Financial Guidance and Claims Bill [HL]

Baroness Drake Excerpts

Committee: 3rd sitting (Hansard): House of Lords
Monday 11th September 2017 Lords Chamber

Moved by

[Baroness Drake]

62: After Clause 7, insert the following new Clause—
“Offence of falsely claiming to be giving guidance and advice on behalf of the single financial guidance body
(1) It is an offence for a person who is not giving pensions guidance, money guidance or debt advice on behalf of the single financial guidance body—(a) to describe themselves (in whatever terms) as a person who is doing so, or(b) to behave, or otherwise hold themselves out, in a manner which indicates (or which is reasonably likely to be understood as indicating) that they are doing so.(2) In proceedings for an offence under this section, it is a defence for the accused to show that the accused took all reasonable precautions and exercised all due diligence to avoid committing the offence.(3) A person guilty of an offence under this section is liable on summary conviction—(a) in England and Wales, to imprisonment for a term not exceeding 51 weeks or a fine, or both;(b) in Scotland, to imprisonment for a term not exceeding 12 months or a fine not exceeding level 5 on the standard scale, or both;(c) in Northern Ireland, to imprisonment for a term not exceeding six months or a fine not exceeding level 5 on the standard scale, or both.”

[Baroness Drake (Lab)]

My Lords, Amendment 62 seeks to make it a criminal offence for a person to mimic, impersonate or behave in a way which indicates that they are giving advice and guidance on behalf of the single financial guidance body when they not in fact giving guidance on its behalf and are not authorised to do so. This is not a novel proposal. Under existing legislation, it is a criminal offence to impersonate Pension Wise. This provision would not stop every organisation seeking to use or mimic government initiative statements to give credibility to their approach to attract members of the public, but it would be a powerful deterrent. A deterrent is definitely needed because the human cost of receiving fraudulent, wrong, conflicted or partial guidance from organisations or persons who win people’s trust by misleading them into believing they are acting under an authorised government initiative can be just dreadful, leading to irreversible financial losses, life-changing losses, debt and more.

Those vulnerable to the activities of the misleading, mimicking guidance operators are not only the struggling, the stretched and those with more basic levels of numeracy and literacy, although their needs are very important; in the context of finances, those individuals who are vulnerable and at risk go up the income chain as consumers deal with products and services that can be diverse, complex and rapidly changing. Those with retirement savings, for example, are usually people who have typically had good and sustained periods of employment over their working life and have usually compulsorily or voluntarily set aside money aside for their later life. These impersonators can be ingenious in their hunt to claim fresh victims, as a recent press release from the Pensions Regulator demonstrated when it warned that,

“rogue pension websites that are carrying anti-scam messages to try to trick consumers into believing that they are legitimate businesses”.

Some even imply they are regulated by carrying warning messages designed to prevent people falling victim to scams. These imitators are using material owned by the regulators or other government initiatives to impersonate and mislead the public. Therefore, in this instance, a mechanism designed to protect consumers is now used to dupe them.

The deterrent of criminal proceedings is needed not only to protect the public and the integrity of the services of the new financial guidance body but to protect the legacy names of its predecessor bodies, such as Pension Wise and the Pensions Advisory Service, names which the public will continue to recollect for some time before they recognise and internalise the name of the new body. It must be a criminal act to mimic not only the new brand but any of the existing brands that will move into the new single financial guidance body.

The Government thought it necessary to make an explicit criminal offence to imitate Pension Wise but no provision is contained in the Bill for it to be an offence to mimic the new financial guidance body. At Second Reading the Minister commented that there was no need for such a criminal offence provision in the Bill, as:

“The brand and service offer of the new body will be protected by existing stringent criminal offences under fraud and copyright laws”.—[Official Report, 5/7/17; col. 946.]


However, that view was not considered sufficient to protect the public from operators imitating Pension Wise—such imitation was made a specific criminal offence. I remain concerned that the absence of a specific provision to make it a criminal offence to mimic the new financial guidance body is a weakness in the Bill. Why was it considered appropriate to create a specific criminal offence of imitating Pension Wise rather than relying on existing fraud and copyright laws? Which existing legislation would ensure that any form of imitation of the new financial guidance body was a criminal offence, and why is that not referenced in the Bill? How will the Government ensure that imitating any of the existing brands that will move into the new single financial guidance body, including Pension Wise, will continue to be a criminal offence? I beg to move.

