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Ex-Tory economic secretary criticises review culture

The Government is weighing down the FSA and the industry with constant unnecessary reviews which compromise the independence of the regulator and provide little benefit to consumers, claims the head of the stockbrokers&#39 trade body.

In a speech to the Scottish Financial Enterprise annual dinner in Glasgow last week, Association of Private Client Investment Managers and Stockbrokers chief executive Angela Knight criticised the Government for restricting the independence of the FSA.

Knight, a former Conservative Treasury economic secretary under John Major, said the Government must realise that problems will occur in the financial services industry and the answer is not always to launch an inquiry.

She said: “While the FSA is independent of the Government, the Government is not keeping its distance from the FSA. It is instigating review after review. Myners, Sandler and Pickering are three. The banks have had the Cruickshank review and the outcome of the Higgs review on non-executive directors will result, no doubt, in further changes to corporate governance.

“The net effect is an environment of costs of change without obvious comparable benefits to the consumer.”

A Treasury spokesman says: “We have reviews of specific issues but the overall goal is to strike a balance between the protection of consumers and the interest of industry.”

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