Podcast transcript - episode 8: the Future Regulatory Framework – preparing for the future of financial services

Episode 8: The Future Regulatory Framework – preparing for the future of financial services 

Subscribe to the series today:

Spotify Amazon Apple

Speakers: Irina Velkova, Matthew Conway and Gavin Stewart

Matthew Conway

So if you like climate change it will sit on the same wrong as proportionality and other considerations like that and in meeting their primary objectives and subject to that meeting the secondary objectives, the regulators will need to have regard to promoting NetZero and however the Government chooses to express that climate change objective and again, we think that is absolutely the right way to capture that climate, so actually there's also scope to improve and to deregulate while maintaining the standards that we want to see met by those who deliver certain activities, there will be a need for firms to engage in that policymaking process and of course they're going to have to comply with new requirements and it would be ironic, if somehow we ended up with a set of reforms that were supposed to reduce the burden of regulation that nonetheless imposed more burden introducing them than they were alleviating. So even when you're deregulating even when you're making the burden of regulation lighter to achieve the same high standards

Gavin Stewart

I'm sort of astonished that financial crime disappeared as a primary objective when the FCA was created, they talk quite a lot in the consultation about it being really important, but it doesn't actually change, they're not proposing to change the status quo and I think long term that's actually quite a big problem.

Matthew Conway

Go back to that great quote from Peter Parker "with great power comes great responsibility" and we're not quite sure that the responsibility matches the great power.

Irina Velkova

Hello and welcome to our new episode of Risk and Regulation Unravelled our Grant Thorntons financial services Podcast.

I'm Irina Velkova, your regular host and I bring to your conversations about the dynamic world of risk and regulation. We help our financial services clients understand new regulatory developments, upcoming changes and how to stay ahead of the regulatory curve by inviting renowned experts to share their insights.

Britain has been for a long time leading the way in shaping the European financial services regulatory framework. I do remember back into time when I used to attend meetings that nobody there deciding anything related to financial services regulation before George Osborne at the time has approved of it. Now, with the UK having left the EU the Government is once again banging the drum on transforming how financial services sector is regulated, this time though with a view to regulate differently and for what is right for the UK first and foremost, to do so the Treasury has launched the Future Regulatory Framework Review the latest consultation which was published just two weeks ago. The purpose of this review and the Government's own words is to determine how our financial services are also made, who is responsible for making them, how stakeholders can have their say and how those making the rules are scrutinised and held accountable. To discuss where this consultation is taking us in terms of future direction, what it means for the regulatory framework, the legislators, regulators and most importantly the financial services industry per se.

Today I have asked two exceptional regulatory experts to join me in the conversation and share their thoughts and views. It is my pleasure to welcome Matthew Conway. Matthew is the Director of Strategy and Policy at UK finance, where he's responsible for setting the strategic policy agenda for its 300 members in the banking and finance industry. He is also responsible for promoting high quality, coordinated and effective policymaking across UK finance and leads on strategic and public policy issues. Matthew was previously UK Finance Director of UK Public Affairs, before which he was Head of Regulatory Policy at Lloyds Banking Group and the Regulator of The Financial Conduct Authority and Ofcom having started his career as a civil servant in a range of UK Government departments. Fascinating career Matthew indeed. Welcome to the podcast.

Matthew Conway

Hello.

Irina Velkova

We are also joined by Gavin Stewart. Gavin is a Director at Grant Thornton's regulatory practice and a regulator himself for over 27 years. Prior to joining Grant Thornton Gavin's career spans across working for the Bank of England, FCA and FSA. He's held a variety of senior roles including Chief Risk Officer at the FCA. Not only a steward of regulations though, a few selected know that Gavin competed at the Olympics in rowing, has been heavily involved in elite sport since then and he's currently a steward of the Henley Royal Regatta. Great to have you with us today, Gavin, welcome back to the podcast.

Gavin Stewart

Hi there.

