UK Government introduces Financial Services Bill – it includes the creation of the Council for Financial Stability
18 November 2009
The Bill delivers significant reforms that will provide greater rights and information for consumers, in addition to stronger financial regulation to make banks safer and more robust in the future.
The Bill delivers significant reforms that will provide greater rights and information for consumers, in addition to stronger financial regulation to make banks safer and more robust in the future.
Chancellor of the Exchequer Alistair Darling said:
“From the outset of the global financial crisis two years ago, the Government has taken decisive, innovative steps to protect the savings of British families and stabilise the economy.
“Along with governments around the world, we have learned important lessons about the weaknesses of global banking. In the past too many banks failed to fully understand the risks they took. When the crisis hit, far too many firms found themselves short of capital and without any plan for managing through turbulent times.
“The Bill we are introducing today is central to the Government’s reform agenda that seeks to empower consumers and make sure that, in the future, taxpayers will not be called on to protect banks from the consequences of their actions.”
The Bill includes:
- New powers for consumers to collectively challenge banks in court in addition to a new consumer financial education body and a free nationwide money guidance service
- A requirement for firms to develop ‘living wills’ to help them better understand the risks involved in their businesses and deal with periods of stress, and to ensure they can be wound down in future crises without excessive taxpayer support
- Tougher rules on pay and bonuses that will ensure remuneration policies do not contribute to excessive risk taking
- Strengthening of the regulatory framework, including the creation of the Council for Financial Stability and enhanced powers for the Financial Services Authority
© HM Treasury
