What are the limits of sensible risk-taking?

On Wednesday 15 January, the House of Lords Financial Services Regulation Committee will hear evidence from two panels of witnesses.

At 10.05am, the committee will hear from:

• Chris Pond, Chair of the Financial Inclusion Commission
• Rocio Concha, Director of Policy and Advocacy and Chief Economist at Which?
• Peter Tutton, Head of Policy, Research, and Public Affairs at Step Change Debt Charity.

At 11.05am, the committee will hear from:

• Andy Briggs MBE, Chief Executive Officer of Phoenix Group.

These sessions, which are open to the public, will be held in Committee Room 3 of the House of Lords and streamed live and on demand on Parliament TV.

Questions the committee is likely to ask in these sessions include:

• The committee has received evidence to suggest that the definition of sensible risk taking differs depending on the type of customer. Where would increasing risk appetite result in an unacceptable dilution of consumer protection?
• Have socio-economic issues, such as low literacy, harmed retail participation and lead to more burdensome obligations for firms?
• How prevalent is regulatory overlap in consumer protection and is there evidence that this is inhibiting consumer protection?
• What trade-offs could the UK make between the regulators’ primary and secondary objectives that would facilitate more new investment into primary markets and other productive assets?
• Is the FCA’s approach to implementing the Consumer Duty undermining individual responsibility?

This is the 15th evidence session of the committee’s inquiry into the Financial Conduct Authority (FCA) and the Prudential Regulation Authority’s (PRA) secondary growth and competitiveness objective. This objective was introduced following the passage of the Financial Services and Markets Act 2023.

More about the Financial Services Regulation Committee

The Financial Services Regulation Committee was created in early 2024 following the passing of the Financial Services and Markets Act 2023 which repealed retained EU law for financial services and established a new framework for the regulation of financial services in the United Kingdom.

The committee is chaired by Lord Forsyth of Drumlean. Its members are: Baroness Bowles of Berkhamsted; Baroness Donaghy; Lord Eatwell; Lord Grabiner; Lord Hill of Oareford; Lord Hollick; Lord Kestenbaum; Lord Lilley; Baroness Noakes; Lord Sharkey; Lord Smith of Kelvin; and Lord Vaux of Harrowden.

The committee’s work can be followed on its website.