Irina Velkova

Now, with these two impressive guests by my side, let's start a conversation and just before we dive into the nitty gritty of the topic, Matthew, could you please tell us a little bit more about your role in UK finance and how this relates to reforms by the future regulatory framework?

Matthew

Of course. So, in various iterations of my role over the last three and a bit years I've led on cross cutting and public policy issues and the reform of the rectory framework financial services fits that mould as well as anything else, so I've been involved in our thinking about reviews since Philip Hammond first launched it that Mansion House back in 2019 and at its core is really just good regulation applied in this case to financial services. I guess I've got a bit of a track record in that because what feels like a long time ago in a galaxy far, far, away, I lead the negotiations for the UK Government on the reform of the EU's regulatory framework for electronic communications so, bit of a track record hopefully I know a bit about this.

Irina

Sounds you're absolutely the best guest to have in our conversation today, absolutely. Now getting into the topic and turning to Gavin, Gavin, could you please tell us a little bit more about what is actually the future regulatory framework review and why it matters at all for the world?

Gavin

Okay. Hi there. So, trying to strip it down I think there are maybe four elements to it in two pairs. The first thing is we've taken all the current EU legislation and onshore it at the end of Brexit, so we've basically taken it as a whole and we need to work out what to do with it and how we're going to go about that task and then the key thing about that is in the EU system, there was the EU Commission and the EU Parliament and each roles need to be reapportioned. So, part of the purpose of the review is to decide how we want to do that in our brave new world. So basically where does the power go for those two bodies held? And then the second bit of it is to look at our existing system and do a kind of, you know, cold blooded appraisal of what works well and what doesn't? And what can be improved? And then related to that, how do we want regulation to work in the future and what sort of principles, aims and so on do we want to follow.

Irina

Excellent.

Gavin

In terms of the process, I meant here's obviously been an extensive consultation that Matthew has talked about going back to 2019. We're now at the final consultation stage which is open until 9 February and then I'm looking slightly at Matthew here, I think we're expecting a bill, early summer, sometime?

Matthew

Next session of Parliament, probably early in the summer.

Gavin

Yeah. Then I think the plan, which I'm a bit sceptical about is that it's on the books by the middle of 2023.

Irina

Matthew, did you want to add anything to that and possibly tell us a little bit more through what do you think are the big items that are coming out of this third consultation.

Matthew

Of course, so a brave new world that has such things in it. I mean what we have in this last consultation is really the set of core reforms that the Treasury believes are vital to deliver the outcomes that Gavin's just talked about and they've packaged those up into five groups, so on the principles of objectives that apply to the regulators, and this is a consultation about the Prudential Regulation Authority and the Financial Conduct Authority, the Treasury has proposed new growth and international competitiveness objectives and also its proposed incorporating climate change into the regulatory principles to which the regulators must have regard. On their relationship with the Treasury itself, the Treasury wants to be able to require the regulators to review their rules where it's in the public interest. It also wants to ensure that they consider the potential impacts on deference arrangements and to assess compliance with relevant trade agreements when they make rules and they set their general approaches to supervision. On their accountability to Parliament, the Treasury wants the regulator's to be more transparent and responsive, but it's decided to leave the arrangements for scrutiny to parliament itself. On stakeholder engagement and policymaking, it wants to put the regulators panels on slightly firmer footing and to materially strengthen their approaches to cost benefit analysis and post implementation review and finally, on the regulatory model itself, as Gavin said it was to facilitate the transfer of retained EU law to the regulators rulebooks, it wants to deal innovatively with regulatory requirements that don't require firms to be individually authorised, we might come back to that that's really quite interesting and it wants to be able to give the regulator's some specific objectives in specific areas of regulation. That sounds like quite a lot and it is but the bill again that Gavin's mentioned will have lots of other things fighting for space, we've had the hill review, the Khalifah review, the primary markets review, all of those reviews that require primary legislation, will be fighting for space in that financial services bill next year so what's been proposed in the framework review is probably not much more than the bare minimum that the Treasury believes is necessary to deliver what it wants.

