The Financial Conduct Authority does not need any additional oversight to ensure it remains compliant, a group of prominent MPs said.
Amid a series of recent regulatory failures, including the collapse of Neil Woodford’s fund empire, the massive sale of pension transfers and widespread investor losses from mini-bonds, calls have risen in recent months to ensure that the financial regulator is sufficiently monitoring its work. .
Currently, the primary way the FCA is held to external accountability is through regular questioning of Members of the Treasury Committee.
In a report on the future of post-Brexit financial regulation released on July 6, the Treasury Committee said it was not necessary to bring in another body to examine the evolving role of the FCA in the future.
“We do not see clearly the need for a new committee or a new independent body to carry out this work,” the all-party group of MPs charged with holding regulators and the city at large to account in its report said.
“It would appear a more efficient use of parliamentary resources to use the structures that are already available in both Houses. While the review task is important, it will be extended as new regulations are drafted, rather than a short-term surge in activity. “
The report comes as the government seeks to give London a boost after Brexit, with Chancellor Rishi Sunak issuing a document outlining his plans to capitalize on the country’s separation from the European Union earlier this month, at the following calls for liberalization of regulations. around registrations and the City’s financial markets regime.
“Now that we have left the EU, we have a unique opportunity to take an approach that better suits our markets, while maintaining high regulatory standards,” Sunak said in the 40-page roadmap for the industry. British financier.
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In its investigation, the group of MPs chaired by Tory MP Mel Stride received “several” written submissions proposing a separate subcommittee or new select committee to oversee financial services.
Innovate Finance, the financial technology lobby group, wrote: “With [the] increased role [for the regulators], we recommend that there be more scrutiny of regulators regarding the exercise of their functions and the development of rules than is currently the case ”.
“In view of the significant resources and expertise that such a review will require, we recommend that such a review be carried out by a new independent committee created for this purpose.”
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Barclays and other industry groups, including the Association of British Insurers and the Investment Association, have also suggested creating a joint committee with members of the House of Commons and the House of Lords.
“A joint committee would potentially increase the expertise and experience of members and provide additional resources to enable the committee to address a wide variety of political issues,” Barclays wrote in testimony.
The MPs report also highlighted the independence of regulators from political interference as a key aspect of financial services in the UK, adding that it was “essential” to ensure it retains its status as a hub of the sector.
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Former Chancellor George Osborne gave the Treasury Committee one of its most important powers to date in 2016; MPs can now block the appointment of a new FCA chief executive and send it to a vote in the House of Commons.
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