UK’s new position outside EU won’t lead ‘to race to the bottom’ Economic Secretary to the Treasury John Glen tells delegates at PIMFA’s Virtual Fest 2
The government reaffirmed its commitment to the UK remaining the second largest global hub for wealth management today as Economic Secretary to HM Treasury John Glen, in his keynote address to delegates at PIMFA’s Virtual Fest 2, praised the “vital contribution” the wealth management and advice sector makes to the UK economy and people’s lives.
In a speech that focused on the future, Mr Glen said it was important that the industry seized the advantages of the UK’s new position “outside the structures of the European Union”. But added the Government was not engaged in “a race to the bottom” or “building an enormous smoking bonfire of EU regulation”. He added the Government was “not relaxing our focus on ensuring financial services properly serves society’s needs” saying doing so “would be totally counterproductive”.
“Your service isn’t just a nice to have, it’s often essential to ensuring people have confidence in their financial decisions, helping consumers make the right choices at life’s big moments”. This was especially the case in the last year that had been like no other, he said.
While there was still more work to do to encourage people to save, invest and take advice, Mr Glen said the Treasury and the Financial Conduct Authority were working closely to develop clarification on the point at which consumer support turned into advice and ensure the advice market worked competitively and fairly for both firms and consumers.
Mr Glenn said he believed “as many people as possible should have access to financial guidance and advice if they need it”. But it was also important to “do our very best” to protect consumers from harm and give equal attention to underlining the importance of building a savings and investment habit. Financial advisers and wealth managers had an important role in helping people to do this, he said. “And for our part, in government, we’re determined to ensure the advice market really works for consumers and firms”.
The Online Safety Bill and the integrity of some online advertising and search outcomes – and what they may lead to – was one area where government could act, Mr Glen suggested, saying: “These are the sorts of issues we have got to look at, and we’ve got to look at them honestly and comprehensively”.
Addressing the issue of the Financial Services Compensation Scheme levy the City Minister said that the government agreed the levy had become particularly high for some classes of firms especially advisers and wealth managers and said the Treasury was working closely with relevant regulatory authorities to better understand the issue.
In addition to “keeping pace with our international counterparts” to remain a global hub for wealth management and financial advice, Glen added that the UK departure from the EU allows us an opportunity to do things in a different way. “It gives us a chance to take back control of decisions that govern our financial services sector and be guided by what is right for the United Kingdom. To regulate differently where we need to and better where we can,” he said.
As a result, the government was using its Future Regulatory Framework Review to look again at the current regime to ensure regulations had the agility, coherence and flexibility to respond quickly and effective to emerging challenges and help ensure UK firms could take advantage of new business opportunities, Mr Glen added.
A second more detailed consultation on how to regulate financial services in the future would follow later this year, he said.
Liz Field, Chief Executive of PIMFA commented:“We are very grateful to John Glen for joining us at Virtual Fest 2 and his commitment to the professional advice sector, and our ongoing contribution to the economy and to helping consumers.
“We will continue to engage with and support the government as it seeks to create its vision of a global, open and competitive advice sector that creates a savings and investment culture using innovation and technology to tackle key areas such as online security and climate change that is supported by high quality, agile and responsive regulation”.