Why we should not trust the Lords on Robin Hood

02.04.2012

The UK's House of Lords has recently published a report saying that the financial transaction tax proposed by the European Commission is flawed, yet, as CEO's report on the lobbying around the tax revealed, many of the peers involved in the report have been identified as having conflicts of interest, so questions should be raised about their neutrality.

According to the members' declarations of interests, Lord Flight, for example, holds many positions linked to the financial industry: chairman at Flight & Partners Limited (manager, private equity fund), director of Investec Asset Management Limited (investment manager), director of Metro Bank (retail bank) and chairman of Arden Partners (stockbroker), among others.

Another of the committee's members, Lord Hamilton, is the director of Jupiter Dividend and Growth Trust and of IREF Property fund, while Lord Haskings declares having various personal interests in equities and bonds. Lord Kerr of Kinlochard holds at least four high level positions linked to the industry, including as director of the Scottish American Investment Company, and Lord Vallance of Tummel is a member of Siemens' supervisory board and of Allianz SE's advisory board.

Taking all this into consideration, it is not surprising that the report written by the House of Lords committee seems to echo the arguments brandished by the financial industry, which were major contributors to the committee's consultation on the issue.

The House of Lords EU Sub-Committee on Financial and Economic Affairs says in its report that the proposal for a financial transaction tax (FTT) in the EU should not be supported by the Government. It says it places the City of London under severe threat and is likely to force financial institutions to relocate away from the UK and the EU as a whole.

These are the exact same ideas that the financial lobby has been using in its scaremongering strategy to oppose the tax, as Corporate Europe Observatory showed in “Lobbying to kill Robin Hood”. If the financial lobby manages to make the financial transaction tax finish in the dustbin, it will be a lost opportunity to make a real change in order to curb speculation and regulate a dangerously deregulated financial sector which led the EU to its current crisis.