Regulation is a government cash cow

I read with interest Tony Cornell's Agenda from last month, but I believe there is one small but significant point it could have included: there is no need for the Financial Services Authority (FSA) or the government to 'interfere' - so why do they? Firstly, FSA regulation of general insurance brokers is little more than another way of extracting more money from a particular section of society. Secondly, it is an opportunity for the government to distort employment statistics by creating unnecessary jobs for, in some cases, incompetents who often do not know their own rules.

On the whole, the Insurance Brokers' Registration Council ensured simple financial adequacy and client bank account requirements, in addition to a handful of common-sense rules. All it needed was to make it compulsory for all intermediaries to keep the 'cowboys' out. Instead, we were lumped with a regime that imposes unnecessary paperwork and internal systems on the market, in addition to massive fees.

The latest invention, Treating Customers Fairly, is a joke - if anything, customers are now treated less fairly as crucial funds are being diverted away from servicing their needs to pay the huge additional cost the FSA has created. My commercial customers would vote with their feet if they thought they were not being treated fairly. If our trade associations want to be of real use, they should pick up the mantle in earnest and attempt to inject some common sense into the whole issue of practical regulation for general brokers. If, of course, they have the means and the will to take on one of Gordon Brown's cash cows?

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