[Baroness Kramer (LD)]

My Lords, I strongly support the amendment moved by the noble Baroness, Lady Drake. This is an area where we need belt and braces—every mechanism that we can to make the new body and the services that it will deliver resistant to the scammers, who are ingenious beyond the capacity that most of us find credible, until we experience or hear about a scam ourselves.

In many cases, when people seek advice or guidance over an important matter in their lives, they turn to an organisation in which they have built trust over many years, where they have a whole series of experience and where they have neighbours and friends who share that experience. From that, they can be quite informed in choosing to whom they turn. However, that tends not to be true in the kind of issues that this body will deal with. People who are under debt pressure often panic when they finally reach the moment when they feel they must turn to somebody. It makes them particularly open to scammers, who will do things such as charging them, taking commission and exploiting their vulnerability at that moment. In the area of pensions people are exceedingly confused and, again, are hesitant to turn to names that they might know or which are well established for fear that they will meet a sales opportunity. Therefore, someone who sets themselves up as providing impartial advice suddenly becomes productive. Again, they have no testing mechanism due to previous experience of that body.

Therefore, in supporting the noble Baroness, Lady Drake, on this amendment, we very much seek belt-and-braces protection for consumers, recognising that people are increasingly vulnerable to scamming, particularly with modern instruments such as the internet. The Government need to be motivated to make sure that real and significant protection is in place.

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[Lord Young of Cookham (Con)]

My Lords, the co-pilot is back. I thank the noble Baroness, Lady Drake, for tabling this amendment, which would make it a criminal offence to falsely claim to be giving pensions guidance, money guidance or debt advice on behalf of the single financial guidance body. She set out very clearly the devastating impact that misleading or criminal advice can have on people’s lives. Both she and the noble Baroness, Lady Kramer, identified the ingenuity and adaptability employed by scammers and fraudsters to con people.

I was very interested in this amendment and made inquiries to see who would be caught by it. Clearly, people who claimed to give advice on behalf of the SFGB, or whatever it is called, would be caught but, as it stands, I understand that it would not cover someone pretending to give advice on behalf of a delivery partner. The noble Baroness may like to think about that.

Protecting people from financial fraud and scams is important, and I say to my noble friend Lady Altmann that the Government take it very seriously. Anyone who has served in another place will have seen at first hand the devastating impact that this can have on people’s lives. We will come on to cold calling when we reach Clauses 16 and 17.

Ensuring that people have confidence in the financial guidance and debt advice provided by, or on behalf of, the SFGB will be central to its success and to the success of other government policies to improve people’s financial well-being. This is a matter that we have explored in depth with the existing service providers—the MAS, TPAS and Pension Wise. As the noble Baroness said when she moved her amendment, of those three, only guidance provided under the Pension Wise banner is covered by a specific measure making it an offence to falsely claim to give such guidance. The MAS and TPAS rely on existing criminal offences.

In response to the speeches made, we have considered very carefully whether to go down the Pension Wise route and create a new, bespoke offence to cover all the single guidance body’s guidance and advice services. We have weighed up whether there is evidence to suggest that a bespoke offence would have any greater effect than existing criminal offences, taking into account that the Pension Wise offence has never been used in a prosecution.

There are already criminal offences that would cover imitation of the new body; again, the noble Baroness referred to these. For example, if an individual was misled by someone dishonestly claiming to give guidance or advice on behalf of the body with the intention of causing financial loss, this would amount to an offence. In England, Wales and Northern Ireland a person could be prosecuted under Sections 1 and 2 of the Fraud Act, and in Scotland such conduct would likely amount to the common-law offence of fraud.

In addition, under the Consumer Protection from Unfair Trading Regulations 2008, Regulation 9 makes it an offence to advertise or market a service in a manner that deceives or is likely to deceive the average member of the public. If that advertising or marketing causes or is likely to cause an average person to take a decision they would not have taken otherwise, again, this is an offence. This would make it a criminal act, for example, for scammers to use the logo of the new body.

