A top group of MPs clashed with the banking watchdog today over the speed with which it is pushing through the government’s landmark package of City reforms.
The chair of the influential Treasury Select Committee, Harriet Baldwin, grilled bosses of the Prudential Regulation Authority on the watchdog’s pace of movement as it looks to implement a slew of changes laid out by Jeremy Hunt in the Edinburgh Reforms in December 2022.
“People in the private sector make changes faster than this,” Baldwin told the chief executive of the Prudential Regulation Authority, Sam Woods. “It does really challenge even someone like myself, who’s worked in both areas, to understand why it takes so long to review something like this.”
The barbs come after the select committee launched an attack on the government’s reform agenda last year and labelled it a “damp squib” rather than the pledged “big bang”.
In a stinging attack on the progress of the Edinburgh Reforms, the Baldwin-led group added that several of the measures were not actually reforms and others had been marked as completed prematurely.
Jeremy Hunt laid out the reforms in a speech in Edinburgh in December 2022, with the aim of loosening red tape in certain areas and unlocking the growth of the City.
Four proposals within Hunt’s package currently sit within the remit of the PRA, including the so-called senior manager’s regime, which requires banks and insurers to assess the fitness and propriety of senior staff.
The regime has come under fire from some areas of the industry for the speed which the regulator grants approvals to new senior staff.
Woods defended the pace today however, saying the regulator had addressed “operational issues” holding up approvals and much of the industry did not want a sweeping shake up of the regime.
“Feedback on that particular part of the regime has not been an enormous demand for massive changes,” Woods added. “People want it basically to be made more efficient and work better without undermining the main purpose of the regime.”
Much of the industry had also raised concerns that the regulator was already moving too fast, he said.
“One of the main points of feedback on our most recent consultation has actually been a concern from industry, that the amount of time between the end of the consultation and when we’ve had to bring in the rules is too short,” he added.
The clash comes after the Financial Conduct Authority yesterday looked to defend its pace in pushing through City reforms, comparing itself to a Formula One team.
Read more
FCA: We’re moving at the ‘speed and precision’ of a Formula One team on London listing reform