Irina

Thank you. That sounds indeed there's a lot as you rightly say, just diving into one of the points you mentioned which I think is critical, particularly from a business perspective, what shape do you think are the competitiveness and growth objective take in practice?

Matthew

Sure. So this has been a live debate, to put it mildly and certainly I understand the concerns that have been expressed not least by the FCA and the preparing themselves about whether objectives to take account of competitiveness are a, you know, a return to the pre-crisis light touch regulation that rightly nobody wants to return to and when I say understand it, I literally had an international competitors objective as the Head of International Affairs when I worked at the Office of Telecommunications, it was a primary duty, we were required to do it as much as we were required to do anything else and at best it was unclear what that meant and yes, at worst, sometimes we had to ask ourselves was there a trade-off between the core requirements of regulating telecoms and promoting the interests of British firms overseas. That is not what the Treasury has proposed in this consultation, it's very clear that what it's proposing is a secondary objective for the regulators and what that should do is that it should influence the choice of intervention that those regulators take among all of the interventions that already satisfy their primary objectives. So we're not talking here about trading off financial stability or market integrity for competitiveness, we're not trading off competition for competitiveness, we're not trading off consumer protection for competitiveness, what we're saying is of the range of things that meet those objectives, the regulators will be required to give precedence to the things that at the same time most promote growth and international competitiveness and let's be clear, there's nothing new about this, this is absolutely identical in constitutional terms to the PRA, secondary competition objective, which I think I recall was a little bit controversial at the time but I don't think anybody loses any sleep over anymore and this is a requirement that's absolutely similar to those that the European supervisory authorities have, regulators in Australia, Hong Kong, Singapore and the US have so this is not new, this is not novel, it shouldn't be that contentious and we think the way that the Treasury has approached this is absolutely bang on.

Irina

And yet, obviously, very hot topic nowadays is climate change and that is also part of the consultation, is that the same case with climate change in terms of its a secondary objective and it has to be embedded throughout everything else.

Matthew

So, it's another notch down again, so below the primary objectives are secondary objectives and below the secondary objectives are the regulatory principles to which the regulators have to have regard when they're delivering all of those other objectives? It does sound a little bit 'yes Minister' at times but if you spent 25 years coping with this it makes perfect sense. So, if you like climate change, will sit on the same run as proportionality and other considerations like that and in meeting their primary objectives and subject to that meeting the secondary objectives, the regulators will need to have regard to promoting NetZero however the Government chooses to express that climate change objective and again, we think that is absolutely the right way to capture that requirement.

Irina

I won't go into a conversation of whether that's the right approach or not, indeed and fully understand it because I think climate change probably has to be even more into focus but that's a personal view and I guess, getting into the more practical aspects of the consultation and a question to both of you, what do you think that this actually means for the business in practice and by that I mean the consultation, are firms going to experience tangible changes as to how they work with regulators, for example? Gavin, maybe starting with you.

Gavin

I think the main focus of the framework is really the policy engines of the two organisations. So, if you're dealing with authorization, supervision enforcement, to be honest I don't think you're going to experience a lot of difference. In terms of policy, I think a lot will depend on the arrangements as Matthews indicated are quite variable so a lot will depend on what they really look like in practice and a lot of that will depend on the engagement level of the various parties and how representative some of the changes turned out to be in the round or whether the space ends up dominated by those with the loudest voices, so we'll have to wait and see on that a little bit. I'm particularly interested in the role of the Treasury in all this, I think that, you know, its ability to, you know, we'll come on to this I think but require review of policy and have responses to letters that are public and so on has the potential to put quite a lot of pressure on what are meant to be operationally independent regulators and I think that's much more of an emphasis in the framework than the role of Parliament than the TSC, it's fleshed out a lot more so again, might come to that a little bit later. I think the cost benefit analysis arrangements or requirements for a published framework and setting up a new panel are effectively quite fundamental because they essentially park the bus in the middle of the core policymaking process and that I think could have quite a profound difference and then I think on the competitiveness and Netzero stuff, I think those conversations are going on anyway so I think the Khalifah reviews look to me to be all about competitiveness, I don't think the competitiveness lobby will necessarily get any quieter because it's a secondary objective, it's always been there and I think it always will be there and the question is how the regulator's respond to it and do they respond in a proportionate way and in a different way, but similar, I think NetZero is something that's happening anyway to the way regulation works, it's been happening for the last five years, we like this as a principle and I think it will become one of the core things that regulators do over the next decade, let's say as a minimum irrespective of whether it's a principle or not so I think it's good it's in there but I think the reality has already moved on.

Irina

Yeah. And Matthew, same question to you but perhaps you mentioned something quite interesting in your previous response where you talked about individual authorization and maybe you want to explore a little bit more on that as well.

Matthew

Okay. So first of all, I agree with everything Gavin said so at the risk of maybe just saying it in a different way I hope that on the whole these reforms will change the relationship between regulators and firms in two ways. So first of all regulators will have to think differently, that's what these objectives are about, the point of these objectives is if they're not there regulators can't do them and if they are there they have to do them, so you change the objectives and the principles, by definition you change the thought process, regulators will be accountable for the decisions that they take to deliver those objectives and those principles so the substance of their engagement with firms will be different. Over time, this is the second way I hope it will change, that should change the culture in regulators so that they're more open, they're more transparent, they're more willing to contemplate different ways of achieving the same high standards and they're more willing to accept that they don't always get it right, you know, to use the old cliche, a bit more like pilots and a bit less like surgeons, with apologies to any surgeons who are listening to this, you know, our regulators are good but post Brexit they need to be consistently at the top of their game and I think we hope that some of these reforms and like Gavin, I think those on cost benefit analysis are really quite fundamental we're hoping this will just, you know, increase the rigour of what regulator's do day in, day out. So let's come back to that that interesting bit, what the Treasury has grappled with is those bits of EU legislation that impose rules on people that do things without requiring those people to be authorised to do them and the Treasury has, and this is a personal opinion but I see precedents in how telecoms is regulated, the Treasury's decided that rather than try and force those things into the regime of requiring people to be authorised to do them, to instead create a parallel regime, is that a designated activities regime where you don't have to be individually authorised but if you choose to do something you make yourself subject to rules and that and the parallel to that in telecoms is what's in the Communications Act and what's in the EU framework which is there are some things that you can be licenced for using radio spectrum to offer wireless services, using telephone numbers but there are things that member states cannot require you to be authorised for and you just have the right to do them, like run a telecommunications network, you can just do that tomorrow but if you do it, you're subject to rules you make yourself subject to rules by dint of providing that service so it breaks that link between individual authorization and rules that apply when you do something. That is, I think a neat solution to the problem of incorporating these directory rules that are predicated on authorization but also, I’m beginning to wonder in the debate where we've said we'd like to see more same activity, same risk, same regulation, if firms are offering broadly substitutable products consumer should expect that they will be regulated in broadly the same way. We wonder whether this begins to provide a framework within which yes, you can regulate activities without having to regulate entities where frankly the regulation of the entity is not the point

Irina

Gavin, what's your view on that?

Gavin

I think for a slightly different reason, I think it's a really interesting concept so I'm really interested in how the perimeter works and how regulatory arbitrage works and how you do things that are very similar to regulated activities but they aren't legally but they do have an impact potentially on regulators objectives and I think that was an issue in and around the financial crisis, the PRA actually has a power to request information from unregulated entities from the 2010 Financial Services Act and I know, Matthew and firms and so quite rightly are very keen on predictability but I think personally for that to work there needs to be an area not too wide, but an area of uncertainty around just what's regulated and what isn't so that there's some discretion, properly policed under the perimeter report and what the FCA has to do properly policed about how you deal with those activities that aren't regulated, from entities that aren't regulated, but actually, they're still in the space and I think I’d be really interested to see how this develops.