Offences under the Fraud Act are subject to a maximum term of imprisonment of 10 years and offences under the Consumer Protection from Unfair Trading Regulations carry a maximum term of imprisonment of two years. As a deterrent, both maximum terms are significantly greater than the maximum 12 months envisaged by the amendment.

For these reasons, and having listened to the arguments, our assessment is that there are already existing offences which will provide for the single financial guidance body to take action against people claiming fraudulently to be delivering its services or using the body’s brand and reputation to mislead members of the public. Where people seek to scam and defraud by falsely claiming to be acting on behalf of the body, they will be liable to prosecution under existing offences, leading to the possibility of a custodial sentence. We believe that the protections in existing offences are sufficient and I therefore urge the noble Baroness to withdraw her amendment.

[Baroness Drake]

I thank the Minister for his response. I am not sure all my questions were answered, particularly on how to protect from the mimicking of existing bodies that go into the organisation, while they still have credibility, until the new body’s name becomes absorbed by the public. However, in responding to his points, I borrow the phrase of the noble Baroness, Lady Kramer: the Bill needs to be belt-and-braces in terms of it being a criminal offence to mimic this body.

The new body’s guidance will influence people’s decision-making—that is why it is being set up. It recognises a market failure and many consumers who would use the guidance service could be at risk if they go in the wrong direction and to an organisation which is mimicking it. I note the Minister’s point that my amendment would not cover all the circumstances of the criminal offence, but the fact that my amendment could be improved is not a reason for not having explicitly in the Bill a provision that expressly says it is a criminal offence to mimic this body.

There are two strands to my argument: first, it should be expressly in the Bill that it is a criminal offence to mimic, impersonate or imitate the service of the single financial guidance body; and, secondly, there must be some reference to the legislation under which that would be an offence. A Bill would normally refer to the legislation or spell out specifically new legal provisions about the criminal offence. At the moment, however, the Bill is silent on the issue. That is a gap in the Bill. I beg leave to withdraw the amendment.

Amendment 62 withdrawn.

Moved by

[Baroness Drake]

63: After Clause 7, insert the following new Clause—
“FCA: requirement to signpost to the single financial guidance body for pension guidance, money guidance and debt advice
(1) The Financial Services and Markets Act 2000 is amended as follows.(2) After section 137FBB insert—“137FD FCA general rules: requirement to signpost to the single financial guidance body for pension guidance, money guidance and debt advice(1) The FCA must make general rules requiring information about the availability of pensions guidance, money guidance and debt advice from the single financial guidance body to be given by relevant organisations to any category of individuals who may benefit.(2) Before the FCA publishes a draft of any rules to be made by virtue of this section, it must consult—(a) the Secretary of State;(b) the Treasury; and(c) the single financial guidance body.””

[Baroness Drake]

My Lords, Amendment 63 places a requirement on the FCA to make rules requiring information about the availability of advice and guidance from the new body to be given by relevant organisations to individuals who would benefit from it—otherwise referred to as signposting.

If the new body is to deliver on its function to increase people’s ability to manage their financial affairs, there needs to be public use of the guidance. It has to have extensive reach. Experience shows that simply relying on high levels of marketing expenditure is not a cost-effective way of engaging with the public, although from time to time there may be a good reason for running a focused bespoke campaign and, in certain defined circumstances, there is a role for compulsory referral to the guidance service.

Two effective levers for driving public use—they are not exclusive but they are effective—are achieving high levels of public trust by delivering a service which has a spreading reputation for impartiality and efficiency, and the relevant organisations such as market providers and other key bodies actively signposting those who would benefit from it to the guidance available. Evidence of the public need for guidance has been well rehearsed in this Chamber. Research by the Money Advice Service reveals that across a range of measures, financial capability and resilience has got worse over the past 12 years, and other reputable data sources confirm this. Effective signposting will improve the public use of guidance and, in some circumstances, address the known barriers put in place by some providers who are reluctant to see their customers accessing impartial guidance for fear that it increases the risk that they will not buy a product or a service from them. Effective signposting means not just compliance but organisations actively promoting the guidance service.

The Government expect the FCA to review its rules on signposting, but that leaves room for ambiguity, argument and yet more consultation. This amendment would remove any ambiguity and would put into the Bill a requirement on the FCA to set rules to secure the effective signposting to guidance for those most likely to benefit from it. On pensions guidance there is currently a legal requirement on providers to signpost to Pension Wise. DWP figures show that of the people who use Pension Wise, 58% heard about it from their provider and only 8% from advertising. The take-up of Pension Wise has been modest, but I suspect that that is in part because some providers have not actively signposted and in part because, in the first year of pensions freedom, those accessing pots would have included many for whom their DC or AVC pot would not have been a significant part of their retirement income. That will change over time as DC savings become more dominant. The use of guidance will increase, as indeed the Pension Wise figures are increasing.

Signposting to TPAS dispute services is captured in various occupational, personal and local government pension scheme regulations—some 12 sets in all, I think. My amendment would strengthen the FCA duty to set rules on signposting across the financial guidance space. Signposting needs to happen at the right point for those who would benefit from it and be actively supported by providers and other relevant organisations. The ABI has worked with the existing guidance bodies on signposting, such as on the template for Pension Wise, with the result that more people hear about the service through that route. They have indicated that they want to work with the FCA and DWP to improve communications and promote the use of Pension Wise as the norm.

But there is no unanimity of view in the industry. Some providers set up guidance units as part of their own commercial proposition and not all will want to actively signpost customers to impartial and independent guidance which could impact on their own company sales and customer retention. It is estimated that, by 2030, workplace defined contribution schemes will hold £1.7 trillion, five times the £340 billion held in 2015. As DC savings become the new norm, the need to support consumers will increase. The FCA’s recent Retirement Outcomes Review Interim Report scopes the problem well, observing that pension freedoms have made retirement decisions much more complex than ever before, and that consumers can struggle to understand their options and to think through the implications, leading to decisions which may not be best for them. They can choose the “path of least resistance” on drawdown and stay within the walled garden of their existing provider without shopping around. Some 94% of non-advised drawdown sales were made to existing customers. Some consumers cannot, or will not, engage with these decisions. Not all of them will take advice because of its cost and availability— a market gap.

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[Baroness Buscombe]

My Lords, I very much thank the noble Baroness, Lady Drake, for her amendment. I agree with much of what she said, but her amendment would amend the Financial Services and Markets Act 2000 to require the Financial Conduct Authority to create a new rule. That would require all relevant firms regulated by the FCA to signpost their customers to the new single financial body.

The noble Baroness outlined her concerns on the matter on Second Reading. She said:

“There should be a requirement on the industry and relevant players to clearly signpost the services of the new body to the public”.—[Official Report, 5/7/17; col. 919.]


The Government agree with the noble Baroness that signposting has an important role to play in helping to improve public access to guidance. A key challenge for the body will be promoting its services in an effective and efficient way to ensure that those who need support can easily access it.

The new body will need to think creatively about how it works with the financial services industry, the devolved Administrations, and the public and voluntary sectors to target and promote the services it offers. The FCA is clearly a key player in this. Both the Government and the FCA are determined to help members of the public to take advantage of the financial guidance available to them. We envisage that signposting by authorised firms will be a crucial way of encouraging people to engage with the new body.

I should note that the FCA already has some measures in place to ensure that firms promote the Money Advice Service’s guidance offering. To take one example, consumer credit firms cannot communicate a financial promotion with relation to high-cost short-term credit without a risk warning that points consumers to the Money Advice Service. However, the Government believe that the FCA should review its current rules and expand them where necessary. The creation of the new body provides an excellent opportunity for such an exercise to be conducted. Indeed, the Government’s response to the most recent consultation noted that they expect the FCA to review these rules in the light of the creation of the new body so that individuals are signposted to the body by industry at moments when they are most likely to benefit from guidance. I am pleased to say that the FCA has now committed to updating its current measures and, where appropriate, will look into creating new rules to increase uptake of the new body’s services.

I will offer a couple of further examples of current FCA rules that I hope in some way respond to the noble Baroness’s concerns. For example, if the customer falls into arrears on a regulated mortgage contract, a mortgage firm must provide a customer with a Money Advice Service information sheet called Problems Paying Your Mortgage in 15 days. In its first communication with a customer a debt management firm must inform customers that free debt counselling, debt adjusting and provision of credit information services is available and that the customer can find out more by contacting the Money Advice Service. Also, a debt management firm must provide a link on its website to the Money Advice Service’s debt advice locator tool.

In the light of the FCA’s commitment to review its rules, create new rules and increase uptake of the new body’s services, I do not believe that legislation is required to achieve the worthy aims set out in the noble Baroness’s amendment. I am grateful to her for giving me the opportunity to put on record the Government’s view on this very important matter. Having done so, I hope that she will be prepared to withdraw her amendment.

[Baroness Drake]

I thank the Minister for her reply. My amendment does not seek to set down in detail what the FCA’s rule should be or specifically cover, or whether it should require signposting in every instance. The driver is that there should be signposting where those individuals would benefit from guidance. That is obviously a judgment to be made in the circumstances that would apply.

Although the Government expect the FCA to review its signposting rules, a review is a review—that is what it is. There will be lots of discussions and consultation. Not everybody in the industry will support active signposting. Putting the duty on the FCA in the Bill removes any ambiguity about the fact that, to get the public to engage with the guidance service, there has to be an effective system of active signposting by providers and organisations relevant to the service. It is a simple proposition: the new guidance body will fail in its strategic objectives if it does not get public use of the service it provides. It would be a wonderful Rolls-Royce service; it is just nobody would be using it. We know in many instances that the behaviour of the provider defines the consumer experience. There is merit in putting in the Bill that the FCA has a duty to come up with signposting rules that will ensure that those who benefit the most from guidance will be actively and effectively signposted. I beg leave to withdraw my amendment.

Amendment 63 withdrawn.

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Moved by

[Baroness Drake]

68: Schedule 3, page 24, line 21, leave out paragraph 12 and insert—
“12_ For section 3S (the consumer financial education body) substitute— “3S Duty of the FCA in respect of the single financial guidance bodyIn discharging its duty to approve standards set by the single financial guidance body under section 6(2) of the Financial Guidance and Claims Act 2017, the FCA will act in the interests of consumers and promote financial inclusion.””

[Baroness Drake]

My Lords, Clause 6 requires the single financial guidance body to set and publish the standards that it will meet in the provision of information, guidance and debt advice. It is specifically required to obtain the approval of the FCA to those standards. Clause 7 requires that every three years the FCA must review whether those standards are appropriate, review how they are being monitored and enforced, and make recommendations. Amendment 68 would place a requirement on the FCA that, when discharging its duty to approve these standards, it will act in the interests of consumers and promote financial inclusion. The intention of the amendment is to strengthen the remit of the FCA, in this instance, to act in the consumer’s interests.

The single financial guidance body is an organisation whose function is expressly to support individual members of the public. Its objectives are to improve individuals’ financial capability and their ability to make informed decisions and to manage debt. Problems of access undermine the general principle that consumers should take responsibility for their own decisions. People cannot reasonably exercise that responsibility if they struggle to understand the nature, processes, terms and conditions of products and services.

The financial guidance body standards have to be approved by the FCA, whose remit is different—its remit is to ensure well-functioning competitive markets. If there is a gap in the market, the FCA often does not have the power to fill it, and if there is a market failure it seeks to address it by improving competition, even though in many instances the weakness of the consumer buy-side market forces cannot exert the necessary force to achieve a well-functioning market in parts of the financial services industry. The FCA acknowledged in its Retirement Outcomes Review Interim Report that competition is not working well for consumers who do not seek advice; it has concerns about whether a competitive market can develop in future; and consumers can struggle with the complexity of decisions. This echoes the view of the OFT, in its 2013 report on workplace pensions, that the buy side there was one of the weakest that it had ever encountered.

Competition will not always be an effective way to overcome access problems; the very creation of the financial body is a recognition of that fact. As for the wider market, in its paper on Access to Financial Services in the UK, the FCA observed that,

“left to the market, some consumers will be unable to access the products or services they want or at a price they are willing or able to pay”.

