CentreRight

It’s the Breakneck not the Brokeback Coalition

Iain Anderson, Director and Chief Corporate Counsel, Cicero Consulting

You would hardly know that Parliament has risen for its summer break for the new Coalition continues to spew out a myriad of consultations into the late July air.

The air of a purposeful and dynamic Government is being created. It compares highly favourably with the dismal, glacial pace of policy under Labour in its final years – unable to move forward with many decisions as a result of the inevitable exhaustion that sets in following a decade in power.

Civil servants I talk to commend the Coalition’s energy – and you can see it when you go in to meet ministers – they are full of ideas and those ideas are quickly forming into Green Papers and – in some cases – directly into legislation.

With the strains of coalition I can understand this urgency to get things done in the first year or two when the majority is stable and to learn the lessons of New Labour – which failed to drive forward much reform in 1997 – when it had the clear electoral mandate to do so. There is certainly not a wasted moment in the new administration.

But while I welcome the purpose and the direction – as do civil servants who want clear leadership – it is really important that our new Government takes the time to get things right. The reforms to the financial regulatory regime are going to be subject to considerable scrutiny and given the failure of the tri-partite regime that is exactly right. Our education reforms - on the other hand - have been fired through.

Let’s take the time to get our reforms right and ensure we do not get burn out. While the reform is exhilarating – lets ensure our ‘Breakneck Coalition’ lasts the pace.

The Financial Reform Package

Iain Anderson is Director at Cicero Consulting.

There have been acres of ink expounded on the proposals to scrap the Financial Services Authority since George Osborne published his plans in opposition in July 2009.

Those plans did give HM Treasury officials almost a year to get ready for the likely changes and to develop an implementation strategy. And the Chancellor’s impressive Mansion House speech last week did lay out a clear roadmap towards those reforms. So officials have clearly and quickly got with the programme!

However I think some more clarity is needed around who will lead the reforms and how oversight will take place on a day to day basis.

The Chancellor has rightly pointed to the deficiencies of the Tri-Partite arrangements between the Bank of England, FSA and HM Treasury under the previous administration. Politically I think it is important right now to show that HM Treasury will not just lead the reforms – as it must – but that it will also ensure there is a clear, ongoing oversight process in place at Treasury after 2012 when the new regulatory bodies are in place.

That may mean there is a need to beef up the ‘oversight’ function in terms of staff at HM Treasury – but that is a small price to pay to ensure both accountability and we have people in place to ask the right questions of the Bank of England and the other new authorities.

Speaking to current FSA and Bank of England officials since the speech, I think they would welcome this lead.

Attending this week’s FSA Annual Meeting, it was already clear that the locus of power is ebbing away – the question and answer session was the most lacklustre affair I have seen for years ending half an hour before its allotted time.

I hope we will see the publication of the full legislative proposals soon and that the Government looks to have a priority track for the legislation in the coming session to ensure that we can get on with the process of UK regulatory change and also keep our eyes on the wider global financial debate to ensure the UK is able to maintain competitive advantage.