Irina

Is that going to end up in actually almost regulating more as in expanding the activities that are regulated compared to what we currently have in place?

Matthew

It is a vehicle to expand regulation but then so is the Regulated Activities Order, so to an extent, and we've started having this debate internally, I think it's in principle neutral to the amount of regulation, it's just a different way of regulating if you choose to do so but I suspect it is true that it would be easier to add an activity into the regulated perimeter, than it would be to introduce the authorization of individual firms and persons, which is just a more cumbersome way of introducing regulation so it might be deemed of being an easier way of expanding the perimeter at the same time I wonder whether there is scope to move things out of the Regulator Activities Order regime into this new one and to say, look, we still want to retain regulation but actually there's no point in regulating you individually, all that we need to do is say if you do this thing you're subject to some rules and whether you've got a licence isn't the point or not, you know, there are all sorts of laws that apply to us but we don't have a licence for them. It's just if you do them, do them in this way, don't do them in that way. So actually, there's also scoped to improve and to deregulate while maintaining the standards that we want to see met by those who deliver certain activities so it's a double-edged sword. Equally, when it comes to regulation, I’m reminded of the old adage that you don't write a play and put a gun over the mantelpiece if you don't intend to fire it before act two so anything that permits the expansion of regulation, I think inherently comes with an asymmetric risk that you will increase it and not decrease it.

Gavin

I suppose I see it more as a potential buffer if it's used properly so you're always going to have a perimeter and once you have a perimeter you're going to have arbitrage right so rather than expand the perimeter constantly, which is effectively ai what's happened in the last 20 years, if you have a sort of a buffer, a grey zone, if you like where you can exert appropriate authority and powers and obligations to provide information and so on, it's effectively a deterrent so either you do this properly or you more or less stay out, that requires an awful lot of skill and craft and so on from people operating the regime but I think the framework for doing that is potentially there if this goes through.

Irina

Yeah, but I think that's what it sounds that the grey zone, if you like the buffer almost sounds like creating instability to your point earlier and lack of predictability so does this mean that the regulators suddenly have to become much better at communicating and actually stakeholder engagement to your earlier point Matthew in order to make sure that the various stakeholders actually know what to expect and what the direction of travel is, potentially what's the thinking of the regulators with regards to this buffer? That could be quite tricky frankly as a regime.

Matthew

I'm like Gavin so I also see it as a buffer but I see it the other way around which is I think by being very clear what's in the buffer, you know, up to this point you're authorised, you have to be authorised individually, from this point to the next point you don't need an authorization but if you do something you are subject to rules, if you do it beyond the buffer you are genuinely unregulated. I see it's actually reducing that area of uncertainty where regulators can intervene but can't regulate but can do this, but can't be that, you know, you don't regulate the activity because I'm a regulated firm, somehow, you've got to look over what I do. That's the unpredictability, I think, being very clear that there are things you need to be individually authorised for, there are things that you can just do but you're subject to rules and everything else is by definition unregulated, that actually to me is a very clear approach to defining what's within and without scope of regulation.

Irina

Okay, well, certainly more to explore here. I'll go to lighter questions just to make a bit of conversation and maybe just asking Matthew when you're not actually commenting on Government reforms and policies what do you like to do in your spare time?

