By Marcus Leach
The Government has published its financial regulation White Paper and draft Bill which provides further detail on the Government’s proposed reforms to the financial regulatory regime within the UK.
Thursday’s White Paper has been extensively informed by the responses to the Government’s last round of consultation in February, and contains a number of new policy proposals which have been developed in light of stakeholder feedback, including:
- a specific statutory objective governing the Prudential Regulation Authority’s responsibilities for the insurance sector;
- an updated and enhanced competition regime under the Financial Conduct Authority (FCA);
- steps to strengthen the handling of cases of widespread consumer detriment, including mis-selling.
The publication of this White Paper marks an important stage in implementing these proposals as it sets out detailed policy plans alongside draft legislation to form a clear blueprint for reform.
It also marks the beginning of the Parliamentary stages of the process: pre-legislative scrutiny of the draft Bill is due to begin shortly and, subject to the progress of pre-legislative scrutiny, the Government hopes to introduce the Bill later this year.
"This is a key milestone in the process of developing and implementing a new system of financial regulation, which will address the flaws in the ‘tripartite’ model that contributed to the financial crisis," Financial Secretary to the Treasury Mark Hoban MP said on launching the proposals.
"This is a detailed blueprint for regulatory reform setting out how the new structure will work. This Government is determined to strengthen the financial system and to do so in a way that gets it right - that’s why we’ve worked hard to consult with a wide-range of stakeholders over the last year. We look forward to working with stakeholders and Parliament during the period of pre-legislative scrutiny.”
Significant progress has been made since the Chancellor used last year’s Mansion House speech to outline the Government’s plans to fundamentally reform the UK’s failed system of financial regulation.
The Government set out initial thinking last July, and a further consultation paper - with detailed proposals for establishing a new system of specialised and focused financial services regulators - followed in February 2011.
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