—which I think is widely accepted—between accountability and responsibility? While it may be the case that the chairman and chief executive officer of a major international company is accountable for everything that happens in that company, there is no possible way in which they can be responsible for everything that happens in a worldwide group of the size of HSBC.

Lord Strathclyde:My Lords, with all his experience and knowledge—not just as head of the Civil Service and Cabinet Secretary but having had a more commercial career since he left—the noble Lord, Lord Butler of Brockwell, has brought a lot of wisdom and good sense to this debate, on which we should all reflect.

Lord Kinnock:My Lords, since the Leader of the House has told us that the work of the noble Lord, Lord Green, is of benefit to the United Kingdom’s profile—the words he just used—does he think that the accountability of an individual in a very senior position in Government or business ceases when that individual changes post? Does he not think that it would benefit the UK’s profile to ensure that a Minister rigorously adheres to the wording of the Ministerial Code, as just spelt out by my noble friend? Further, does he not think that the ethics of business require that a Minister who has the opportunity and the right to come to this House to explain themselves should do so?

Lord Strathclyde:My Lords, I do not disagree at all with what the noble Lord says about the ethics of the industry in which my noble friend was involved. In fact, only last week, this House set up a special Joint Select Committee to look at ethics and many other practices in the banking industry. Surely that is the point. If a Select Committee of this House or another place wishes to ask my noble friend questions, it should do so. My purpose is to reflect on my noble friend’s role in government and to answer on behalf of Her Majesty’s Government.

Lord Cormack:My Lords, does my noble friend agree that anyone who knows the noble Lord, Lord Green, could not doubt his total integrity for a moment?

Lord Strathclyde:My Lords, I agree with that but I wholly accept that questions need to be asked—and are habitually asked—of a Minister to make sure that he is accountable to Parliament. As I said in my reply to the noble Lord, Lord Kinnock, if a committee of Parliament wishes to put questions to my noble friend, it is entirely free to do so.

Lord Grocott:My Lords, perhaps I can remind the Leader of the House of a report with which he will be, no doubt, almost word perfect: the report of the Leader’s Group on Working Practices, which made a number of recommendations. Of course, the group was established by the Leader for the Leader. Recommendation 3 of that report—which, I remind him again, was published more than a year ago in April last year—said:

“We … recommend that there should be a monthly question time dedicated to questions on House of Lords matters addressed to the Leader of the House”.

Perhaps I may helpfully suggest that both today’s Question and indeed the very important one raised last week by my noble friend Lord Barnett could be handled were the Leader to accept that simple, unanimous recommendation by a committee that was set up at his instigation. I urge him to act on that recommendation as soon as possible.

Lord Strathclyde:My Lords, from memory, I do not think that there has been a single Question put to me in my capacity as Leader of the House in the past 12 months. That rather leads me to believe that there is no great demand for a monthly Question Time session for the Leader. There are perfectly good methods for asking me questions and noble Lords should use them if they wish to.

Lord Hughes of Woodside:My Lords, from a rather different view, perhaps, I query what was said by the noble Lord, Lord Butler. Surely accountability and responsibility cannot simply be divided one from the other—it is not as sharp as that. Accountability and responsibility go hand in hand and no one should doubt it.

Lord Strathclyde:My Lords, my noble friend Lord Cormack said that no one should challenge the integrity of my noble friend Lord Green, and I agree with him. But if it comes to a choice between the noble Lord’s view of what is responsibility and accountability and that of the noble Lord, Lord Butler of Brockwell, I will go with the noble Lord, Lord Butler of Brockwell.

Baroness McIntosh of Hudnall:My Lords, I personally—along with most of the House, I feel—am in no position and would not wish to challenge the integrity of the noble Lord, Lord Green. However, does the Leader of the House agree that perhaps there would be less question about his conduct over the issue of HSBC were the House to see him more often answering questions that relate to his ministerial responsibilities? It may have something to do with his relative unfamiliarity to Members of the House that they are perhaps more sceptical than they should be.

Lord Strathclyde:My Lords, as a Minister for trade, my noble friend of course spends a great deal of time overseas. Since he was appointed, he has travelled to 42 countries and visited 73 cities. In his role as Minister of State for Trade and Investment, he has answered a total of 72 Parliamentary Questions, including two Oral Questions out of three that he could have answered. The response to the point raised by the noble Baroness is that if more Questions on trade and investment were put down, I am sure that my noble friend would be very happy to come and answer them.

Baroness Royall of Blaisdon:My Lords, I thank the noble Lord for his answers, but perhaps I may say that I found his initial response to my Question slightly patronising, albeit not in terms of the substance. I table PNQs when I believe that there is a matter of accountability which is of interest to this Parliament as a whole—we are the only House of Parliament sitting at the moment—and when I believe that it is of importance to this nation. I do not do so for personal gratification.

Lord Strathclyde:My Lords, if the noble Baroness felt that I was in any way seeking to patronise her, I apologise fully.

 

 

 

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