The Treasury select committee has called for the Payments Council to be brought within the financial regulatory system amid concerns over its accountability.
The TSC’s report, published today, welcomes the Council’s decision to retain cheques, but recommends that the Treasury makes provision in the upcoming Financial Services Bill to bring the Payments Council formally within the system of financial regulation to ensure it is publicly accountable.
It says the composition of the Board of the Payment Council should be changed so there is greater consumer representation.
The committee is also calling for any two of the four independent members to have the right of veto over a decision of the Council. Currently all four independent members must agree.
TSC chairman Andrew Tyrie (pictured) says: “The Payments Council is an industry-dominated body with no effective public accountability. It should not have unfettered power to take decisions on matters, such as the future of cheques, or other issues, that are of vital importance to millions of people.
“This is why we have recommended that the Council be brought within the formal regulatory system. As an immediate first step the board of the Payments Council should have greater consumer representation.”
Tyrie says the Payments Council’s decision in December 2009 to aim to abolish cheques by 2018 was taken “without an assessment of the costs and benefits” and without providing any indication of what alternatives would be put in place.
He says: “The Payments Council’s decision caused great and unnecessary concern among bank customers. And during the course of the Treasury committee’s inquiry it became clear that the Council’s plans did not have the confidence or support of the public, Parliament or the Government.”