View more on these topics

Treasury must set early date as FSA hides behind N2

Sir Howard Davies&#39 performance before the Parliamentary inquiry into Equitable Life was the most disappointing since his appointment in 1997.

He refused to allow Martin Roberts,the only FSA civil servant involved in regulating Equitable for the DTI, Treasury and FSA, to answer questions.

He refused to offer an opinion on previous Government regulation, surely not too much to ask of a chief regulator.

To compound the insult, a story appeared in the Financial Times that morning, with the FSA conceding it had underestimated some of the risks,another snub to the inquiry.

Davies is at grave risk of making a mockery of Parliament but we will leave the final verdict on this to the MPs of the Treasury select committee.

Most seriously, Davies argued the FSA could not intervene fully in Equitable because it lacks full statutory powers,due on a date known bizarrely as N2.

Before this magical event occurs some time this year, the UK will witness the introduction of two new pensions, the erosion of polarisation and the launch of new distribution channels with little experience of selling financial products.

The 1 per cent compulsory cap on charges is pulverising existing channels, with the collapse of tied salesforces. It is also straining providers&#39 balance sheets and leaving a yawning commission gap between different types of products, surely a temptation for the less scrupulous.

Davies should be on the phone to the Treasury, demanding it gets its finger out on N2 before another disaster.

Recommended

NDF&#39s 6th sense for income & growth

NDF Administration has brought in the sixth version of its extra income & growth plan. The plan is a guaranteed income and growth bond, with Abbey National Treasury Services providing the investment management. Investors will buy shares in Census, an investment company based in Ireland, which will then invest in the Nikkei 225 index over […]

Unum increases disability insurance sales

Disability insurer Unum has announced a 47 per cent increase in sales from £29.4 in 1999 to £43.2m in 2000. The income protection specialist also saw its IFA sales increase 42 per cent last year and growth of 150 per cent in Europe.Its results were reflected across its product range with its group and individual […]

MPs&#39 swords miss their targets

The much anticipated Parliamentary inquiry into the Equitable Life debacle was finally held last week and the media turned out in force to rub their hands in glee at the downfall of one of the UK&#39s oldest life offices. The event was so popular that the hearing had to be moved from the small chamber […]

Davies blocks Cousins quizzing civil servant

FSA chairman Sir Howard Davies has been attacked by the Treasury select committee for his handling of the Equitable Life inquiry. Davies came under fire from MPs last week after he refused to allow Labour MP Jim Cousins to question FSA head of insurance Martin Roberts about his role in the affair as both DTI […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment