Financial Services: Regulation

Lord Leigh of Hurley Excerpts

Wednesday 6th September 2017 Lords Chamber

Asked by

[Lord Leigh of Hurley]

To ask Her Majesty's Government whether it is their policy to reduce unnecessary regulation of financial services; and if so, whether they intend to review current Financial Conduct Authority practices to ascertain whether that regulator is going beyond what is appropriate and necessary to fulfil that policy.

[Lord Leigh of Hurley (Con)]

I beg leave to ask the Question standing in my name on the Order Paper and draw your Lordships’ attention to my register of interests.

[The Minister of State, Department for International Development (Lord Bates) (Con)]

My Lords, the Government are committed to reducing unnecessary regulation in the financial services industry, but also recognise the need for an effective and proportionate regulatory regime to ensure that markets function well and consumers are appropriately protected. The Government do not believe that the FCA is going beyond what is appropriate and necessary to fulfil the Government’s policy.

[Lord Leigh of Hurley]

I thank the Minister for that Answer and I draw his attention to the Queen’s Speech. I am sure he will agree that the commitment to further strengthen our resilient economy, following press reports, means that a specific review in this Parliament of the somewhat opaque policies and procedures of the FCA will be most welcome, in particular to the financial services industry.

[Lord Bates]

We have to recognise that the review that took place in light of the situation that occurred 10 years ago, with the financial crisis, necessitated a wholesale reform of consumer protection and also of the strength and stability, including the systemic strength, of the financial services industry. That was why these radical reforms were brought forward: to put consumer protection at the heart of this and to improve the conduct and authority of the mechanism by which that is done. That comes at a cost, and the cost has to be borne, ultimately, by consumers. That is one reason that it is important that the FCA pays attention, which it does, to the fact that it is required, as well as protecting consumers, to create an efficient and effective market for consumers so that they get good value for money as well as protection.