It is a pleasure to serve under your chairmanship, Ms Clark. I am delighted to be here to support this excellent Bill. I congratulate my hon. Friend the Member for Cardiff North on securing and promoting the Bill and for securing a prompt date for the Committee stage of a life-changing Bill for the mutual sector. If this is his swansong—he is retiring from Parliament at the general election—he can be proud of his record of being so persistent in stressing the importance of this measure. I am delighted to support it and congratulate all hon. Members who were involved in ensuring the measure got parliamentary time and could be dealt with during this Parliament.

The Bill started in the other House, where it had wide cross-party support. I also congratulate my noble Friend Lord Naseby on his work to promote the merits of the Bill. The Government support the key aim of the Bill, which is to provide friendly societies and mutual insurers with a means to raise external capital in a way that does not impinge on their mutual status. As my hon. Friend and other Members will know it is a priority of the Government to promote more competition and choice in financial services. To have a healthy and thriving mutual sector is vital, to which the Bill makes a significant contribution.

We all know that access to capital and credit is the lifeblood of any company. Access to capital poses a specific issue for mutuals, as they were designed to serve their members and did not have capital investors in mind. Unlike other firms, mutuals cannot issue shares, which deprives them of access to the equity markets, and that means that in broad terms mutuals access their regulatory capital from retained earnings and by issuing subordinated debt. That long-term approach is often seen as a strength of the sector, but mutuals have long made the case that the restrictions on accessing external capital can act as a brake on the sector’s ability to adapt and respond to new market conditions.

The sector has also argued that that limits an individual firm’s ability both to secure maximum investment in the business to develop innovative products and to grow through acquisition. This enabling Bill would allow friendly societies and mutual insurers to issue a new class of deferred share. The Bill has two substantive clauses.

Clause 1 would allow HM Treasury to make regulations that would permit friendly societies and mutual insurers to issue new deferred shares. Clause 2 sets out the conditions that will preserve the mutual status of firms that wish to issue deferred shares.

Clause 3 sets out the definitions of terms used in the Bill and clause 4 contains the title, confirms that the Bill extends to the whole of the United Kingdom and will come into force when the Treasury makes the regulations provided for in clause 1.

In specific answer to the hon. Member for Kilmarnock and Loudoun’s question about when the legislation can be brought in, we are consulting the regulator and interested parties in drafting the regulations and are keen to progress the matter as soon as possible, while ensuring that we get the regulations right. Therefore, I cannot give her a specific answer other than to say it is an urgent priority. I can also confirm that the Bill raises no human rights issues.

The Government fully support the Bill. It is consistent with the commitment in the coalition’s programme to promote mutuals and to foster diversity in financial  services. It is a short Bill but one that can provide a big opportunity for the mutuals sector. I am delighted that all Members, as I understand it, intend to support the Bill.