Select Committee on Treasury Minutes of Evidence

Memorandum submitted by the Financial Services Practitioner Panel

  The Practitioner Panel was set up, as the Practitioner Forum, by the Financial Services Authority in 1998 to create a high-level body to which it could turn for opinions on matters having an impact on regulated firms. Subsequently, the Financial Services and Markets Act 2000 ("the Act") established the Panel as a statutory body, alongside the Consumer Panel. This was in recognition of the important role of both Panels in the accountability and regulatory framework established under the Act. Both the Practitioner and Consumer Panels became statutory on 18 June 2001.


  The remit of the Panel is to represent the interests of practitioners, and to provide input to the FSA from the industry in order to help it in meeting the statutory objectives and principles of good regulation. The Panel's four principal functions are:

    —  to monitor the FSA's effectiveness as seen by the industry;

    —  to communicate to the FSA issues of general concern to regulated businesses about regulation in practice;

    —  to respond when requested to by the FSA with a practitioner view of key regulatory issues; and

    —  to contribute a broad financial industry view on the formulation of FSA policy and on the response the FSA proposes to make to representations it has received during any formal consultation process.


  Section 11 of the FSMA brought an important part of the formal accountability of the FSA to the Practitioner Panel into effect. Coming into effect on 18 June 2001, this means that if the FSA ever rejected formal advice offered by the Panel, it should have to explain its reasons in writing. The same also applies to the FSA's relationship with the Consumer Panel. Neither Panel expects that formal representations under the Act will be made often, and none have been made to date since the provision was brought into effect.


  The Panel commissioned a survey of regulated firms for their views on regulation, the results of which were published in early 2000. A further similar survey is planned for the early summer of 2002, with the results to be published in the Autumn.


  Donald Brydon became Chairman on 1 October 2001, having been vice-chairman before that. He has been a member of the Panel since its inception. He succeeded David Challen, who retired as Chairman at the end of September 2001, having led the Panel's work since it was first set up in 1998.

  Membership of the Panel is constructed to represent the various sectors within which regulated financial businesses operate, based mainly on nominations made by trade associations. It has been agreed that for the purposes of Nolan procedures the Panel can be treated as a non-departmental public body, meaning discretion can be used not to apply full Nolan procedures. Members are drawn from the most senior levels of the industry. The Act only specifies two sectors which must be represented, these being recognised clearing houses and recognised stock exchanges. Members are formally appointed by the FSA, and the Chairman must have the formal approval of the Treasury.

  The Panel aims to rotate its membership to ensure a balance between consistency and new input.

  The current Panel membership is:
Donald Brydon (Chairman) Chairman & Chief Executive, AXA Investment Managers.
Barry BatemanPresident, Fidelity Investment Management Ltd.
Jonathan BloomerGroup Chief Executive, Prudential plc.
Matthew BullockGroup Chief Executive, Norwich & Peterborough Building Society.
David ChallenCo-Chairman, Schroder Salomon Smith Barney.
Clara FurseChief Executive, London Stock Exchange.
David HardyChief Executive, London Clearing House.
Ian HarleyChief Executive, Abbey National.
Roy LeightonUK Chairman, Credit Lyonnais.
Brendan NelsonChairman Financial Sector, KPMG.
Michael QuickeChief Executive, Leopold Joseph & Sons (Joint Chairman of FSA   Small Business Practitioner Panel).
Roger SandersPrincipal Roger Sanders Associates (Joint Chairman of FSA   Small Business Practitioner Panel).
Hector SantsVice-Chairman, Credit Suisse First Boston.
Paul SpencerChief Executive (UK), Royal & Sun Alliance Insurance Group.

30 January 2002

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