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Debate raises concern at FSA’s accountability

MPs have criticised the FSA’s lack of accountability when making financial regulation.

The frustration was a recurring theme during the Parliamentary debate on the impact of the retail distribution review.

Treasury select committee member and Labour MP George Mudie said it is “very worrying” that decisions like the implementation of the RDR can be taken by regulators without recourse to Parliament.

He said: “In our humility, or generosity, we are passing so much power to the regulators on matters we will be accountable for.”

Conservative MP Harriett Baldwin said she believes the debate was the first time the FSA has been subject to Parliamentary scrutiny over its regulation.

Labour’s Shadow Treasury minister Christopher Leslie said there is a “democratic deficit” on financial services policy.

Conservative Neil Carmichael said: “Is it not time for us to recognise that the FSA ought to held accountable, just as other quangos are?”

Treasury financial secretary Mark Hoban said MPs should think carefully before calling for further accountability.

He said: “It might be very attractive in the context of this debate for Parliament to take more responsibility but honourable members might feel it less appropriate at other times.”

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. The FSA is fully accountable to Her Majesty’s Treasury so Harriet Baldwin should ask if she can rummage about in the files at their respective policy units.

    All failures can be traced there.

  2. “All power tends to corrupt and absolute power corrupts absolutely.”

    In a nutshell this famous quote sums up why the FSA has taken the Stalinist approach it has to devising and implementing the RDR.

    But, to be fair, the FSA didn’t create itself, Parliament did. And to quote a famous judge “Be you ever so high, the law is above you”.

    So to those IFAS who yearn to see this dictum applied to the FSA make sure you get your evidenced-based submissions in to the TSC by the 17th January deadline.

    To find out exactly how to do it, go to the link below

    http://www.parliament.uk/business/committees/committees-a-z/commons-select/treasury-committee/news/call-for-written-evidence-on-rdr/

  3. The FSA is supposed to be accountable under the Statutory Code of Practice For Regulators. The problem lies in the total lack of any structure to enforce compliance with that code. As a result, the FSA simply ignores it.

    AIFA ~ why aren’t you doing anything about it?

  4. For FSA read Treasury
    For Treasury read tax
    For RDR read fees
    For fees read 20% VAT

  5. Under Miscelaneous under the FSMA 2000 it says”

    Exemption from liability in damages

    19(1)Neither the Authority nor any person who is, or is acting as, a member, officer or member of staff of the Authority is to be liable in damages for anything done or omitted in the discharge, or purported discharge, of the Authority’s functions..”

    SO THERE IS NO ACCOUNTABILITY AT THE FSA.

    For everyone else they have to be accountable.

    That is not good regulation of any kind and has to change

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