The market can go only so far in addressing the various financial needs of people.

The FCA is an economic regulator with a statutory objective to secure an appropriate degree of protection for consumers of financial services, which is largely focused on the provision of information and disclosure, given the general principle that consumers should take responsibility for their decisions and providers should give consumers a level of care that is appropriate, having regard to the capabilities of the consumer. However, the FCA does not have a specific objective or duty relating to consumers’ access to financial services or financial inclusion. The extent of the FCA toolkit in assisting vulnerable customers can appear uncertain.

The single financial guidance body, by comparison, is created to focus expressly on the needs of the public and the consumer, to improve their financial capability to make informed decisions. It is given the power in Clause 2(3) to do anything that is conducive to the exercise of its function.

So there is clearly a potential for tension between the remit of the FCA, when it considers whether to authorise the guidance body standards, and the aspirations of the guidance body on how to support the public when setting those standards. The objectives of the FCA and the financial guidance body need to be aligned when the standards for the provision of service by the new body are set and approved. That is the purpose of my amendment, which would give the FCA the duty to act in the consumer’s interest when authorising those standards.

The standards are a matter for the new body when it is set up. I do not seek to debate what the standards should be, but as a way of illustrating my point I could speculate on matters where tensions could arise: the qualitative standards for the guidance and how far guiders can go in their role in enhancing individuals’ ability to manage their financial affairs and make informed decisions; the guidance output given to the customer; standards for determining when the provision of guidance and debt advice are considered lacking such that the new body has a locus; the consumer’s journey, including how they get the guidance; the ability of vulnerable customers to access financial guidance; and the extent of active promotion of the financial guidance service by relevant organisations.

The answers to the questions of what the standards should be on these and other matters may be different depending on whether they are looked at wholly through the lens of the individual—the consumer’s interest—or from the perspective of a competitive, well-functioning market. The FCA and the new financial guidance body should look at these standards through the same lens, that of the consumer’s interest. That is what my amendment seeks to do. I beg to move.

[Baroness Kramer]

My Lords, I will speak in support of this very important amendment moved by the noble Baroness, Lady Drake. Much of the difficulty in the conversations we have had around this Bill has come over the role and obligations of the FCA. If the Minister or her officials care to look at the FCA website, they will understand that consumer protection is very much interpreted in the realm of preventing mis-selling and preventing scams; it is not a broader protection of the consumer in the way that some might interpret that language—for example, to make sure that the consumer has successful routes to navigate financial services.

I can give the Minister one simple example of which she will be aware. Many of us around this Committee—and, indeed, probably the Minister herself—believe that a breathing space scheme would be very advantageous in helping people to move through debt management to restore their finances. However, the FCA cannot mandate such a thing. It cannot act, as it were, to protect the consumer even though one might consider, if using just the English language, that such an action would be captured by the words “consumer protection”.

In the same way, on the issue of access the FCA can try and act so that a banking institution, for example, does not put up barriers that would discriminate or set itself up in such a way that people could not get on to the relevant website to access the service, but that is not access as in, “What financial services do members of the public require, and are those kinds of services being provided by the financial service sector and industry?”. So it cannot gap-fill. Actually, it is quite unusual to have an arrangement where such gap-filling is not possible. For example, in the United States, that may be done indirectly through things such as the Community Reinvestment Act, so there are paths by which that kind of back-filling can be pursued by the regulator.

I hope very much that the Government will understand that, in terms of providing advice and guidance, the FCA in looking at the standards that have been set cannot operate within the usual realm of an economic regulator of essentially promoting market efficiency or market fairness, which is its fundamental and underlying approach and responsibility. That is why the inclusion of language that talks about acting in the interests of consumers and about promoting financial inclusion is very appropriate when the FCA is now engaged in something that steps outside its traditional, typical overarching role.

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[Baroness Buscombe]

My Lords, there is much agreement around the House about this issue. I am hoping to persuade noble Lords that, while absolutely agreeing in principle, I believe that it is unnecessary to have this provision in the Bill.

