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.”