For the last six months I have been involved in a dreary correspondence with Lord Myners, via my own MP, regarding Myners’ June 2009 submission to the joint committee on human rights regarding the surreptitious removal of the 15-year long-stop defence.
Readers may recall that the committee decided that the matter was not of sufficient importance and this was primarily due to Myners advising them that: “The Financial Ombudsman Service rules were consulted on extensively before they came into force on 1 December 2001”. He also stated: “The Limitation Act 1980 does not apply to the FOS, a point that was discussed and considered when the Financial Services and Markets Act 2000 was being debated by Parliament.”
This January, he again chose to rewrite history and complained: “My letter (to the committee) does not refer either to Parliament debating the removal of the long stop or to the FSA entering into extensive consultation on the issue.”
His latest missive, dated March 14, asserts: “The FSA consulted, in parallel, on the detailed rules including those covering the ombudsman. I note, for example, that the question of time limits for making a complaint to the FOS was discussed in the joint FSA/ FOS consultation paper CP33.”
CP33 did consult on time limits for complaints but not only was the 15-year long stop never discussed, it was also not even mentioned. The feedback statement, CP49, was published in May 2000 and contained an important proposal. “Alignment with the English law of limitations in respect of the time limit for making a complaint to the scheme after the act or omission giving rise to the matter in question.”
Again, there is no specific mention of the long stop but a clear proposal that the FOS time limits would reflect those of the court system.
A policy statement was published in December 2000 and no specific mention was made of the long stop. A subtle wording change emerged where it stated: “As envisaged in CP49, the time limits for bringing a complaint to the FOS broadly mirror the law of limitation in respect of bringing actions to court.”
So, did Lord Myners tell the joint committee that not applying the Limitation Act was discussed and considered by Parliament when debating the bill? Yes. Did this happen? No.
Did Lord Myners state that the FSA consulted extensively on the FOS scheme rules before they came into force? Yes. Did this happen? Yes and no – the FSA did consult and did propose the time limit rules would mirror those within English law but did not ever mention the removal or retention of the long stop. In the minutes of the FSA board meeting, dated September 18, 2003, the FSA’s then chief executive, John Tiner, stated: “We did not consult on having a 15-year limitation period when dispute resolution rules were consulted on.”
At a recent meeting, Conservative MP and chairman of the Treasury sub-committee Michael Fallon expressed disquiet regarding the removal of advisers’ rights. It is to be hoped that Lord Myners is called before them to explain his elastic terminology.
Alan Lakey is director of Adviser Alliance and partner at Highclere Financial Services