Financial Services: Regulation

Lord Tomlinson Excerpts

Wednesday 6th September 2017 Lords Chamber

[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.

[Lord Tomlinson (Lab)]

Will the Minister undertake to tread very carefully in this area? We all know what we have been through in the last decade; it was as a result of being seduced by appeals for lighter-touch regulation, and we do not have any desire to go through that sort of process at all. Any change will have to be justified, not just because the industry wishes it but as a way of respecting the needs of consumers in this country to have a properly regulated financial sector.

[Lord Bates]

The noble Lord is absolutely right. Virtually every adult in the United Kingdom is a consumer of financial services, be it for mortgages, credit cards, loans, insurance products or pensions. It is essential that consumers continue to have confidence in the institutions that provide those services so that they continue to do those things, which are very much a social and economic good for this country.