I hear what the noble Lord says, but the FCA has a statutory objective to protect consumers. It is clear that the culture of the body will be different, not least because its focus will be to provide a customer-focused service. I hope that that is helpful.
I turn to Amendments 58, 60 and 61, tabled by the noble Baroness, Lady Kramer, and the noble Lord, Lord Sharkey. These would require the single financial guidance body to produce and publish annually a report of its assessment on compliance with the standards; the FCA to additionally lay a copy of its periodic report on the body’s standards and monitoring framework in Parliament; and the body to publish a substantive response to any recommendations made by the FCA in its report within three months of the FCA providing the body with the report. I agree that it is vital to ensure that the public are confident that the body delivers consistent good-quality information, guidance and advice either itself, or through its delivery partners.
4.15 pm
It is also right and proper that the body should be accountable for the quality of the service that it provides, either directly or through others. The standards will form part of that assessment. Responsibility for monitoring compliance with the standards rests with the body itself. This reflects the fact that it is intended to be an independent, self-governing body. Like any other service provider, monitoring the quality of the service that it or its delivery partners is providing to the public will be a routine, good governance activity. The board will want assurance that the services being provided to the public meet the standards it has set. We expect the body to design and implement a standards framework to support this, and regularly to report findings and recommendations from this activity to the board. The body will need continuously to review its service standards to ensure that its services remain focused on the needs of its customers.
The Department for Work and Pensions will, as part of its regular accountability reviews with the chief executive, require the body to provide assessments against key performance indicators, including compliance with the standards. As a further safeguard, the FCA will periodically review whether the standards continue to be appropriate and whether the processes the body has established to monitor and enforce compliance with them are robust. The FCA will provide the SFGB and the Secretary of State with a report on its review. These reviews will take place at least once every three years, allowing the FCA to carry out a review more regularly if necessary. As part of its review, the Financial Conduct Authority may make recommendations on how the processes could be improved or recommend that certain standards need to be reviewed. If it does, these recommendations would be addressed by the board, and worked through with the support of the DWP, the FCA and its delivery partners.
To successfully deliver services that meet its standards, the body will need to have a strong working relationship with the FCA and its delivery partners. For example, the FCA currently meets regularly with the Pension Wise team and each of the Pension Wise guidance providers to discuss how the Pension Wise standards
are being met, and to constructively work through any issues. The Bill already requires the body to produce an annual report at the end of each financial year, which must cover its activities in relation to the exercise of its functions. The Secretary of State must lay this report before Parliament, and the body will be required to publish it. As a key indicator of its performance, it would be inconceivable that the body would not provide detail in its annual report on how both it and its delivery partners performed against the standards, and on the effectiveness of its monitoring arrangements.
Where the FCA has carried out a review of the body’s monitoring and enforcement of the standards, we would expect the body’s annual report to cover any recommendations made by the FCA and how the body has responded to them. In addition, the Secretary of State has the ability to issue a direction to require the body to include such information in its annual report if necessary. I agree that it is important that there be transparency in this process, but this should not come at the expense of unnecessarily compromising the body or its delivery partners. If problems are uncovered by the FCA then of course these should be tackled, but the FCA review is not just about identifying negative points. It also involves assessing whether to raise standards to ensure services to the public are continuously improved. The body should, of course, give an account of its performance and detail on how it has tackled any issues, but as I have explained, this should take place in its annual report, allowing it time to address and improve matters.
In conclusion, I believe that there are already measures in the Bill and elsewhere which provide sufficient scrutiny of the activities of the single financial guidance body, and I urge the noble Lord to withdraw the amendment.