ABI sceptical on timetable
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The Association of British Insurers has questioned whether the proposed timetable for implementing the new regulatory structure is achievable, saying it is “ambitious” in the face of on-going initiatives such as the RDR.
Chancellor George Osborne said last June the FSA would be scrapped in favour of the Prudential Regulation Authority and the Financial Conduct Authority, with the process completed in 2012.
In March, FSA chief executive Hector Sants said the regulator will formally move to the new structure by the end of 2012 or early 2013.
The latest Treasury consultation on the new regulatory framework was published in February and closed last week.
In its response, the ABI says: “The proposed timetable for implementing these reforms is very ambitious. The Government should bear in mind that the financial sector is at the same time facing other substantial regulatory developments, for example, RDR and Solvency II.”
It says firms and regulators are already stretched through having to deal with these initiatives and have limited capacity. It says: “We believe there is a need for a period of stability for firms and regulators to embed the changes already announced and so think that in developing the new regulatory structures, the Government should make the minimum changes necessary to the existing requirements.”
The ABI’s comments are backed by a survey carried out among members of the Chartered Insurance Institute. The findings, published in the CII’s response, show that out of 1,984 members, 61 per cent do not believe the timeframe for transition will be sufficient.
Evolve Financial Planning director Jason Witcombe says: “We need to make sure we do not bite off more than we can chew. All regulatory changes are designed for the greater good but we cannot be expected to do everything at once.”
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