Labour peer and draft Financial Services Bill committee member Baroness Drake says the new regulatory structure and its judgement-based approach is likely to deliver more effective regulation and clearer accountability.
The committee is due to publish its report this week on the Treasury’s proposals to replace the FSA with the Prudential Regulation Authority, the Financial Conduct Authority and the financial policy committee.
Speaking to Money Marketing in a personal capacity, Drake says she is happy with the concept of judgement-based regulation but prefers the term “intelligent anticipation”. She says: “It is not a judgement solely based on the evidence before the regulator. It will look at the evidence, anticipate future risks and then address them.”
Drake says the committee’s report will be constructive, offering ways to improve the proposals, which should then deliver an effective regulatory system.