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Watchdog urged to encourage saving
The Financial Conduct Authority will be launched next year following the break-up of the FSA
Britain's new financial watchdog must be more "in touch" with consumers and do more to encourage people to save, the Government has been told.
The Association of British Insurers (ABI) wants the incoming Financial Conduct Authority (FCA) to be mandated to put consumer interests at its heart and to ensure it does not just "get involved when something goes wrong".
The ABI - an industry group representing the insurance sector - is calling for policy targets to encourage people to save more towards their retirement and to increase consumer confidence.
The FCA launches next year following the break-up of the Financial Services Authority (FSA) under a complete regulatory overhaul that will also see the Bank of England handed far greater powers.
The ABI said a recent survey found only 7% of people believe the FSA is doing a good job, but it added the reforms offer the chance to create a more powerful and targeted regulator.
In a paper released as part of its conference on regulation, the ABI outlines six policy objectives it wants the FCA to take on board, including ensuring that regulation is more closely aligned with what consumers want and need.
Otto Thoresen, director general at the ABI said: "This means a departure from a regulator which traditionally only got involved when something went wrong - and a move to an FCA which understands the financial needs of all consumers so that people from every background benefit."
Mr Thoresen said the ABI will work closely with the new FCA in an attempt to avoid a "predator-prey" relationship between the insurance industry and the regulator. He pledged on behalf of the insurance sector to lead a quarterly review with the FCA of industry progress in addressing the risks identified by the regulator.
Speaking at Tuesday's conference, FCA chief-executive designate Martin Wheatley said his job would be to ensure consumers get a "fair deal".
He added: "What is clear is that there are also some things we must do differently as a regulator. We need to be better at spotting the risks to consumers, we need to be able to decisively deal with the events that come to a head, and we need to do all of this more quickly and with better results for consumers."
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