In a paper, Building Britain’s Future, launched today, Brown says: “We believe the Financial Services Authority is the primary mechanism through which we should regulate the financial markets.
“Through the future Financial Services and Business Bill, the Government will toughen the regulation of the financial system, ensuring that the FSA has sufficient powers to do its job and improve efficiency and competition.
“We will consider how to make it easier for new entrants to join the banking market and make existing participants more diverse.”
Responding to the proposals, Association of British Insurers director of financial regulation Peter Vipond says: “Enhancing the FSA’s powers, so long as they are accountable, will be of real benefit – especially the ability to act at short notice. It is equally important to make sure the powers are exercised in conjunction with those of the Bank of England.”