Matthew

Well, I like the recognition, it's not all that I do, because at times, it feels like it is. So um, I’ve got two children who are about to give me four years of GCSE and A levels so there's a lot of focus on that and I'm just generally driving them around. I play cricket and squash at a level of mediocrity that rankly would embarrass Gavin and it is no state secret that I have an unhealthy interest in Star Trek and I'm always amused that you know, good science fiction is actually about holding up a mirror to ourselves today and telling stories and looking at how humans are today through the lens of speculative fiction and I'm always amused that Star Trek has created one particular alien race, the Firangi who are rampantly capitalist so this is, you know, a way to explore the unhealthy extremes of capitalism and they have a regulator whose job is to ensure that they remain rampantly capitalist and that body is called the Firangi Commerce Authority. It's the FCA.

Irina

I must say I'm sure lots of our listeners actually would find a resemblance between science fiction and regulations sometimes. Moving back again to the conversation we were having earlier and given all these changes that we just spoke about, do you think that this is going to result in some additional costs for the business, would the firms need to make some investments on their side to be able to adapt to the new framework and when they should actually start getting ready for that? Maybe Matthew and then Gavin?

Gavin

So, I think, you know, there's a bit of a too soon to tell here but I'm not sure there'll be a lot of visible change that they need to adapt to. Clearly, there's potential different cost benefit analysis process and I think that's really important but I'm wary of talking up new arrangements in advance of them being in place. On one level, it's never too early. but I think I don't see any immediate investment firms need to be making, I think there's definitely something about monitoring the situation for now but I think you could argue that the FCA transformation process will potentially have as much direct impact on firms costs in reality is as this well but I think there's always a case for thinking through what policy changes are coming down the line and hide it in my cup. So there'll be a shift here between primary legislation that we still need to have for everything that's been onshore from the EU and moving to a place where actually the regulators are able to make regulation pretty much by themselves within guidelines set up by Parliament, when that shift comes, it will be quite important for firms on approach to it but that's probably at least a couple of years down the line from where we are now.

Irina

Matthew, what do you think in terms of additional costs?

Matthew

Yeah, very similar to Gavin, this is mostly about how regulators operate. Although I do think that if we are to expect regulators to do a better job of impact analysis, if actually incumbent on firms to do a better job of giving the regulators the information they need to do a better job of impact analysis. It's a bit chicken and egg if you don't think it's going to be taken seriously you're not going to put too much effort into informing it well, this kind of puts the ball back in firms court, if the regulators do this properly you will no longer be able to say, well that was a rubbish cost benefit analysis if the reason it's rubbish is because nobody provided the regulator's with the information they needed to be able to do it. So that puts more of an emphasis on us. Again, as Gavin says, I think longer term, particularly as we domesticate retained EU law there will be a need for firms to engage in that policymaking process and of course they're going to have to comply with new requirements and it would be ironic if somehow we ended up with a set of reforms that were supposed to reduce the burden of regulation that nonetheless imposed more burden introducing them than they were alleviating. So even when you're deregulating, even when you're making the burden of regulation lighter to achieve the same high standards, you still have to demonstrate that the benefits are greater than the costs.

Irina

Yeah, well let's hope we get there indeed and just before we get to the final questions of the conversation today, because we are pretty much out of time Gavin you hinted about your elite sports career at the start of this conversation today, you have competed at the Olympics twice in 1988 and 1992 as a rower, do you still practice actually rowing or you have defaulted to other less exciting activities, put it that way.

Matthew

Gavin looks like a keen golfer to me now, but I may be wrong.

Gavin

In someone's dreams, I think mostly I have defaulted to other things but rowing obviously left quite a big gap so I stopped rowing seriously a couple of years after the Barcelona Games in 1992 and instead I spent a lot of time representing athletes to sports authorities and Government and then I went on to the board of UK Sport in 1998 and particularly worked at establishing the sports lottery and the grant framework and so on around it and then I left that just before the Athens Olympics in 2004, when I completely switched away and I've spent most of my spare time since writing novels, so really quite different

Irina

I remember that now about the novels, we're going to ask you about your novels in another podcast that we do together, but it sounds like you've kept yourself busy and just again, probably at the end of the conversation today, what changes and a question to both of you, what changes would you like to see between this third consultation and the final bit? What do you think is critical to be addressed? Maybe Gavin first and then Matthew?

