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‘Regulatory regime is like Little Britain’

The Financial Services and Markets Act has been a “complete failure”, according to Treasury select committee member Mark Garnier.

Speaking at a Lansons fringe event at the Conservative conference in Birmingham this week, Wyre Forest MP Garnier said the FSA has failed to create constructive relationships with firms.

He said: “There is no doubt the FSMA has been a complete failure from start to finish and I am not saying that just because it was set up by Gordon Brown. Under the previous regime, firms had a relationship with the regulator. Under the FSMA it is like a sketch from Little Britain, you call the regulator and they tell you the computer says no. There is no relationship there so no wonder it has not worked. It needs to be changed.”

But Garnier, a former investment banker, said he is concerned that the new proposed regulatory structure gives too much power to the governor of the Bank of England.

The Treasury is consulting on proposals to replace the FSA with the Prudential Regulation Authority, to be positioned under the Bank of England, and pass conduct of business oversight to the Consumer Protection and Markets Authority.

The PRA will conduct prudential supervision of all deposit-taking firms, insurers and investment banks. The CPMA and the PRA will both be overseen by the Financial Policy Committee which will be chaired by the governor of the Bank of England.

Garnier said: “One problem with the proposals is it makes the governor of the Bank of England very powerful. The current governor is very good but there is no guarantee that governors are going to be as good in the future.”


7IM cuts costs on AAP range

7IM is reducing the costs of its AAP passive multi-manager funds by replacing some of the exchanged-traded funds and tracker fund holdings with direct exposure to the underlying shares. The firm feels it is important to keep costs down in the current climate of low growth to prevent charges eating into investors’ capital. It says […]


Lloyds introduces spot-checks for interest-only mortgages

Lloyds Banking Group will conduct spot checks at random on brokers submitting interest-only cases and ask them to supply evidence that the client has an appropriate repayment vehicle in place from October 15. In May, Lloyds reviewed its interest-only lending policy, declaring that it would no longer accept selling a main residence as a repayment […]

Hoban says Isas don’t face cuts

Treasury financial secretary Mark Hoban has rejected claims that the Government is considering reducing tax incentives on Isas in the forthcoming comprehensive spending review. At the Labour conference in Manchester last week, Treasury select committee member Andy Love warned that the Government may target Isas as part of its package of cuts. He said: “We […]

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Auto-enrolment — don’t leave it too late…

With auto-enrolment (AE) well under way for the UK’s largest businesses, over the next three years an additional 800,000 smaller employers (with less than 60 employees) will start their journey to comply with the legislation. AE mandates all eligible employees and their respective employers to make regular pension contributions into a qualifying pension scheme. To learn more about the legislation read our brief Jelf AEase — simple steps to AE compliance guide.


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There is one comment at the moment, we would love to hear your opinion too.

  1. The current governor is very good but there is no guarantee that governors are going to be as good in the future.”
    Who could he be alluding too?

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