ABI: Response to Conservative plans on financial reform
Responding to Conservative proposals on the future shape of UK financial regulation, Stephen Haddrill, the ABI’s Director General, said:
“We welcome the clarity and detail in this paper. These are significant issues for the insurance industry and there is much to consider here. The key issue for insurers, whoever supervises them, is that insurance is not treated like banking. We must remember that regulation has worked better for insurers than for bankers.
“Whatever structure is adopted, there are several key issues. Firstly, it must deal with systemic risk. We therefore support the Conservatives’ proposal of a Financial Policy Committee sitting within the Bank of England and containing independent experts, which mirrors our Macro-prudential Committee proposal in our June paper ‘Restoring Market Confidence.’
“Secondly, it is key that a successful regulatory framework must tackle overlap and underlap in responsibilities between the respective agencies.
“Finally, a lack of communication can happen whatever the system. There will be aspects of regulation coming out of Brussels and the international arena that will not fit neatly into whatever regulatory structure the UK adopts, making better communication and co-ordination even more vital.”
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