HM Treasury has published treasury minutes that include the government’s response to the House of Commons Public Account Committee’s (PAC) report on financial services mis-selling.
The PAC report was published in May 2016 and formed the view that the FCA, government and the FOS were being too passive in their approach to mis-selling of financial services products. The report sets out six recommendations to address the issue.
The FCA, government and the FOS have accepted the recommendations made by PAC, with the exception of the recommendation that HM treasury and the FCA should develop ‘real-time’ indicators of the extent of mis-selling, and assess regularly how their actions are in reducing it. HM Treasury explains that real time indicators are not feasible as it only becomes apparent to the consumer and the supervisor after the mis-selling has taken place.
The response sets out details of the initiatives taken by the government, the FCA and the FOS to address the PAC’s other recommendations. These include:
- The government’s decision to transfer regulatory responsibility for claims management companies to the FCA.
- The FOS’ publication of a timetable on 1 July 2016 for resolving older PPI cases.
- The FCA identifying the culture of firms and the provisions of financial advice as priorities in its 2016-17 business plan.
- The government giving active consideration to making regulations that would give the National Audit Office (NAO) access to any information that it reasonably requires from financial regulators to fulfil its functions. It will aim to make these regulations by January 2017, if it decides to take this approach.