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		</div><p><a href="http://londonglossy.com/wp-content/uploads/2011/02/do-not-rush-finance-regulation-mps.jpg"><img class="alignnone size-full" title="Andrew Tyrie chairs the Treasury Select Committee" src="http://londonglossy.com/wp-content/uploads/2011/02/min-do-not-rush-finance-regulation-mps.jpg" alt="Andrew Tyrie chairs the Treasury Select Committee"/></a></p>
<p>Plans to overhaul UK financial regulation are in danger of being rushed in before they are properly thought through, MPs have warned.</p>
<p>The Government plans to do away with the tripartite system introduced by Gordon Brown in which the Financial Services Authority (FSA), the Bank of England and the Treasury share responsibility for regulating the City and the economy in the wake of the financial crisis.</p>
<p>It has drafted plans to create a &#8220;twin peaks&#8221; system, which involves scrapping the FSA and making the Bank a &#8220;super-regulator&#8221;, giving it additional responsibilities for overseeing financial stability and the health of companies.</p>
<p>The Government aims to have legislation in place in mid-2011 and the new system completed by 2012.</p>
<p>But the Treasury Select Committee warned it should not be rushed in to meet an &#8220;ambitious timetable&#8221; and said that more time may be needed to take in any recommendations made by the Independent Commission on Banking.</p>
<p>Treasury Committee chairman Andrew Tyrie said: &#8220;In light of the banking crisis, the Government is rightly proposing radical changes to the way in which financial services are regulated.</p>
<p>&#8220;However, having examined the initial proposals, the Committee&#8217;s overriding concern is about the proposed speed of implementation. It is vital to maintain the momentum for reform, but there is no point in flawed change.&#8221;</p>
<p>A new body called the Financial Policy Committee (FPC) will sit within the Bank of England and maintain the UK&#8217;s overall financial stability. The FSA is being split in two, with one arm becoming the new Prudential Regulation Authority (PRA), also under the control of the Bank, which will be responsible for supervising the soundness of financial firms.</p>
<p>The FSA&#8217;s consumer protection work will be carried on by the Consumer Protection and Markets Authority (CPMA), which will be an independent body.</p>
<p>The committee raised concerns that the Bank in its expanded role as a &#8220;super-regulator&#8221; should remain accountable and called for more independent members on the FPC. It also said it was unconvinced by claims that the £50 million cost of changing the system would be borne by the industry without being passed on to consumers.</p>
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