News 26 May 2010
The Coalition Document, the Queen’s speech, and financial capability
On May 20th, the new coalition government published its Coalition Document. This 36 page document sets out the joint agreement between the Conservatives and the Liberal Democrats which forms the basis of their new coalition.
Within the document there are several areas of interest to both CFEB and many of our national strategy partners.
In section 1 – Banking, the government states ‘We will create Britain’s first free national financial advice service, which will be funded in full from a new social responsibility levy on the financial services sector’ followed by ‘We will reform the regulatory system to avoid a repeat of the financial crisis. We will bring forward proposals to give the Bank of England control of macro-prudential regulation and oversight of micro-prudential regulation’.
Both these statements had already appeared in the Conservatives Election Manifesto, so are nothing new, however this does mean that these ideas will now be acted upon.
We have already been in discussions with HM Treasury to understand what the new government's expectations are for the national Moneymadeclear money guidance service and will of course keep you fully informed of all developments.
You may also have already seen press reports of a £1.7billion cost for the financial services industry. However, this figure was first published in the Thoresen review which reflected the cost estimate for the service over a 52-year period. Our budget for CFEB's first year of operation stands at £32.9m and it will be funded by the FSA levy.
The State Opening of Parliament is one of the most colourful events of the parliamentary year and this year’s Queen’s speech outlined a list of 22 bills. These included reference to an Equitable Life Payments Scheme Bill and a Financial Reform Bill but there was no mention of a levy on the profits of UK banks.