The concept of “justice” is marvellously flexible. It is a word that acquires new meaning entirely dependent on whose mouth is articulating it. The definition ascribed to it by the Oxford Dictionary states: “The quality of being fair and reasonable.”
When Walter Merricks, ruled as chief ombudsman , he advised the Treasury select committee, “we comply with the rules of natural justice”. This is described by the Business Dictionary as: “Nemo judex in causa sua: no decision is valid if it was influenced by any financial consideration or other interest or bias of the decision-maker. These principles apply to decisions of all governmental agencies and tribunals, and judgments of all courts, which may be declared to be of having no effect (ultra vires) if found in contravention of natural justice.”
Likewise, John Howard, former chair of the Financial Services Consumer Panel, has called for “consumers to be able to get some sort of justice in financial services”.
Similarly, Paul Myners, former City Secretary within the Labour Government has been described by a Labour insider as having “a genuine instinct for social justice”.
We are indeed lucky because it seems that the financial services sector is overburdened with kindly souls eager to assist and apply the soothing balm of “justice”.
Money Marketing readers will recall the peremptory removal of the 15-year long stop has caused a hiatus to the natural, social justice that financial advisers previously enjoyed. Its confiscation, courtesy of the FSMA 2000, has created injustice and much seething resentment.
Last year, at my behest, the human rights committee decided to investigate whether advisers’ human rights had been breached by this and wrote to Paul Myners for an explanation. Myners’ reply was factually incorrect, demonstrably so, but it served to divert the committee which summarily dropped the investigation.
I engaged, via my MP, the roads minister Mike Penning, in an ultimately fruitless correspondence with Myners as I attempted to winkle justifications from him.
The final reply from the Treasury, last April, was penned by an underling who advised that the Treasury had nothing further to add.
Readers may recall that Myners advised the committee the removal of the long stop had been consulted on by the FSA, that Parliament had debated such a removal and that another ombudsman body, the Legal Services Ombudsman, also ignored the 15-year long stop. All three statements were wrong and provably so.
My MP was sufficiently disturbed to advise advancing the matter as a complaint to the Parliamentary and Health Service Ombudsman, the body that undertakes “independent investigations into complaints that government departments have not acted properly or fairly”
The Parliamentary vision of “justice” is somewhat malleable because the ombudsman’s response explained: “We are unable to investigate this complaint as statements made by a minister to a Parliamentary select committee are part of proceedings in Parliament and do not constitute an administrative function of HM Treasury. In addition, such statements are covered by Parliamentary privilege”.
Is it not ironic that the Parliamentary Ombudsman is shackled in this way whereas the Financial Services Ombudsman is able to ignore statute, common law and legal precedent as well as common sense, in order that “natural justice” is obtained?
Alan Lakey is partner at Highclere Financial Services