Gavin

Okay, so I guess I've got three things on my list that I'm really interested in. The first is the capacity in the Treasury Select Committee to scrutinise properly, what the regulators do not just when something's already gone wrong. So, I'm particularly interested in whether they can provide an early emphasis on really key consultations. So, ones that might be there at the moment light consumer duty and the changing role of the Regulatory Elections Committee, I'd be interested to see how Parliament's scrutiny of that would work in a future iteration and really a better conversation about how regulators make choices. I don't think we've ever really had a sort of mature debate about how regulation really works in practice and I'd like to see that come through a bit more and then the role of the Treasury, I'd like to see a bit more clarity around when they'll issue letters of recommendation which the regulators are now going to have to respond to publicly and also how often under what sort of circumstances they would do an independent rule review. I think that's really quite vague in the consultation and it's open to a lot of interpretation the way they've written it. And then finally, the thing that isn't in there that I think should be is I'm still sort of astonished that financial crime disappeared as a primary objective when the FCA was created, they talked quite a lot in the consultation about it being really important, but it doesn't actually change, they're not proposing to change the status and I think long term that's actually quite a big problem.

Irina

Yep. Still quite a lot to be done with the final bill. Matthew, would you agree with these comments?

Matthew

I don't disagree but I've got a different sort of three legged stool that is how we sort of look at this and you know, this is an approach which sets the framework within which regulators operate, it tells regulators how to operate and it sets out how they're accountable for what they decide and like any good three-legged stool, if one of those legs isn't the same length as the other two it falls over. I think Trish has done a pretty good job on the framework and on the rigour that regulators need to abide by when they're making decisions. I think we're a bit disappointed that none of these core reforms apply to the payment systems regulator and to the Bank of England's regulatory functions other than as the PRA. I don't quite understand why the PSR shouldn't have a growth and competitiveness function. I don't understand why the Bank of England when it's regulating other things shouldn't have to meet the same standards of cost benefit analysis that just seems slightly intellectually inconsistent. So that's the bit that's lacking there but I think the leg of the stool that isn't right at the moment is how poor rule making can be challenged in practice. It's not judicial review, it doesn't work, FS firms around the world don't take their financial services regulators to Court because they're concerned that it will have an impact on the supervisory relationship so simply saying JR is there is to pretend that it works well when it doesn’t, and the answer isn't the Treasurer of Parliament. They will intervene too infrequently, they will intervene after the fact and they will risk politicising decisions that are the preserve of independent regulators whether or not they make them well, we suggested a version of the super complaints procedure that exists for consumer bodies, you know, the idea that designated bodies should be able to say to a regulator, we think your rule isn't right, please think again, it's not an appeal, it doesn't involve any other body. It's asking the regulators to reconsider their own homework, that would be an improvement. Clearly, we didn't persuade the Treasury to adopt that approach. There may be better ones, but whatever the answer is, I think that for us, is the bit of the stool that's imbalanced and if you end up with regulators charged with dealing with problems as they best see fit with an enhanced toolkit, then, you know, to go back to that great quote from Peter Parker, with great power comes great responsibility and we're not quite sure that the responsibility matches the great power.

Irina

Indeed, and I think that's absolutely the best way to finish this conversation today and I really thank you very much for your input and your insights. I hope you all enjoyed the conversation and found it as informative as I did. So, thank you very much to our listeners today. Just as a brief note, you can sign up to the Financial Services Regulatory Newsletter to receive weekly updates and invites into your inbox to stay up to date with upcoming episodes, be sure to subscribe to the podcast on Apple podcasts, Spotify, Google podcasts and Amazon music.

Thank you all for tuning in today. We'll be back with our next episode next month to talk about our exciting topics of the risk and regulatory world.

Thank you again and goodbye.