Aifa chairman John Gummer has called on Hector Sants to improve the FSA’s relationship with Europe and learn lessons from the European Union to create more sensible regulations.
Speaking at the Aifa dinner last night, Gummer said the priority for the new FSA chief executive was understanding the UK’s position within the EU and showing a regulatory attitude that is “more effective, less gold-plated”.
The Tory MP told members the fact the Insurance Mediation Directive was originally five pages but in the UK was implemented in an 800 page document shows the difference between “sensible regulation and gold-plated British bureaucratic regulation”.
He warned Sants against doubling up on European regulation through trying to address issues that Europe is already investigating, or planning to look into.
He said very often regulation becomes “regulation just for itself” and the industry needed to ask itself what regulation had delivered over the years.
Gummer called for a three year independent review of the FSA’s Treating Customers Fairly initiative to assess its strengths and weaknesses.
He said the FSA must ensure the statute of limitations is applied for advisers and called on the FSA to work with the trade body’s stakes in the ground initiative.
He also called for a proper reform of the current disclosure requirements to ensure they benefit the consumer.
He praised the FSA for its recent Financial Services Compensation Scheme announcement saying it shows “a regulator we can do business with and who we can trust”.
He said the moment Aifa will disagree with FSA policies is when they are part of a politically correct regulatory agenda, rather than being in the interests of the customer.
He said Sants’ speech at the dinner shows the FSA seems to be concentrating on customer interests and he has high hopes the relationship between Aifa and the FSA will be “immeasurably enhanced” by the changing attitude he has felt from the regulator for the last 18 months.
He said: “This is an industry respected throughout the Country for providing good advice properly presented with real warnings of the downside and a sensible assessment of the advantages. That is what we want and we must not allow anything to come between the two of us achieving that aim.”