The Treasury select committee has called on the Government to increase the accountability and transparency of the new financial conduct regulator.
In a report published last week, the TSC says current proposals do not provide for “adequate accountability” or “sufficient scrutiny”.
It says the Financial Services Bill should include FSA chairman Lord Turner’s suggestion of publishing full minutes of Financial Conduct Authority board meetings and a requirement for the FCA to provide Parliament with information when asked. It also calls for the TSC to be given pre-appointment scrutiny over the regulator’s chief executive and for industry to be more open about regulatory grievances.
TSC chair Andrew Tyrie says: “Higher accountability to Parliament will help provide better regulation and avoid the problems that have plagued the FSA.”
In the past, committee members have slammed the quality of FSA cost-benefit analyses. Conservative MP Mark Garnier described one study justifying the RDR as “farcical”. The report says the FCA must challenge the “old and inappropriate” FSA approach. It says the bill should force the regulator to improve the quality of information it collects and avoid a tick-box approach.
It adds that when new regulation is forthcoming, the regulator must be exact about what it expects from firms.
The draft does not discriminate between types of consumers and the report says the bill should “clarify the balance of protection and consumer responsibilities” of different consumers.