Incoming financial markets commissioner Jonathan Hill has been called back to the European Parliament for a second hearing, in an unprecedented move and a potential blow to the UK government’s nominee.
Hill, who endured a three-hour hearing yesterday in front of the European Parliament’s Economic and Monetary Affairs Committee (ECON), was criticised by MEPs for not providing enough detail in his answers.
As a result, the UK Conservative Party peer will return to face the committee for another grilling.
The Socialist and Democrat Party confirmed Hill would have to return and said while the party believed he could be a good commissioner, he was not convincing over the “content and priorities” of his portfolio.
“He failed to provide concrete answers on specific issues such as the capital markets union, shadow banking or the European deposit guarantee scheme, which is the last remaining component of the banking union. These issues are of the utmost importance for the Socialists and Democrats.
“We will ask him to provide clarifications during an exchange of views with members of the economic and monetary affairs in the European Parliament.”
German MEP Sven Giegold, a member of the Green Party, tweeted yesterday evening saying Hill would be invited to a new exchange with MEPs.
In German, the MEP said Hill had received “nachsitzen”, the German word for school detention.
During his confirmation, Dutch and UK parliamentarians urged Hill not to let the revised IORP Directive “become the next Solvency II”.
The British commissioner-designate was repeatedly challenged over his links to the financial lobby and asked to clarify his view on regulation and how it could be perceived as hindering growth.
Hill – handed the prestigious financial stability, financial services and capital markets union brief by European Commission president Jean-Claude Juncker – repeatedly stressed the need for transparency and said he would follow the example set by outgoing internal markets commissioner Michel Barnier in disclosing his meetings.
Fielding a question by Giegold, who had previously criticised Hill’s nomination due to his past links to the financial services lobby, Hill insisted he was not a “representative of the City of London”.
One parliamentarian from the UK later challenged Hill to guarantee the revised IORP Directive would not “become the next Solvency II”, while a Dutch MEP said her countrymen needed reassurance their pension system would not be subject to “far-reaching harmonisation” stemming from a belief that ‘one size fits all’ regulation should be applied to the financial industry.
Hill said he believed the Commission was “taking a different approach” as far as IORPs were concerned, and was “very conscious” on the work needed to devise solutions that worked “in the interest of the greatest number of players”.
On the matter of sustainability, a brief now handed to Justice commissioner-designate Vĕra Jourová, Hill nonetheless said that if companies were not acting in the long-term interests of shareholders “you end up with problems”.
Other lawmakers voiced concerns that Hill’s remit to promote growth and investment would come at the expense of regulation.
The former leader of the UK’s House of Lords, the country’s upper chamber, assured MEPs there would not be a “mindless bonfire of everything” and said it was a “false dichotomy” to see it as a matter of growth versus regulation.
However, he insisted part of his role would be to identity any obstacles “standing in the way of the free flow of capital”, a matter that would be addressed through the proposed creation of the Capital Markets Union.
The proposal for a more unified capital market, one of Juncker’s core pledges, has yet to be fleshed out, with Hill saying he did not yet have a “grand vision”, just weeks after his appointment.
But he acknowledged it was a “project for all 28 [member states]”.
The commissioner-designate did stand by Juncker’s proposed timeline for the launch of the union, by 2019, and said elements of it would be in place much sooner.
He also said the European Long-Term Investment Fund (ELTIF) could potentially allow the Commission to incentivise investments in projects tackling climate change.