Banking Bill battle

It's a score-draw in the first leg of the report stage of the Banking Bill - with the government fending off one change it really didn't like and suffering defeat on another.

In both cases the votes were close; the government won by nine on the issue of powers to separate "utility" and "casino" banking, and lost by five on proposals for tougher professional standards for bankers.

And I expect pretty similar results as the report stage continues today, with peers to debate amendments on the rules for bonuses - the government having already offered a considerable concession on another important issue, who sets the "leverage ratios" which govern how much a bank can led on the basis of its assets.

Which brings me to one of the key points about all this.

Much of the action is taking place below the radar, as ministers seek to agree compromises with peers, particularly those who've served on the Parliamentary Commission on Banking Standards.

In some cases this will mean more amendments being bought forward at the next stage of consideration, third reading, in the new year.

At least that gives peers the chance of some festive fun, studying what will doubtless be complicated and highly technical amendments over the holiday.

Meanwhile, a quick scan of the division list for Tuesday reveals a couple of key factors.

First of all there was no Lib Dem rebellion against the government line - Independent Lib Dem Lady Tonge who's lost the party whip, was the only one to go off piste.

The votes were won and lost mostly on the turnout of crossbenchers and peers from smaller parties, or with no party affiliation (this usually means quangocrats who've given up their party ties to hold down official jobs of one kind or another).

So in the government victory over "separation" powers, the vote against ministers was bolstered by 40 Crossbenchers, three non-affiliated peers, one from Plaid Cymru, one Independent Labour (Lord Stoddart of Swindon), Lady Tonge, the independent Lord Alton and the DUP's Lord Browne of Belmont.

Notable non-voters were three commissioners, Lord Lawson, Lord Turnbull and Archbishop Justin Welby, who may have been placated by a skilful speech from the Treasury Minister, Lord Deighton, who offered them the prospect that an independent review of the operation of "ring fencing" between the two branches of banking could consider ordering total separation.

The Archbishop did vote in the government defeat, but Lords Lawson and Turnbull did not… Lord Lawson seemed content with compromises offered by the government, or at least content enough to await further amendments at third reading.

But the key to the government defeat seems to have been a few more crossbenchers turning out. The likes of Lord Armstrong, the former cabinet secretary, Lord Dannat and Lord Walpole appeared in the aye lobby for this vote.

This, incidentally, was the 82nd government defeat since 2010 and the formation of the coalition, and ministers will have to decide whether they want to try and reverse it when the bill returns to the Commons, next year.

The majority is narrow, and they could normally expect some peers to back off; but battling for looser regulation of bankers is not an obviously popular position, and they could take a political hit.

And there may be more such dilemmas ahead.

Wednesday's vote(s) on remuneration issues could go either way.

There is clearly no automatic read-across between the various issues being fought out, and peers who disagree with the government on, say, leverage rations, do not automatically do so on controlling bonuses.

The commission's wrung substantial concessions out of ministers, and so far, in the battle of the whips between Labour's wily Steve Bassam and the quietly effective Lib Dem, Lord Newby, it's honours even.

*In my preview of the week's parliamentary business I mentioned the Lib Dem Lord Carlile of Berriew would be seeking to block the Criminal Defence Service (Very High Cost Cases) (Funding) Order 2013 and the Criminal Legal Aid (Remuneration) (Amendment) Regulations 2013 on Wednesday 27th. That debate has now been postponed to Wednesday December 11.