§ 7. Mr. DoranTo ask the Secretary of State for Trade and Industry when he next plans to meet the chairman of the stock exchange; and what will be discussed.
§ Mr. RidleyMinisters meet the chairman of the stock exchange whenever appropriate to discuss topics of mutual interest.
§ Mr. DoranWhen the Secretary of State next meets the chairman of the stock exchange, will he discuss with him fraud and investor protection in the City? As we move 1413 towards 1992, with the present high levels of fraud and lack of investor protection in the City, is not business likely to flow from Britain rather than to come here?
§ Mr. RidleyI do not accept what the hon. Gentleman says. The Government have put in place four specific measures to provide a strong legislative framework to regulate the activities of the City. The previous legislation was woefully inadequate. Furthermore, my right hon. Friend the Chancellor of the Exchequer has abolished stamp duty on share dealing, which will help to make London remain the centre of European financial activity, and I am confident that it will.
§ Mr. HanleyWill my right hon. Friend remind the Labour party that this Government introduced a criminal offence for insider dealing and for trading in investment business without a licence? It ill-befits the Labour party to complain about our form of regulation. Will my right hon. Friend also confirm his confidence in self-regulation as a principle in the City?
§ Mr. RidleyI have never understood why the Labour Government of 1974 did not proceed with the previous Government's plans to put in place legislation on insider dealing and other matters and why, during all their six-year tenure, they passed no legislation to deal with that problem. My hon. Friend is absolutely right to point to that grievous omission. I also agree with my hon. Friend's latter remarks.
§ Rev. Martin SmythWhile welcoming the tightening up in the City, may I ask the Secretary of State to agree that there may be a need for a revision of the guidelines for the futures and options markets for the protection of investors?
§ Mr. RidleyIt will be for the Securities and Investments Board to consider whether changes are needed. With the system of self-regulation that we have in place, it is for practitioners, guided by the SIB, which has authority, to decide how best to ensure that regulation is of the highest standard but at the lowest possible cost.
§ Mr. Charles WardleWhen my right hon. Friend next meets the chairman of the stock exchange, will he ask what lessons could have been learnt from the ombudsman's report on Barlow Clowes? Will he ask him whether the class 1 circular issued upon the reverse takeover of Barlow Clowes by James Ferguson (Holdings) plc in April 1987 should have contained more information about the trading relationship between Barlow Clowes and Barlow Clowes International?
§ Mr. RidleyAll that I can say is that I will draw my hon. Friend's comments and questions to the attention of the chairman of the stock exchange. It is not for me to reopen those questions, as the Financial Services Act 1986 has transferred the responsibility elsewhere.