FSA Annual Report 2006/07 - Better Regulation Ltd
FSA Annual Report 2006/07 - Better Regulation Ltd
FSA Annual Report 2006/07 - Better Regulation Ltd
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110<br />
Section six – Appendices<br />
Appendix 2<br />
At least seven days before publishing the results of thematic work we provide<br />
a summary of the findings, or other material, and an overview of the<br />
communications plan to the trade associations, consumer bodies and the<br />
Practitioner and Consumer Panels. In many cases we engage the Panels<br />
earlier than this. When we publish our findings we set out clearly which<br />
industry sectors are affected. We make firms that were visited in the course<br />
of thematic work aware of the results and, in almost all cases, we provide<br />
individual feedback to them.<br />
In addition to contact with individual firms we communicate the outcomes<br />
more widely through press releases, speeches and Dear CEO letters. We will<br />
continue to focus on indicating where the minimum threshold of compliance<br />
lies (for example by pointing out good and bad practice) and to make clear<br />
that going beyond the minimum standard is a matter of commercial<br />
judgement for firms’ senior management and is not a <strong>FSA</strong> requirement.<br />
All the material we publish is potentially relevant to an enforcement case.<br />
For example, it could be relevant to the question of reasonable predictability<br />
and it could inform the regulatory context at the time of the behaviour in<br />
question. Firms are not legally obliged to act on everything we say; only rules<br />
and Principles are binding. Where, however, firms reasonably rely on<br />
statements we have made in determining the approach they adopt, this will<br />
be a defence to any subsequent action we take.<br />
An expert group has been established to review continuing problems with the<br />
quality of advice, and this group includes representatives from the<br />
Practitioner and Smaller Businesses Panels. We welcome the Panel’s<br />
involvement in this work and acknowledge their concerns in this area.<br />
Through this work we intend to establish what proportion of the<br />
recommendations made to consumers are broadly suitable, or suitable for a<br />
defined range of consumer needs. We intend to design a research<br />
methodology that is credible and authoritative and results in a study which is<br />
replicable and can serve as a baseline to allow us to assess whether the<br />
quality of advice (in terms of outcomes rather than processes) is improving<br />
or deteriorating over time. If a suitable methodology can be identified and<br />
we agree to proceed with this work, we expect that it will provide valuable<br />
information on industry progress in providing suitable advice to consumers.<br />
The quality of advice work is being co-ordinated closely with the retail<br />
distribution review and mortgage effectiveness review.<br />
Financial capability<br />
We welcome the Panel’s support for our commitment to increase spending on<br />
financial capability. We recognise that improving financial capability is a<br />
major challenge and one that will take a generation to take full effect. In this<br />
context we welcome the publication in January of the government’s longterm<br />
approach to financial capability, and the government’s independent<br />
feasibility study to deliver a national approach to generic financial advice,<br />
which complement our National Strategy.<br />
As the Panel observes, changes to the school curriculum are for the<br />
government and the Qualifications and Curriculum Authority (QCA). We<br />
have liaised closely with both the QCA and the DfES on this issue. In<br />
February 20<strong>07</strong> the QCA published proposals for changes to the secondary