At a meeting of the public accounts committee on Monday, Conservative MP Richard Bacon said if the FSA had been audited by the NAO, weaknesses in the regulatory system may have been spotted earlier.
Treasury permanent secretary Sir Nick MacPherson agreed that the case for an NAO audit should be considered.
Bacon said that if the NAO had been able to conduct value- for-money studies on the FSA “the problems that have been identified would have identified earlier”.
Committee chairman Edward Leigh, MP, told MacPherson: “Since 2000, the rule is that you have to request the NAO to look at a specific part of the FSA and you have only ever done that once since 2000 and that was a fairly tangential inquiry. After all, the FSA is primarily concerned with financial stability and protecting the consumer. You have asked the FSA to look at it once since 2000 and that was not about financial stability or protecting the consumer. That must be a worry now, mustn’t it?”
MacPherson said: “I have said this needs to be looked at afresh. Obviously, it requires a ministerial decision. We will ensure that it is considered and that ministers take a view.”
Hundreds of Aifa and AMI members are backing a campaign which is calling for the FSA’s budgeting process to be regularly scrutinised by the NAO as well as a review of regulatory fees.
Syndaxi Financial Planning managing director Robert Reid says: “We need to work out whether the FSA is worth the money that we have been spending on it.”