I thank the noble Baroness for her amendment, which would impose a legislative requirement on the Financial Conduct Authority to act in the interests of consumers and to promote financial inclusion while discharging its duty to approve standards set by the single financial guidance body under Clause 6(2). We have discussed the setting and publication of standards and the monitoring and enforcement of those standards in our useful debate on Clauses 6 and 7. The standards are designed to provide ongoing assurance to members of the public about the quality of the services provided by the new body. Those standards will apply to the body itself when delivering its services directly, and to any delivery partner organisations that it engages to deliver services on its behalf.

We have already covered the role of the FCA in the standards-setting process. The FCA will add value by providing useful independent scrutiny, and the standards will benefit from the FCA’s expertise in relation to the debt advice sector and its experience in setting the standards for Pension Wise. We are confident that the FCA will, of course, act in the interests of consumers throughout this process; as noble Lords may know, the FCA already has a statutory objective to secure appropriate protection for consumers.

On the topic of financial inclusion, I am aware that the statutory objectives of the FCA were of some debate during the Lords ad hoc Select Committee on Financial Exclusion. One of the committee’s recommendations included giving the FCA a new objective to promote financial inclusion. As the current amendment touches on the subject, I observe that the FCA has already taken several steps to promote financial inclusion. Access to financial services is already written into its competition objective, which states that the FCA may have regard to,

“the ease with which consumers who may wish to use”,

financial,

“services, including consumers in areas affected by social or economic deprivation, can access them”.

Indeed, noble Lords will be aware of the good work that the FCA has done to promote financial inclusion through its occasional papers on vulnerability and access, as well as through its work to promote financial technology. To take one example, the FCA’s TechSprint events have brought together teams from the technology industry and across financial services to develop ideas and proof of concepts. The first of these events focused on identifying potential solutions to improve financial inclusion and access to financial services. In light of that work, I do not believe it necessary to amend the FCA’s objectives or specify financial inclusion in the context of the body’s standards. Indeed, I have provided definitions of financial inclusion and capability on other occasions, as has my co-pilot, and I hope that these definitions have convinced noble Lords that it would be unhelpful to connect financial inclusion to the new body within legislation.

In relation to the previous amendment I made reference to the fact that the FCA has committed to creating new rules on access, to increase uptake of the new body’s services. The new body will be focused on financial capability, and the standards are very much focused on the body’s ability to deliver high-quality guidance, information and advice that will help members of the public to make informed financial decisions. To be clear, the standards do not concern financial inclusion, which is about the supply of useful and affordable financial services and products by the financial services industry.

In response to my noble friend Lady Altmann, I absolutely agree that the focus for the FCA in terms of the new body has to be protection in new ways of the interests of consumers. In our negotiations and discussions with the FCA, we feel very much that that is the way forward. It is correct that the FCA has a number of objectives, of which consumer protection is only one. Given the strength of the debate, I shall of course consider this fully between now and Report. It is important that maybe we think about this a little further, in terms of the relationship between the FCA and the new body, because clearly it raises concern across your Lordships’ House.

It is important to note that the FCA has a lot of relevant expertise in setting the framework for the financial advice provided to consumers and setting standards for the Pension Wise service—just two examples. However, given the strength of the debate, if noble Lords are supportive, it would be sensible for us to have the opportunity to consider the matter between now and Report. Perhaps we could have another meeting with all interested Members to discuss this very important issue. The relationship between the two bodies will focus on the consumer, and I am working hard to persuade noble Lords that that will work—but, clearly, they feel that there is more to be done and more reassurance to be given. I am very happy to be able to do that before Report. I hope on that basis that the noble Baroness will withdraw her amendment.

[Baroness Drake]

I thank the Minister. I am very pleased that she has agreed to consider the matter further before Report. I stress that this is not a criticism of the FCA but a recognition that the creation of the financial guidance body is in part to deal with market failure. Consumers cannot exercise their influence; if the authoriser has to look at functioning markets, but the person seeking the authorisation exists solely to be a consumer champion, there is a dysfunctionality in how standards are assessed and how efficient that guidance body can be in fulfilling its remit. However, I shall not labour the point, because the Minister has very kindly agreed to consider the matter before Report. I beg leave to withdraw my amendment.

Amendment 68 withdrawn.