Source · Select Committees · Treasury Committee
Recommendation 19
19
Accepted
Paragraph: 119
The information the FCA has made available on how it is performing against its service...
Recommendation
The information the FCA has made available on how it is performing against its service standards shows a deteriorating picture. The FCA has a reputation for being too slow in its authorisation work, and this will inevitably hold back British fintech companies and crypto firms as well as larger firms. When the FCA publishes its next update on the service standards it should write to us, outlining any areas where it is still not meeting its statutory and voluntary timelines, and setting out its strategy for closing any gaps.
Government response summary AI-generated
The FCA wrote to the Committee alongside the publication of their Annual Report and Operating Service Metrics and will keep the Committee updated on the progress made to reduce authorisation queues.
Summary of the government's response below — read the verbatim text to verify.
Paragraph Reference:
119
Government Response
Accepted
HM Government · verbatim extract
Accepted
We recently wrote to the Committee alongside the publication of our Annual Report and Operating Service Metrics (previously referred to as our Service Standards), in light of this recommendation. We will keep the Committee updated on the progress we are making to reduce authorisation queues Progress includes a successful additional recruitment of case officers, improvements to processes and a reduction in the time taken to allocate cases to case officers. This progress has reduced Authorisations’ overall caseload by more than 40% since December 2021, from c.12,500 to c.7,000 cases at the end of July 2022. We will continue to publicly report our performance against service metrics. I look forward to providing a further update to the Committee at our next accountability hearing. As set out to you in that letter, while we are committed to further improving our processes, the increased detailed scrutiny we are committed to carrying out at our gateway can mean that some applications take longer to process. Rigorous assessment at the gateway is essential for us to fulfil our consumer protection objective. Over the coming year we expect Parliament will examine many of the issues raised during your inquiry into the future of financial services, including the powers, remits and objectives of the regulators, as part of the legislation required to implement the new regulatory framework. We stand ready to provide technical advice to the Committee and other parliamentarians to support this work. Nikhil Rathi Chief Executive 30 August 2022 1 In its regulation of central counterparties (CCPs) and central securities depositories (CSDs). 2 https://www.gov.uk/government/consultations/payments-regulation-and-the-systemic-perimeter-consultation-and-call-for-evidence 3 “Going forward, preserving the primacy of the U.K. regulators’ general objectives in principle and practice will be paramount. Delegating responsibility to the regulators for setting requirements that are often technical and complex is beneficial, but the United Kingdom must avoid a proliferation of wider financial services policy priorities that could divert focus from financial stability. Enhanced accountability and transparency mechanisms should also operate in a way that preserves the independence of regulators and should not reduce operational and regulatory effectiveness.” United Kingdom Financial Sector Assessment Program Financial System Stability Assessment 2022 4 Prudential and Resolution Policy Index 5 Review of Solvency II : Reporting (Phase 1) 6 https://www.fca.org.uk/news/press-releases/fca-tells-lenders-support-consumers-struggling-cost-living 7 https://www.fca.org.uk/publication/corporate/our-strategy-2022–25.pdf
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