Regulation post Covid: Part 2 (48) - 16/3: Two years ago today; FCA ballot on industrial action
Gavin Stewart
Writer, Commentator on financial regulation; Former regulator; Ex-international rower & Sports Administrator.
Two years ago today, the Prime Minister announced a soft Covid lockdown, formalised a week later. And I wrote the first of these daily blogs...
Below, is my first blog (16/3/20), which indicates some of how much has changed in the interim...
"I have been finalising a series of blogs based around the FCA's sectors views and their likely impact on its forthcoming Business Plan. This work is now redundant because the Business Plan, whatever was in it, is redundant.
COVID-19 will change the shape of conduct regulation and drive fundamental changes over the next six months. Among these are likely to be the following:
1. A downgrading of the FCA's competition agenda, driven by a new emphasis on securing the integrity of financial services and products.
2. Leveraging SMCR into a much broader regulatory tool and using it as a mechanism to try and ensure fair treatment of vulnerable consumers - which at the moment is everyone!
3. A blurring?of lines between prudential and conduct regulation (PRA and FCA). When the dotcom crisis threatened the solvency of insurance firms, the FSA mantra was that prudential regulation was the first line of consumer protection."
I'll leave others to take a view on the accuracy or otherwise of that first Covid blog, the only defence I'll offer being that it was a pretty murky future I was peering into. Two further points for context:
(1) At the time, I was trying to look only 6mths ahead, reflecting the broad view at the time of the likely duration of the crisis, and part of the story of the last two years is the continual recalibration of the regulatory response.
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(2) My misunderstanding at the time of the true scale of the regulatory challenges, which took at least a couple of months to emerge.
PART 2: FCA BALLOT ON INDUSTRIAL ACTION
Unite's press release yesterday, announcing the ballot, marks a tipping point. And when the ballot opens on 12 April, it will be the first time industrial action has been a credible possibility in the history of UK financial regulation.
When the FCA launched its "new employment offer" a couple of weeks ago, I suggested that avoiding industrial action, given how unprecedented it would be, should be one of the tests against which we judged it.
This still feels highly improbable, but I assume it's unlikely Unite would be calling a formal ballot if it wasn't confident it would win it. The ballot closes on 12 April, so watch this space...
Starting on 16 March 2020, I began writing daily blogs about the impact of the Covid crisis on financial regulation, and this has extended into commentary on regulation generally.?
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Financial journalist and podcaster specializing in regulation and compliance
2 年I think your crystal ball gazing was pretty accurate especially on SMCR. How many Dear CEO letters have we seen in during crisis warning about consequences of mid-conduct? Lots. Particular favourite was the PRA one on bonuses & dividends for it no-nonsense tone. What will be interesting is if SM end up in enforcement if/when mis-conduct comes to light.
That was pretty good going Gavin. You definitely hit on the themes that became important like vulnerable consumers (mortgage and other payment holidays) and financial resilience. Competition has been discussed obviously but really it seems like there are other pressing matters. You have said, if I remember correctly, that competition isn’t going to be a primary focus .