The proposals, set out in the Treasury’s white paper on banking reform, say it will be funded by the collection of levies from FSA-regulated and OFT-licensed firms as well as a range of other funding streams.
The new authority will take the strategic lead on consumer education and information provision relating to personal finance.
The Treasury has estimated that the total cost of setting up and running the body will be £24m over a period of 52 years.
It will work with regulatory bodies and consumer representatives, including the Consumer Advocate proposed in the recent consumer white paper, to ensure an effective, strategic approach to cross-cutting issues affecting consumers.
The FSA will establish the authority’s board and chairman with the approval of the Treasury but it will be independent from the FSA.
The authority will have the power to delegate functions where other organisations might be better placed to deliver and will have statutory immunity in relation to the discharge of its functions.